Louisiana Judge Lifts Hold Sought By Aetna On Medicaid Contracts
September 14 2011 - 6:50PM
Dow Jones News
A state court judge in Louisiana dissolved on Wednesday a
temporary restraining order that had stopped health officials there
from awarding Medicaid contracts while insurer Aetna Inc. (AET)
sorted out its appeal plans.
Aetna has protested the state's decision to award what could add
up to about $2 billion in annual revenue to five other firms that
will coordinate service for nearly 900,000 Medicaid recipients. The
company felt the process was flawed and lacked transparency.
"We are disappointed in today's decision and continue to have
concerns with the manner in which the Medicaid contracts were
awarded," Aetna said in a statement late Wednesday. "We believe
that there were errors in the procurement process and in the
scoring of the awards. We are evaluating all of our options and
will make a decision shortly on how to proceed."
A 19th Judicial District Court official and a spokeswoman for
the Louisiana Department of Health and Hospitals, the agency that
picked companies to manage the government health plan for the poor,
also confirmed Wednesday's ruling by Judge William A. Morvant.
The Health and Hospitals department already denied an Aetna
appeal, as did the state's commissioner of administration. Last
week, a different judge temporarily handling the case signed an
order setting the temporary restraining order while giving Aetna 14
days to determine whether it intended to file a petition.
In the same court on Tuesday, Judge Todd Hernandez ruled against
an effort by the three publicly traded Medicaid winners in
Louisiana--Amerigroup Corp. (AGP), Centene Corp. (CNC), and
UnitedHealth Group Inc. (UNH)-- to keep their information private
and out of Aetna's hands.
Tyler Mason, a spokesman for UnitedHealth Group, said in an
email that the insurer was evaluating the court decision and
considering all available legal options, including the possibility
of an appeal. A Centene spokesperson could not be reached for
comment Wednesday, and an Amerigroup spokesman declined
comment.
The state health agency in July recommended Medicaid contracts
for those insurers plus two private firms. "We are moving forward
with the contracts and readiness reviews," agency spokeswoman Lisa
Faust said following Wednesday's ruling.
Aetna closed down 6.7% at $40.26 Wednesday, and was up 1.4%
after hours.
-By Jon Kamp, Dow Jones Newswires; 617-654-6728;
jon.kamp@dowjones.com
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