Mid Atlantic leaving Md. Medicaid business

Maryland Watch

December 21, 1996

With the state tightening Medicaid reimbursement, Mid Atlantic Medical Services Inc. (MAMSI) of Rockville is getting out of the Maryland Medicaid business.

MAMSI currently has 40,000 Medicaid enrollees in the state and will continue to serve them until they can be enrolled in other plans, which should take until about July, Michael H. Savage, a company spokesman, said yesterday.

MAMSI has posted two straight losing quarters. In October, it cut back on areas it serves with its Medicare HMO, saying reimbursements were too low. MAMSI projects that its payments for Maryland Medicaid enrollees would decline from $152 to $122 per member per month, Savage said. He said MAMSI still has Medicaid members in Virginia and Delaware, but is considering cutbacks in Virginia as well.

Also yesterday, Foundation Health of Rancho Cordova, Calif., announced that it had been awarded an 18-month contract, valued at $7.8 million, to enroll Maryland Medicaid recipients in managed-care plans. The state decided to use a third-party enrollment broker after a number of abuses by HMO recruiters.

Pub Date: 12/21/96

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