Transparency in Medicaid Managed Care: The Power of the California Procurement Database

The Illinois Answers Project has just published a must-read piece of investigative reporting:  “Insurance Giant Failed Foster Kids with Inadequate Care.”  It raises a number of disturbing questions about the way children in foster care are being treated in the state’s Medicaid managed care program.  About the performance of a Centene subsidiary that has contracted with the Illinois Medicaid program to specifically serve foster children and youth.  About the performance of the state Medicaid agency responsible for overseeing the contract.  About the performance of CMS in overseeing the expenditure of federal Medicaid funds.  And about the “natural experiment” now underway in several states on how to make Medicaid managed care work best for children and youth in foster care—either through “single-payer” MCOs focused only on foster children and youth, or through comprehensive MCOs that enroll children in foster care alongside all other Medicaid-eligible children.

Hopefully, this reporting will result in rapid and sustained improvement in the performance of all concerned.  There’s certainly lots of room for it.  But what we want to do here is highlight the role of government transparency in this investigation—in particular, the contribution of California’s managed care procurement database.  What, you might be wondering, does California’s managed care procurement have to do with the performance of an MCO in Illinois?

In February of this year, when California’s Medicaid agency issued a Request for Proposal (RFP), it made clear to all potential bidders that the information they submitted would become public when the awards were announced.  Among the information that the agency requested in order to evaluate each proposal was a list of all enforcement actions taken against the applicant over the previous five years due to health plan performance.  In the case of a subsidiary of a national company, the RFP requested the same information about any subsidiaries of the parent company operating in other states.

At the end of August, the agency announced its intent to award contracts to MCOs that submitted winning proposals and, as promised, made the proposals of all bidders available to the public. This was a transformative transparency event. A Centene subsidiary in California had submitted a proposal, so the history of enforcement actions against all of its subsidiaries became available on request.  Inquiring minds at the Illinois Answers Project asked for and received the proposal from the California  agency and took a close look.  They learned about a disciplinary action against Centene’s Illinois subsidiary that was not posted on the sanctions page of the Illinois Medicaid agency’s website. Let’s let the reporters, David Jackson and Rachel Hinton, tell the rest:

“The details were obtained through a public records request to California’s Medicaid agency…Centene’s California bid submission says Illinois HFS cited YouthCare (the Centene plan for Illinois children and youth in foster care) for three serious deficiencies: failing to identify and classify the risk level of children in a timely way, failing to conduct thorough Health Risk Assessments and failing to appropriately document Individualized Care Plans for complex and high-risk children.

Centene said in the California records it was subject to an official HFS (Illinois Department of Healthcare and Family Services, which houses Medicaid) Corrective Action Plan. However, Eagleson (HFS Director) said in an interview last month that her department never publicly disclosed the enrollment freeze because it was not part of a formal Corrective Action Plan, and HFS said in a statement that the action was imposed by its contracted auditor and not the department itself.” 

It’s unusual when a state Medicaid agency is even less transparent than an MCO about the plan’s performance, but there you have it. (For a classic in the annals of opacity, look no farther than the end of the piece, where you will find redactions made by the state agency in its response to the reporters’ public records request for a Quarterly Business Review slide deck submitted by Centene regarding its performance under a public program financed with public funds).

Kudos to California’s Medicaid agency for showing us the potential of a managed care procurement for holding contractors accountable.  Advocates and policymakers in Florida, Texas, and Washington, where Centene also operates what it calls “sole source” MCOs for foster care children and youth as they do in Illinois, may want to review the enforcement sanctions and other information relating to those subsidiaries. (In July Centene began operating this model in Missouri).  And it’s not just about Centene.  Other “Big Five” parent companies, Elevance Health and Molina also submitted proposals in California’s procurement, so information on the performance of their subsidiaries in other states is also available, either on the California agency’s website or on CCF’s.

Transparency is all the more important when it comes to ensuring that children placed in foster care, who often need immediate medical attention after they’ve experienced abuse or neglect, get the care they need. And as more states consider “single-payer” MCOs for these children, the Illinois Answers Project investigation is a reminder of what’s at stake. North Carolina has delayed its rollout of a single MCO for foster care children due, in part, to concerns from advocates that foster children and families in the state could face similar problems to those in Illinois.

Across the board, we don’t have enough data to know how well these plans are performing for the children and youth in foster care.  In this system, more transparency is essential to accountability of both MCOs and state agencies for performance.  Investigative reporting like that of the Illinois Answers Project is an important start.