By Jim Saunders
The News Service of Florida
TALLAHASSEE — Two health insurers have launched legal fights after they lost out on contracts to provide managed care to state employees, with one insurer alleging a violation of Florida’s open-meetings law.
AvMed and Aetna have filed four challenges after the Florida Department of Management Services last month announced its intent to award contracts to administer health-maintenance organization and preferred-provider organization plans for state workers, retirees and dependents.
AvMed was shut out of receiving HMO contracts. Aetna was selected to provide HMO services in only some of the areas it sought and was not chosen for a PPO contract.
The Doral-based AvMed filed a lawsuit Monday in Leon County circuit court alleging that a department negotiation team violated the open-meetings law by improperly holding some discussions in private. The lawsuit, in part, seeks an injunction to prevent the department from moving forward with the HMO contract decisions.
Meanwhile, three challenges by AvMed and Aetna have been sent during the past week to the state Division of Administrative Hearings. As an example of the issues, Aetna is challenging the department’s decision to award a statewide contract to Florida Blue for PPO services, saying it has a better network of health providers in some areas.
“While Aetna maintains that it provided the best value to the state overall and should have been awarded a statewide contract, at a minimum, Aetna is confident that its offering was more beneficial than other vendors in certain areas of the state, and Aetna thus should have been awarded a contract to serve at least those areas of the state,” the PPO challenge said.
The cases stem from what is known as an “invitation to negotiate” process that started last year. The department plans to award three-year contracts for HMO and PPO services, with potentially three one-year renewals, according to documents in the cases.
While Florida Blue would receive a statewide PPO contract, the department would award HMO contracts in nine different regions of the state. Aetna would receive contracts in four of those regions, while UnitedHealthcare would receive contracts in four regions and Capital Health Plan would receive the contract in a region that includes Tallahassee and surrounding counties.
The invitation to negotiate last year said the programs had about 168,000 “subscribers,” with 52 percent in HMO plans, 47 percent in PPO plans and 1 percent in Medicare Advantage prescription-drug plans. It said benefit and administrative costs during the 2021-2022 fiscal year were projected to be about $2.9 billion.
In the open-meetings lawsuit, AvMed said it has provided HMO services to state employees for 40 years. It also said that, as of Jan. 1, it provided managed care for about 50,000 state employees, retirees and their dependents. It sought new contracts in six regions.
The lawsuit said the state’s open-meetings law provides exemptions for some parts of meetings that involve “negotiation strategies.” But it alleges that a department negotiation team on the HMO contracts improperly held private discussions during two meetings on issues that did not involve negotiation strategies.
For example, the lawsuit alleges that one of the meetings involved “a discrete discussion of which HMO respondents provided the best value in particular regions. Nothing in this portion of the meeting amounted to or constituted ‘negotiation strategies.’”
