Managed Care Plan To Lose Contract with TennCare Unless It Corrects Financial, Claims-Processing Problems

Unless Universal Care of Tennessee "quickly" corrects some financial problems, the insurance company could lose its contract with TennCare, Tennessee's Medicaid managed care program, and its 134,636 beneficiaries would be transferred into a different health plan, the Nashville Tennessean reports. State Department of Commerce and Insurance spokesperson Marilyn Elam on March 26 said that because of the company's history of late payments to providers, inadequate claims-processing system and negative net worth of $42 million, the state is considering ending the company's TennCare contract, meaning that the company would be placed either in state-supervised rehabilitation or in liquidation. Elam added that Universal Care, which began participating in TennCare last July and is one of nine managed care organizations in the program, is required by state law to have a net worth of at least $6.52 million (Lewis, Nashville Tennessean, 3/27). If Universal Care cannot resolve its problems by April 19, its TennCare beneficiaries on May 1 would be shifted into TennCare Select, a backup fee-for-service program administered by BlueCross BlueShield of Tennessee. TennCare Director Mark Reynolds said, "We must act firmly to hold managed care organizations accountable for their contractual obligations, specifically to pay providers promptly and accurately. The Department of Commerce and Insurance and TennCare are working together to review [Universal Care's] difficulties." Universal Care is the third TennCare MCO that has been unable to meet the program's net worth requirement in recent years. Last year the state terminated its contract with Access MedPLUS, and two years ago it took over Xantus HealthPlan (Sharp, AP/Memphis Commercial Appeal, 3/27).