Aetna lost out in the bidding for the state’s new Medicaid contract after it deadlocked in scoring with a coalition that included Blue Cross and Blue Shield of Kansas and Blue Cross and Blue Shield of Kansas City, new documents show.
Aetna and the Blue Cross team – known as Healthy Blue – were tied in the scoring after a group of 20 evaluators rated the proposals made by seven bidders.
Healthy Blue made the final cut along with two incumbent managed care companies, Sunflower Health Plan and UnitedHealthcare. The contracts run from this Jan. 1 to the end of 2027.
Aetna, which struggled meeting state contractual demands administering the program in 2019, didn’t get the contract along with Molina Healthcare of Kansas, UCare Kansas and CareSource.
Aetna ultimately lost out despite the tie because it didn’t score as well in some key areas, including its provider network – something that was considered a key metric in deciding who would get the contract.
The companies not getting the contract have 30 days to file a protest with the state from the date the award was made. It remains to be seen whether a protest will be lodged, although one is anticipated to be filed.
Aetna could not be reached immediately for comment Thursday morning about the scoring, although the company said Tuesday that it was evaluating its options.
“We’re disappointed with the decision given the strength of our proposal and the excellent support we provide to our members in the state,” Aetna spokesperson Alex Kepnes said after the selections were announced Tuesday.
Most of the other companies that lost out in the bidding have not returned emails seeking comment.
New documents released this week showed that Sunflower and United led the scoring among the seven bidders seeking to administer a $4 billion program that provides health coverage for roughly 450,000 less-affluent Kansans.
Sunflower led the way with 729.25 points out of 1,000 points available. They were followed by United with 683.25 points. Aetna and Healthy Blue were tied at 522.
The state rejected Aetna because there were important differences in the two proposals, namely the provider network, a state document shows.
The provider network metric is one of the most complex and recipient-critical criteria on which the applicants were evaluated, according to the award document.
It involves tightly written regulations from the federal government with which the state must comply to guide delivery of services and assurance of provider and consumer satisfaction, the document says.
“Healthy Blue presented the strongest provider network response and ranked first in scoring,” the award document said, alluding to the rating for that topic area.
Molina Healthcare of Kansas, UCare Kansas and CareSource trailed the four leaders in scoring.
CareSource, an Ohio-based managed care nonprofit, that teamed up with Kansas groups that advocate for children, mental health and Kansans with intellectual disabilities, came in fifth in the scoring with 504.5 points.
Molina, founded in 1980 as a provider organization serving low-income families in Southern California and reincorporated in Delaware in 2002, finished sixth with 397.5 points.
The company served about 5.3 million members across 19 states at the end of 2022. The company said it was successful in every request for proposal it responded to in 2022.
And last in scoring was UCare, an independent, nonprofit health plan based in Minnesota that reported serving more than 659,000 members in 2022.
UCare received 308.75 points, state documents show.
Here’s a link for all the bidding documents, including all of the proposals submitted by the seven companies seeking the state’s managed care contract.
The state developed a scoring system for the bidders’ responses to 36 technical questions used to evaluate their proposals.
The state determined the maximum number points available for each technical question, ranging from five to one.
A score of five meant bidders received all the points possible, a score of four meant they received 75% of the available points, a three meant they received half the available points and a two meant they received 25% of the points.
A score of one meant the bidders received no points.
For example, if the maximum number of potential points available for a technical question was 50 points and a bidder received a rating of a four for its response to a question, the bidder received 75%, or 37.5 points, for that question.
The bidders were evaluated in seven major topic areas, including their experience and qualifications, member experience, their provider network, quality assurance and how they would respond to hypothetical case situations.
In evaluating the differences between Aetna and Healthy Blue, the scoring document noted that Healthy Blue fared better in the topic areas that were evaluated, according to the state document showing how the contract was decided.
For instance, Healthy Blue scored higher than Aetna in five of the seven areas that were evaluated, including experience and qualifications, member experience, the provider network and their responses to the hypothetical case questions.
By comparison, Aetna scored higher than Healthy Blue in just two of the seven areas, including quality assurance, according to the scoring report.
Further, Aetna had eight responses rated a two and one that rated a one. Healthy Blue had seven responses that rated a two and none that dipped as low as a one.
On the critical question of the provider network, Healthy Blue had the highest score of any bidder, receiving 102.5 of the 145 points available for that topic.
Aetna received 80 points for that topic area, ranking it fourth among the seven bidders seeking the Medicaid contract.
Sunflower and UnitedHealth also ranked higher than Aetna in this category.
The scoring document indicates that Aetna came up short in various areas when addressing the provider network.
The document said that Aetna had “minimally acceptable” responses to ensure member access to nonemergency medical transportation
It said the company didn’t fully describe how it would ensure timely access to quality dental care in all areas of the state.
It said the company had a “weak response” for recruiting Medicaid providers, and that its responses related to a provider directory were “minimally acceptable.”
The scoring document also noted that Aetna had a history of having unresolved issues for extended periods of time, an issue widely reported after the company won the state’s Medicaid contract in 2018.
During the summer of 2019, the Kansas Department of Health and Environment notified Aetna that it wasn’t meeting its contractual commitments.
The letter warned Aetna that failure to correct the issue will lead to the termination of its contract.
A top Aetna executive eventually apologized to state lawmakers for the company’s failure to meet the terms of its contract for administering the state’s privatized Medicaid program.
The State established four evaluation committees responsible for reviewing and evaluating
bidders’ responses to the technical questions in the requests for proposal.
Each evaluation committee was made up of five individuals who collectively offered experience and expertise related to the subject matter.
The committees were comprised of staff from the Kansas Department of Health and Environment and the Kansas Department for Aging and Disability Services.
Everyone involved in the evaluating the bids signed a nondisclosure/conflict of interest agreement promising confidentiality and attesting that they had no real nor apparent conflict of interest in the request for proposal.
