What comes after ObamaCare? John Kitzhaber's air conditioner...

Kari Chisholm

Writing in the Washington Post, überwonk Ezra Klein describes what's happening in Oregon health care reform as "the right next step" after ObamaCare.

And what's that exactly?

Well, it starts with Governor Kitzhaber's air conditioner story. (Raise your hand if you've heard it before!)

Oregon Gov. John Kitzhaber (D) loves to tell the air-conditioner story. He loves to tell it so much, in fact, that it has become something of a running joke in Oregon health-policy circles. At this point, even Kitzhaber is in on it. Before he repeats it to me, he says, “I probably shouldn’t bore you with my air conditioner story.”

Here’s the air conditioner story: There’s a 90-year-old woman with well-managed congestive heart failure who lives in an apartment without air conditioning. That’s actually the whole story.

Kitzhaber, a former emergency room physician, sees this as the perfect example of what’s wrong with our health-care system. “A hot day could send the temperature in her apartment high enough that it strains her cardiovascular system and kicks her into full-blown congestive heart failure,” he said. “Under the current system, Medicare will pay for the ambulance and $50,000 to stabilize her. It will not pay for a $200 window air conditioner, which is all she needs to stay in her home and out of the hospital. The difference to the health-care system is $49,800. And we could save that $49,800 without reducing her benefits or her quality of life.”

Is Oregon really going to start buying air conditioners for little old ladies in hot apartments? You bet we are.

It all starts with our Coordinated Care Organizations (CCOs) - a term you've surely heard a bunch of times, but may not entirely understand. (I know I didn't.) Let Ezra explain:

At the core of this shift are Oregon’s 15 “coordinated care organizations.” What makes them different from accountable care organizations or managed care is that they’re responsible for more than the health of their members, which now include 94 percent of the state’s Medicaid population. They’re also responsible for the health of the communities they’re in. They have to run regular community health assessments, and the results influence their pay. ...

The biggest change relates to the air conditioning story. Kitzhaber has given the CCOs radical flexibility in what they can purchase with Medicaid dollars. They can buy an air conditioner for a 90-year-old woman in a hot apartment. They can also try to improve outcomes by investing in “upstream” preventive care; one CCO is paying pregnant women to stop smoking. They’re also integrating with other public services.

“Six months ago,” said Oregon Health and Science University’s McConnell, “if you were a Medicaid patient who came to ER 20 times you’d get treated on your 21st time and go home. Now you come in and there’s a social worker with a list of names and they work with you when you leave to connect you with outpatient care and other resources.”

Here's the Gov on what this really means:

“The fundamental problem with our health-care system is the growing discrepancy between the cost of care, the resources available to pay for it and the tenuous connection between that expenditure and actual health,” Kitzhaber said. “What we’re doing is instead of putting our budget into the ER and paying for congestive heart failure after congestive heart failure, we’re putting it into care coordination and community health workers. We’re investing in health. It’s just a paradigm shift.”

Previously: John Kitzhaber's big bet to save American health care, January 2013

By Kari Chisholm May 21, 2013