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Oregon Lawmakers Announce Health Care Expansion

The Associated Press

SALEM, Ore. (AP) — The Oregon Legislature's majority Democrats announced a deal with the medical industry that they say will bring state health insurance coverage to 80,000 more children and at least 50,000 low-income adults.

The proposal unveiled Thursday calls for raising taxes on hospital revenues and establishing a new tax on health insurance premiums to pay for the expansion.

Democratic lawmakers and Gov. Ted Kulongoski said the deal provides a way to expand health coverage at a time when the economy is struggling.

"With unemployment at record levels, more Oregonians than ever are in need of the health care coverage that this agreement will provide," said Senate President Peter Courtney.

The House and Senate Democrats say they are ready to use their "supermajority" in the Legislature to enact those new taxes on health insurers and hospitals.

Republicans say the taxes, and the Democrats' plan to create a new state office to guide an overhaul of Oregon's health care industry, should be placed on a statewide ballot.

"As Oregonians lose health insurance, the Democrats' response is to raise taxes and increase the costs of health care," said Rep. Ron Maurer, R-Grants Pass.

However, Democrats said Oregon stands to recoup almost $1 billion in federal Medicaid funds in the next two years by raising $400 million from the new taxes and assessments.

The tax on health insurers will come to 1 percent of their premiums, which will provide health coverage to up to 80,000 children who lack medical coverage.

The hospital tax rate is to be set by the director of the Department of Human Services. It would increase the number of low-income adults who could enroll in the Oregon Health Plan.

Kulongoski, whose office has been involved in the negotiations with legislators and the medical industry, said the deal is "one of the most significant measures before the Legislature this session."

"Access to affordable health is one way the state helps Oregonians, in good and bad economic times," the governor said. "Healthy children go to school ready to learn. Healthy adults are more productive members of society."