Largest provider saw record penalty
Our newsletter tends to focus on property insurance but this was a story of note that we ran across recently about Florida’s $28.3 billion Medicaid program. The state Agency for Healthcare Administration (AHCA) has assessed $23.1 million in damages and sanctions against Medicaid managed care plans for violating terms of their contracts for the fiscal year that ended June 30, 2022. Florida’s largest provider, Sunshine State Health Plan was fined a record $9 million by AHCA in March for failing to pay claims for sick children over several months, according to Christine Sexton in Florida Politics. There were more than 121,000 claims from health care providers in which payments from Sunshine were either delayed or not made at all.
The $23.1 million in damages and sanctions is one of the larger amounts assessed by AHCA in recent years and covered 208 final actions against managed care plans. It comes as enrollment in state Medicaid managed care plans has grown to 4.2 million people. Sunshine Health Plan had a total of $11.7 million in damages and sanctions and StayWell Health Plan another $4.9 million in damages and sanctions. Both are owned by Centene Corporation and combined were more penalties than any other health plans for the year.
Florida and other states rely on these Medicaid managed care plans to help control costs. But a growing number of states are questioning the plans and investigating whether they are living up to their state contracts, according to Managed Health Executive, which includes a state-by-state trend analysis.
The Medicaid plans aren’t the only ones facing scrutiny. Private Medicare Advantage plans are also under investigation for similar failings. The U.S. Department of Health and Human Services in May released a report that found Medicare managed care organizations inappropriately deny medically necessary care to tens of thousands of people enrolled in private Medicare Advantage plans every year. The report called for increased enforcement against plans with a pattern of inappropriate denials. Its inspector general concluded that coverage and payment denial prevent patients from receiving necessary care and can unnecessarily burden physicians.
LMA Newsletter of 10-24-22