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NEWS

Dropping Aetna from Medicaid means job losses

Jonathan Starkey and Jon Offredo
The News Journal

About two hundred Delaware-based healthcare jobs will be lost at the end of the year after the state department of Health and Social Services announced Wednesday it will no longer offer Medicaid coverage through one of its managed care organizations, Delaware Physicians Care Inc.

Some employees working with Delaware Physicians Care, an Aetna health plan, may have opportunities to get other jobs with the company's Medicaid operation. Aetna's two closest plans are in Maryland and Pennsylvania, said Aetna spokesman Walt Cherniak. But by Jan. 1, the 202 jobs associated with the Aetna plan will be gone.

"We're going to be talking to our employees on a one on one basis," Cherniak said. "There will be job reductions, it is just impossible to say right now how many there will be."

About 137,000 Delaware Medicaid patients are enrolled in an Aetna Delaware Physicians Care plan, meaning those patients will have to transfer over to a Highmark or United Healthcare plan when open enrollment begins Nov. 1. Currently, 54,000 Medicaid patients are enrolled in a United Healthcare plan.

Stephen Groff, director of the state's Medicaid program, said the Delaware Department of Health and Social Services will send out supplemental enrollment materials to educate Medicaid patients about their options and "reinforce that they have a choice."

"We'll be identifying those populations that perhaps have the greatest risk or transition needs," Groff said Thursday. "The bottom line is nothing ever goes perfectly and we realize that. It's just very important for people to understand if they have a concern or an issue they need to reach out to us."

Rita Landgraf, DHSS secretary, said the department was ready to move forward with three managed care organizations but financial negotiations failed with Aetna.

"We actually thought three carriers would be the appropriate level," Landgraf said. "Unfortunately at the end of the day we we couldn't come to an agreement with Aetna."

About 230,000 Delawareans rely on Medicaid, an insurance program for low-income residents funded jointly by the federal and state governments. Roughly 200,000 of those patients get care through one of the managed care organizations. More than $1.6 billion flows through the managed care system in Delaware.

Medicaid is one of the state's largest public expenses, costing state taxpayers about $700 million annually.

President Obama's health care law expanded eligibility for the program up to 138 percent of the federal poverty level. More than 8,000 newly eligible Delawareans have enrolled since implementation of the expansion last year, and Landgraf expects that number to grow.

The federal government is picking up the vast majority of the cost for those new patients.

Landgraf acknowledged Thursday that dropping Aetna could mean short-term job losses, but suggested many of those workers in direct support roles could find new jobs.

"Those jobs don't go away," Landgraf said. "The other carriers will need to get that level of personnel to support the population. So the jobs themselves don't go away. They just might not be part of that company. I thought that the Aetna team on the ground was exceptional."

Those who choose United Healthcare plans could still be shut out of A.I. du Pont Hospital for Children after contract talks between Nemours and United Healthcare fell apart this spring. Parents of children requiring specialty care were urged to find new providers in Philadelphia or Baltimore.

Contact Jonathan Starkey at 983-6756, on Twitter @jwstarkey or at jstarkey@delawareonline.com. Contact Jon Offredo at 678-4271, on Twitter @jonoffredo or at joffredo@delawareonline.com.