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DC Shakes Up Health Care Delivery in Pandemic

In the middle of a deadly global health pandemic, DC Mayor Muriel Bowser’s administration has decided to shake up the city’s system for delivering health care to poor residents who are on Medicaid. Many of them are people of color and are part of the population hardest hit by the novel coronavirus.

Still, Bowser’s team is poised to remove two existing contractors and replace them with CareFirst BlueCross BlueShield Community Health Plan and MedStar Family Choice. They will retain AmeriHealth Caritas District of Columbia Inc. 

If you aren’t a Medicaid client, why should you care?

As much as $1.5 billion of public money will be spent on these three contracts. More than 300,000 individuals could be affected by the change, including at least 60,000 who have been part of what is called a “fee for service” system.

I expect the change, if it comes to fruition, will exacerbate the negative COVID-19 statistics.

Wayne Turnage, deputy mayor for health and human services, doesn’t agree. “The new contracts stabilize the Medicaid program, allowing it to be financially viable, bringing in a population whose care heretofore has been uncoordinated, and with the possibility of  better services and cost savings to the District,” he told me during an interview last week. 

See for yourself. 

People in the traditional Medicaid-managed care programs would be pulled from their existing insurance plans and placed into an open pool. Those classified as “fee for service” would be dumped into that same pool. 

Then, “We are going to distribute everyone equally among the three winners,” explained Turnage. It’s as if the Medicaid patients were chips in a game of poker, or widgets — not people who likely are already concerned about their health care and who have built relationships with their doctors, including medical specialists.

If someone doesn’t like the assignment, that person could request to be moved, Turnage said. In other words, instead of jumping through one hoop during a pandemic, they would need to jump through two. 

“Finding a barber or a hairstylist is hard. Finding someone to take care of your body is even harder,” said Gordon Fletcher, chair of the Ward 5 Democrats and advisory neighborhood commissioner for single-member district 5A08. Fletcher is one of several individuals to have raised concerns about the timing of the Medicaid change. 

Some in the health care community, including clinic directors, are worried about what the switch might mean for their stable of doctors. Equally important, several managed care providers have filed complaints with the DC Contract Appeals Board (CAB) citing irregularities in the procurement process. 

It’s a mess.

“This should not be occurring during a pandemic. For something of this magnitude, sufficient and proper notice was not given,” added Fletcher. 

“I don’t believe everyone understands the potential impact. This is going to be jarring,” said Sydelle Moore, also an ANC member in Ward 5. She has written a letter to Ward 5 DC Council member Kenyan McDuffie.

“This has the potential to be disastrous for the mayor if it doesn’t turn out well,” said one longtime leader in the health care community who requested anonymity.

The new managed care organization (MCO) contracts were sent on July 20 to the DC Council for approval — just as the legislature was in the middle of heated debates about the 2021 budget. The Committee on Health, chaired by Ward 7’s Vincent C. Gray, is expected to discuss the issue at an oversight roundtable Wednesday. However, if a disapproval resolution is not filed before July 30, the contracts will be deemed approved. 

Raise your hand if you think putting the squeeze on the council was deliberate.

To be fair, not everyone is dissatisfied with the changes. Tamara Smith, executive director of the DC Primary Care Association, applauded Bowser and Turnage. “It is a big change. [But] we believe conditions have been put in place to protect the beneficiaries and providers.”

Still, knowing the ferocity of COVID-19, why would the government choose to move now? Money and politics. 

“We can’t have a managed care program if the structure is driving one or more [of the companies] into insolvency,” said Turnage. 

“The other part is trying to deal with the enormous challenge of improving health outcomes for people not in managed care,” continued Turnage, noting that those individuals “typically have a disorganized relationship with the health care system,” are among “the sickest,” and thus are some of the most costly to serve.

Medicaid’s fee-for-service patients often choose their own health providers, who submit invoices directly to the DC government. There is no third party to filter requests for payments or deny claims for whatever reasons. So, when a doctor sends a bill, the government normally pays it. 

Under the proposed changes, that would end. MCOs would handle payment requests. They could also do what some insurance companies do: deny claims. That could leave either doctors or patients fighting over the costs of their health care and the quality of those services. It could also result in some doctors becoming frustrated with the process and deciding not to accept Medicaid. In DC, there is a long line of physicians who have walked away. Residents — poor residents — ultimately are the ones who have suffered.

Turnage said the new contracts include so-called “universal” language that would require each MCO to enter into signed agreements with every hospital and community clinic or facility in DC. Anyone who fails to follow the terms of the agreement could be kicked out.

Wait, wait. That happened once before, according to current contractors, including one that has filed a protest with the CAB.

In 2013, when the District implemented another procurement for Medicaid MCOs, MedStar Choice was one of the winners; it had a contract for nearly four years. During that period, instead of working collaboratively with other MCOs and hospitals, MedStar Choice entered into an agreement only with AmeriHealth. Then MedStar would only route patients needing specialty care to one of its hospitals, according to government sources and individuals in the health care community. 

That maneuver caused a drop in clients for Amerigroup and Trusted Health Plan, increasing their risks and jeopardizing their financial health. On the other hand, MedStar Choice, which denied over 100,000 clients from using other facilities or MCOs, saw a 54% growth in four years, according to health care officials. After being challenged about the way it was doing business, MedStar left the program in 2017. 

“It did have a negative impact on the program,” confirmed Turnage. 

However, Turnage said MedStar presented “one of the best plans that has been selected” this time around. “We cannot not give a contract because we are mad at what they did in the past,” he added.


Contracts often include past-performance clauses. Shouldn’t there be consequences for manipulating poor DC residents in order to increase a company’s bottom line? 

The city ended up paying more for health care than it should have. Instead of imposing any punishment, DC is handing out a multimillion-dollar contract as a reward.

Turnage said he is prepared to move forward, despite the issue involving MedStar and questions about whether the District was right to grant CareFirst BlueCross BlueShield certified business enterprise preference points, which are reserved for local, minority-owned for profit companies. (CareFirst recently acquired DC-based Trusted Health Care.)

The CAB, which is reviewing the various protests, could rule that the administration must restart the procurement process. “We will do whatever the CAB tells us,” Turnage told me, acknowledging that one result could be that Medicaid clients would have to jump through three hoops.

I respect Turnage’s record of accomplishments, but his approach this time makes no sense. 

Three council members could file a disapproval resolution, slowing down the process and demanding the mayor and her team wait for the CAB’s ruling. The legislature could also push Bowser and Turnage to revise the District’s existing contract with the current group of MCOs, extending those agreements for three to six months or until the city is on the other side of the coronavirus pandemic.

Don’t count on any of that. This is all wrapped in heavy politics. 

In the Health Committee’s notice for its roundtable, Gray noted that DC’s Medicaid program has made it difficult for residents to use “their insurance in all hospitals throughout the District. … There [also] has been a lack of health care services in Ward 7 and 8 that make it harder to effectively utilize health insurance.” He also linked the managed care requirements and the new $300 million hospital at St. Elizabeths East that the council just approved. 

The Bowser administration isn’t simply looking to save money. If MCOs are required to make referrals to hospitals, where cost of care is often higher, that will mean guaranteed income and patients for the operator of the new hospital east of the Anacostia River; that same company also operates George Washington Hospital in Foggy Bottom. 

Don’t forget that MedStar runs Georgetown University Hospital and Washington Hospital Center. And the city just agreed to a huge tax abatement to help Howard University build its new facility to squash its opposition to the St. Elizabeths project. 

All mouths are fed.

Gray desperately wants that new hospital as part of his legacy. He may be prepared to turn a blind eye to all these health care shenanigans. Who really cares that there is a pandemic or that the people everyone claims they want to help may be the ones most harmed?

This article was previously published at

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