DCH set to award insurance contract to Blue Cross

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Blue Cross Blue Shield of Georgia is in line to snag the contract for administering the State Health Benefits Plan, the $3 billion program that provides health insurance coverage for more than 600,000 teachers, state employees and retirees.

The Department of Community Health (DCH) released official notice Wednesday that it intends to award the contract to Blue Cross Blue Shield, which won out over United HealthCare, Aetna, and Cigna.

If the contract award is finalized, Blue Cross Blue Shield would replace the current administrators Cigna and United Healthcare.

DCH said it has chosen Express Scripts Inc. as the plan’s pharmacy benefits manager. The losing bidders were OptumRx, Caremark PCS Health, Catamaran PBM of Maryland, Cigna, and Blue Cross Blue Shield.

The agency intends to award the contract for wellness programs to HealthWays. The other contenders were the Kaiser Foundation, Optum Health, Blue Cross Blue Shield, Cigna, Humana and Active Health Management.

Attorneys for United HealthCare have filed a formal protest of DCH’s intent to award the management contract to Blue Cross and have accused the agency of conducting a “secret procurement” process that excluded United.

“In what has to be one of the most egregious examples of a State entity acting outside the boundaries of Georgia procurement law, the Department of Community Health, through its consultant Aon Hewitt, is conducting a secret, hidden procurement for one or more 2014 health insurance plan contracts,” the protest states.

“This is no way to run any public procurement, not to mention one that is so critical to a significant plurality of the residents of our State,” the United protest states. “When an agency ‘goes rogue,’ it is the duty of the agency’s Commissioner and other executive branch agencies with express authority to retake the control that should have been exercised previously.”

DCH released this response from Commissioner Clyde Reese:

Since February 2013 the State Health Benefit Plan completed two independent projects to identify health plan options for the State Health Benefit Plan members.

The first project, initiated on February 11, 2013, was intended to procure statewide vendors to offer health plan, pharmacy and wellness options. The validity of the first project will be determined following the conclusion of the Notice of Intent to Award period.

I have completed my review of the second State Health Benefit Plan project. The purpose of the May 28, 2013, project was to solicit a response from a regional vendor. I have determined that the process used in the second project was not properly inclusive. It is prudent to take the following steps:

  • The Department of Community Health will issue a letter to the Attorney General’s Office requesting guidance
  • The Department of Community Health will be developing an alternative approach to solicit responses from vendors to provide health plan options within specified regions of the state

© 2013 by The Georgia Report

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Tags: Blue Cross Blue Shield , DCH , State Health Benefits Plan , United HealthCare