Arkansas lawmakers agree to a contract with United Healthcare in a bid to lower the cost of insurance

Arkansas lawmakers and officials from the Department of Employee Benefits are reconsidering the state’s health insurance plan for retired employees and public school employees. A contract negotiated between the Department of Employee Benefits and United Healthcare was approved by the legislative subcommittee that oversees the department.

Jake Blade, director of employee benefits, said United Healthcare was one of three companies that applied for an offer by the state. After winning the bidding process, which must follow state laws, he says, the department was able to negotiate a contract it was satisfied with.

“We have really strengthened some performance guarantees and some other aspects of the contract to make sure that the vendor we chose was really of a high standard, and would be accountable to our members’ needs and the expectations of the GA,” Blade said.

Through United, the state will now be able to offer Medicare Advantage Plus to retired employees, instead of just Medicare. Bleed says that traditional Medicare pays for the first 80% of claims, while the state pays the remaining 20, plus member liability payments. With Medicare Advantage Plus, United takes on liability, which Bleed says will incentivize the company to keep risks low to lower its cost.

Linda Jones, chief customer officer at United Healthcare, said Medicare’s traditional concerns are about paying claims to members, while Medicare Advantage Plus should also worry about members’ health.

“We will now take responsibility for helping retirees lead healthier lives. We will put clinical programs in place in addition to the value-added services we have added,” Jones said.

Bleed said getting Medicare Advantage Plus through United Healthcare can help the state save money, while maintaining the same benefits.

We negotiated with them [United] A share-earning agreement where they have to report how much money they spend on interest,” Blade said. “If they keep a lot, they give it back to us. I think we have really good buffers to make sure the savings don’t lead to less benefits for our members.”

Blade added that the federal government is providing United with subsidies that will also play a role in helping save money.

Several lawmakers said voters are coming to them with concerns about how registration will work. Rep. Stephen Mixes, R-Greenbrier, said questions were emailed asking if retirees would stay on their current plan if they wanted to. Bleed assured lawmakers that retirees will be able to decide which coverage they prefer.

“Retirees who qualify for Medicaid will be automatically enrolled in the Medicare Advantage Plan. They will then have the opportunity beginning in August or September through November 30 to make their decision. Then they can pay the accompanying rates, and they can do that or they can move to a Medicare Advantage plan,” Blade said. .

Lawmakers voted unanimously to approve the contract if it turns out to be legal. Mitch Ross, director of the Office of Government Procurement, said: objection United has been sued by healthcare company Benistar.

Ross made it clear to lawmakers that the contract should be suspended until the objection was proven unfounded. Ross said Bennister made the objection, arguing that he should not be dismissed.

“The RFP requires any seller to be 4 stars or more, and Benister is not a 4 star seller,” Ross said when asked about ineligibility.

According to the Centers for Medicare and Medicaid Services (CMS), United has received an overall rating of four stars.

Lawmakers have given the committee’s co-chairs the authority to proceed with United’s contract if the objection is dismissed. No clear timeline has been given for how long a review of an objection could take.