Two firms that lost out on key state contracts for implementation of Gov. Bobby Jindal’s new health-care delivery system for the poor have filed protests.
Automated Health Systems Inc. is challenging the state Department of Health and Hospitals’ award of the contract for the program’s enrollment broker to Maximus Health Services.
Automated Health Systems attorneys argued that Maximus should have been disqualified for failing to meet the requirements. Maximus submitted an “unrealistic low bid” that could jeopardize the success of the program, according to the protest.
Meanwhile, the minority-owned Louisiana Physician Connections is seeking re-evaluation of its proposal to operate one of the “coordinated care networks” that will provide care to about two-thirds of the state’s 1.2 million Medicaid recipients.
The chairman of the Louisiana Physician Connections board of directors, Donnie Batie, of Baton Rouge, complained about the “inconsistencies in evaluation and scoring” of his organization’s proposal.
The protests came as the state prepares to embark on a new system, under which private insurance companies and other entities would take over $2.2 billion of the care delivered through the $6.7 billion Medicaid program.
The entities form networks of physicians, specialists, clinics and other providers responsible for care delivery and get paid either insurance premiums or fees for services rendered.
Steve Russo, Department of Health and Hospitals’ general counsel, said Friday that protests were expected and won’t delay the January start of the phase-in of coordinated-care networks.
The program will be launched in the New Orleans area and be implemented statewide by May under DHH’s time schedule.
Russo said time for resolving any protests was built in.
“When you are dealing with (contract) awards of this size, you are always expecting protests from those who feel they have adequate grounds to question the process and the scoring,” Russo said.
The companies had 14 days to protest the decisions to DHH Secretary Bruce Greenstein.
Greenstein has until Thursday to reply to the AHS enrolment broker protest and until Friday to reply to LPC’s protest on its rejection as a coordinated-care network, Russo said.
If unsuccessful, the companies have two weeks to file an appeal with Commissioner of Administration Paul Rainwater, who has 10 days to decide, Russo said.
After that, the companies have six months in which they can challenge the contract awards in court, he said.
DHH awarded Maximus a $9.45 million, three-year contract to be the program’s enrollment broker. The broker will help Medicaid recipients sign up with one of the five companies chosen to operate the new privately operated managed-care plans.
Two other companies sought the business - AHS and Policy Studies Inc.
“Maximus failed to comply with mandatory proposal submission and disclosure requirements, grounds for DHH to disqualify the proposal,” according to AHS’ protest filed by Kevin Hayes, a lawyer with the firm Adams & Reese.
“DHH’s failure to disqualify Maximus’ proposal and the evaluation process flaws, allowed Maximus to prevail based on its unrealistic low bid,” Hayes wrote.
AHS claims that the low bid was possible because Maximus fails to “dedicate sufficient resources” to the enrolment broker contract.
Louisiana Physician Connections was one of three companies that sought to be a player in the “shared risk” model of the coordinated-care networks. It is a “fee for service” model instead of lump sum health insurance premium based.
It lost out to United Healthcare of Louisiana Inc. and Community Health Solutions of America.
In his protest, Louisiana Physician Connections’ Batie wrote that Community Health did not score sufficient points to meet the standard that DHH set for possible rejection of proposals.
Batie said Louisiana Physician Connections “inappropriately” lost 376 points in the scoring of its proposal. His letter detailed where LPC alleged the problems occurred.
Recovery of those points would put it in contention for the contract, he said.