HNF Stories
11:44 am
Tue January 7, 2014

Medicaid Contract in Turmoil

Miami-Dade County, the juiciest plum in Florida Medicaid’s switch to mandatory managed care, could still be in play following a ruling against the Agency for Health Care Administration in its contracting decisions. Hundreds of millions of dollars could ride on the outcome. 

The decision by Administrative Law Judge John Van Laningham, issued Jan. 2 tells AHCA that it should rescind its decision to award a contract to Prestige Health Choice for the region that encompasses Dade and Monroe counties.

Such a decision, called a “recommended order,” isn’t the last word.  AHCA has 10 days to file "exceptions" to the opinion, and 30 days to issue a “final order” that takes the recommended order into consideration. If AHCA rejects Van Laningham’s recommendation, it has to have a lot of evidence to do so and be prepared for a court fight.

Such a fight could come in any case, because so much money is at stake for those Medicaid enrollees.  
Van Laningham wrote that Prestige -- founded by non-profit health centers -- didn’t really meet the definition of a “provider service network” or PSN any more because in his opinion, some of the "providers" don't really meet the definition.

The opinion presents a problem for AHCA, since the managed-care law requires each region to include a PSN to compete with HMOs. And Prestige is the only PSN that was awarded a contract in Miami-Dade and Monroe counties. 

Care Access PSN, LLC, one of four PSN bidders for the South Florida region, contested the contract award.  A number of companies or PSNs were admitted as interveners in the case: Prestige, Amerigroup, Humana, Simply Healthcare, Sunshine State, WellCare, United and Molina.

Last summer, AHCA invited 10 bidders to negotiate for contracts, including two PSNs, Prestige and Care Access.  AHCA announced in September that contracts in the Dade-Monroe region would go to six plans: five HMOs and Prestige.

Later, after considering some protests, AHCA announced that four more contracts would be added in the region, all to HMOs. That brought the number of contracts for the region to 10, which is the maximum it can offer.

Care Access filed a protest, saying Prestige isn’t really a PSN because even though it was formed by non-profit health centers, today insurance companies effectively control it. Florida True Health, in which Florida Blue holds a substantial interest, reportedly owns 40 percent of the shares and an option to buy the other 60 percent.  

In an understatement, Van Laningham called the process by which Florida True Health bought its stake in Prestige a “complex transaction.”

A late-November article by Matt Dixon in the Florida Times-Union described the financial arrangement, saying that Florida Blue and AmeriHealth Caritas formed Florida True Health last year. it said the health centers that supposedly were the “providers” in the PSN held a minority stake. 

AHCA spokeswoman Michelle Dahnke said the agency is reviewing the recommendation and considering what to do next. “All affected parties will have the opportunity for due process,” she wrote.

As Phil Galewitz of Kaiser Health News reports, the Florida-based health centers that formed Prestige aren’t the only clinics getting into the insurance business. 

--Health News Florida is part of WUSF Public Media. Contact Editor Carol Gentry at 813-974-8629 (desk) or e-mail at cgentry@wusf.org. For more health news, visit HealthNewsFlorida.org.