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Case Updates

Insurance Companies Fight to Hide Data on Billions of Taxpayer Dollars Expended for Medicaid

The Law Center is litigating on behalf of the public interest to keep insurance companies from hiding how they reimburse dentists who treat Medicaid patients.

Running Pennsylvania’s Medicaid program costs more than $20 billion per year and accounts for one-third of the state’s general fund budget. Most Medicaid expenditures flow through private health insurance companies before reaching physicians and dentists who treat low-income children, people with disabilities, and other Medicaid enrollees.

Now, the nation’s largest insurance companies are fighting the Law Center in the Pennsylvania Supreme Court to keep this flow of public money under wraps. Managed care organizations (MCOs) including Aetna Better Health, Inc., Keystone Mercy Health Plan, and UnitedHealthcare of Pennsylvania, Inc., argue in briefs recently submitted to the Pennsylvania Supreme Court that contracts showing the rates by which they disburse public funds to dental subcontractors and dentists to treat people enrolled in Medicaid are not subject to the state’s Right-to-Know Law. They claim that these contracts must be hidden from public scrutiny because they contain “trade secrets” and “confidential proprietary information.”

If the insurance companies prevail, taxpayers will have no way to evaluate how these public funds are spent and whether these billions of dollars are paid to providers in accordance with federal laws designed to ensure access to quality care.

This briefing is the latest development in the Law Center’s 3½-year battle to uncover these rates.

The MCOs are supported in their arguments by two associations that represent health insurance companies: America’s Health Insurance Plans (AHIP) and the Pennsylvania Coalition of Medical Assistance Managed Care Organizations. Both filed amicus briefs in the case. AHIP in particular has substantial reach: it represents all of the major health insurance companies in America, and its members cover more than 70% of the people enrolled in Medicaid. AHIP’s stake in this case amplifies the potential national ramifications of a court ruling against transparency.

In addition to wanting to keep secret how they spend public funds, the insurance companies also argue that the rates have nothing to do with the care received by low-income children and other Medicaid beneficiaries. However, they simultaneously acknowledge a direct connection between reimbursement rates and availability of service.

Their inconsistency and admission of a problem gets to the heart of why the Law Center launched this effort in 2011. Data on provider payment rates are necessary to understand whether dentists can afford to accept Medicaid patients. Lawsuits on behalf of Medicaid enrollees around the country have repeatedly proved that low provider reimbursement rates are a major barrier to accessing quality care.

In an important recent decision in a Law Center class-action lawsuit, a federal judge in Miami found that Florida’s Medicaid program provided inadequate reimbursement rates for medical and dental care, and that these low rates were “by far the most important factor” determining whether doctors and dentist would participate in Medicaid.

Briefing is now concluded in this matter. We will post an update once the Court schedules oral argument.

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