The Public Employees Insurance Agency in West Virginia has denied two protests of its decision to award a multimillion-dollar management contract to a Maryland company.
Humana Inc. and Highmark Health Insurance Co. filed the formal protests after the PEIA awarded the contract to manage its new Medicare Advantage program to Bethesda, Md.-based Coventry Health Care.
Ted Cheatham, the PEIA’s director, told Humana and Highmark in letters that the PEIA evaluation committee which awarded the contract had acted “appropriately, evenly and fairly.”
Humana, based in Louisville, Ky., had claimed the bidding process contained technical errors that should be reviewed. Its $72.3 million bid received 92 out of a possible 100 points from the PEIA, while Coventry’s $83.3 million bid received 93 points.
Pittsburgh-based Highmark, whose bid was disqualified, contended that the PEIA did not give it sufficient notice of changes in the agency’s request for proposals.
After Coventry was determined to be the winning bidder, Cheatham said he was authorized to negotiate a “best and final offer” on costs. Those negotiations reduced the PEIA’s cost to about $55 million, he said in his letter to Humana.
The PEIA Finance Board approved Medicare Advantage in December in response to a new federal funding program that gives the state lump-sum payments for covering Medicare retirees.
Medicare Advantage, which will cover about 35,000 PEIA retirees, is expected to draw an additional $50 million to $60 million in federal funding to the state, PEIA said.
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Information from: The Charleston Gazette,
http://www.wvgazette.com
Topics Virginia Maryland West Virginia
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