Please ensure Javascript is enabled for purposes of website accessibility

CareFirst acquires Medicaid plans in Maryland, Washington

CareFirst BlueCross BlueShield has purchased Medicaid  managed care organization plans in Maryland and Washington as the region’s dominant health insurer adds Medicaid plans to its portfolio for the first time in decades, the insurer announced Friday.

The nonprofit insurer bought University of Maryland Health Partners, owned by the University of Maryland Medical System, and Washington, D.C.’s Trusted Health Plan. Both acquisitions are subject to regulatory approval.

“Our unique not-for-profit mission calls on us to provide access to affordable health coverage and to support public and private initiatives that provide coverage for the individuals and families in the communities we serve,” CareFirst President & CEO Brian D. Pieninck said in a statement.  “We want to help people meet health care needs at every stage and in every circumstance of life – and for many, Medicaid represents the most affordable coverage.”

Medicaid MCOs are the health insurance providers for Medicaid. They manage patients’ care instead of the state and help to reduce costs to the program while working to improve health plan performance, health care quality, and outcomes, according to the federal Medicaid program.

Not all Maryland Medicaid recipients are eligible for an MCO. Recipients not eligible include people on Medicare, people 65 years of age or older or people in a program with limited benefits, like the Maryland Family Planning Program.

Maryland has nine Medicaid MCOs, including  Aetna Better Health, Amerigroup Community Care, Jai Medical Systems, Kaiser Permanente, Maryland Physicians Care, MedStar Family Choice, Priority Partners and UnitedHealthcare.

The Baltimore-based Health Partners serves 47,000 enrollees in Maryland. The acquisition does not include the University of Maryland Health Advantage Plan, which covers 5,600 people enrolled in Medicare and Medicaid.

The University of Maryland Medical System said Medicaid enrollees in its plan had doubled since 2015 and it believed handing the plan off to a payer like CareFirst was important.

“It ensures our Medicaid enrollees have uninterrupted access to comprehensive health coverage and care through partnership with a Maryland-based, not-for-profit health plan,” Mohan Suntha, president and CEO of University of Maryland Medical System, said in a statement. “Delivering high quality, compassionate care is fundamental to the missions both UMMS and CareFirst serve, and we are confident that Health Partner enrollees will benefit from CareFirst’s expertise in the market.”

Trusted Health Plan covers 34,000 people in Washington.

CareFirst had offered Medicaid MCO plans more than 20 years ago but left the market. About two years ago, the insurer started looking at ways to reenter the market, Pieninck said on a media call Friday.

He cited substantial changes in the Medicaid market, including regulatory changes and the Medicaid expansion under the Affordable Care Act that added thousands of people to Maryland’s Medicaid rolls.

The insurer had two options to get back into the market, he said. First, CareFirst could start its own Medicaid plan. But about a year ago, it decided to pursue buying and investing in an existing plan.

“We spent the better part of 2019 really digging into that and looking not just at capabilities but also culture,” Pieninck said.

The deals offered CareFirst an opportunity to invest in and integrate its abilities with the MCOs’.

But they will also give CareFirst an opportunity to learn from the Medicaid plans, which Pieninck said were coming up with more innovative ways to deliver care, especially to those who need it most.

“We look at this as a broader investment in capabilities,” he said. “CareFirst will benefit from some of the innovations that have existed in these companies.”

To purchase a reprint of this article, contact