A top Aetna executive on Tuesday apologized for the company’s failure to meet the terms of its contract for administering the state’s privatized Medicaid program.
“As the leader of our business, I take full accountability for where we are,” said Randy Hyun, chief executive officer of Aetna Medicaid.
“I want to apologize for not living up to the expectations I’ve had for our plan,” he told a committee that oversees the state’s Medicaid program known as KanCare.
“We preach operational excellence and certainly have not demonstrated that to you,” Hyun said. “That has happened under my watch and I am accountable for it, and I am also accountable, most importantly, for fixing it.”
Late last month, state health regulators warned Aetna that it was at risk of losing the state’s business if it does not comply with the terms of its contract.
The state demanded that Aetna submit a plan for remedying the problems, including the lack of a robust network of health care providers for Medicaid beneficiaries.
The Kansas Department of Health and Environment rejected the first corrective action plan and is expected to start reviewing the second one submitted by the company this week.
“We feel good about what we’ve proposed, and we’ll wait for feedback and we’ll go from there,” Hyun said.
“Just because we’re waiting for feedback doesn’t mean we’re not already acting on our plan. Clearly, there are major issues that we know we have to address, and we have already started to do that.”
Hyun said Aetna has been confronted with contractual problems for some time. He said some issues are closer to being resolved than others.
Among other things, Hyun shook up the management team in Kansas, installing a new acting chief executive officer for Aetna Better Health of Kansas. He also put in place a new chief operating officer.
The company has brought in new personnel from other states to help address the issues that the state wants fixed.
“We’ve asked many of our other folks in other states to join us here in Kansas and stay here until we are able to resolve the issues that we’re going to fix,” he said.
Adam Proffitt, the state’s Medicaid director, told the committee the state has been engaged nearly daily with Aetna’s new management team. He suggested that progress is being made.
He said he expects Aetna’s new corrective action plan will provide more detail and accountability that was absent in the first plan that the state rejected.
He believes the new plan will provide the detail the state wants to ensure that Aetna comes into compliance for the long term.
“The burden of proof, though, is going to be on them to make sure they follow through on that,” Proffitt told lawmakers.
“I’ve been encouraged with the conversations that we’ve had so far with their new leadership team. They seem to be identifying issues and giving the right answers, but the burden of proof is going to be on Aetna to bring themselves into compliance.”
Proffitt said there was no specific date for Aetna to comply with the terms of its contract. He said some problems are easier to address than others.
“We will not let this drag on for years. We expect a quick turnaround,” he said. “But we also want to make sure that what is coming to us and what they are doing is going to be a long-term solve.”
Republican State Rep. Brenda Landwehr of Wichita questioned why the state wasn’t establishing a hard deadline for Aetna to comply.
“This isn’t their first rodeo in states with managed care for Medicaid,” Landwehr said. “I don’t understand what their problems are.”
While Aetna may be replacing management, Landwehr said company executives were not necessarily directly involved in the problems that occurred.
“How deep and how far do we know that these changes are going, and why were they not happening before?” she said.
Proffitt said it was premature to set a hard deadline for compliance until the state and its experts get a chance to review the latest correction.
During the two-day hearing, lawmakers heard complaints about Aetna, including one provider who called the process of working with the company nothing but “utter chaos and confusion.” Some providers have complained about difficulties in getting credentialed with Aetna and claims not getting paid.
“I have heard – and personally experienced – from countless behavioral health providers in our area that Aetna Medicaid has considerable delays in credentialing, incorrect or no reimbursement at all for services rendered and no response to or inaccurate responses to inquiries providers make,” said Jenna Krehbiel, owner of a mental health clinic in Salina.
Aetna, which serves about 100,000 beneficiaries in Kansas, was awarded one of the state’s three managed-care contracts last year. It replaced Amerigroup, which unsuccessfully sued when it lost out in the bidding.
Aetna, along with Sunflower Health Plan and UnitedHealthcare, provide managed-care services under KanCare, the state’s $3 billion privatized Medicaid program serving about 400,000 Kansans.
Aetna has the fewest number of beneficiaries of any of the KanCare managed-care companies. UnitedHealthcare and Sunflower serve about 280,000 beneficiaries combined.
