Beshear cancels and rebids $8B in Medicaid managed care contracts issued by Bevin

Dec. 23--FRANKFORT -- Gov. Andy Beshear is canceling and rebidding the nearly $8 billion in state Medicaid managed care contracts that his predecessor, Gov. Matt Bevin, awarded to five private health insurance companies with only 11 days left in his term.

Beshear, a Democrat who took office Dec. 10, said at a Capitol news conference Monday that he had no other option in dealing with the contracts that affect more than 1 million Kentuckians.

He listed several reasons for his action.

Beshear noted that the Bevin administration's original request for proposals for the contracts included its Medicaid waiver that required some Medicaid recipients to work to get health insurance. Beshear ended that last week, saying the waiver threatened the health care of nearly 100,000 Kentuckians.

Beshear also said members of the state legislature's Government Contract Review Committee unanimously voted to reject the contracts on Dec. 9 and that Bevin had shown bias against one of the unsuccessful bidders --Passport Health Plan of Louisville --by criticizing the company.

Passport and Anthem, which both currently hold state contracts, were excluded from the contracts Bevin awarded. Those agreements were to run for five years and begin next July 1.

Beshear said Monday the state will rebid the contracts on an accelerated time schedule and will operate, for the time being, under the contracts in place.

A request for proposals will be issued with a target date of Jan. 10, Beshear said. Responses will be due Feb. 7, with the goal of selecting providers in April.

The process, said Beshear, may require an extension of the current contract to prevent a loss of coverage for any individual.

He stressed that his decision "has nothing to do with who won or lost in the initial process. The rebidding will be fair. No one is guaranteed a contract."

Companies that won contracts in the initial bidding were: Aetna Better Health of Kentucky; Humana Health Plan; Wellcare Health Insurance of Kentucky; and two newcomers, United Healthcare and Molina Health Care. Aetna, Humana and Wellcare have existing state contracts.

Both Passport, which serves about 300,000 Medicaid enrollees -- most in the Louisville region -- and Anthem, which serves about 130,000 people, had said they plan to file formal protests over the contract awards.

Beshear said any and all companies can participate in the rebidding process.

Kentucky's $11-billion-a-year Medicaid program, which gets about 80 percent of its money from the federal government, provides health coverage for about 1.3 million low-income and disabled individuals. About 1.2 million of them fall into the managed care system.

Passport's loss of the initial contract raised questions about a new headquarters and health campus it had planned to build in west Louisville at 18th and Broadway and its planned $70 million sale to Evolent Health, a Virginia-based health management company.

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