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Medicaid Managed Care Plans Coming Under Scrutiny
States looked to Medicaid managed care plans to control costs and provide some predictability. Now a growing number are asking questions of the plans and investigating whether the plans are living up to their state contracts. Meanwhile, new federal reporting requirements are being implemented that may shed some light on how the plans operate.
In April 2022, Louisiana Attorney General Jeff Landry filed a lawsuit against UnitedHealthcare of Louisiana and OptumRx, a pharmacy benefit manager (PBM) subsidiary of United’s parent company, UnitedHealth Group. In the suit, Landry accused UnitedHealthcare of inflating the amounts it pays OptumRx for drugs to help United increase what it counts as medical losses in Louisiana’s Medicaid program.
In a 57-page lawsuit, Landry said he was seeking to recover “billions of dollars in inflated prescription drug prices.” By inflating what it pays for drugs, the insurer could skirt federal oversight regulations designed to ensure that managed care plans spend at least 85% of state and federal Medicaid funds for patient care and services under the medical loss ratio (MLR) rules, Landry wrote in the lawsuit filed April 13.
A spokesperson for UnitedHealth Group said company officials believe the lawsuit is without merit and the company will […]