Friday, September 15, 2017

Medicaid Melee over Managed Care

The Mississippi Hospital Association failed in its attempt last month to get a court to stop Medicaid from awarding a lucrative managed care contract to three competitors.  MHA's proposal scored sixth out of seven bids.   Hinds County Chancellor rejected the petition for a temporary restraining order and said MHA had not exhausted its administrative remedies.

The Division of Medicaid adopted a managed care  program in 2011 and named it MississippiCan. The initial contract was awarded to Magnolia Health Plans (Centene) and United Healthcare.  Medicaid pays a capitated rate.  Under a capitated rate plan, Medicaid pays the insurance companies a flat fee per patient. The insurance companies keep the difference between the health care costs for the patient and the capitated rate thus there is a financial incentive to contain health care costs.

The MississippiCan contract expired this year so the Division of Medicaid issued a request for proposals on February 3, 2017.  Seven companies submitted proposals for consideration: Amerigroup, Mississippi True (Mississippi Hospital Association, Molina, Magnolia (Centene), United Healthcare, Trusted Healthplan, and Wellcare.  The Division announced it would award the contract to Magnolia, United, and Molina. Copy of RFP. The new contracts will determine who manages over $3 billion in Medicaid services.  

JJ obtained a copy of the score sheet and posted it below.   Magnolia had the best score while Trusted and Mississippi True brought up the rear:

Magnolia: 67.58
Molina: 65.40
United: 64.39
Amerigroup: 63.30
Wellcare: 62.72
Mississippi True: 59.84
Trusted: 58.79

Click on image to enlarge

As one can see, Mississippi True fared well in some categories such as the work plan but trailed the winners by at least a  point each on experience, organization & staffing, and methodology and work statement.  Mississippi True is the Mississippi Hospital Association's first foray into the Medicaid managed care business.  MHA created Mississippi True as a "provider sponsored healthcare plan" (PSHP).  The legislature gave MHA the authority to create a PSHP in 2015 specifically to serve Medicaid patients.  Although MHA claims that Mississippi True is a "local", MHA contracted with Virginia-based Evolent Healthcare to actually operate Mississippi True.  It is safe to say that Mississippi True is an Evolent operation with the MHA label affixed to it.  Local outsourcing at its finest. 

The RFP and the awards were not submitted to the Mississippi State Personal Contract Review Board. The Division claims it is not required to do so because the contracts at issue are insurance contracts.  The Board simply ensures that the procedures for accepting bids and awarding contracts are followed.  It does not determine the actual merits of each proposal.


The Mississippi Hospital Association did not take its loss lightly but instead did what every loser does in Mississippi when a billion-something dollar contract is at stake - sue.  However, Amerigroup and Mississippi True filed a protest with the Division on June 29.   The RFP stated the protest guidelines (p.34 of RFP linked above):

Protests must be made in writing and must be received no later than ten (10) business  days from the notice of non-award.  Protests should be addressed to the Division’s Executive Director and must  contain  specific  grounds  for  the protest.....

The Executive  Director shall  then  determine whether the award of the Contract shall  be  delayed or  cancelled;  or, if the protest is clearly without merit,  or that award of  the Contract  without  delay is necessary to  protect  the  interests  of the State....
Each company had to file a a $500,000 appeal bond it will lose if the appeal is unsuccessful. However, Mississippi True didn't wait for the appeal process to work at Medicaid but also filed a motion for an injunction on July 12 (p.37 below) and a motion for a temporary restraining order on July 13 (p.25). Both motions were filed in Hinds County Chancery Court and assigned to Chancellor William Singletary.

Mississippi True's argued in the motion for a TRO that it was a victim of "bias and discrimination" because it was the only provider-sponsored healthcare plan.   The company also said it asked the Division to provide copies of its competitors' sealed bids but it had not yet received them within the required seven-day period.   Mississippi True further protested that the contracts were not submitted to the State Personal Services Contract Review Board for approval.  However, Governr Phil Bryant instructed Medicaid Director Dr. David Dzeilak to do just that and submit the contract to the board for review.

Mississippi True asked the court to give it an additional seven days to supplement its protest after it received the sealed bids.  It further asked the Court to order the Division to submit the contract to the Board for review and stop the Division from executing any MississippiCan contracts until Mississippi True exhausted its appeals. 

The competitors of Mississippi True didn't sit around and hope for the best but instead all filed motions to intervene as expected.  The Chancellor approved their motions and the fight became a melee.  They argued that Mississippi True couldn't go to court until it exhausted its appeals with the Division of Medicaid- which it had not yet done.  Mississippi True is thus protesting and making the same arguments on three different fronts: Division of Medicaid, Chancery Court, and the Contract Review Board.  The court couldn't adjudicate this case until after the Division and Contract Review Board had a crack at the protest.  The Division even pointed out in an August 14 response that Mississippi True and Amerigroup had not even submitted their amended protests.  It also said it would not issue a final decision on the contract until after it was approved by the Contract Review Board and CMS*  The Division continued their argument and said

 If the Division believes that the arguments have merit, it could award contracts to Amerigroup and Mississippi True; or award a contract to just one of them; or re-start the procurement process altogether; or fashion some other appropriate relief. In other words, Amerigroup and Mississippi True could still win. Consequently, they have not exhausted their administrative remedies, and their challenge in court is premature. The Court must deny their Motion for lack of jurisdiction.
Judge Singletary agreed with the winners and ruled that Amerigroup and Mississippi True must complete their appeals with the state before they can sue the Division in Chancery Court at the hearing held on August 14.

Mississipppi True and its competitors obtained a court order sealing their bids in a separate action. 

*Centers for Medicare & Medicaid Services.

 File posted below
P.1: Order on subpoena
P. 3: Governor's Letter ordering Contract Review
P. 7: Medicaid's response to lawsuit
P. 17: Molina's response to lawsuit
P. 21: Magnolia's response to lawsuit
P. 25: United's motion to intervene
P. 29: Mississippi True's motion for TRO
P. 41: Mississippi True's complaint for TRO and Permanent Injunction



19 comments:

Anonymous said...

A sore loser that came in seventh is attacking the umpire and challenging the rules. Sounds like bad parents after their kid's team finishes next to last in the tournament, but are trying to claim the trophy anyway.

Here is the "Mississippi Truth". The Mississippi Hospital Association hired an out of state company to bid on this in order to avoid accountability for increasing and innapropritae medical care costs. They tried to kill managed care in the legislature since it was passed and failed. They tried suing Medicaid and failed. Then they tried to pass legislation to mandate they be given a contract, paid for by us taxpayers and that failed.

Now this lawsuit and attempted character assasination. Why? To avoid the oversight and accoutability that would limit their abuses and curb their ill gained profits. Anyone who has paid for an emergency room visit lately will understand (ex. sixty dollars for a Tylenol).

Simply put, they want to be the fox guarding our henhouse. They will lose this lawsuit and they should. Then, all public officials and media representatives should remember their trail of attempted character assasinations, false claims of being a Mississippi company and their track record of lies and false promises to legislators, executive branch elected officials, and the media.

The Association has no credibilty. Hospitals should not be spending hundreds of thousands of dollars in membership fees yearly and instead should spend that money on their patients. Instead of investing that money in healthcare, they are using it to protect and increase their illegitimate profits and to prop up an Association that is detroying their good will and credibilty.

Anonymous said...

Medicaid has some "excellent" and "professionally" done commercials on Supertalk. Wonder how much they cost?

Anonymous said...

11:13 is SPOT on!! The hospital Assn hasn't been a viable advocate for its members since that old bastard, Sam Cameron left. They also had another lobbyist (I can't recall his make), who knew Medicaid better than anyone in Mississippi who left when Cameron retired.

Anonymous said...

12:41 and 11:13 nailed it. The hospitals in the hospital association should sue that bunch for malpractice. Then,the people they have libeled and slandered should sue the association for damages. Then, the hospital patients and taxpayers whose dollars underwrite these hospitals should file class action lawsuits against the member hospitals for misuse of public funds and abuse of public trust.

Or maybe the Attorney General and State Insurance Coomisioner could investigate their behavior and make them disgorge their outrageous medical profits swindled from sick folks. Bet that would keep their $500 an hour lawyers from creating any more mischief or defaming honorable folks.

Anonymous said...

... they are using it to protect and increase their illegitimate profits ...

Please define what level of profits are legitimate.

Drain The Damned Swamp and Then Shovel It said...

Here's a bonus question: Which is more useless: The Mississippi Medicaid Commission (is it the only commission left?), The Mississippi Hospital Association or The Mississippi Municipal League?

I know the spending is not comparable, but what about the utility and public good? What does the latter do other than give elected officials several chances a year to meet at casino resorts and spend public funds?

The Medicaid empire, just like the public welfare bureaucracy and public schools administrative offices in general, as well as the state departments involved in all of them, are nothing more than employment agencies. If these blood suckers were all tooled down or abolished, the state employee ranks would be cut by 2/3.

Anonymous said...

Drain the Swamp........let's keep up, now Son. There hasn't been a "Medicaid Commission in 25 years.

Anonymous said...

Medicaid is the worst run agency in the state. Makes MDE look good.

Anonymous said...

11:13, would you mind if I copied your comments and sent them to Anna Wolfe at the CL? She used to do a halfway decent job of covering the city and all the fun things going on there with our former Mayor. But since moving over to her new beat, whatever that is, she obviously hasn't bothered to learn anything about it, or to look for actual facts and truth - instead she has decided to take the dribble given her by the MS Hospital Assn (or its lobbyists) and report them as fact. She could learn a lot just by reading your explination.

Mind if I forward it to her? Not that I think the CL would be worth much more, but at least it might help her save what's left of her reputation as a reporter.

Anonymous said...

The CL just prints what MHA sends to them. And the legislature usually just passes what the MHA tells them to. I hate to see the smear campaign MHA is doing to the folks that did the ratings (who had no incentive to not pick the best proposal)

Anonymous said...

Whoa !
Medicaid" pays a decapitated rate per patient and the insurance company get to keep the money not paid "?
So , if the Medicaid human covered exceeds the rate, it's what? Sayonara?
And, if the Medicaid human stays well, the funds can't be used for the sick human and our tax dollars go to an insurance company? How is THAT a savings to taxpayers or driving down costs?
And, what are the safeguards to make sure a Medicaid human isn't denied costs so the insurance company can collude to reduce the care and keep even more money?
I don't think the concern should be over which company wins the contract, but that there is a contract that seems so lucrative as to start a fight!

Anonymous said...

11:13 says copy, paste and send at will. As short-staffed as they are at the Clarion Ledger, she probabably does not have time to do thorough research. If she did, she would already know that the hospital association is the group trying to corruptly influence the bidding process. Politicians beware.

You might check with 12:41 and send their comments as well. Hard to believe these hospital's (and smart politicians) would let themselves get suckered into this corrupt effort to obstruct cost accountability and defy oversight.

They should look into Singing River Hospital's unconscionable looting of the retirees pension fund to enrich their local business cronies at the expense of taxpayers and retirees. That would be only one example of illegitimate profits. Emergency room costs billed to Medicaid or private insurance would be another. It is up to 300 percent higher than if billed to an uninsured person.

Facts Matter said...

Hey 7:30, the word is "capitated". To answer your question, if a patient's care costs more than the rate, the company still pays for their care and eats the loss instead of the taxpayers. If the patients stay healthy and their care cost less,the company keep the difference. The outcome is less cost to taxpayers, more cost certainty and healthier Mississipians who can work and pay taxes.

Anonymous said...

7:30......You've just showed you complete lack of understanding of "insurance". Do YOU have insurance?? How do you think YOUR insurance company makes a profit???

Boar Hog Tits.. said...

"Drain the Swamp........let's keep up, now Son. There hasn't been a "Medicaid Commission in 25 years. September 15, 2017 at 2:10 PM"

Call it what you like. Facts are facts. The head is appointed by the governor. Maybe the only one remaining like that. They used to all, pretty much, be called commission. Like DPW, which is now called something else.

A pile of shit, like a rose, by any other name...........

See how that works, 2:10. Do keep up, now.

Anonymous said...

Boat Hog.....you're as uninformed as The Swamp drainer. Actually, 49 of the 50 States have Medicaid Director's appointed by their Governor. How, pray tell, would you like to see it done??

Boar Hog In The Swamp said...

10:09...Boar (not boat) Hog here. I referred to state agency heads in Mississippi, not 49 other states. I don't give a shit how their jobs are filled in other states. This one is appointed, thus is a commissioner by any other name, the same as it was before a more politically pleasing title was adopted. As with Department of Public Welfare....

2:10 (perhaps you) said 'There has not been a Medicaid Commission in 25 years'. What's the difference now that it's called by another name? It's still a useless bureaucracy, just something else to give the sitting governor a plum to bestow.

If the Legislature would dump this agency as well as the Education Department and half the school districts, not only would Mississippi cease to be an employment agency, the State Employees Retirement System would immediately reverse fortunes.

Anonymous said...

@September 15, 2017 at 6:35 PM

Medicaid is not the worst run agency in Mississippi. That title belongs to whoever has the taxpayers in Mississippi cough up the most money in lawsuit settlements. Medicaid is not one of them. Go do your homework.

Kingfish said...

I think he meant the old Welfare Commission in the comments.


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