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Cook Children’s Health Plan has filed two lawsuits against the state to block the Texas Health and Human Services Commission from removing the company as its longtime Medicaid contractor.
During a press conference on Wednesday, the Fort Worth-based health system Announced The lawsuit was filed in an attempt to halt a $116 billion Medicaid procurement process that would remove Cook Children’s and two other hospital-affiliated pediatric health plans from the Children’s Health Insurance Program, also known as Medicaid STAR and CHIP.
Under the proposed reforms, Cook Children’s Health Plan in the state’s Tarrant service area, Texas Children’s Health Plan in the Harris region and Driscoll Health Plan in South Texas would be replaced by private companies. Together, the three plans would operate as follows: Managed Care Organizations They provide Medicaid coverage to Texans in their respective areas.
The three plans, developed 20 years ago, serve more than 700,000 families, pregnant women and children.
If state health officials’ decision stands, it would mean fewer managed care organizations administering STAR and CHIP and a shift to national, for-profit health care companies in most parts of the state.
And about 1.8 million Texans who get Medicaid insurance through the state’s six managed care organizations will have until next year to switch to new insurers.
The lawsuits were filed in Travis County. One petition seeks a declaratory judgment and injunction against HHSC Commissioner Cecil Irwin Young to overturn the contract award. The second lawsuit is for a temporary restraining order requiring the state health agency to stop finalizing the procurement outcome.
“These steps we are taking are strong but necessary,” Rick W. Merrill, president and CEO of Cook Children’s Healthcare System, said in a news release.
HHSC spokeswoman Jennifer Ruffcorn said the agency could not comment on pending litigation but that the contract status remains pending.
“Although (the request for proposals) has been posted, responded to and evaluated, the procurement will remain open until all protests and objections submitted by respondents have been resolved and the contract has been executed,” Ruffcorn said in an email.
The future of the procurement process now rests entirely in Young’s discretion, with no deadline for him to decide whether to uphold the agency’s decision, reverse it and start again, or formally postpone it until parliament has an answer next year.
Cook Children’s Health Plan President Karen Love said in a news release Wednesday that the decision to terminate Medicaid contracts with the three affiliated hospitals was based on a flawed process that puts Texas families at the mercy of national, for-profit insurers.
“The state got it wrong, and we’re asking the court to fix it,” she said.
Texas Medicaid STAR and CHIP program It covers the costs of routine, acute and emergency medical visits. STAR primarily serves pregnant women, low-income children and their parents. CHIP provides health care to low-income children whose families earn too much to qualify for Medicaid, which has the lowest income limits in the country. Its members make up the majority of Texans enrolled in the state’s Medicaid program.
Medicaid managed care contracts are typically the most expensive contracts paid for by taxpayers.
Texas officials earlier this month rejected an attempt by several managed care organizations to undo a proposal to be kicked out of the state’s Medicaid program.
A representative for Driscoll Health Plan said Thursday that the group has appealed the decision to the state because it could result in more than 500 job losses if the decision is finalized.
Driscoll Health Plan CEO Craig Smith told The Texas Tribune on Thursday that the organization filed a second appeal last week and is awaiting a ruling. He said he is prepared to take legal action against the state if the appeal is denied.
Representatives for Superior Health Plan, a managed care organization that operates similarly to Driscoll & Cook Health Plan, expressed disappointment Thursday in the decision to reject the protests of the three hospital plans. The organization is also exercising its right to appeal, saying it expects the current decision by Texas health officials to cause the biggest disruption to member care in Texas Medicaid history.
If the procurement is defeated, it would mark the third attempt in the past six years for the Texas Department of Health and Human Services to award a contract for the Medicaid program, which covers most low-income Texans for state health insurance.
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