Pacific Source, and now today, Providence Health insurance announced they are exiting the individual insurance market and/or most of the health insurance market in Oregon. These are two of the largest insurers in Oregon.
Meanwhile, the state of Oregon has proposed to launch its own, state run health system, starting in 2028. Details will be announced in September of 2026.
The Oregon Universal Health Plan (UHP) proposes to provide zero co-pay, zero deductible, comprehensive coverage of health, mental health, dental health and vision – to everyone, at “no cost”.
It would be paid for by doubling the state’s income and capital gains tax – which is currently about 9.9% for most everyone – to 19.9%. Oregon already has among the highest tax burden in the nation without the doubling of the income and capital gains tax. For currently working employees, the theory is taxes would go up, but since companies would no longer run their own health care plans, the companies would pay workers more. That’s the theory but that’s not how market pricing works.
Medicare
The UHP would require ending Medicare for the 18% of state residents who receive Medicare, and all would be rolled into the state plan. This requires the Federal government to direct Medicare funding to the state’s UHP (this requires approval of the Federal government and it is unclear this can be done). The UHP proposal says that the UHP would not work unless all Medicare recipients are rolled into the UHP.
While Medicare covers health care nationwide, the UHP would provide coverage only in Oregon, plus emergency coverage only when out of state, limited to approved providers in as yet-not-specified national coverage network. If you needed to access a specialist out of state, you would not be covered. You would not be covered for other than emergency care while traveling in the other 49 states.
Medicare recipients would lose access to other benefits they may receive via supplemental Plan G/N type plans, including international coverage while traveling, or that they receive via Medicare Advantage plans. If a Medicare recipient were to move out of state, later, in order to then sign up for a Plan G supplemental coverage plan they would be subject to “medical underwriting” – which is a weird way of saying that pre-existing conditions would not be covered. Thus, those on Medicare would be locked in to living Oregon the rest of their lives – or lose access to important medical insurance. For many, the new taxes would add $5,000 to $20,000 to their annual expenses – in exchange for receiving fewer benefits.
We live in Oregon. Having only recently started on Medicare, we are watching this carefully and are making plans, as needed, to move out of state as early as 2027.
Major insurers are now dropping out of Oregon – as they will have no future in Oregon once the UHP arrives. Their departure will be used as part of the argument to enforce Oregon’s UHP on the state by 2028, raising taxes and delivering less value to 1 in 5 residents.
Oregon’s history of running health care is awful – the state’s Cover Oregon ACA/ObamaCare “Health Exchange” spent $450 million on development and marketing yet never enrolled even one individual before it was shut down. The same people now think they can run the state’s entire health care economy.
There is no choice but to move out of state.
