Rebidding of Medicaid managed-care contracts gets same result: Anthem and Passport to be out on Jan. 1; Passport plans protest

By Al Cross Published June 1, 2020 HEALTH BUSINESS, HEALTH POLICY, YOUR HEALTH

By Al Cross
Kentucky Health News

Hundreds of thousands of Kentuckians on Medicaid will have a new managed-care organizations to deal with when the new year rolls around, because two of the five MCOs serving the state were not among the five winners this week of state contracts for 2021.

Medicaid members of Anthem Health Plans and Passport Health Plan will have to choose from subsidiaries of the five insurers that won the bidding: Aetna, Humana, UnitedHealthcare, WellCare and Molina Healthcare, which apparently hopes to supplant Passport as Louisville’s favored MCO. Passport was scored seventh among seven bidders, and Anthem placed sixth.

The two losers and the five winners were the same chosen by the administration of Republican Matt Bevin 11 days before he left the governor’s office in December. Democratic Gov. Andy Beshear canceled the contracts and sought new bids, noting the timing, the vote against the contracts by a legislative advisory committee and Bevin’s previous criticism of Passport.

Health Secretary Eric Friedlander said terms of the contracts were revised to increase oversight, quality control and transparency. But in the end, the result for the 1.4 million Kentuckians on Medicaid was the same.

“I wasn’t a part of it whatsoever,” Beshear said Friday. “It’s done objectively, and it’s done under the law.” He noted that the bid scoresheets are posted online. The contracts total almost $8 billion.

Beshear said Anthem “does a really good job” with the state employee health plan, and said Passport “has provided great service and “been an important community member.” It is the only not-for-profit MCO in Kentucky and is based in Louisville, where most of its members live. It was created in 1997 as a pilot project to control Medicaid costs in the Louisville area at the state’s request.

Passport was building a new headquarters in western Louisville. Beshear indicated that Molina wants to take over the project; he said one company had said it was committed to creating 1,100 jobs in a headquarters in Louisville, and indicated later that the company was Molina, which is based in Long Beach, Calif., and has 3.4 million members.

Evolent Health, which recently bought most of Passport, said they would protest the contract decision, saying that “disrupting insurance coverage and continuity of care during an unprecedented public health crisis could have on some of the most vulnerable members of Passport’s community.”

The University of Louisville, which once owned 70 percent of Passport, had 19 percent after the sale. Other local owners include University of Louisville Physicians, the Jewish Heritage Fund for Excellence and Norton Healthcare.