Oregon is implementing performance improvement plans for the first time to address excessive health care spending by three organizations. The Oregon Health Authority's (OHA) 2025 cost growth target report identified five health organizations that exceeded spending limits without justifiable reasons.
The OHA aims to ensure affordable care, recognizing that high costs prevent people from accessing necessary services. The state established the Sustainable Health Care Costs Growth Target Program in 2021 to limit annual per-person health care cost growth to 3.4 percent.
Oregon's program takes a total cost of care approach, involving both insurers and providers in shared responsibility for controlling costs. Most organizations had acceptable reasons for exceeding targets, such as regulatory changes or increased operational costs.
However, St. Charles Health System, The Corvallis Clinic, and PacificSource were identified as not having acceptable justifications for their cost increases.
Consequently, these three organizations must now submit performance improvement plans by January 2026. ModaHealth Medicare Advantage plans were excused as they are no longer offered, and UnitedHealthcare's plans were excused to allow focus on its parent company's accountability.
These improvement plans will include savings targets and strategies to address costs. The OHA is also exploring additional tools and policies through a new Committee on Health Care Affordability.
Starting in 2028, the OHA will impose fines on organizations that repeatedly fail to meet spending targets over a five-year period without acceptable reasons.
