The D.C. government violated procurement laws when it awarded three of its largest contracts this summer — totaling $1.5 billion for three companies to manage health care for Medicaid recipients, a D.C. Contract Appeals Board judge ruled.

 

The city must reassess the contracts that govern which insurance plans are available to hundreds of thousands of poor Washingtonians, Judge Nicholas A. Majett said in his order. The decision could mean tens of thousands are forced to change health plans, some for the second time in a year.

Deputy Mayor for Health and Human Services Wayne Turnage said in an interview Wednesday that he would seek a solution that would allow as many beneficiaries to keep their current health plans as possible: “The goal of the administration is to make sure that we do not have to move the beneficiaries yet again. We will do all that we can to prevent that from happening, and I believe we will be successful.”

 

 

Majett ruled that all beneficiaries may stay on their current plans through the end of September 2021.

The administration of D.C. Mayor Muriel E. Bowser (D) decided earlier this year to move a larger number of Medicaid recipients in the city onto what is known as a managed-care plan, where a private insurance company provides health insurance to Medicaid recipients.

Three providers won contracts to offer those plans: MedStar, AmeriHealth and CareFirst. Amerigroup, a company that previously provided managed-care plans for the city but lost out on this bid, challenged the decision.

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Majett ruled in Amerigroup’s favor this month, with Chief Administrative Judge Marc D. Loud Sr. concurring. The Dec. 1 ruling was unsealed Tuesday.

 

Under District procurement law, companies that bid on city contracts are scored on a point system. Of the seven companies that bid on the Medicaid contract, according to Majett’s ruling, the three contract recipients scored the highest, followed by Amerigroup.

 

But Majett found that MedStar did not include information about its leadership that was supposed to be in its bid, and that the company submitted performance evaluations pertaining to two previous contracts when it should have submitted three.

MedStar should have scored lower under the law, and Amerigroup should have scored higher, Majett wrote, concluding that Amerigroup was judged more harshly than MedStar for weaknesses in its responses.

 

Turnage said Wednesday that the Department of Health Care Finance would respond to the ruling. Asked whether he would consider keeping just two providers, AmeriHealth and CareFirst, given the judge’s finding that MedStar was unfairly ranked, Turnage said, “I don’t want to speak in hypotheticals.”

The lucrative Medicaid contracts have been overturned in similar fashion before, most recently in 2017.

 

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