A company that Oklahoma has enlisted to help run its managed care program is currently being sued by the Ohio Attorney General for breach of contract.
Dave Yost, the Attorney General of Ohio, alleges that managed care giant Centene Corp. conducted an “elaborate scheme” to maximize company profits at the expense of the Ohio Department of Medicaid.
Oklahoma Complete Health, a subsidiary of Centene Corp., was enlisted back in February — along with three other companies — to run Oklahoma’s managed care program beginning later this year.
Centene did not respond to The Transcript’s request for comment.
The Ohio AG’s office accuses Centene of filing reimbursement requests for amounts already paid by third parties; failing to accurately disclose to ODM the true cost of pharmacy services, including the disclosure of discounts received; and artificially inflating dispensing fees.
“Centene’s Buckeye Health Plan administered its pharmacy benefit via sister companies Envolve Health Solutions and Health Net Pharmacy Solutions,” a press release from the Ohio AG reads. “The practice of subcontracting to more than one Pharmacy Benefit Manager (PBM) raised questions about Buckeye Health Plan’s business practices and, ultimately, Centene’s.”
According to The Commonwealth Fund, a private foundation whose purpose is to “promote a high performing health care system,” a pharmacy benefit manager plays an essential role in deciding how much a pharmacy gets paid, and in determining the cost of a drug.
“Pharmacy benefit managers are companies that manage prescription drug benefits on behalf of health insurers, Medicare Part D drug plans, large employers and other payers,” Commonwealth Fund’s website says. “By negotiating with drug manufacturers and pharmacies to control drug spending, (pharmacy benefit managers) have a significant behind-the-scenes impact in determining total drug costs for insurers, shaping patients’ access to medications, and determining how much pharmacies are paid. PBMs have faced growing scrutiny about their role in rising prescription drug costs and spending.”
Oklahoma state Senator and pharmacist Rob Standridge, R-Norman, said that the new shift to managed care and how managed care in other states has taken advantage of the most vulnerable communities concerns him not only as a provider, but as a lawmaker and a consumer.
“Additionally as a taxpayer and a senator, I am very concerned about the inevitable increase in Medicaid spending this outsourcing will result in based on our neighbor states, which will culminate in increased taxes, likely dramatic, for all,” Standridge said.
A spokesperson for the Oklahoma HealthCare Authority said there are strict protections in place to prevent what happened in Ohio from happening in Oklahoma.
“We are aware of the claims against Centene,” said Melissa Richey, spokesperson for the OHCA. “We are confident in the contractual safeguards we have in place for SoonerSelect and will hold our managed care partners accountable for their performance. We look forward to continuing a strong relationship with these partners to improve health outcomes for Oklahomans.”
According to the OHCA, the contract managed care organizations have to sign with the state requires that all contractors or subcontractors not engage in “spread pricing,” and that all the payments to pharmacies must follow a “transparent, pass-through model.”
Centene is also currently under investigation in Mississippi.