Mississippi Awards Medicaid Contracts To Centene, Molina, TrueCare

Dive Brief:

• Mississippi has granted Centene, Molina and TrueCare new Medicaid managed care contracts, two years later than the state intended after the awards were tied up by challenges from UnitedHealth and Elevance.
• The four-year, $3.8 billion contracts were signed Aug. 12, a Mississippi Medicaid spokesperson confirmed.
• Molina and Centene subsidiary Magnolia Health are incumbents in Mississippi’s managed care program. It’s the first Medicaid contract for TrueCare, an insurance nonprofit formed by the Mississippi Hospital Association and providers in the state that will replace UnitedHealthcare.

Dive Insight:

Molina said it planned to award contracts to Magnolia, Molina and TrueCare in August 2022 to serve beneficiaries in its managed care program, called the Mississippi Coordinated Access Network or MississippiCAN, along with the Children’s Health Insurance Program.

MississippiCAN covers almost three-fourths of the 650,000 people in the state’s overall Medicaid population, not including CHIP.

However, implementation of the contracts stalled after incumbent UnitedHealthcare, along with Amerigroup — an Elevance subsidiary seeking to enter the state — protested, alleging the bidding process was unfair. 

Though the companies failed to prevail in state review, the legal quagmire led Mississippi to divvy out short-term emergency contracts to incumbent MCOs as recently as last month to ensure Medicaid beneficiaries didn’t experience any gaps in services.

Now, Mississippi is forging ahead with new awards.

“We are working on the implementation process,” said Mississippi Division of Medicaid spokesperson Matt Westerfield.

UnitedHealth declined to comment on the contract loss, while Elevance did not respond to a request for comment.

It’s not uncommon for payers to squabble over contracts for Medicaid managed care, in which states pay private insurers a flat rate per enrollee to manage the care of beneficiaries in the safety-net program.

The contracts can be a source of strong and dependable revenue, and are especially valuable for insurers like Centene and Molina that bring in the bulk of their toplines from government business.

Centene’s Magnolia Health, for example, has received almost $15 billion in contracts from Mississippi since 2017 — the most of any MCO, according to the state’s contract database. UnitedHealthcare has received $10.4 billion, while Molina has received $8.7 billion.

Proponents of managed care argue the arrangements ensure more budget predictability for states, while putting plans on the hook for controlling the medical costs of their members.

However, researchers, lawmakers and patient advocates have aired concerns that insurers are restricting care to retain more Medicaid revenue as profit.

Top Democrats in Congress launched an investigation into the quality of MCOs last year, following research finding high rates of coverage denials.

Those concerns are compounded when insurers are driven by profit motivations. Minnesota, for example, recently banned for-profit entities from participating in its managed care program.

Still, Medicaid managed care has grown to become the dominant Medicaid delivery system in the U.S. The majority of U.S. states have adopted a managed care model, with Mississippi moving to managed care in 2011.

It’s been a busy year for contract reprocurements, with Rhode Island, Kansas, Florida, New Hampshire, Texas, Virginia and Michigan all issuing awards.