Indiana to bid $68 billion in Medicaid contracts this summer

Indiana's social services agency plans to rebid $68 billion worth of health care contracts in August for vulnerable Hoosiers making up 20 percent of the state's population.

Mitch Roob, secretary of the Family and Social Services Administration, made the announcement at a Friday quarterly financial review meeting.

Termed the "Mother of All Procurements" in a slide presentation, FSSA plans to put out a proposal request for managed care services for the Healthy Indiana Plan, Pathways for Aging, Hoosier Care Connect and Hoosier Healthwise.

In all, these programs cover more than 1.4 million Hoosiers.

Roob said the target for new contracts to be effective is Jan. 1, 2029. He didn't explain the maneuver during the meeting. His office released a statement.

"Details about the Managed Care Entity Procurement are still being finalized, including the scope and final amounts. Because of the complexity of the process, more information won't be available until closer to its release early this fall."

All of the programs provide Medicaid coverage to different categories of Hoosiers. Under a managed care system, the state pays a flat amount per enrollee, instead of paying for each service those people obtain.

HIP covers Hoosiers ages 19 to 64 who meet specific income levels, while Pathways covers Hoosiers older than 60 in need of long-term care and support. Hoosier Care Connect is for those aged 59 years and younger, blind, or disabled and who are also not eligible for Medicare. Hoosier Healthwise is for children up to age 19 and pregnant individuals.

Hoosier Healthwise has the highest enrollment, followed by HIP and Pathways.

Rep. Ed Clere, R-New Albany, a longtime public health advocate, warned that a mass rebidding process is "a recipe for additional disruption, if not disaster."

"And the people who have been affected, and who are at risk and who continue to be at risk are some of the most vulnerable Hoosiers," he told the Capital Chronicle. "Kids, seniors, people with disabilities."

"We should proceed very carefully and thoughtfully," Clere said. "If there's a concern about a contract, then let's look at that contract. If there's a concern about a population, then let's look at that population. But trying to do it all at once is very worrisome."

In November, FSSA announced that provider MDwise would no longer serve as a managed care health plan for Indiana's Medicaid programs, including HIP and Hoosier Healthwise. Members had to select a new plan from the remaining carriers – Anthem, CareSource or Managed Health Services – during the current open enrollment.

Pathways has had its own problems.

A Tuesday press release from the Indiana Health Care Association supported a bill to reform the program.

"The PathWays for Aging program has been plagued with issues since it launched July 1, 2024," the release said. "The program allows Humana, Elevance Health and United Health Care to oversee, on behalf of the state, the Medicaid coverage for 117,000 Hoosiers in need of nursing home level of services."

"Humana and Elevance were placed on corrective action plans with the state soon after the program's launch due to a multitude of billing, claims processing and other contract violations," the association said. "All three of the insurance companies last year owed more than $100 million in late and inappropriately denied Medicaid payments to the nursing home industry."

Elevance Health was formerly known as Anthem.

Molina Healthcare was also initially selected as a provider for Pathways, but was later dropped by the state.

Clere acknowledged Gov. Mike Braun's administration might be looking for opportunities to improve care models, but urged caution.

Managed care "can be a good thing – which has been the case overall with HIP, for example – but it can also be a very bad thing," he said. "The devil is in the details, and there are way too many details in the combined programs to address them all at once without putting a lot of vulnerable Hoosiers at risk."