Louisiana’s lawmakers take their second look Friday at a proposal to extend high-dollar contracts for the managed-care companies that coordinate health services for most state Medicaid patients.
Gov. John Bel Edwards’ administration is seeking to keep the deals in place for the five managed-care companies for another 23 months beyond their January expiration date. The price tag for the extension is estimated at $15.4 billion in federal and state cash.
The joint House and Senate budget committee is holding a special hearing on the extension request Friday, two weeks after lawmakers postponed a decision, saying they wanted more time to study deals that are among the most expensive in state government.
The private companies coordinate services for 90 percent of Louisiana’s Medicaid recipients, nearly 1.5 million people — mostly pregnant women, children and adults covered by Medicaid expansion.
Two weeks ago, lawmakers sought more information about the performance metrics used, the decision-making involved in extending the contracts and the method for estimating costs.
Raising more questions, the Legislative Auditor’s Office released a report after the extension vote was delayed that said the health department doesn’t properly monitor the managed-care companies to ensure they provide enough specialists to treat Medicaid patients’ mental health and substance abuse problems.
Health Secretary Rebekah Gee said the contract extensions include more accountability and link more payments to health quality metrics. She said her department will do a more wide-ranging system redesign as it rebids the work.
Louisiana pays a per-member, per-month fee for each Medicaid patient enrolled in a health plan with the companies. The enrollees get services through a network of doctors and hospitals. The managed-care networks don’t cover most services for disabled and elderly Medicaid patients.
Former Gov. Bobby Jindal moved to the privatized, insurance-based model for much of the Medicaid program in 2012, shifting from Louisiana’s previous system of directly reimbursing doctors and hospitals that cared for Medicaid patients with a fee paid for each service rendered.
The Edwards administration wants to continue the current managed-care deals, which began in 2015, through December 2019 while seeking new bids for the work.
Both administrations said the shift to managed care lessened growth in Medicaid costs by better coordinating patient care.
But the contracts have drawn more scrutiny from the majority-Republican Legislature during the Edwards administration. Payments to the managed-care plans grew after the Democratic governor boosted the number of Medicaid enrollees by 440,000 with the expansion authorized under the federal health care overhaul.