State signs up new HMO for Medicaid

State officials have signed up a new HMO to provide services for Nevada's Medicaid and Nevada Checkup members.

AMERIGROUP Corp. will replace Anthem, which terminated its contract with the state effective Dec. 31. Health Care Financing and Policy Administrator Charles

Duarte said the state could have conducted a formal bid process, but there will be far less disruption in services by signing AMERIGROUP, which was one of the bidders for the present contract.

Anthem decided to drop its contract with the state after saying the 3.6 percent rate increase Jan. 1 wasn't sufficient. Duarte and Human Services Director Mike Willden tried to reach a compromise but said in July they were unsuccessful.

"One of the issues is the federal government requires us to pay them an actuarially sound rate, so I can't just make something up. It has to be a rate that was determined to be appropriate," said Duarte.

Anthem provided services to Medicaid enrollees primarily in the Las Vegas and Reno urban areas. They serve some 40,600 of the more than 50,000 on Medicaid and 8,500 of the 27,500 children served by Nevada Checkup.

AMERIGROUP has agreed to take over that contract, providing all HMO services including claims administration for Medicaid patients for a fixed monthly rate.

Duarte said other options would have run the risk of higher rates for coverage or of non-compliance with federal rules, which could cost the state millions of dollars more.

- Contact reporter Geoff Dornan at gdornan@nevadaappeal.com or 687-8750.