D.C. Medicaid contracts still in flux

March 11, 2013

(Matt McClain for The Washington Post)

The District government’s effort to award some of its largest contracts, to manage the health care of low-income residents, seemed close to resolution last week when word leaked of a tentative award to three firms. But it seems the process will continue for at least a couple more weeks.

On Friday, at least one bidder received a request for a second best-and-final offer from the city procurement department. A D.C. official not authorized to speak about a pending procurement confirmed the second round of final bids, which would indicate that the tentative awards — to Medstar Family Choice, Thrive Health Plan and AmeriHealth Mercy — might be far from final indeed.

The new bids are due next Friday, according to the letter. Besides the previous three firms, at least three others are thought to have potentially submitted bids: UnitedHealthcare, a current D.C. contractor; California-based Molina Healthcare; and Maryland-based Riverside Health.

Since the disclosure last week, the unexpected emergence of new player Thrive has generated the most chatter in local political and health-care circles. Its owners, Michigan businessman Tommy Duncan and Los Angeles lawyer Dennis S. Ellis, are not well known in the city but have enlisted a team of big local names. They include Sharon Baskerville, a longtime health-care activist and former executive director of the D.C. Primary Care Association;  Ivan Walks, a former health department director; and Edward Porcaro, a former D.C. health-care finance official. Still, other players are wondering whether Thrive has the big-time capital to match the big-time names.

Under the managed-care contracts, firms are paid a flat monthly rate for each resident they enroll who is eligible for Medicaid or other government heath programs. The firms then pay health-care providers like doctors, clinics and hospitals, taking overhead and profit out of the leftovers.

Health Care Finance Director Wayne Turnage said he could not discuss the timing of the contracts, which could be worth as much as $668 million to any single company. “I try not to get involved in procurement except to say, ‘Please, hurry up,’ ” he said.

Mike DeBonis covers local politics and government for The Washington Post. He also writes a blog and a political analysis column that runs on Fridays.
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Mike DeBonis | March 11, 2013