Mayor expected to announce executive emergency over ‘dire’ DC Medicaid situation

As the clock ticks down on MedStar health care access for more than 200,000 D.C. residents who rely on Medicaid, a deputy mayor called the situation “dire,” but said the mayor would likely step in by the end of the week to provide relief.

Wayne Turnage, deputy mayor of health and human services, told WTOP that D.C. Mayor Muriel Bowser is expected to announce an executive emergency.

“The executive has a number of levers that she can pull, and she will evaluate which of those levers offers the best opportunity for her to avoid a potential disruption. And again, I think there’ll be some light shed on that this week,” Turnage said.

A judge last year ruled the city improperly awarded MedStar’s insurance arm, MedStar Family Choice, its contract worth more than $1.5 billion.

MedStar’s existing contract runs out Sept. 30.

The District is able to essentially start the bidding process over by making a change. It’ll now require Medicaid-managed care plans to cover inpatient mental health and substance abuse treatment, Turnage said.

But what happens in the meantime is uncertain.

“This is a mess,” at-large Council member Christina Henderson told WTOP last week. “It’s been a mess for months.”

Access at risk

WTOP obtained an email Turnage sent to Ward 7 Council member Vincent Gray on Aug. 20, with the subject line “Troubling Developments in the MCO (Managed Care Organizations) Program.”

In it, Turnage said that MedStar had told another Medicaid contractor that it was pulling out of the program after the contract had been canceled. Turnage raised to Gray the spectre of Medicaid recipients losing their access to health care in the middle of a pandemic.

WTOP reported last week that access for D.C. Medicaid patients was at risk if MedStar terminated its remaining contracts this fall. As one of the largest health care providers in the region, Turnage explained, MedStar was able to offer discounted prices, which it could no longer offer if it lost the Medicaid contract.

“MedStar said that if they didn’t have a health plan program, then the discount pricing that they normally offer through the health system would go away,” Turnage said. “And so the remaining two health plans that would be in the program indicated to me that if they lost that discount pricing, they would be underwater financially.”

Henderson told WTOP, “I think the council was warned that this could possibly be an outcome. Not all of my colleagues saw it that way. And so I’m hopeful that the mayor and her team can figure out a way to sort of bridge the gap while we try to work for a more permanent solution.”

She added that Bowser “does have a couple of levers available to her under the public health emergency and under emergency procurement authority. But … she has a team of lawyers, I’m sure, who are working around the clock to try to figure out how to sort of salvage the situation, while also not running completely afoul of the contract appeals board decision on this matter.”

Complaint filed

The judge’s ruling that voided the MedStar contract came in response to a complaint filed about a year ago by Amerigroup, a health insurance provider which was denied D.C.’s Medicaid contract.

The company alerted D.C.’s attorney general and inspector general that the District made a series of “serious violations of various sections” of the Public Procurement Reform Act of 2010. Amerigroup alleges, based on emails it received via a Freedom of Information Request, that a technical evaluation team on various dates in December 2020 improperly and illegally disclosed information about the Medicaid bids to Turnage.

“The deputy mayor is not a part of the evaluation process,” Amerigroup’s complaint said, also alleging that Turnage “further improperly and illegally disclosed protected information to various members of the D.C. Council.”

After the judge’s ruling, the Bowser administration asked the D.C. Council to amend the procurement process, making MedStar’s contract valid. When they voted not to change the law, Bowser blamed the council for the possibility that Medicaid recipients would lose their health care.

Amerigroup called on the Contract Appeals Board to sanction the city’s contract office, Turnage and his department for violating the city’s procurement rules, according to documents filed with the CAB.

Turnage told WTOP in a statement that “At no time during or after the recent managed care procurement, did I send a document, sealed by the court, to any person or entity outside of the Department of Health Care Finance. Also, at no time during or after the recent managed care procurements did I impermissibly share protected information with members of the Council.”

‘Fiasco’

Bowser said last week all D.C. residents would be impacted, citing “unacceptable waiting periods in crowded hospital emergency rooms, difficulty securing primary care visits, and lengthy 3- or 4-month delays for specialty care appointments.”

“We will keep fighting for these residents to prevent a chaotic and abrupt disruption,” she added.

Ambrose Lane Jr., chair of the Health Alliance Network, called the whole thing a “fiasco” that jeopardizes the health care of Black and brown poor residents of D.C., adding that this would also have a devastating effect on the immigrant population.

He wrote in an email that his organization “believes that this may violate Title 6 of the Civil Rights Code. We are also looking into filing a complaint with the Department of Health and Human Services Office of Civil Rights.”

Lane added, “It appears that MedStar is unhappy with the fact that they lost their bid to keep their Medicaid managed-care contract … and the D.C. Council refused to step in to change the law retroactively.”

Turnage said MedStar accounts for more than 38% of the utilization in D.C.’s health system and more than a third of the $304 million spent on hospital services in 2018. Turnage said the numbers are virtually unchanged for 2019 through 2020.

WTOP’s Megan Cloherty and Rick Massimo contributed to this report.

Will Vitka

William Vitka is a Digital Editor and reporter for WTOP.com. He's been in the news industry for over a decade. Before joining WTOP, he worked for CBS News, Stuff Magazine, The New York Post and wrote a variety of books—about a dozen of them, with more to come.

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