The Maryland Department of Health has agreed to renew Kaiser Permanente’s contract as a Medicaid provider, averting an outcome that one prominent health care advocate said would have amounted to a blow to public health.

Gene Ransom, CEO of the independent Maryland State Medical Society, said Tuesday that a tentative decision made by the state health department last week to remove the health care giant from its list of managed care organizations (MCOs) that provide care through Medicaid would have left about 110,000 Marylanders without health care coverage and seeking new doctors with little time to adjust their status.

But the two sides reached an agreement Wednesday, coming to terms that allow Kaiser to remain one of nine such providers in 2025. The decision comes with just a little over a month remaining before Nov. 1, the first day of the open enrollment period during which Marylanders must choose their health care coverage for next year.

“The Maryland Department of Health is pleased to have reached an agreement with Kaiser Permanente that will enable Kaiser Permanente to participate as a HealthChoice managed care organization in 2025,” the state and the HMO said in a joint statement issued late Wednesday. “The agreement supports historic changes that increase MCO accountability and responsibility, while focusing on the Moore-Miller Administration’s efforts to achieve health equity and improve health outcomes for Marylanders.”

The health department informed Kaiser Permanente in a letter Friday that it would not be renewing the conglomerate as part of its Medicaid delivery system.

The health department establishes the requirements providers must meet to be accepted as MCOs. Kaiser Permanente, which primarily covers residents in Prince George’s, Montgomery and Baltimore counties, has served as an MCO for the past 10 years.

In a statement it issued Friday, the department said the administration of Gov. Wes Moore and Lt. Gov. Aruna Miller, both Democrats, had introduced a number of new requirements for MCOs. It listed five such requirements. Each called for MCOs to provide services aimed at improving equity in health care, including reducing disparities in the quality and accessibility of such care across racial boundaries.

“The terms of the 2025 contract for each MCO include historic changes that increase MCO accountability and responsibility of focusing on the state’s efforts to achieve health equity and improve the health of Marylanders,” it read.

The statement listed the eight MCOs it said the department would be offering contracts for the coming year. Kaiser Permanente was not among them. The statement did not point to requirements the company had failed to meet, and Betty Hwang, a Kaiser Permanente spokesperson, declined to specify them.

Ransom said Tuesday that if the initial decision were to go forward, it would throw portions of the health care system into disarray. He also said it was unclear whether there were even enough physicians accepting new patients to accommodate what would have amounted to a sizable need on short notice.

He added that he faulted no one for the dispute — “I do understand some of the things the state is trying to accomplish here — they make sense to me — and the concerns Kaiser has raised also make sense to me,” he said — but added that his organization, a private nonprofit commonly known as MedChi, was concerned that canceling Kaiser Permanente’s contract would disrupt tens of thousands of doctor-patient relationships, a subject his group tracks closely.

Hwang suggested this week that the disagreement between the parties stemmed from the fact that Kaiser Permanente — whose Medicaid work in Maryland last year earned a rating of 4.5 stars out of 5 for “overall treatment, prevention, equity, and patient experience” from the National Committee for Quality Assurance, a health care accreditation group — stemmed from the fact that the company uses a different health care delivery model than the other MCOs employed by the state.

Kaiser is the only MCO in the group that employs its own physicians and requires its patients to use those physicians. That, Hwang said, helps determine how it tracks, records and reports patient information.

The two sides cast the agreement as a win for patients in the state.

“Working in partnership with Kaiser Permanente and our 8 other managed care organizations, the department is committed to continuing to deliver quality care for the state’s 1.4 million HealthChoice participants,” the statement read.