State officials will eliminate a flawed system that has wreaked havoc on the treatment community and reduce payments to behavioral health providers at a time when the coronavirus pandemic has increased demand for mental health and addiction services. Hired a new contractor to handle the process.
The state Appropriations Committee announced Wednesday that Boston-based Carelon Behavioral Health Inc. will receive up to nearly $340 million to replace its contract with Optum, a subsidiary of Minnesota-based managed care giant UnitedHealth Group. Approved the new contract.
Gov. Wes Moore, one of three members of the Public Works Commission that approved the contract, said the current vendor is “failing” to provide the level of service Marylanders deserve.
Carelon was formerly known as Beacon Health Options and was the contractor the state used before Optum.
Health care providers say Optum’s system has been plagued with problems since its launch in 2020, and that it was unable to treat new or existing patients on Medicaid, the federal-state health care plan for low-income residents. It is said that he was unable to make a claim for reimbursement.
Ultimately, the state ordered Optum to pay $1 billion based on an estimate based on previous provider claims, which is due to accounting issues and some providers still struggling to repay. This led to overpayments.
A damning 2022 audit found the state overpaid providers $223.5 million and underpaid others, losing millions more in federal matching dollars. There was found. The agency also rejected a $20.5 million damage claim and withholding of payments allowed in the contract, saying it would jeopardize the company’s relationship with Optum and could lead to litigation.
Forgoing damages was especially frustrating for lawmakers who were confident Optum had been properly vetted when it won a $198.2 million, five-year contract starting in 2020.
The audit found the state failed to vet Optum’s subcontractors, ignored warnings about the vendor from current customers, and failed to test the system used to process provider claims before launch. It was also revealed.
In a January letter to Maryland Health Secretary Dr. Laura Herrera Scott, Congressional Auditor General Gregory A. Hook said she requested a status report on the audit findings by the end of 2023. The letter said the Ministry of Health responded that “the issue still exists.” Substantially unchanged, these recommendations are expected to be implemented in the 2024 calendar year. ”
Auditors were scheduled to conduct another review in the third quarter of this year.
“Before them [the state] We hired the last contractor, so things were going relatively well,” said Josh Adler, deputy director of the Legislative Audit Office, which conducted the audit. Unsatisfactory audits are rare and most findings are resolved within six months. However, these findings remained unresolved for more than a year.
“I don’t remember ever sending a letter like this,” he said.
Meanwhile, Deputy Health Care Financing Secretary Ryan Moran, who oversees the state’s Medicaid program, submitted the Careon contract for approval.
Moran said there were “significant” malfunctions in Optum’s claims processing system that “continue to strain provider operations while the state grapples with the long-term behavioral health impacts of the pandemic.” Stated.
He said nearly all of the more than 300,000 public health behavioral and substance abuse patients are Medicaid recipients.
Moran said his department is “fully committed” to a successful transition between Optum and Careon over the next 10 months.
An Optum spokesperson did not respond to requests for comment regarding outstanding issues with the system or the replacement of the system.
Shannon Hall, executive director of the Maryland Association for Community Behavioral Health, which represents more than 100 mental health and addiction treatment providers that treat about 90,000 Medicaid patients, said providers are excited about the implementation. He previously said he hopes the new system will be properly tested and work. .
Providers are still dealing with functional issues in their systems, which involve many labor-intensive manual tasks that need to be automated, she said. She said the burden has diminished her behavioral health capacity, and although she didn’t have the data, it’s likely some people won’t be able to get an appointment when they need it.
Hall said each time a new system comes out, there are challenges in its rollout. He said Carelon was the last of the two bidders for the large contract, leaving him with some concerns about “whether the vendor will be able to get the job done when the stakes are so high.” Ta.
However, she said: “We are committed to making the transition as smooth as possible. We look forward to working with the Carelon team.”
Carelon plans to begin the design and development phase of the contract on March 1, and company officials have assured the state it will be operational by early 2025, according to a state report. The initial $233 million contract is for five years, with one two-year renewal option for $99.7 million.
