BATON ROUGE, La. (AP) — Multibillion-dollar contracts that are among the most lucrative in state government are up for bid as Louisiana's health department sets about deciding which private companies will manage the care of 1.5 million Medicaid patients.
Louisiana currently contracts with five managed-care companies to oversee services provided to 90 percent of its Medicaid recipients: Aetna Better Health, AmeriHealth Caritas Louisiana, Healthy Blue, Louisiana Healthcare Connections and United Healthcare Community Plan. The contracts, negotiated by former Gov. Bobby Jindal's administration, expire Dec. 31.
New deals will begin in January. The department intends to announce the winning bidders at the end of June, with the possibility of choosing up to four managed-care firms.
The state pays a per-member, per-month fee for each person enrolled in a health plan with the private companies — mostly adults covered by Medicaid expansion, pregnant women and children. The enrollees get services through a network of primary care doctors, specialists and hospitals.
Critics say that under the existing contracts, the managed-care companies aren't closely tracked to ensure proper spending in the more than $12 billion Medicaid program and that not enough is done to punish poor performance.
Gov. John Bel Edwards' administration pledged to make changes in the next round of contracts.
"Our managed-care organizations are expected to demonstrate innovation. There should be an increased focus on health equity and social determinants of health," Health Secretary Rebekah Gee said in a statement Monday. "The managed-care organizations will be expected to work with each enrollee to drive behavior change and encourage health choices."
The health department said it will be searching for companies with proposals aimed at improving patient care, improving health outcomes for Medicaid enrollees and lowering costs in the program.
Jindal moved to the insurance-based model for much of the Medicaid program in 2012, shifting from a previous system of directly reimbursing doctors and hospitals with a fee paid for each service rendered to a Medicaid patient. The managed-care contracts annually account for roughly one-quarter of the state's operating budget.
Lawmakers extended the existing contracts in December 2017 at the urging of the Edwards administration, keeping the current companies in place for 23 months beyond the expiration date while the health department seeks new bids for the work. House Republicans grudgingly lifted their opposition after language was added to the deals explicitly giving the legislative auditor oversight of them.
The Edwards administration tweaked the terms in the extensions, adding what it says were more dollars tied to performance and more quality measures. The health department said that in the new round of bids, it has tightened requirements the managed-care organizations must follow, such as increased access to primary care and preventive services.
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