Rival insurers oppose UCare's request to halt Medicaid, MinnesotaCare overhaul

Rival health insurers want a Ramsey County judge to deny UCare's bid for a second chance at business through a large public health insurance contract.

In separate court filings supplied by health plans to the Star Tribune on Wednesday, Blue Plus, HealthPartners and Medica argue that the orderly transition for thousands of public health insurance enrollees would be threatened if a judge interferes with competitive bidding results announced last month by the state Department of Human Services (DHS).

In July, Gov. Mark Dayton announced preliminary results of a competitive bidding process that could save taxpayers $450 million, but would drop Minneapolis-based UCare as an option for most in the state's Medicaid and MinnesotaCare programs.

Earlier this month, UCare sued the state and asked for a temporary injunction to stop the new contracts from being instituted for 2016. A Ramsey County judge is scheduled to hear UCare's motion on Friday.

The new contracts would shake up the list of managed care organizations operating in counties across the state. As a result, Minnetonka-based Medica says it stands to lose about 40,000 current enrollees in some counties, while gaining an estimated 150,000 enrollees in other counties.

"Given the size of the membership shift, Medica has begun preparations for the transition of members to and from Medica and other health plans, and it has begun to make necessary staffing changes to effectively administer this transition," the insurer said in a memorandum it said was filed late Wednesday. "Any changes or disruption to the administration of these programs … will further confuse the community and enrollees about the changes ahead."

Minnesota hires managed care organizations for most in the Medicaid and MinnesotaCare programs, which provide health insurance coverage for lower-income state residents.

The HMO generated about half of its $3 billion in revenue from the state programs in 2014, and has said it would likely need to eliminate hundreds of jobs due to the state's decision on the contract.

The new contracts would mean about 369,000 people with coverage provided through UCare would need to select a new plan for next year, or would be assigned to one. After factoring changes that affect other managed care organizations, the competitive bidding process means that an estimated 475,000 people would need to make changes.

In its filing, Bloomington-based HealthPartners argued, "Stopping the transition envisioned and established by the DHS at this late stage will affect the ability of plan members to obtain health care services in the coming year."

Blue Plus, which is a division of Blue Cross and Blue Shield of Minnesota, said in its filing, "It would be fundamentally unfair to change the rules of this process now and force DHS to contract with UCare."

Representatives for Blue Plus and HealthPartners said the memos from both companies were filed late Wednesday. Dan Ness, a UCare spokesman, said the HMO was reviewing the filings but would have no comment.