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Medicaid hearing

Max Naethe of Kalispell, who testified Friday in favor of a bill to expand Medicaid coverage in Montana, listens with his 10-year-old daughter, Aliceia, to other testimony for Senate Bill 405 at the Capitol. Naethe said he needs a heart transplant and doesn’t earn enough money to get a subsidized policy, but that he’d be covered by expanded Medicaid. In the foreground is the sponsor of the bill, Sen. Ed Buttrey, R-Great Falls.

HELENA – If Medicaid is expanded in Montana, a health insurance company would be managing the program – and would get paid millions of dollars a year under the plan still being considered.

A fiscal analysis of Senate Bill 405 estimates the expansion’s third-party administrator would get paid $20.07 each month per covered client.

If 26,000 people sign up for the coverage in the first year, as estimated, that’s as much as $6.3 million for the insurance firm that wins the third-party administrator contract.

The same analysis estimates that nearly 46,000 people will be covered under the expansion by 2019. That’s $11 million for the managing insurer.

This amount is more than double the cost estimated in Gov. Steve Bullock’s Medicaid expansion plan, which was killed by the Montana House last month. Bullock’s plan would have hired a TPA, but paid it only an estimated $8 per client per month.

Bob Olsen, vice president of MHA, the hospital lobby that helped draft SB405, says the third-party administrator would do much more work under that bill, such as helping collect payments from covered customers. Bullock’s bill didn’t require any premium payments.

Blue Cross and Blue Shield of Montana, the state’s largest private health insurer, also has been consulting with supporters of SB405. A spokesman for the company wouldn’t say whether it plans to bid on the TPA contract, should the bill pass the Legislature.

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