Blue Cross to Sue to Block Contract Award
PROVIDENCE, R.I. (AP) -- Blue Cross & Blue Shield of Rhode Island on Tuesday said it will sue to block the awarding of a health-care contract for state workers to a competitor.
Gov. Don Carcieri's administration earlier this month awarded the three-year management contract to United Healthcare of New England. The contract would take effect in January. The state on Tuesday denied Blue Cross' protest, which claimed its offer was better for the state than United's proposal.
"We feel the state analysis was wrong. We will be pursuing this in Superior Court," Fraser said. He said the company will seek a restraining order preventing the contract from being awarded, until a judge can determine whether the state acted properly.
Blue Cross has the current contract for the estimated 25,000 state employees and retirees. In a letter to Blue Cross, Administration Director Beverly Najarian said the state acted "in good faith, complied with all the purchasing statutes, regulations ... and fairly awarded" the contract to United.
Carcieri's office claims United's successful bid offered about $8 million more in savings than did Blue Cross' proposal. Najarian said she would be "astounded if any judge would allow them to put a restraining order on this. My understanding is they would have to have much more substance."
Blue Cross had argued it offered a better deal on drug rebates, savings tied to contractual deals with area hospitals and other benefits. The company also claims United didn't meet certain bid requirements. Najarian said the savings Blue Cross claims the state failed to recognize were projections that were not guaranteed in the company's bid.
"There were no guarantees, no assurances, they were unwilling to take any risk themselves," she said.
United spokeswoman Debora Spano said the company is confident "we've come in with the best bid for the state and taxpayers. In the end it will be proven that we have the best value."
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