Centene addresses ‘challenges’ in California’s Medi-Cal Rx launch

Dive Temporary:

• Centene CEO Sarah London addressed considerations surrounding a subsidiary’s implementation of California’s new Medicaid prescription drug program after information studies chronicled members struggling to get entry and approvals to wanted drugs.
• “There [is] zero backlog in authorizations,” London mentioned Tuesday on a name with traders. California Division of Well being Care Companies spokesman Anthony Cava confirmed, telling Healthcare Dive there is no such thing as a backlog in prior authorizations or approvals for medicines throughout the state’s prescription drug program run by Centene subsidiary Magellan Well being.
• Individually, Cava confirmed that the division is presently investigating Centene relating to alleged overbilling for Medicaid pharmacy companies in California following actions and settlements in different states.

Dive Perception:

Shortly after Gavin Newsom was sworn in as California’s governor in 2019, he sought to sort out the excessive price of prescribed drugs. To harness the size of shopping for in bulk for the state’s roughly 13 million Medicaid enrollees, Newsom introduced Medicaid prescription buying underneath one umbrella by an government order.  

Magellan Well being was later awarded the statewide contract for pharmacy companies, generally known as Medi-Cal Rx. Magellan estimated the contract would ship annual income between $70 million and $80 million, in response to a Nov. 7, 2019, submitting with the U.S. Securities and Trade Fee.

Medi-Cal Rx went reside in January. That very same month, Centene accomplished its $2.2 billion acquisition of Magellan.

“There have been challenges out of the gate, however I feel the staff recovered extremely effectively. And, you understand, you’d need to ask California, however at the very least the alerts we’re getting from them is that they are very proud of the collaboration and the partnership,” London mentioned on Tuesday’s name.

She added that the Magellan staff in California labored intently with the state within the days after Medi-Cal Rx went reside and mentioned “it has been performing very, very effectively since mid- to late February.”

The challenges in California come on the heels of Centene reaching settlements in various different states relating to allegations of overbilling Medicaid applications.

Centene reached a no-fault settlement with New Hampshire and agreed to pay the state $21.1 million in January. Centene has reached comparable settlements in different states, together with Illinois, Ohio and Mississippi. Centene beforehand disclosed that it has put aside $1.25 billion to resolve these disputes, in response to its annual report filed with the SEC.

California’s well being division that oversees the Medicaid program is conscious of the settlements elsewhere and mentioned it “takes all allegations of fraud, waste, and abuse critically and investigates allegations when warranted,” in response to the assertion supplied by Cava.