Six DMOs Likely to Vie for Texas Medicaid Dental RFP But Newcomers May Not Get a Contract

An industry insider has told TDMR that he thinks six dental management companies will vie for the Texas Medicaid dental contract RFP that closes in September.

He named the two current contractors, MCNA and DentaQuest, and included Liberty Dental and Delta Dental out of California, Avesis, and Scion Dental now Skygen as insurers he felt would gamble the estimated $1 million needed to put a bid together for the contract.

The Texas contract is one of the largest managed care awards outside of California.

Must have a provider network already in place 

Other large players in the industry such as Cigna, Aetna, or Superior Health/Centene with their DMO Envolve, he felt would not apply.  They are too involved in other states and would also have trouble meeting a major requirement of the Texas RFP which is demonstrating a network of providers already in place.  Both Liberty and Avesis have been recruiting providers for their networks in Texas for almost a year.  Delta Dental is apparently going to go with the network it established back in 2012-13 before it dropped out of the Texas Medicaid dental market.

Only two contracts to be awarded as a minimum, not three

One of the concerns for new DMO applicants is that the state did not increase the minimum number of contracts to be awarded under the RFP from two to at least three.  As TDMR previously highlighted, the RFP states “HHSC intends to award contracts to at least two Dental Contractors.”  It was thought in the DMO industry that the state would definitely increase the number to three.

There are a number of reasons this is problematic for the new companies seeking to enter the market.  First, despite some provider dissatisfaction with both MCNA and DentaQuest, it is unlikely that it has been sufficient that the state would replace them with entirely new untried entities.

Incumbents have powerful advantages

To ensure their position, MCNA maintains a powerful force of lobbyists.  At one time, it employed former Governor, now Secretary of Energy, Rick Perry.  He has been replaced by former Texas Health and Human Services Commission Executive Commissioner Albert Hawkins and the company has elevated former HHSC Chief Dental Officer Dr. Linda Altenhoff to Vice President of Program Integrity [see MCNA Board of Directors].

Altenhoff is infamous for telling dental providers involved in the Xerox orthodontic prior authorization scandal to assume that their requests were being reviewed by a board-certified orthodontist when in fact they were being rubber stamped by unqualified Xerox administration staff.  Xerox, now Conduent, is being sued for Medicaid fraud by the state which is seeking to recover some $2 billion.

DentaQuest, too, has an army of lobbyists but also tries to show that it is trying to meet contract requirements and save the state money.  Our insider called DentaQuest’s recent approach to large providers about taking capitation payments instead of fee-for-service a “trial-balloon” meant to build ammunition for the RFP.

New DMOs problematic for state

Lastly, he felt Health and Human Services has lost a lot of their expertise in evaluating dental plans because of Altenhoff moving to MCNA.  The adding of additional DMOs into the mix would create new problems for the agency in how to split the state.  Also, in other states, companies losing RFPs have sued the states involved.

Status quo a possibility

For all of the above, hIs conclusion is that it would be very easy for the state to stay with the status quo.  It is not clear whether Texas is willing to move to more than two DMOs.

With all the problems uncovered again in HHS contracting, it will be interesting to see what happens.


7 Responses

  • Dr Altenhof?

    What a joke? She has known history of lying to doctors. I was there when she knowing lied to a bunch of orthonditist about each case was to be supervised by a board certified orthodontist. I saw this myself. Don’t trust MCNA.

  • Why would the state trust companies like avesis. The history is laden with poor follow through and sound business decisions. Joining the Guardian name couldnt help them as in an almost desperate attempt to commit industrial suicide, hired the legacy management team from a sion dental. Look at the issues scion is still cleaning up.

    Texas needs a company who will be honest and provide services promised.

Leave a Reply

Your email address will not be published. Required fields are marked *