New Contract Awards May Shift Thousands of Medicaid Enrollees in Michigan

NASHVILLE, Tenn., Aug. 12 /PRNewswire/ – HealthLeaders-InterStudy, a leading provider of managed care market intelligence, reports that the Michigan Department of Community Health has awarded new Medicaid contracts that will likely shift thousands of enrollees into new plans across the state. According to the recent Michigan Health Plan Analysis, Health Plan of Michigan, Molina Healthcare and McLaren Health Plan are among the big winners following a recontracting process, with Health Plan of Michigan gaining coverage in 16 counties while Molina and McLaren each added six.

Under the new contracts, health plans will continue to use their own preferred drug lists with the exception of atypical antipsychotics and HIV/AIDS drugs. Both of these are carved out and will continue to be administered by Michigan Medicaid on a fee-for-service basis. The new contracts take effect on October 1, 2009.

“Health Plan of Michigan already has significant coverage in the counties making up lower Michigan, and with the addition of 16 more, it has the potential to become the state’s largest Medicaid HMO by enrollment,” said Rick Byrne, analyst with HealthLeaders-InterStudy. “This means the insurer will have greater negotiating leverage with providers and vendors.”

The objective of the recontracting process was to balance the number of plans operating in some counties. Michigan’s Medicaid program is among the largest in the country, enrolling approximately 1.1 million people. In 2008, Michigan Medicaid plans directed spending of $352.4 million on prescription drugs.

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    Lisa Osgood                         Elizabeth Marshall
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SOURCE HealthLeaders-InterStudy