As a backdrop to the budget deliberations expected to begin this week in the DC Council, a fight has ensued between several legislators, Mayor Muriel Bowser and her deputy for health and human services, Wayne Turnage. The executive included in her proposed 2022 Budget Support Act a section entitled Department of Health Care Finance Support Act. That measure is purposefully intended to circumvent a ruling by the DC Contract Appeals Board (CAB) involving not one but two Medicaid contracts; the most significant of them was the $1.5 billion managed care contract involving among other companies MedStar Family Choice Inc.
Meanwhile, three legislators—Chairman Phil Mendelson, Chairman Pro Tempore Kenyan McDuffie, and At-large Council member Robert White, who oversees the Office of Contracting and Procurement—have introduced “Fidelity in Compliance of Contracting and Procurement Temporary Amendment Act of 2021."
As written, it would “amend, on a temporary basis, the Procurement Practices Reform Act of 2010 to require compliance with contracting and procurement law as ordered by the Contract Appeals Board and to mitigate the impact and disruption to District residents because of non-timely or noncompliance of ordered reevaluations.”
Further, it requires the executive to “complete the reevaluation as outlined and mandated by the Contract Appeals Board case [CAB No. P-1128] no later than June 30, 2021.” The bill also mandates maintenance of “agreements to provide Medicaid services with no fewer than three managed care organizations at any given time.”
Council members hope to get the legislation passed as an emergency on Tuesday (June 1).
Mendelson said he wasn’t sure of the vote count when I spoke with him over the weekend—although he mentioned that during a staff only meeting the discussion was quite animated. He said that while Turnage “has a good reputation with council members, one of his challenges is that only a couple of years ago he was telling us how horrible MedStar.
“Now, MedStar is the preferred candidate,” added Mendelson.
“Judge [Nicholas] Majett [of the CAB] ruled in December 2020 that OCP violated District procurement laws and the terms of its own solicitation in the Medicaid contract process.,” said McDuffie in an email to me. “The emergency legislation simply requires the mayor to follow the CAB ruling and limits possible disruption to Medicaid beneficiaries, who are some our city’s most vulnerable residents.”
That CAB ruling came after Amerigroup—one of the existing MCOs—filed a series of complaints. In another Medicaid-related case, the CAB found the city violated the law that requires contractors to provide minority subcontracting plans at the time of submitting their bids. Since MedStar had not provided such a plan, it essentially meant the company was potentially out of the MCO competition.
Earlier this year, the Bowser administration introduced the Health Finance Support Act using the normal legislative process. The council’s Committee on Health held a public hearing in April. It appeared, then, that the mayor and Turnage might not have the votes.
Placing the measure in the Budget Support Act (BSA) gave them better odds. More important, it circumvented McDuffie’s committee which was next in line to hold a hearing. It was likely the bill would not make it out of the Committee on Business and Economic Development.
Consequently, it wouldn’t matter if the health committee favored it, the proposal would not make it before the council. On the other hand, the BSA is voted on by the full legislature.
Like council members and others, I had a favorable opinion of Turnage. That was before this managed care debacle, which began during the opening chapters of the coronavirus pandemic. Despite the adverse conditions, he insisted the city renegotiate its new managed contract and shift more than 200,000 low-income or disabled residents from their existing health care providers.
Then, he and the Office of Contracting and Procurement violated city laws, rules and regulations, including providing preferential Certified Business Enterprise points to a national company that was not located in DC. MedStar Family Choice didn’t even submit a minority contracting plan as required by law.
Turnage has created a mess. Instead of cleaning it up, things have simply become far worse. And still, he won’t do the right thing.
The mayor seems to have his back, which means she also won’t do the right thing. All of this is happening as the she pontificates about being determined to provide equity for small businesses, especially those owned by women and people of color. Amerigroup is operated by a Black woman—a woman who once worked with Turnage.
Turnage has mounted an aggressive campaign to halt the emergency measure, writing to Gray and other members of the Committee on Health. Typical of Turnage’s behavior throughout this entire affair, his correspondence is misleading and a case study in government operatic.
He said the measure would “Abruptly and imperiously terminate the process for three competitive procurements at the Department of Health Care Finance (DHCF).”
It does not. As is evidenced, the bill requires the agency follow the CAB ruling and the city’s procurement law.
Turnage also asserted the legislation would “Mandate that DHCF retain three managed care plans in the Medicaid program by adding a replacement health plan, Amerigroup DC (Amerigroup), as a substitute for MedStar which, as noted above, would be removed by the early termination of the procurement process.”
I feel as if someone has dropped me in former President Donald Trump’s world.
In fact, the Mendelson-McDuffie-White proposal does not predetermine the outcome of the re-evaluation. It states quite clearly that three plans must be maintained; that is based on Turnage’s argument last year that three companies would be needed to adequately provide health care to the city’s most vulnerable residents.
Legislators are smart enough to understand identifying a specific contractor in legislation would be blatant steering. On the other hand, Turnage has said publicly and on multiple occasions that if he is made to conduct the reevaluation, as ruled by the CAB, and MedStar is knocked out of the competition, he will not select Amerigroup, even if it has the next best score.
Did someone hear the word lawsuit? It certainly sounds like the Bowser administration has given Amerigroup the grounds for filing one.
Recounting the costs of the programs affected by the botched procurement partially overseen by him, Turnage also argued that “It is essential that the District retain a reputation for fairness in its procurement process.” He also said, “the most pernicious consequence that would attach to the passage and subsequent compliance with this bill concerns the impact on the Medicaid and Alliance enrollees.”
The fact is, Turnage, with Mayor Bowser’s blessing, has already upset the health care of tens of thousands of vulnerable residents. Consider these statistics from the MCAC Enrollment Report - March 2021.pdf (dc.gov).
In October 2020, when the new MCO contract went into effect, there were a total of 275,062 Medicaid recipients. By February 2021, that number increased to 276,925.
Initially, CareFirst BlueCross BlueShield Community Health Plan of DC had 69,462 or 32% of the total 275,062 clients; MedStar Family Choice Inc. had 69,462 patients, also 32% of the total; and AmeriHealth Caritas District of Columbia Inc. had 75,421 customers or 35% of the total.
Interestingly, by February 2021, those numbers were drastically different. The total increased to 276,925 recipients. CareFirst had only 59,671 on its rolls, however. The number of clients being served by MedStar had dropped to 58,768. AmeriHealth was carrying a load of 102,532 or 48% of the total.
Those results were just the opposite of what Turnage had insisted would happen by renegotiating the contract when he did. Back in August 2020, appearing at a roundtable before the Committee of the Whole, he cited an imbalance in the patient load that threatened the fiscal stability of AmeriHealth.
“If we have the same contracts in place that we have now, you will have AmeriHealth with well over 100,000 members [and] begin to see the kind of losses that pushed them to the brink and calling a meeting with me and saying we have to fix this or I don't know if we can stay in the program,” Turnage said.
AmeriHealth now has over 100,000 members. Does anyone need any more evidence that Turnage does not know what he’s doing?
If the mayor won’t stop him from creating more havoc. The council should. Legislators should approve the emergency without hesitation.