Louisiana Spotlight: Medicaid deals are headache for governor

BATON ROUGE — Gov. John Bel Edwards promotes his Medicaid expansion program as a central reelection selling point, but the contracts that provide those health services are becoming an unwanted election-year complication that could mess up his story line.
Losing bidders for the next round of multibillion-dollar contracts to manage health services for Medicaid patients are accusing the Edwards administration of bias and conflicts of interest. Republican and Democratic lawmakers are worrying publicly about whether health care access will be disrupted for half a million Medicaid enrollees, many of whom are in Edwards’ expansion program.
The accusations and criticism come in the middle of an election season when the Democrat Edwards is fighting to win a second term against two major Republican opponents, U.S. Rep. Ralph Abraham and businessman Eddie Rispone, who are criticizing Edwards’ management of the government-financed Medicaid program.
The contracts pay for private 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 new managed care deals slated to start in 2020. Five companies currently do the work under contracts expiring at the end of this year. Louisiana Healthcare Connections and Aetna Better Health have Medicaid managed care contracts with the state, but weren’t chosen for new deals. They filed protests , accusing the health department of improprieties.
More than 560,000 Medicaid recipients who receive coverage through Aetna and Louisiana Health Care Connections will have to transfer to new health plans if the contract awards are upheld, and several lawmakers have fretted about the logistics of accomplishing that by January.
In a letter to Edwards, Democratic U.S. Rep. Cedric Richmond said Louisiana’s health department has had technology problems that would likely make it difficult to shift patients to new health plans without “at least some of these patients falling through the cracks for a time.”
Several lawmakers asked how Humana Health Benefit Plan of Louisiana, which hasn’t done Medicaid managed care work in the state but won a contract starting in 2020, will quickly ramp up a new health plan with a network of doctors, clinics and hospitals available to Medicaid patients.
The governor and his health department are defending the bid evaluation and contractor selection, saying it followed the detailed requirements laid out in Louisiana procurement law. Edwards told callers to his radio show last week that the process is working as it should.
“We anticipate that we’re going to be able to move forward without any interruption in services,” the governor said.
But his health department undermined that claim in paperwork filed with the state procurement office about the dispute over the contracts.
In a letter to Louisiana’s chief procurement officer , the health department warned that if the ongoing legal challenges cause delays in contract negotiations, that could “disrupt and jeopardize the provision of health care to more than 1 million of Louisiana’s most vulnerable citizens.”
The losing bidders for the new deals are claiming state law wasn’t followed in selecting the winning contractors. Lawyers for Louisiana Healthcare Connections called the process “tainted with conflicts of interest and bias from the start.” Attorneys for Aetna accused the health department of using a “biased and arbitrary scoring methodology.”
The companies argue the bid evaluation was skewed to benefit Humana. Louisiana Health Care Connections claims a health department official that helped in the contract award process even fell asleep during its oral presentation.
Because the Medicaid managed care deals are so lucrative, disputes over new contract awards seemed almost inevitable.
But the Edwards administration could have avoided such a high-profile dispute in the middle of an election cycle if it had sought new bids for the work before the existing contracts were slated to expire in December 2017. Instead, the health department urged lawmakers to extend the current deals for another 23 months, placing decisions about new contracts smack in the middle of campaign season.
Melinda Deslatte has covered Louisiana politics for The Associated Press since 2000. Follow her at http://twitter.com/melindadeslatte