A Kentucky judge has tossed out contracts awarded to six health insurance companies, citing flaws in the state’s bidding process for $8 billion in state Medicaid business.
Franklin Circuit Judge Phillip Shepherd ordered the state to rebid the entire package, the Courier Journal reported. The flaws “cast a cloud over the process’s legitimacy,” Shepherd said in his order issued Wednesday.
This would make the third time Kentucky will have to seek bids for the contracts, which are for outside companies to manage healthcare for people covered by Medicaid.
In a brief statement, the state Cabinet for Health and Family Services said: “The judge’s orders are being reviewed and next steps are being determined.”
The first round of contract awards came under former Gov. Matt Bevin in late 2019. The second round came last year after Gov. Andy Beshear tossed out those contracts and ordered them rebid, citing questions about the awards, although the outcome was unchanged.
Shepherd said all current contracts will remain in place so health services are not disrupted for about 1.5 million Kentuckians who get health coverage through the federal-state Medicaid health plan.
The federal government provides around 70% of the costs of the $12-billion-a-year program, which is Kentucky’s largest health plan.