NC judge keeps in place Medicaid managed care awards

February 19, 2021 GMT

RALEIGH, N.C. (AP) — A trial court judge said Thursday that he’ll leave in place another judge’s decision that rejected arguments from an unsuccessful bidder for North Carolina’s upcoming managed-care initiative for Medicaid.

Wake Superior Court Judge Michael O’Foghludha said at the close of online arguments that he would uphold an administrative law judge’s previous decision affirming how the Department of Health and Human Services conducted the process that led to contract awards in 2019.

Four conventional insurers and one physician partnership received the awards, for which the cumulative contract values could reach $6 billion annually. After many delays, the managed-care program is supposed to go live in July, covering 1.6 million Medicaid consumers.


The group “My Health by Health Providers” — composed of 12 local hospital systems and a New Mexico-based insurer — contends the DHHS process was flawed and biased against provider-led organizations like My Health. The group also said conflicts of interest were present.

Other losing bidders also formally opposed the DHHS decision.

O’Foghludha, who plans to sign a formal order later, said from the bench that Administrative Law Judge Tenisha Jacobs correctly followed the proper standards in examining whether how DHHS gave the awards substantially prejudiced My Health.

O’Foghludha suggested a further appeal by the losing side may be ahead: “I’m certain that my word is not going to be the final word on this.”

My Health CEO Lisa Farrell said late Thursday the group still believes the General Assembly, which first approved the Medicaid managed care in 2015, intended for all North Carolinians to have the choice “to have their health care managed by provider-led entities led by North Carolina health care providers — not only large commercial insurers.”

Under managed care, the state Medicaid program will move from a traditional fee-for-service model to one in which organizations receive fixed monthly payments for every patient its providers see and treat.