NewsCovering Louisiana


Legal disputes stalling new Louisiana Medicaid contracts

Posted at 10:41 AM, Aug 29, 2019
and last updated 2019-08-29 11:41:53-04

BATON ROUGE, La. (AP) - Plans to shift more than 500,000 Louisiana Medicaid patients to new health plans by January will remain stalled, with Gov. John Bel Edwards' administration unable to negotiate contracts with four managed care companies while legal disputes continue.

Louisiana's chief procurement officer Paula Tregre on Wednesday denied the Department of Health's request to move ahead with new multibillion-dollar contracts while Tregre is determining whether the contract awards followed state law.

The department argued that delays could jeopardize services to Medicaid patients.

But in an email refusing to let the department restart contract plans, Tregre noted that Health Secretary Rebekah Gee recently told lawmakers the legal disputes didn't threaten care.

"It has not been shown to me that the substantial interests of the state would be advanced if the stay were lifted, as LDH has already represented to the Legislature that there would be no disruption of services to current Medicaid enrollees (if) the protest review process were to extend beyond the expiration date of the existing contracts," Tregre wrote.

The two losing bidders for the Medicaid contracts, Louisiana Healthcare Connections and Aetna Better Health, are formally protesting the contract awards, accusing the health department of a biased bid review rife with conflicts of interest. The contract negotiations automatically stopped when the protests were filed, but Gee asked to allow her agency to resume work to move to the new contracts by January.

The Edwards administration has defended the bid review and scoring process as following Louisiana law, with the new contracts aimed at improving health care and lowering costs.

At issue are contracts for private insurance companies to oversee care for about 90% of Louisiana's Medicaid enrollees, an estimated 1.5 million people - mostly adults covered by Medicaid expansion, pregnant women and children. The contracts are among the largest in state government, accounting for roughly one-quarter of the state's annual operating budget.

The Edwards administration chose four companies for the new managed care deals slated to start in 2020: three current Medicaid contractors and one new contractor. Five companies currently do the work under deals expiring at the end of this year.

Louisiana Healthcare Connections and Aetna currently have Medicaid managed care contracts with the state but weren't chosen for new deals. They asked Tregre to keep the department from moving ahead with new contracts while their protests are pending.

The health department didn't immediately say Thursday what Tregre's decision means for the Medicaid program, which had intended to start an open enrollment period in mid-October to let patients with Louisiana Healthcare Connections and Aetna find new health plans.

Health department lawyer Stephen Russo told lawmakers two weeks ago that the agency could seek emergency contracts to keep current health plans in place if legal protests are ongoing when new contracts are supposed to start. The department, however, told Tregre that could cause "much uncertainty" for the Medicaid program.