FamilyCare Says State Could Cost Plan $7 Million

One of the state's top Oregon Health Plan contractors says a system enrollment defect has plan losing members

July 8, 2009 -- FamilyCare intends to take legal action against the state unless Medicaid officials fix an enrollment problem that could cost them $7 million this year. It’s among 14 managed care plans that insure Oregon Health Plan members.

Jeff Heatherington, CEO and president, has given officials until Friday (July 10) to submit a written correction action plan.
Because of problems with its new computer system, known as MMIS, case workers have had to manually enroll members in the Portland tri-county area. Since November, FamilyCare has lost members because of a system defect, according to Heatherington.    
“The leadership in the Department of Human Services has taken a cavalier attitude toward the health plans,” he said. “They haven’t cared to understand the problems we’ve been having. We’re going to open the windows and doors of the MMIS situation so everyone knows what’s been going on.”
Lynn Read, deputy administrator of Medicaid, acknowledged the computer system isn’t working in the tri-county area, which has resulted in manual enrollment, but said that FamilyCare hasn’t impacted.
“There’s no reason why Jeff has been excluded because the algorithm we’re using has been working,” she said. “If there were no new clients, their enrollment would have dropped significantly.”
In fact, the latest statistics show FamilyCare’s enrollment increasing between April and May, with its percentage of the overall population (328,709) growing from 6.6 to 6.9 percent.
But that’s not true in Multnomah County, Heatherington insisted. His plan actually lost 258 members between March and May, whereas CareOregon gained 2,787 newcomers. Since last November, FamilyCare has 962 fewer members in the tri-county area.
Heatherington cited a conversation with Rosa Frank, a prepaid health plan coordinator with Medicaid, who told him on June 15 that “there was no algorithm in place” to assign members to FamilyCare since it was a “married” plan and offered both mental health and physical health services. “There was no process or directive in place to do enrollment” for FamilyCare, and “this system defect was previously identified,” she told him.

Unless this problem is resolved, FamilyCare estimates that it will lose approximately $9-10 million in 2010.


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