Louisiana ends Medicaid contracts for Humana, UnitedHealthcare, others due to poor bidding process

Flag of Louisiana, which contains a pelican mother and three baby pelicans on a blue background with a white ribbon that says "Union Justice Confidence"
Louisiana rescinded the Medicaid managed care contract for UnitedHealthcare, Humana and several others after a protest from Centene and Aetna. (Getty Images/Belyay)

Louisiana rescinded Medicaid managed care contracts to UnitedHealthcare, Humana and two other insurers because of problems with the bidding process.

The decision by Louisiana’s state procurement officer announced Friday likely will mean a new round of bidding for Louisiana’s Medicaid managed care program unless the decision is appealed and overturned.

Centene’s Louisiana Healthcare Connections and Aetna Better Health Louisiana protested the state’s award of Medicaid contracts to Healthy Blue, Humana Health Benefit Plan of Louisiana, AmeriHealth Caritas and UnitedHealthcare Community Plan last year.

Centene and Aetna charged in their appeal last August that Humana gave inaccurate information and that the scoring method used by the bidding process was “tainted with multiple conflicts of interest within the evaluation committee.”

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Louisiana’s procurement officer didn’t find any bias against Aetna or Centene among the evaluators nor any conflicts of interest.

However, the procurement officer did find the evaluation process to be riddled with problems. For instance, the state changed its evaluation tool for bids multiple times after the review process had started, tainting the evaluation.

The original request for proposals also required the insurers to give a provider network listing. However, “unbeknownst to proposers and contrary to the language of the RFP” the evaluation committee did not examine the provider network listing.

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The committee also didn’t properly amend the RFP to tell insurers they were not going to review the listing.

Humana said that it was "disappointed" in the ruling.

"We will be appealing the decision and await the state’s final determination in the coming weeks," the insurer said in a statement. "We continue to focus on preparing for the start of the new Medicaid program."

AmeriHealth added that it was reviewing the decision, and UnitedHealthcare said it will continue to serve the state's Medicaid beneficiaries but did not mention an appeal.

Louisiana paid out $7.6 billion to five managed care plans in the 2018 fiscal year, the state’s department of health said.

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