By REBECCA HANSEN-WHITE/KLCC News

EUGENE — The Oregon Health Authority has found that Eugene-based Oregon Medical Group, and two insurers, unreasonably increased healthcare costs.

Oregon has been trying to rein in healthcare spending for years. In 2019, lawmakers created a program to study and limit healthcare costs. Under the program, healthcare companies operating in Oregon are only allowed to increase spending by 3.4% per person, a rate based on wage growth and inflation.

On Wednesday, OHA published findings that show 28 healthcare entities had costs over the target. For the first time, it found three of those did not provide valid justification for the increased costs. Justifications can include providing new or expanded services like behavioral health, an increase in workforce costs or extended hospital stays because of a shortage of nursing facility beds.

“We know that people are delaying healthcare because of how much it costs, skipping prescriptions, or delaying doctors appointments because of that affordability concern,” said OHA program manager Sarah Bartlemann. “What this program is really focused on is helping healthcare costs grow a little bit more sustainably.”

Oregon Medical Group’s privately insured patients’ costs increased by nearly twice the target. OMG was purchased by Optum, the largest employer of physicians in the US, in 2020. Since then it’s lost more than 30 physicians and dropped potentially thousands of patients.

Optum also purchased Portland-based Family Medical Group Northeast in 2021, Canby-based Davies Clinic in 2023 and The Corvallis Clinic last year.

Insurer UnitedHealthcare, which is owned by the same parent company as Optum, also had its spending flagged. OHA found UnitedHealthcare’s Medicare Advantage plan costs increased by 6.4% without a valid justification in 2021.

OHA also found Portland-based insurer Moda’s Medicare Advantage plan also had an unreasonable cost increase, about 11.6%. However, the company ended that plan in 2024.

Bartlemann said another report looking at 2022 healthcare spending will be released in May. After that, reports will be released annually.

If a healthcare entity fails to meet the cost targets after the May review, the agency can place it on a performance improvement plan in hopes of lowering costs. The agency can start issuing penalties next year for companies that continue to miss spending targets.

“We’re at this point where we are starting to hold health plans and provider organizations accountable for their cost growth,” Bartlemann said. “If they go over the cost growth targets, we need to have conversations with them about why”

Optum did not respond to a request for comment from KLCC.