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Court Rules against DHS in HealthChoices Bid Protests, HAP Assessing Next Steps

April 13, 2018

This week, the Commonwealth Court of Pennsylvania ruled against the Pennsylvania Department of Health and Human Services (DHS) in three separate appeals from bidders involved in the HealthChoices procurement process. 

During January 2017, DHS chose six managed care organizations (MCO) to negotiate contracts for the physical health care services of 2.2 million Medicaid consumers in the HealthChoices program. Various bidders filed multiple protests that were adjudicated through the commonwealth’s protest process. After DHS denied protests by UnitedHealthcare of Pennsylvania, Inc., Aetna Better Health of Pennsylvania, Inc., and Vista Health Plan, Inc., each appealed those decisions in Commonwealth Court.

In all three decisions issued this week, the court found that a December 19, 2017, meeting between the DHS Deputy Secretary and Deputy Chief Counsel and Centene’s CEO and its Chief Business Development Officer directly violated the Procurement Code. Regardless of what occurred during the meeting, the provisions of the Request for Proposal (RFP) did not allow for contract negotiations before DHS determined whether the bidders were responsible offerers who submitted valid proposals. As a result, the department’s orders denying each of the three bid protests have been reversed.   

HAP staff reviewed the court documents and have contacted DHS for its analysis of the future of the HealthChoices program. The initial protests effectively stopped the implementation of the new MCO contracts, and DHS extended the current contracts with existing providers through calendar year 2018. In the recent decisions, the court found that DHS erred in denying the bid protests, but did not explicitly instruct DHS to reissue the RFP and restart the process.

HAP will continue to monitor the status of the HealthChoices implementation and provide additional updates as they become available. In the meantime, HAP encourages providers to continue to engage with plans that may be entering the geographic zone(s) in which they operate.

Zone

Existing HealthChoices MCO

Southwest

  • Aetna Better Health‚Äč
  • Gateway Health
  • United Healthcare of PA
  • UPMC for You
Northwest 
  • Aetna Better Health
  • AmeriHealth Caritas
  • Gateway Health
  • UPMC for You
Northeast 
  • Aetna Better Health
  • AmeriHealth Caritas
  • Geisinger Health Plan
Southeast 
  • Aetna Better Health
  • Health Partners Plans
  • Keystone First Health Plan
  • United Healthcare of PA
Lehigh/Capital 
  • Aetna Better Health
  • AmeriHealth Caritas 
  • Gateway Health
  • United Healthcare of PA
  • UPMC for You  

 

For more information, contact Jolene Calla, HAP’s vice president, health care finance and insurance.

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