MS- Division of Medicaid to contract with nonprofit backed by state hospitals to administer benefits

MM Curator summary

[MM Curator Summary]: More info on the recent CareSource win in MS and the partnership with TrueCare.


The article below has been highlighted and summarized by our research team. It is provided here for member convenience as part of our Curator service.




JACKSON • The state Division of Medicaid will award a new contract for managing insurance benefits for Mississippi’s most vulnerable citizens to a not-for-profit backed by some in-state hospitals and two other private organizations.

The division said in a press release on Wednesday that it intends to award TrueCare, Magnolia Health and Molina Healthcare with the lucrative contracts for administering Medcaid’s managed care system, called MississippiCAN, and the Children’s Health Insurance Program.

Two state agencies investigated Magnolia Health, the Mississippi subsidiary of health giant Centene, over allegations tied to pharmacy benefit managers. 

TrueCare is a not-for-profit formed by some private hospitals and the Mississippi Hospital Association over their belief that in-state hospitals can provide better services to patients, which is different from a traditional managed care organization.

To manage the benefits, TrueCare partnered with CareSource Management Services, an Ohio-based managed care operation. CareSource will manage the day-to-day operations and TrueCare will provide “local expertise and oversight,” according to TrueCare’s proposal it submitted to the division.

“Our mission is to ensure Mississippians can easily access their benefits to live healthier lives, while prudently managing state resources,” the proposal reads.

The organizations who submitted applications to the Division of Medicaid are still technically under procurement rules that require them to be silent, meaning entities are limited in what they can publicly say.

Senate Public Health Chairman Hob Bryan told the Daily Journal he thinks that having a not-for-profit and traditional managed care organizations managing Medicaid benefits in the state at the same time will be a “great controlled experiment.”

“I think this is a great opportunity,” said Bryan, D-Amory. “The Hospital Association for years has said they can do a better job of providing these benefits. Well, here’s their chance to prove it.”

Mississippi’s Medicaid managed care system provides health insurance benefits for about 480,000 poor adults and children, disabled people, pregnant women, and others.

The Division of Medicaid pays managed care organizations a set rate per patient to administer those benefits.

The other two organizations who are set to receive contacts — Molina and Magnolia — are for-profit managed care entities who are also currently administering portions of the state’s Medicaid benefits.

Another surprising development from the division’s announcement was that United Healthcare, a managed care firm who was already administering part of the state’s Medicaid benefits, was not awarded any contract.

Groups have seven calendar days to protest the division’s decisions on who should receive contracts, but it’s unclear if any organizations who submitted proposals intend to file a protest petition.

After the protest period lapses, the contracts will go before the state’s procurement review board for approval.

The division’s decision comes at a time when traditional managed care organizations have come under scrutiny by some physicians, independent pharmacists and lawmakers.

Hospitals leaders and independent pharmacists have criticized managed care firms and PBMs for putting profits ahead of patient services. But managed care organizations largely contend that they’ve accomplished their goal of controlling the state’s fluctuating Medicaid costs.

State Auditor Shad White inked an agreement in April 2019 with Ridgeland-based law firm Liston and Deas to help investigate if Magnolia Health, the Mississippi subsidiary of health giant Centene, was over-inflating its bills to the state Medicaid division, as previously reported by the Daily Journal.

The investigation by the outside attorneys, White and Attorney General Lynn Fitch centered on one portion of the managed care system: pharmacy benefit managers.

These subcontractors, known as PBMs, serve as middlemen between insurance companies, drugmakers and pharmacies. They manage drug benefits, negotiate drug prices and reimburse pharmacists on behalf of companies.

Centene settled with the state in June 2021 for $55.5 million. The company did not admit any wrongdoing in the agreement, and the state said the company was providing quality health services.

The settlement, though, hasn’t stopped White’s office from continuing to examine the billing practices of PBMs. White’s office in March signed an agreement with data analytics firm Intelaform Services to collect and analyze a wide breadth of data involving PBMs that do business with the state.

The contract between White and Intelaform authorizes the private firm to investigate and analyze data generated by PBMs, pharmacy benefit administrators and managed care organizations that conduct business with state agencies — a wide scope of data.

The new contracts come at a time when the House and Senate Insurance Committees are set to convene a hearing on Aug. 29 to examine PMBs and the state’s insurance plan.


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