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Senators express hope that state picks Medicaid managed care providers based on service, not least cost

St. Francis Ministries
Posted at 11:23 AM, Jul 09, 2022
and last updated 2022-07-09 12:23:02-04

LINCOLN, Neb. (Nebraska Examiner) — Five health insurance companies have submitted bids to handle the state’s Medicaid managed care program, a contract that now costs the state nearly $3 billion a year.

Two state senators voiced hope Friday that the winning bidders would be selected on superior service and not least cost, which has caused problems in past state bid selections.

Two to three of the companies will be announced as winning bidders in late August, according to the Nebraska Department of Health and Human Services.

They will provide physical health care, behavioral health care, pharmacy and dental services to about 340,000 low-income and disabled Nebraskans.

The bidders are: 

  • Community Care Plan of Nebraska Inc., d/b/a Healthy Blue
  • Medica Community Health Plan
  • Molina Healthcare of Nebraska Inc.
  • Nebraska Total Care Inc.
  • United Healthcare of the Midlands Inc.

Three of those companies — HealthyBlue, United Health Care and Nebraska Total Care — currently share the five-year state contract.
The department said the bids will be scored based on specific and general expertise by Medicaid leaders. Two rounds of bidders’ questions have been answered prior to the July 1 deadline to submit bids.

State Medicaid Director Kevin Bagley said that a goal is “to improve our members’ and providers’ experiences by building on previous successes and making thoughtful changes in response to stakeholder feedback.”  

Some state legislators have expressed concern about the state’s Request for Proposals (RFP) process given multimillion-dollar mistakes over “bad bids” that were approved for services including the state’s Medicaid managed care program and for two computer systems.

In 2019, the state made what would later amount to a $158 million mistake in awarding a contract to oversee the state’s child welfare system to St. Francis Ministries of Kansas. That financially troubled nonprofit’s $197 million bid was later revealed to be horribly low, requiring $158 million more in funding.

State Sen. John Arch of La Vista said he was encouraged that five bids were received for the Medicaid managed care contract.

“What we’re looking for are companies that can demonstrate that they can improve the health of the population that they’re managing,” Arch said, and not because they are the “cheapest” bid. 

He said he was very encouraged by the procurement process so far.

Omaha Sen. Machaela Cavanaugh, who led criticism of the St. Francis contract, said she hopes the state isn’t focused on picking the lowest bids but by considering which services will be covered and not covered, at the cost they’re offering.

“I don’t want another situation of an underbid that hurts people,” Cavanaugh said.

Arch said that a consultant has already been hired to delve into the state’s procurement process, as required under a bill passed by state lawmakers this spring.

The consultant will offer recommendations for improvement in a report due Nov. 15, he said.

Nebraska Examiner is part of States Newsroom, a network of news bureaus supported by grants and a coalition of donors as a 501c(3) public charity. Nebraska Examiner maintains editorial independence. Contact Editor Cate Folsom for questions: Follow Nebraska Examiner on Facebook and Twitter.

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