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A Conversation With Eric Hunter, MBA on Redetermination, Combining with SCAN and Major Players ‘Sniffing Around’ Medicaid and Oregon

MHE PublicationMHE July 2023
Volume 33
Issue 7

Eric Hunter, MBA, has been president and CEO of CareOregon, a 500,000-member Medicaid managed care organization, since 2016. This interview was conducted in May for Managed Healthcare Executive’s monthly “What’s On Your Mind” podcast.

Eric Hunter, MBA, has been president and CEO of CareOregon, a 500,000-member Medicaid managed care organization, since 2016. Prior to CareOregon, Hunter was the chief operating officer for the Boston Medical Center HealthNet Plan and held executive positions at Schaller Anderson, Centene and other organizations. He joined the Managed Healthcare Executive editorial advisory board in October 2020.

This interview was conducted for Managed Healthcare Executive’s monthly “What’s On Your Mind” podcast. Hunter's episode aired in May 2023. The transcript has been edited for length and clarity.

We have titled this podcast, “What’s On Your Mind.” When you got up this morning and thoughts about work and healthcare started to enter your consciousness, what was on your mind?

I’m glad to be here to talk about what’s going on with us and what’s on my mind. At the top every day, every morning, is our network — the frailty of the network that we rely on to serve, at CareOregon, over half a million people. The challenges are immense. As creative as we want to be in our programs and setting up ways to engage people and get them to a healthier state, personally and in their communities, if we don’t have the partners who can make that happen, then we’re lost.

Network and access have been an issue in Medicaid for a while. Traditionally, it has been a question that Medicaid just didn’t pay enough for providers to want to see Medicaid patients. Is that still the fundamental problem?

I think that is still the primary issue. But in the past, we were blessed with federally qualified health centers, academic medical centers — people who are just passionate about serving the underserved. We were able to have providers who would take those lower payments and serve Medicaid members.

Now with the overall contracting and shrinking of networks and available providers, those who are left have to take care of themselves, which means getting the higher revenues from commercial plans because they have to keep their doors open. It’s really constricted the availability of folks who can take Medicaid patients as a part of their panel. They just don’t have the man power to be able to serve everyone that comes in, so they have to prioritize.

Is there any system in Oregon that used to take Medicaid but doesn’t anymore?

Not in our network. We have been lucky in that the partners we have in Oregon are as committed as they’ve ever been. I think that’s a testament to the fact that Oregon providers and even systems are either local or regional at most. They’ve got a vested interest in Oregonians being healthy.

Continuous enrollment in Medicaid is winding down. How is that going for CareOregon? How many people are affected? Are people losing coverage? Are they migrating to exchange plans?

In Oregon, we started the process of redetermining people on April 1. Oregon has been very deliberate about the need to be smart about this, because even just in Oregon, we have 1.5 million people needing to be redetermined over the next 14 months. Estimates are that around 17% to 20% of those individuals may fall off the rolls at some point.

I was on a task force with state officials to create a bridge plan that will allow people between 138% of the federal poverty limit and 200% of the poverty level, who are currently on Medicaid, to stay on Medicaid. We’ll eventually bring that entire population on to a part of the state’s Medicaid coordinated care organization program. We’re definitely protecting those who are churning the most to keep them from even having to deal with the exchanges at this point.

At CareOregon, in the first few months of 2023, we’ve handled more than 3,000 calls from members specifically asking about what’s going on with redetermination. The managed care companies now have the ability to gather updated addresses and send those on to the state, which is huge. One of our main efforts right now is making sure we have the right contact information, so when members do need to get redetermination, they actually get their forms.

Now let’s jump to your merger with the SCAN Group*. How it did it come about? Did SCAN approach CareOregon or vice versa?

We don’t necessarily refer to it as a merger. We call it a combination, because it is different than traditional mergers, where you’ll have two companies that are disparate and doing their own thing that are then put together to create something brand new. That’s not what we’re doing here.

We’re working with SCAN to create an umbrella organization of sorts, a parent company called HealthRight Group, of which CareOregon will be a subsidiary and the SCAN health plans will be subsidiaries. We will have a shared services division and an ancillary services division. But CareOregon will continue to exist with our name, our mission, our board and our relationship with our communities as we’ve always had, just as part of a larger organization.

The entire conversation happened almost by accident, in that they had new leadership starting at SCAN right at the outset of COVID-19 pandemic. One of the current Scan board members, Colleen Cain, was a former board member of CareOregon and was on our board when I was hired.When they brought Sachin† in at SCAN, she knew they were looking at being more aggressive in thinking about regional strategies, and she connected Sachin and me to talk about what we had in common and to share stories and best practices because we had similar missions at our companies.

This wasn’t a financial transaction or something bankers brought across. Neither of us said, “Hey, do you want to be a partner?” It truly was a mission-based conversation about how we go about the business and the challenges we faced. As we talked more and more, we realized there was true alignment. We don’t overlap in services and geography. We’re primarily Medicaid, they’re primarily Medicare. They’re in California, Texas, Arizona, New Mexico and Nevada. We’re in Oregon. There’s no competition here. It truly is about creating something that will let us do things we couldn’t do before.

We’ve had challenges even in Oregon, where we’re a major player, in that all the other partners we work with or compete with are part of larger regional organizations. They have greater wherewithal than we do to meet technology challenges, do the analytics, (as well as) staffing and finding the right people. We were at a disadvantage.

Could you elaborate on the analytics and technology advantages of the SCAN combination?

When I talk about engagement and the growth in the IT space from the combination, it’s less about either entity having a market advantage over the other. We’ve looked at our claims payment system. They have as well. It would be nice to look at what is best in market now for those kinds of systems that will truly integrate all the care that we have, plus with our providers have two-way communication, closed loop systems. Those kinds of system information implementations are incredibly expensive. As big as we are, we don’t have a lot of leverage with the organizations that provide those products. But with SCAN, we have much greater scale and scope.

Does the combination with SCAN mean CareOregon is looking at the Medicare market or a different population? Or do you plan to stick with Medicaid?

CareOregon currently has Oregon’s largest dual-eligible Medicare Advantage (MA) population, so we’ve been in Medicare for 12 years now. Until three years ago, we had straight MA that we weren’t particularly adept at, because our work in Medicare is directly tied to the work we do in Medicaid. With SCAN and their knowledge, we may reevaluate doing straight MA in Oregon again, because they’ve been a 4.5-star plan in Medicare for six years running.

Is this combination with SCAN going to change how you manage pharmacy benefits?

We’ve got a great relationship with Optum, who we use right now. But as big as we believe we are in Oregon, we are an afterthought in the Optum world. They do their best to support us, but conversations that you have with any entity that’s a vendor that brings an organization with revenues of $7 billion and 2,700 employees are different than ones you have with an organization that has $2.5 billion in revenue and 1,300 employees.
I suspect there will be opportunities for us through greater scale and geographical reach.

Some people in Oregon have raised concerns about the deal, that it would be destabilizing or would make CareOregon less responsive to local needs. Why is this partnership combination a good thing for Oregonians?

One of our primary goals in how we structured this deal was to maintain the ability of Oregonians to make decisions on what’s best for Oregonians. That’s why the CareOregon board will continue to exist, continue to set the strategic goals for Oregon and start the budget approval process for Oregon, even after the combination closes. Our relations with our coordinated care organizations will stay the same. We’re actively maintaining those local governance relationships, because the closer you get to the member, the better you understand what their needs are.

As I said, we will potentially have shared resources. We will have shared knowledge. We will be able to start new programs. SCAN has great programs that created a company to do healthcare for homeless seniors in the Los Angeles area, and we’ve talked to some local providers about maybe doing something similar here. They’ve got programs in expanding LGBTQ-related services specifically. We’ve worked closely with the Cascades AIDS Project here. So, how do we learn from each other? It’s those kinds of things that will bring true value to Oregonians.

Do you have an eye on anything happening nationally that’s filtering down to Oregon, aside from redetermination, that’s an exogenous factor you’re dealing with?

Medicaid is now the largest insurance program in the country. There’s a lot of money in Medicaid, and a lot of the big players know that. A lot of them know that Oregon, in particular, is very generous in supporting our people in our state, so they are looking at (and sniffing around) Oregon. Humana has decided to go all in on MA. That’s a direct challenge to us. The Uniteds, the Centenes, the CVS Aetnas of the world have their sights on places like this. Amazon, Walmart — it’s all of that.

We’re proud of the work we do. We think we do it better than anybody else, frankly. But there are limits to what you can do to stay competitive while still serving our mission. That’s one of the things that says, let’s get the combination with SCAN on the road so we can start building that infrastructure that lets us fight to compete to serve the most vulnerable.

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