Washington, D.C., Mayor Muriel Bowser declared a state of emergency Sept. 1 to extend MedStar's Medicaid contract.
The move came after threats that MedStar, which also manages a sprawling hospital system, would end its relationship with the two insurers — CareFirst and AmeriHealth — that cover most of the area's Medicaid enrollees, according to The Washington Post.
MedStar's insurance arm was one of three companies to win a city Medicaid contract in 2020, but the decision came with backlash as a judge found that the process violated rules and the payer should not have been given a contract.
MedStar's insurance arm covers 60,000 Medicaid beneficiaries. Officials are confident that the new deal will lead to MedStar continuing to allow its doctors to be in-network for other Medicaid insurers.
Ms. Bowser is now facing criticism for the legality of the move, which violates both procurement laws and a judge's directive, according to The Washington Post.