A Rhode Island Superior Court judge blocked the state from awarding a three-year health insurance contract to UnitedHealth Group and ordered state officials to conduct a new bidding process for an insurer. In a scathing 42-page ruling, Judge Netti Vogel said the original bidding process was "infected with error" and blatantly biased against rival bidder Blue Cross and Blue Shield of Rhode Island. "Whether due to ignorance of the law, their own flawed sense of fairness, or some other less innocent motive, they skewed the process in favor of United and denied (the Blues) fair and equitable treatment mandated by law," Vogel wrote, citing six "specific wrongful acts" that she concluded the state had committed.
The Blues, which has covered the state's 52,000 employees, retirees and dependents for three years, sued the state Department of Administration in October claiming that state officials "acted arbitrarily and capriciously" when they chose to go with UnitedHealth rather than renew the Blues' contract, set to expire Dec. 31. The state, which contends that UnitedHealth offered $8 million more in savings than the Blues, said it would appeal the decision to the state Supreme Court. -- by Laura B. Benko