Lawmakers extend Medicaid contract another year, while court dispute rages over cancelled deal

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BATON ROUGE, Louisiana — Lawmakers have agreed to extend the state's multimillion-dollar Medicaid claims processing contract by another year.

The extension was needed after Gov. Bobby Jindal fired the company that had been picked to take over the work, CNSI, because of concerns the firm was given favorable treatment by his former health secretary.

A criminal investigation is ongoing into the award of the now-cancelled $200 million contract to CNSI. The company is suing the state for wrongful termination.

In the meantime, the Jindal administration has kept Molina Medicaid Solutions on the job. The House and Senate health care committees agreed Thursday to extend the company's contract through Dec. 31, 2015.

Molina's current contract with Louisiana began in January 2005. The health department says the extension will cost nearly $40 million next year.

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