Paramount sues state for access to Medicaid bid documents

May 11—Paramount Advantage, ProMedica's insurance subsidiary, is suing the Ohio Department of Medicaid to force it to provide vital documents that ProMedica says will show that a decision to exclude Paramount from being a state Medicaid provider was biased.

The complaint by Paramount, filed Friday in Ohio's Court of Claims in Columbus, says that it made a request for specific documents it needed to protest an April 9 decision naming six other managed care organizations (MCOs) to become Medicaid providers on Jan. 5 next year.

Instead, the state provided "a prepackaged set of documents created in advance of the awards, rather than a response to Paramount's specific and detailed requests," Paramount said.

The ProMedica subsidiary wants the court to order a mediation hearing within the next 14 days, order the state Medicaid department to produce all the requested documents within 14 days, pay Paramount's court filing fee, and provide any other relief it deems necessary.

In its filing, Paramount said currently it is a high-performing MCO and its officials were shocked by the decision to reject its application to remain a Medicaid provider, which is a not-for-profit enterprise. Medicaid is a federally funded, state-administered insurance program for people with poverty-level incomes.

The state Medicaid department gave Paramount "the second lowest score out of all applicants, including a score of 0 out of 100 on Paramount's oral-presentation portion of its application — as if Paramount had not bothered to show up," the complaint states.

Applicants could score up to 1,100 points, with Paramount seeking to serve two regions. It scored 358 points for a West region that included Toledo, Dayton, and Cincinnati, and 342 in the Northeast region.

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The six companies chosen scored between 696 and 905. They were UnitedHealthcare Community Plan of Ohio, Inc., Humana Health Plan of Ohio, Inc., Molina Healthcare of Ohio, Inc., AmeriHealth Caritas Ohio, Inc., Anthem Blue Cross and Blue Shield, and CareSource Ohio, Inc.

Paramount said it believes the state had an "implicit negative bias" against it because in 2019 Paramount helped expose "serious flaws" in algorithms used by the state to assign Medicaid recipients to various MCOs.

In early 2020, Paramount stopped serving about 30,000 Medicaid customers after noting that the state was basing the premium's cost on the average Medicaid client while Paramount, which lost $103 million in 2019, was handling Medicaid's most challenging and costly patients. The dispute forced the state to correct its billing.

After being rejected for Medicaid distribution in 2022, Paramount appealed the decision but said the state failed to fully comply with its records requests in advance of its April 23 protest filing date. "Paramount was forced to file its protest without the information it should have been provided in order to fully develop its protest," the complaint states.

On Monday, the state Department of Medicaid declined to comment on Paramount's court filing.

In a statement, ProMedica said, "We continue to be astonished by the Ohio Department of Medicaid's decision to exclude not-for-profit, Ohio-based Paramount from its list of 2022 Medicaid insurance providers. And, we're not the only ones — to date, nearly 40 organization leaders across the state have sent letters to (the Ohio Department of Medicaid) to express their extreme concern about its decision and show support for Paramount.

"Clearly, there is a lot at stake here for our Medicaid members, partner organizations, employees, communities and state. At least 600 jobs are at risk, and the negative ripple effect from those losses will be significant. The estimated economic impact to Ohio in the form of lost tax revenue, consumer spending and community contributions is $81 million annually," the statement read.

"Paramount is fully committed to doing everything possible to resolve this issue. This is the largest contract to be awarded by the State of Ohio, and we would expect the procurement process to have the highest level of transparency. We have been incredibly troubled by the lack of transparency we have experienced, and as a result, we found it necessary to file the public information request complaint," the statement concluded.

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