Kentucky Medicaid lawsuit: UnitedHealthcare accuses Anthem of violating procurement rules – Louisville Business First

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Curator summary

KY MCO contract protests continue, with UHC asking judge to invalidate Molina win and give lives that Anthem lost to UHC.


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UnitedHealthcare of Kentucky Ltd. raises its own allegations of improper hiring of a government official in the legal controversy surrounding the state’s Medicaid contract awards.


One of the two incoming companies to the Kentucky Medicaid program made a bold ask in the legal dispute surrounding how the administration of Kentucky Gov. Andy Beshear awarded its five Medicaid contracts.

In Franklin Circuit Court, UnitedHealthcare of Kentucky Ltd. made a motion before Judge Philip Shepherd on Nov. 4 asking him to eliminate Anthem Kentucky Managed Care Plan Inc. and Molina Healthcare Inc. from participating in the Medicaid program and to reassign their members to UnitedHealthcare.

Specifically, the motion asks Shepherd to modify his Oct. 23 order to enjoin the Kentucky Cabinet for Health and Family Services (CHFS) to eliminate the Medicaid contract Molina Healthcare was awarded in May following an request for proposals process and to assign the members that are covered by Anthem, who did not prevail in the RFP, to UnitedHealthcare.

In his Oct. 23 order, Shepherd ordered the state to allow Anthem to continue participating in the Medicaid program. The order came as part of Anthem’s lawsuit against the state, filed in September, that came after it exhausted an administrative appeal.

Attorneys for the Beshear administration have said in court documents that the state will continue to include Anthem in the Medicaid program — despite claiming that Shepherd overstepped his bounds — to “ensure continuity of care in the Medicaid program and to prevent any potential disruption in the provision of services to Medicaid members.”

In November 2019, the administration of then-Gov. Matt Bevin announced the five winners of an RFP for the Medicaid contracts after Bevin lost the election to Beshear, who rescinded the contracts in December 2019 and announced a new RFP process.

Ultimately, the Beshear administration announced the same RFP winners as the Bevin administration did.

UnitedHealthcare won a contract in both RFPs, while Anthem did not win a contract in either.

Allegations of improper hiring

Anthem claimed in its appeal and lawsuit that the state erred in its scoring methods and for failing to eliminate a successful contract winner, Long Beach, California-based Molina Healthcare, over allegations of improperly hiring former Beshear CHFS transition team co-chair Emily Parento.

UnitedHealthcare argues that Shepherd’s order making Anthem a sixth Medicaid company violates state law and the terms of the state’s RFP. Further, the company argues that allowing Anthem to remain within the Medicaid program wouldn’t leave enough Medicaid members for UnitedHealthcare to run a viable business.

“UnitedHealthcare has been selected twice to serve the Medicaid population in Kentucky,” UnitedHealthcare spokeswoman Catherine Witz said in an email. “We respect the judge and his ruling, but we must ensure a fair and transparent procurement process.”