Louisiana starts to wind down UnitedHealthcare’s Medicaid contract covering 330,000 people

Louisiana started moving 330,000 Medicaid recipients last week out of insurance plans UnitedHealthcare offers at the direction of Attorney General Liz Murrill, who is suing the company. 

The Louisiana Department of Health opened up a special, monthlong re-enrollment period Jan. 15 for all Medicaid recipients with UnitedHealthcare plans. They have until Feb. 15 to sign up for health insurance with one of the five remaining companies in the state’s Medicaid program. If they don’t pick a new insurer by that deadline, the health department will automatically assign them to a new plan starting April 1. 

State Medicaid Director Seth Gold said his office has sent out at least one notice to every UnitedHealthcare enrollee informing them their health care plan won’t be offered after March 31. 

“We’re trying to provide as much flexibility and opportunity for our United members,” Gold said Wednesday at a health care summit Gov. Jeff Landry’s administration organized.

AmeriHealth Caritas, Aetna, Elevance Health, Humana and Louisiana Healthcare Connections are the other companies that will continue to provide Medicaid plans in the state.

A little over 1.5 million people in Louisiana, about a third of its population, receive health insurance through Medicaid, a government-backed program funded mostly with federal money. Those who qualify include low-income citizens, pregnant people and people with disabilities. 

In December, the state health department abruptly announced it would be pulling back from a $4.2 billion contract with UnitedHealthcare to provide Medicaid coverage throughout 2026. State officials have not said how much of that $4.2 billion contract, one of the largest in state history, will be paid to the company to cover the shortened, 90-day contract. 

With 330,000 enrollees, UnitedHealthcare was the second largest private plan in Medicaid at the end of last year.

Murrill directed the health department to cancel the UnitedHealthcare contract because the company refused to provide documents to her office about its prescription drug pricing for Medicaid. The attorney general has alleged UnitedHealthcare overcharged the state for prescription drugs and asked for the information as part of a lawsuit brought on behalf of the state. 

The canceled contract took Louisiana state lawmakers by surprise, however. 

In late November, the Landry administration asked legislators to sign off on the yearlong contract with UnitedHealthcare before terminating the arrangement less than two weeks later.

Health Secretary Bruce Greenstein said Louisiana would be willing to continue working with UnitedHealthcare if the company and Murrill reach an agreement in the next few weeks. 

“United is not out yet,” Greenstein said. “There is still an opportunity for the plan/corporation to meet the requirements of the attorney general and resolve their dispute.”

Reaching a consensus seems unlikely. The attorney general’s office said  Wednesday afternoon there had been “no change” in its standoff with UnitedHealthcare. State Rep. Dustin Miller, D-Opelousas, who leads the Louisiana House Health and Welfare Committee, said UnitedHealthcare does not want to be part of the Medicaid program anymore.

“United is not interested in coming to the table. They are out,” Miller said in an interview Wednesday. 

When moving UnitedHealthcare recipients into new plans this spring, Greenstein and Gold said the state will prioritize keeping families together with one health insurer. They will also try to move people to plans their doctors and medical providers already accept .

Louisiana will also provide more flexibility to Medicaid enrollees who want to switch plans in general. Starting in March, any Medicaid recipient will be allowed to switch plans twice during the calendar year at any time. They will no longer have to wait until an open enrollment period in the fall to move to a different insurer, Gold said.

The new flexibility with Medicaid enrollment is expected to save the state money. Louisiana will no longer have to hire as many insurance brokers and ramp up marketing for an open enrollment period that less than 3% of Medicaid enrollees were using to switch plans anyway, Gold said.