The California Department of Health Services has reviewed appeals and completed awards of Medi-Cal managed-care contracts to commercial HMOs in a program covering 12 counties.
Medi-Cal is the state's Medicaid program. The contracts for all 12 counties, running for six years, were awarded last October but were protested in seven counties.
In Los Angeles County, the award to Foundation Health was upheld, and appeals by Care First, Tower Health Services and California All Health-a consortium of HMOs-were denied. The contract is worth up to $5.9 billion.
The department has prohibited one of Foundation's subcontractors, Universal Care, from marketing to Medi-Cal beneficiaries. The department said it took that action because Universal paid kickbacks to physicians and engaged in other marketing violations. Foundation has notified Universal that its contract will be terminated unless it complies with department standards.
In Riverside and San Bernardino counties, the award to Molina Medical Centers was affirmed and appeals by Blue Cross of California's California-Care, California All Health and Tower Health Services were denied. The contract is worth up to $1 billion.
In San Joaquin and Stanislaus counties, Omni Healthcare won its appeal of the award originally made to CaliforniaCare. The contracts are worth as much as $618 million. CaliforniaCare may request that the department reconsider the decision, state officials said.
In Fresno County, the awards to CaliforniaCare and Foundation Health were upheld and Maxicare's appeal was denied. Each contract is worth up to $546 million. But the department can't sign contracts with the HMOs until a lawsuit filed by the county against the state is resolved.
In Kern County, the award to CaliforniaCare was affirmed and the appeal by California All Health was denied. The contract is worth as much as $446 million.
The state has designated both commercial and locally organized systems to serve Medi-Cal recipients in those 12 counties.