Three private HMOs contracting with Georgia to oversee care for Medicaid beneficiaries have not paid providers for millions of dollars in outstanding claims, according to a lawsuit filed Tuesday in Fulton County, Ga., Superior Court, the Atlanta Journal-Constitution reports. According to the suit, filed by a group of Georgia physicians, the Peach State Health Plan, AMGP Georgia Managed Care Company and Wellcare of Georgia were aware at the time they were awarded the contracts last year that they would be incapable of paying claims on time. The suit also alleges that the plaintiffs have been forced to lay off employees and reduce treatment of Medicaid beneficiaries because of late payments from the HMOs. Attorney Rod Edmond, who represents the plaintiffs, said, "These are doctors who have made a commitment to treat the less fortunate, and a substantial percentage of their patients are Medicaid patients," adding, "[I]f they are owed $50,000 or $75,000, it could literally put them out of business." Peach State, AMGP and Wellcare were selected from 10 companies that submitted bids to the Georgia Department of Community Health last year after the state announced a plan to shift Medicaid beneficiaries to HMOs. One million Medicaid beneficiaries and 200,000 children in PeachCare for Kids are expected to be enrolled in the HMOs by Oct. 1, the Journal-Constitution reports. Kent Jenkins -- a spokesperson for Amerigroup, the parent company of AMGP -- said that he has not seen the lawsuit but added that the plan had paid $80 million in claims in its first 10 weeks. Ninety-seven percent of the claims were paid within 15 days, according to Jenkins. "For a program that's just getting stared, that's a very, very solid start by any stretch of the imagination," he said (Ahmed, Atlanta Journal-Constitution, 8/16).

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