Letter to New York Attorney General Against Centene Expansion

Centene plans to buy a New York Medicare company. We need to alert the NY Attorney General that many California substance use treatment facilities are failing because of policies adopted by Centene post its merger with Health Net in 2016.

How does this effect you?
We have a unique opportunity to influence what happens in New York by communicating to their Attorney General that Centene needs to first face the mess it has made in California. Many well-respected California facilities have had to close their doors, or are struggling to stay open, because Centene has refused to quickly implement and follow the direction of our Insurance Commissioner to pay its long overdue 2015-2016 claims. 
Hopefully your signature on this petition will convince the New York Attorney General to make Centene paying it's bills in California a condition of acquiring the Medicare advantage company in New York.

If you are a California substance use treatment facility Owner, CEO, biller, provider, or have been effected by Centene's merger with Health Net, please sign this letter so we can get the attention and support of New York Attorney General Schneiderman.

Strength in Numbers!




November 3, 2017

Attorney General Eric Schneiderman

Office of the Attorney General
The Capitol
Albany, NY 12224-0341


Re: Proposed Centene Acquisition of Fidelis Care


Dear Attorney General Schneiderman:


This letter is to inform you of the opposition by many in the substance abuse treatment industry to the proposed $3.75 billion acquisition of Fidelis Care by Centene. Each of the undersigned facilities are substance use treatment providers who were negatively impacted by the California acquisition of Health Net by Centene. Some of the signatories also have facilities in New York state. Post Centene’s acquisition of Health Net, Medicare decreased Health Net and Centene’s Medicare Star Quality rating from 4 to 3.5 stars after a program audit http://www.prnewswire.com/news-releases/centene-comments-on-medicare-star-quality-ratings-300534733.html


As you may know, Centene merged with Health Net on March 28, 2016. The usual arguments were made: the acquisition would improve the quality of care, reduce overall health care costs and expand access to care.  Post the Health Net acquisition, none of the claims have materialized. Premiums continue to rise, network adequacy has not improved and there is no substantial data indicating that the quality of care has improved.


Studies indicate that mergers and acquisitions in the healthcare sector often do not produce the projected results. Below is analysis by two national news organizations of the proposed Aetna/Humana merger that was not allowed to move forward:





On January 8, 2016, prior to their merger with Centene, Health Net launched a dragnet audit of virtually every substance use treatment provider in California, as well as several other states. During this unsubstantiated audit, payments were withheld although many treatment centers were taken off the audit list in the Spring of 2016. Health Net, post the merger with Centene, continued to withhold payments from many substance use treatment providers dating back to August 2015.  


Health Net, which paid all out-of-network claims from January 1, 2014-February 10, 2016 at 75% of billed after adjustments for patient responsibility, began to assert that they should have paid claims at 190% of Medicare instead.  The audit created numerous HIPAA violations by Health Net including multiple requests for the identical medical records that were lost by their organization and robo-signed, generic denials of payment for “lack of medical necessity.”  The denials did not differentiate between claims for alcoholism, dependence on illicit drugs, pharmaceutical drug addiction, or dual diagnoses. 


Due to the efforts of Addiction Treatment Advocacy Coalition, the California Department of Insurance opened an investigation in May 2016.  Subsequently, Centene has been told three times by the California Department of Insurance that they need to pay all facilities that were taken off the audit list in 2016 provided the facilities had filed complaints with the DOI.  Those who had not filed complaints could do so in 2017.  Centene was required to pay inpatient and outpatient claims for which payment has been withheld at 75% of billed, adjusted for patient responsibility and any previous payments.  In August 2017, Centene finally began to resolve some of the payment issues.  Although the settlement agreements are confidential, it is rumored that in many cases the statutory 10% per year interest has not been included.


Actions by Centene have caused many substance use treatment facilities to close their doors or suspend operations waiting for claim payments to be made. Centene has acknowledged that they have reserves that will be used to pay claims during the rest of 2017 and 2018. However, some of the claims are almost two years old. What organization do you know that can wait two years for payment?


Given the importance of the Medicare and Medicaid market in New York, we believe that the health of New York citizens will be negatively impacted if the Fidelis acquisition by Centene moves forward.



Substance Abuse Treatment Facility, CEO/Owner, Biller, and Provider


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