Texas rejects Centene, Elevance protests over alleged Aetna leak

Texas denied requests by Centene, Elevance Health and six other insurers to reconsider which managed care companies it will rely on to run its $116 billion Medicaid program over the next six years, rejecting allegations that local officials’ process improperly advantaged rival CVS Health. 

The Texas Health and Human Services Commission in March announced it intended to award new, six-year Medicaid and Children Health Insurance Program managed care contracts to 14 companies including CVS Health’s Aetna, Centene, Elevance Health, Humana, Molina Healthcare and UnitedHealthcare. 

Related: Medicaid disclosure unfairly benefits Aetna, rival insurers say

The intended contracts are set to begin Sept. 1. They expand the market share of for-profit carriers Aetna, Humana, Molina Healthcare and UnitedHealthcare while reducing Centene and Elevance Health’s footprint. Texas officials also intend to cut three hospital-based carriers from the STAR Medicaid managed care program. 

Centene, which operates as Superior Health Plan in Texas, Elevance Health, which operates as Wellpoint, and six other carriers protested the decision. Texas denied all carriers’ protests Thursday, according to state documents released to the public on Friday. 

Among other issues, companies alleged in protest documents that Texas Medicaid improperly responded to Public Information Act requests and released their bids to rival Aetna while the review process was ongoing. That gave the CVS Health subsidiary a leg-up when competing for the lucrative contracts, companies alleged.

Among large insurers, Aetna will gain the most new members from the proposed Texas contract, adding 461,000 enrollees, according to a March report by investment bank Stephens. Centene stands to lose the most, at 652,000 enrollees, while Elevance Health will lose 255,000 members, according to Stephens. 

In letters to Centene, Elevance and other companies sent Thursday, Texas officials wrote that releasing companies’ contract proposals before finalizing intended Medicaid awards did not violate state law. 

“Superior has not provided any documentary evidence to show how any purported release directly affected the integrity of the solicitation or the resulting contract awards. Further, [the Public Information Act] process is separate and distinct from the solicitation, response evaluations and contract awards,” Kay Molina, deputy executive commissioner of procurement and contracting services at Texas Medicaid, wrote in response to Centene’s protest documents. 

Protesters AmeriHealth Caritas, CareSource, Centene, Driscoll Health Plan, Elevance Health, Baylor Scott & White, and Texas Children’s Health Plan did not immediately respond to interview requests. 

Cook Children’s Health Plan will appeal the decision, a spokesperson wrote in an email. The nonprofit insurer is owned by Fort Worth-based Cook Children’s Health Care System. 

“We are deeply disappointed by the Texas Health and Human Services Commission’s decision to deny our protest to remain in the STAR (Medicaid) and Children’s Health Insurance Program. This procurement process has been flawed from the beginning and we will pursue every legal option available, including filing an immediate appeal. We are confident in the strength of our case and believe we will prevail,” the spokesperson wrote.