Louisiana’s health department is moving to install emergency contracts in an effort to ensure health coverage for 1.5 million people is not disrupted in the looming open enrollment period, a day after the state procurement office blocked a new round of multi-billion dollar contracts from moving forward.
The agency said it will contract with the five existing Medicaid managed care organizations, or MCOs, for the emergency contracts. The contracts will likely stay in place until the protests are resolved, said LDH spokesman Bob Johannessen.
A new round of contracts — worth several billion dollars — was halted by the state procurement office in a decision made late Wednesday, until the office rules on the protests by two losing bidders, Louisiana Healthcare Connections and Aetna.
The move to block LDH from negotiating the new contracts came less than two months before open enrollment for the Medicaid program. It also came despite objections from state health officials who said such a delay would jeopardize coverage for the 1.5 million people who will need to pick health plans.
Paula Tregre, Louisiana’s chief procurement officer, said she decided to keep the stay in place because LDH previously suggested there would be no disruption of services to current Medicaid enrollees if the protests stretched past Dec. 31, when the current contracts are set to expire. An attorney with LDH suggested at a recent budget hearing it would seek temporary emergency contracts if that happened.
But last week, LDH started raising questions about whether emergency contracts would work. Rebekah Gee, the secretary of the health department, warned a delay in the new contracts would “disrupt and jeopardize” Medicaid enrollment, and she asked Tregre in a letter to allow the department to move forward with negotiations.
“The stay will introduce additional, catastrophic delay and uncertainty in the operation of the program as we understand that the stay may bar LDH from proceeding further with negotiating the terms of the contracts and awarding the contracts to the four MCOs that will manage the Medicaid health care services,” Gee wrote in a letter to Tregre.
The dust up over the new contracts has intensified since the health department announced its new picks for the lucrative Medicaid managed care work, in early August.
The losing bidders, Louisiana Healthcare Connections and Aetna, filed protests and asked the state to keep in place a stay that blocked the new contracts from moving forward while their protests play out.
Gov. John Bel Edwards administration’s health department earlier this year launched a bidding process for new contracts for companies that manage care for the state’s 1.5 million Medicaid enrollees under a privatized model put in place by former Gov. Bobby Jindal. Currently, five companies operate as managed care organizations, or MCOs, in the state. In early August, LDH selected Humana, a newcomer to Louisiana’s Medicaid program, and three existing MCOs.
Edwards has made his expansion of Medicaid a key part of his reelection platform. The move, in 2016, gave nearly half a million low-income people health care coverage in the state, and polling has shown the move to be popular.
The dispute over the contract comes at an inopportune time, about a month before early voting begins in the governor’s election. Edwards is a rare Democrat in the Deep South, and faces two well-funded challengers.
The health department’s picks sparked a backlash from the losing bidders, especially LHCC, which is the state's largest MCO and is the subsidiary of insurance giant Centene Corporation. LHCC workers protested at the Secretary of State offices earlier this month as Edwards qualified for reelection. Congressman Cedric Richmond penned a letter to Edwards raising concerns about the move. A new group called Caring Health Solutions has begun running billboards chastising the governor for leaving out LHCC.
Since filing the protests with Tregre’s office, the other MCOs and the health department have filed hundreds of pages of documents. The protests accused the health department of a biased bidding process that unfairly tilted the scales against LHCC and Aetna, with the firms citing what they called conflicts of interest among the selection committee, among other things. LHCC filed emails between LDH staffers with its protest, claiming the officials were against the firm from the beginning. It also claimed a LDH staffer fell asleep during its presentation, an assertion LDH rejected.
The health department, and the winning bidders, have fought back, and asked the procurement office to reject the protests. In a response, the agency said LHCC’s protest is based on “innuendo, assumptions, hypocrisy, their unjustified interpretation of certain emails, and, potentially, outright false statements.”
Tregre’s decision will likely be appealed to Commissioner of Administration Jay Dardenne, and the protests are expected to end up in the courts.