Questions surround performance of state’s Medicaid contractors, each a contributor to governor, Republican party

July 10, 2017

A company that won a share of Nebraska’s state Medicaid managed care business donated at least $23,500 to Gov. Pete Ricketts’ campaign fund between 2014 and this year.

Nebraska Total Care, which is part of St. Louis-based Centene Corp., was one of three companies to win the Heritage Health managed care contract for a share of 230,000 Medicaid clients. UnitedHealthcare and WellCare of Nebraska began operating managed care with Nebraska Total Care in January.

Those other contractors have also contributed to the governor’s campaign committee, according to the Nebraska Accountability and Disclosure Commission, but not as much. UnitedHealth Group contributed a total of $12,000 in 2015 and 2016. WellCare Health Plans contributed about $2,000 total to Ricketts in 2016 and 2017, according to reports.

Aetna Inc., which originally was tapped to be a contractor but was later replaced, contributed about $10,000 to Ricketts in 2014 and 2015, and gave $10,000 to gubernatorial candidate Bryan Slone in 2014.

The contractors also have contributed money to lawmakers, and thousands of dollars to the Nebraska Republican Party. Their support for politicians extends across the country.

In Nebraska, Ricketts spokesman Taylor Gage says the governor’s office doesn’t play a role in selecting vendors for Heritage Health, the name for the state’s Medicaid managed care program, or managing their performance. The Department of Health and Human Services oversees the program.

“HHS is tasked with choosing the best vendors to deliver services for their customers,” Gage said.

Heritage Health is a health care delivery system that combines Nebraska’s physical health, behavioral health, and pharmacy programs into a single comprehensive and coordinated system for Nebraska’s Medicaid and Children’s Health Insurance clients. Each client chooses and enrolls in one of the networks.

Just five months after it began operations, Centene’s Nebraska Total Care, with nearly 76,000 members, received a notice of serious deficiencies from the state Medicaid division because specific concerns of providers were not adequately addressed, including not paying them in a timely manner.

Attempts to reach Ryan Sadler, CEO and plan president at Nebraska Total Care, were unsuccessful.

Department of Health and Human Services spokeswoman Kathie Osterman said the division has received a corrective action plan from the company and is reviewing it.

Centene, a Fortune 500 firm, has a simple business model for its booming future based on cost control, according to a 2012 article in the St. Louis Post-Dispatch. “Save the states between 5 percent and 8 percent of the cost to care for their poorest, sickest and youngest patients — and pocket a piece of the difference.”

To help get those deals with states, the article said, Centene fields an army of lobbyists with a war chest for political and charitable donations.

Because of concerns by Medicaid providers, voiced at a recent hearing of the Legislature’s Health and Human Services Committee, Lincoln Sen. Kate Bolz sent a letter July 5 to Ricketts, members of the Legislature and state Interim Medicaid Director Rocky Thompson asking for information on several of those complaints.

“I have heard numerous concerns from both constituents and health care providers regarding unpaid claims, network adequacy and service denials,” wrote Bolz, who is also the executive director of the Nebraska Association of Service Providers.

Since the hearing on June 27, she has gotten even more phone calls and emails raising concerns about the state’s Heritage Health program, she said.

She is asking what expectations the federal Medicaid program has for the network and for the most recent analysis or data being used to monitor, track or assess Heritage Health. She also wants to know what strategies and reforms are ensuring appropriate and timely reimbursement of providers, and how unpaid claims are being addressed.

Bolz also asked about grievance procedures and data for service denials, including denials concerning medications and therapies.

After the hearing, Sen. Sue Crawford of Bellevue said it was clear that the problems within Heritage Health go beyond what should be expected and have become a serious threat to the state’s health care coverage.

While Nebraska Total Care has been singled out for deficiencies, all three managed care contractors have had troubles in Nebraska and elsewhere.

WellCare Health Plans, based in Tampa, Florida, paid $137.5 million to the federal government to settle claims that it overcharged for its Medicare and Medicaid programs.

California imposed $173 million in penalties in 2014 against United Healthcare and the federal government issued a $2.5 million civil penalty against that company this year for not complying with certain Medicare rules that resulted in higher out-of-pocket costs to beneficiaries and denials and delays in accessing services, according to reports.

Crawford, who is on the Health and Human Services Committee, said she was going to talk with Chairman Merv Riepe to arrange for quarterly oversight meetings to ask Thompson and the managed care organizations more questions and get more answers on the public record.