Ohio awards Medicaid external quality review contract after limited competition

Ohio Controlling Board, Aug. 25 — The Controlling Board approved a contract letting Mercer perform Ohio’s external quality review organization (EQRO) work for Medicaid after agency officials said few vendors bid and federal rules require the state to hire an independent third party. The vote approved spending authority for an EQRO contract that the Department of Medicaid described as required by the Centers for Medicare & Medicaid Services (CMS) and made up of roughly 31 discrete review and validation projects. Agency officials said the contract's cost reflects both a larger set of federally required activities and higher reporting and analytic detail CMS now demands. Why it matters: The EQRO work underpins federal reporting, validates performance measures, and supports quality-improvement projects tied to managed-care organizations (MCOs). Controlling Board members pressed the department on why more bidders did not respond, the growth in contract costs, and whether the state can reduce reliance on outside contractors. Medicaid officials said the market for EQRO work is small and specialized. Adam Lanafelt of the Department of Medicaid said roughly a dozen firms nationally provide this work; several operate only in a single state. Allison Miles, deputy legal counsel who oversees procurement, said the department invited additional qualified firms after an initial solicitation produced an unsuccessful bidder and one inadequate proposal. "Mercer won the contract," Miles told the board, adding that the department ran a targeted solicitation, used a published scoring rubric and negotiated contract terms after Mercer earned sufficient points to open pricing. Officials and clinical staff described what the EQRO does and how the results…