Wells resigned Feb. 27 after nearly two years as director of the Office of Medicaid Policy and Planning, a part of the Indiana Family and Social Services Administration.
He intends to finish his medical residency at the Indiana University School of Medicine in Indianapolis.
FSSA Secretary Anne Murphy appointed Pat Casanova as Wells' interim replacement. Casanova has been serving as Medicaid's director of agency coordination, integration and policy.
"This has been a great experience and I am grateful for the opportunity," Wells wrote in an e-mail he sent to colleagues.
Meanwhile, the Indiana House of Representatives passed language as part of the budget bill that would block Medicaid's effort to save millions by consolidating the buying of pharmaceuticals for Medicaid patients.
In order to centralize drug purchases, Indiana Medicaid would take away that responsibility from the insurance companies it hires to administer Medicaid benefits for nearly three-quarters of Medicaid's 800,000 patients.
Those three companies are Indianapolis-based MDWise Inc.; Managed Health Services, a unit of St. Louis-based Centene Corp.; and WellPoint Inc.'s Indianapolis-based subsidiary, Anthem Blue Cross and Blue Shield.
Buying and managing pharmaceuticals represents about 15 percent of the value of their contracts.
Federal law mandates that drug companies give discounts to state Medicaid programs. Wells wants Indiana to be able to take advantage of those discounts, which average about 35 percent-much higher than what the insurance companies are able to negotiate with drug companies.
Medicaid needs those savings, Wells said in a February interview, or it will have to cut its payments to physicians, hospitals, nursing homes and other providers 5 percent.
"It's really simply a trade-off on a one-to-one level," Wells said.
But the budget bill passed by the House, HB 1001, demands no change either to the insurers' Medicaid contracts or to reimbursement rates for health care providers.