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[MM Curator Summary]: The loss stings, but new(ish) CEO London assures shareholders that there is robust lesson-learning happening.
Centene’s headquarters in Clayton.
Dilip Vishwanat | SLBJ
Clayton-based Centene Corp. (NYSE: CNC) has lost out on a lucrative contract for a new managed care program in Indiana.
The Indiana Department of Administration recommended on March 1 that negotiations begin with four bidders to provide services so Medicaid recipients over the age of 60 can continue to live in their homes.
Those companies are Anthem Blue Cross and Blue Shield, Humana Healthy Horizons in Indiana, Molina Healthcare of Indiana and UnitedHealthcare Community Plan. A wholly-owned subsidiary of Clayton-based Centene, Managed Health Services, was not chosen, along with CareSource Indiana and MDWise Inc.
The estimated value for the four-year contracts is $3.8 billion for each of the companies chosen through a request for proposal, which the state of Indiana issued in February 2022. Managed Health Services ranked fifth in the final RFP score to provide long-term services and supports, referred to as LTSS.
The outcome is the latest in a series of ups and downs in the post-CEO Michael Neidorff era. In late December, Centene won back two big-ticket Medicaid contracts in California after filing appeals. A California state agency scrapped an RFP and issued direct contacts with Centene’s subsidiary to serve Medicaid enrollees in Los Angeles County – with a 50% subcontract to Molina Healthcare of California – as well as in Sacramento and eight other counties.
A few weeks earlier, the U.S. Department of Defense on Thursday bypassed Centene in awarding $136 billion in contracts for the health insurance provided to active-duty military members, a blow to Centene, which long held some of the work.
Centene’s current CEO, Sarah London, was asked Tuesday at the Barclays Global Healthcare Conference about the RFP pipeline this year.
“The recent Indiana LTSS result was certainly not what we were looking for,” said London. “But I will say that the organization across all lines of business has an increased discipline around looking at where things don’t always go the way we want them to and pulling out valuable lessons learned.”
Centene CEO Sarah London
The new program, Indiana Pathways for Aging, is scheduled to launch in the summer of 2024, according to a spokesperson for the Indiana Family and Social Services Administration.
Managed Health Services is a managed care entity that has operated in Indiana for about 25 years through the Hoosier Healthwise and Hoosier Care Connect Medicaid programs and the Healthy Indiana Medicaid alternative program. MHS also offers a Medicare Advantage plan and health plans through the Affordable Care Act marketplace in Indiana.