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

By: - July 8, 2022 5:14 pm
Saint Francis Ministries

Kansas-based Saint Frances Ministries. (Sherman Smith/Kansas Reflector)

LINCOLN — 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.
State Sen. John Arch of LaVista
State Sen. John Arch of La Vista (Courtesy of Unicameral Information Office)

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. 

State Sen. Machaela Cavanaugh
State Sen. Machaela Cavanaugh of Omaha (Courtesy of Unicameral Information Office)

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.

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Paul Hammel
Paul Hammel

Senior Reporter Paul Hammel has covered the Nebraska Legislature and Nebraska state government for decades. He started his career reporting for the Omaha Sun and later, editing the Papillion Times group in suburban Omaha. He joined the Lincoln Journal-Star as a sports enterprise reporter, and then a roving reporter covering southeast Nebraska. In 1990, he was hired by the Omaha World-Herald as a legislative reporter. Later, for 15 years, he roamed the state covering all kinds of news and feature stories. In the past decade, he served as chief of the Lincoln Bureau and enterprise reporter. Paul has won awards for reporting from Great Plains Journalism, the Associated Press, Nebraska Newspaper Association and Suburban Newspapers of America. A native of Ralston, Nebraska, he is vice president of the John G. Neihardt Foundation, a member of the Nebraska Hop Growers and a volunteer caretaker of Irvingdale Park in Lincoln.