United Healthcare wants the Jindal administration to reverse the multimillion-dollar hiring of Blue Cross and Blue Shield of Louisiana to manage state employee health insurance plans.
In a 15-page protest released this week, United Healthcare accused the Office of Group Benefits, which helped review the proposals, of making a flawed analysis, using objectionable scoring and “bending over backwards” for Blue Cross and Blue Shield.
“During these tough financial times when every dollar should count, it is inconceivable that the OGB would fail to scrutinize proposals closely to maximize the bargain it can strike for state taxpayers,” United Healthcare wrote.
Meanwhile, a legislator is seeking state Attorney General Buddy Caldwell’s input on whether the outsourcing plan — which will shift duties handled by state workers to a private company — requires legislative committee approval.
According to state law, contracts for basic health care services “shall be subject to review and final approval by the appropriate standing committees of the legislature.”
State Rep. Katrina Jackson, D-Monroe, said she contacted the Attorney General’s Office after reading the law.
“At some point, we have to stop allowing the administration to circumvent the legislative process,” Jackson said.
In a statement, Commissioner of Administration Paul Rainwater disagreed that further legislative approval is needed.
He said the law Jackson cited is not applicable.
Rainwater also could be involved in United Healthcare’s protest of Blue Cross and Blue Shield receiving the contract.
The protest first will go to Charles Calvi Jr., chief executive officer of the Office of Group Benefits. If he rejects it, United Healthcare will have the option of appealing to Rainwater.
The final remedy would be to pursue a court challenge.
The Office of Group Benefits provides health and life insurance to about a quarter-million current and retired state employees and dependents.
Blue Cross and Blue Shield, United Healthcare and Humana submitted proposals to serve as administrator of state health plans covering more than 200,000 people.
The contract will result in 177 positions being eliminated from the Office of Group Benefits’ 327-member workforce.
The Jindal administration contends the change will save $20 million a year.
Blue Cross and Blue Shield stands to receive $37.8 million a year to serve as administrator. Humana sought $49.1 million a year and United Healthcare wanted $40.3 million.
However, United Healthcare contends it was actually the least expensive bidder. The company questioned the accuracy of other bidders’ numbers.
For example, the company said, Blue Cross and Blue Shield listed 2,991 anesthesiologists when only 498 anesthesiologists are in the possible pool referenced.
“OGB turned a blind eye” and allowed Blue Cross and Blue Shield to amend its proposal hours before the award was issued, United Healthcare complained.
Blue Cross and Blue Shield declined comment, referring questions to the Office of Group Benefits, which is under the umbrella of Rainwater’s Division of Administration.
“The protest is currently being reviewed by the CEO of OGB, and should there be an appeal to his determination that appeal would come before the commissioner, making it inappropriate to comment,” Rainwater’s spokesman, Michael DiResto, said.