Oregon's Transition to a Managed Care Model for Medicaid-Funded Substance Abuse Treatment: Steamrolling the Glass Menagerie‪.‬

In 1993 Oregon became one of the first states to apply for and receive a Health Care Financing Administration (HCFA; now called Centers for Medicare and Medicaid Services) 1115 Medicaid waiver from the U. S. Department of Health and Human Services. Policymakers in Oregon, after the passage of a series of legislative bills (Rutledge, 1997), restructured the state's publicly funded health care services and implemented the landmark Oregon Health Plan (OHP) in February 1994, which included outpatient substance abuse treatment as a benefit. Before OHP, only a minority of clients seeking publicly funded substance abuse treatment services were eligible for Medicaid. Treatment services delivered to Medicaid clients were paid for by the state using a fee-for-service model. Substance abuse treatment for low-income people not eligible for Medicaid, who accounted for the majority of clients obtaining publicly funded substance abuse treatment, was provided through a "slot" model funded through Oregon's general fund. These outpatient treatment slots were akin to "beds," in that a single person filled each slot. This service delivery model had pervaded the publicly funded outpatient substance abuse treatment system for more than 50 years, influencing the philosophy and the delivery of publicly funded treatment.