Louisiana’s Medicaid program started the new year under a cloud of uncertainty, amid a continued dispute over multibillion-dollar contracts to provide health services to 1.5 million people.

Lucrative deals with five private companies that manage care for most Medicaid patients, accounting for roughly one-quarter of the state’s annual operating budget, were set to expire at the end of December.

Gov. John Bel Edwards’ administration chose four companies to do the managed care work, with the deals planned to begin in January.

But two losing bidders that currently hold managed care contracts—Louisiana Healthcare Connections and Aetna Better Health—are protesting that decision, and the legal process has stopped the new contract awards from taking effect.

In response, the Edwards administration signed emergency contracts to keep the existing five companies in place for up to another year—while the new deals remain stalled—to avoid the disruption of health care access to nearly one-third of Louisiana’s population.

Edwards spokeswoman Christina Stephens said the state wanted to ensure “that no one lost access to care while the protest is pending.”

“Our goal has always been to provide high quality coverage to the families that rely on Medicaid, while at the same time ensuring that the Medicaid program is efficient and accountable,” she said Tuesday in a statement.

Federal Medicaid officials, however, have yet to approve the emergency contracts. The managed care organizations can’t get paid under the emergency contracts until Louisiana receives that go-ahead from federal officials, according to Stephen Russo, chief lawyer for the Louisiana Department of Health.

He expects that approval to come before the first payment is due Feb. 10.

Meanwhile, a new Louisiana health secretary and Medicaid director will inherit the contract dispute.

Health Secretary Rebekah Gee announced Monday that she’s resigning from the job she’s held for four years at the end of the month. The department’s Medicaid director, Jen Steele, also is exiting the agency. Read the full story. 

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Edwards administration seeks federal approval on emergency Medicaid contracts – Greater Baton Rouge Business Report