on Friday joined with business, health and political leaders in downtown Portland Friday to celebrate the week's news that with approval of $1.9 billion in new federal funding, a health care and budget disaster had been averted.
Now, he said, the state's ambitious reforms of the Oregon Health Plan can proceed without cuts that would have devastated the Medicaid funded system that provides care for more than 600,000 low-income people.
"The only thing that stands between this state and success is ourselves," he said, standing in a third-floor meeting room of the nonprofit care group, Central City Concern.
The federal money amounts to a down payment on savings Oregon intends to deliver the federal government of $11 billion over the rest of the decade.
The five-year deal provides a large chunk of funds this year: $620 million That nearly covers a $640 million budget hole that was built in to the state's current budget by lawmakers using theoretical savings to comply with the constitutional requirement of passing a balanced budget.
, D-Gresham, who chairs the Senate Health Committee.
The looming budget cuts could have kicked in later this year, potentially devastating the state's low-income health care safety net.
"I want to make sure you all know that this was not a foregone conclusion," said Malia Wasson, the Oregon president of Minneapolis-based U.S. Bank, and chair of Oregon Business Council. "Not so long ago it didn't look very good and there was great pressure on the governor not to come back empty handed."
The reforms, some of which required federal approval, will bring together new managed-care groups called coordinated care organizations. They will be given a slice of Medicaid funds to care for a set number of people.
Kitzhaber, who'd announced the likelihood of federal funding and used it to cajole lawmakers into lining up behind a reform bill in February, downplayed the threat of denial by the feds -- saying the main challenge was Oregon's desire to get the money sooner rather than later.
"They wanted to make this happen, so this was all about getting to yes," he said. "It was just getting the right people in the room."
, president of the Oregon Health & Science University. With the federal funding to keep people talking, those discussions-- and reforms -- can continue.
The five-year deal comes with a catch: if the state does not cut Medicaid spending by 2 percent next year, the federal funds could dry up.
"This is not the ending; this is clearly the beginning," Kitzhaber said. "We have to actually demonstrate that we now can bend that cost curve down."