The Minnesota Department of Human Services (DHS) followed the law and used reasonable standards when evaluating competitive bids for public health insurance programs this year, according to a report released Tuesday by the state's Office of the Legislative Auditor.
The report concludes that DHS used a "reasonable and inclusive process" to generate a request for proposals from HMOs and county-based groups hired by the state to manage care for public insurance enrollees.
The auditor also concluded that DHS correctly calculated the total technical and price bid scores, and properly ranked managed care organizations.
Legislators called for the audit report because the bid results are prompting changes in the lineup of health plans that operate in Medical Assistance and MinnesotaCare next year. The biggest shift involves more than 350,000 people who are moving from Minneapolis-based UCare to other managed care organizations.
"We were unable to commence a full review of DHS's competitive bidding process," the report states. "However, we did agree to conduct a limited review."
DHS says the competitive bid results will save state and federal taxpayers $450 million next year. While UCare has cut about 250 jobs in the wake of the state's decision, Blue Cross and Blue Shield on Monday announced expansion plans based on its winning bids.
Blue Cross and Minnetonka-based Medica expect to gain more than 100,000 enrollees each next year in the public health insurance programs.
In the report, Legislative Auditor James Nobles wrote that "the Legislature needs to address certain other procurement policies and do so before the next round of competitive bidding for public health care programs."
