Payers tighten their control

Of a recent Centene-WellCare merger, one provider cited Centene’s ‘track record’ in Illinois
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Friday, February 14, 2020

ST. LOUIS – As big payers get ever bigger, HME providers and stakeholders fear the impact these monopolies could have on the market.

Centene Corp. in January finalized its acquisition of WellCare Health Plans, creating what it calls the leading healthcare enterprise focused on government-sponsored health care programs. It now provides health care to more than 24 million members across 50 states.

“The bigger the payers get, the more control of the market they have,” said Craig Douglas, vice president of payer relations for The VGM Group. “They are always looking to get things cheaper and making the providers feel like they don’t have much choice—it’s a take-it-or-leave-it approach.”

To get the deal approved, Centene divested its Medicaid and Medicare Advantage plans in Illinois, and WellCare closed its Missouri Medicaid and Medicare Advantage plans and its Nebraska Medicaid plans.

Provider Dan Heckman says he hasn’t seen any problems with WellCare in Illinois yet, but he points to Centene’s “lousy track record” in the state, where Centene’s Illinicare, a Medicaid managed care organization, implemented cuts of up to 50% in 2018.

“I would expect when contracts are sent out the next time, they will reflect Centene-type pricing,” said Dan Heckman, president and general manager of Heckman Healthcare in Decatur, Ill. “That’s definitely going to be a problem.”

It all comes down to money, says provider Gary Sheehan, with patients the ones who ultimately suffer.

“Profit is their clear motive,” said Sheehan, president and CEO of Sandwich, Mass.-based Cape Medical Supply. “It doesn’t seem like insurers are particularly concerned with patient experience. A lot of time, when things go wrong, the root cause is the insurer’s rules and regulations.”