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Thursday, October 12, 2006

Ind. Courts - "Insurance companies: State erred in awarding contract"

A story today in the Indianapolis Star reports:

Two companies that failed to win contracts to serve the Hoosier Healthwise insurance program have filed complaints in federal court.

The suits contend the Family and Social Services Administration and Department of Administration did not properly evaluate their proposals and violated federal guidelines for awarding contracts.

In a related development, a third unsuccessful bidder for a share of the $4.4 billion, four-year contract has turned to the Indiana Supreme Court after a similar complaint was dismissed by a Marion County judge.

Attorneys for Caresource Indiana and Molina Healthcare of Indiana filed the complaints Tuesday in U.S. District Court, Southern District of Indiana. They are seeking damages and an injunction that would prohibit the state from executing the new contracts -- set to take effect Jan. 1 -- with the three winning firms.

In the other case, Harmony Health Plan of Indiana is asking that its appeal of the Marion County decision bypass the Court of Appeals so the Supreme Court can hear the complaint before the new contracts go into effect.

Attorneys for the state filed a response Thursday opposing Harmony's request, saying the lower court decision was correct and there is no emergency that requires a speedy determination by the Supreme Court.

Hoosier Healthwise, a combination of Medicaid and the Children's Health Insurance program, serves about 535,000 low-income Indiana residents.

Readers may recall the Sept. 5th Court of Appeals opinion in City of Fort Wayne v. Pierce Manufacturing (see ILB entry here), where the Court held that:
as an unsuccessful bidder, Pierce was not a “person aggrieved” and did not have standing to appeal the City’s award of the contract under the Public Purchasing Statute.
For more on the case, see this ILB entry from Sept. 6th.

A check of the docket in Pierce (90 A 02 - 0512 - CV - 01155) shows that a petition for transfer is pending, filed Oct. 5th. Furthermore, amicus curae briefs have been filed by Molina Healthcare, one of the parties that filed suit in federal court yesterday in the FSSA suit.

Harmony Health Plan v. Ind. Dept. of Administration (49 A 02 - 0610 - CV - 00846) is the case identified in the Star story as filing for expedited appeal (or, alternatively, a stay of the State's current contracting, pending review) directly to the Supreme Court.

The ILB has obtained copies of the complaints of Molina Healthcare and Caresource Indiana filed here in federal court.

Posted by Marcia Oddi on October 12, 2006 09:08 AM
Posted to Ind Fed D.Ct. Decisions | Ind. App.Ct. Decisions | Ind. Sup.Ct. Decisions | Indiana Courts