6:32 PM, Oct 14, 2012 | The Courier-Journal
Over 15 years ago, a group of visionary leaders from the University of Louisville Health Sciences Center, the Family Health Centers, Park Duvalle Health Center and Gov. Paul Patton established Passport Health Plan. Passport was a public-private partnershipthat would, in effect, operate the Medicaid program in Jefferson and 15 surrounding counties known as Kentucky’s Medicaid Region 3.
This public-private partnership was unique in the some important ways: It was governed by a coalition of hospitals, physicians, other clinicians and member advocates. Five local, nonprofit health care organizations provided the financial capital to establish the plan. It was, and still is, a nonprofit Kentucky corporation which allows Passport to focus on medical care without the overriding goal of generating a return for shareholders.
Moreover, the founders of Passport focused on three primary goals. The first was to offer a network of providers that would equal or exceed those provided by commercial insurancecarriers. Second, the plan would focus on quality, including high member and provider satisfaction levels. Finally, Passport would use financial incentives to reward physicians who improve the quality of, and access to, care while reducing the rate of growth in cost.
Interestingly enough, then as now, reducing the cost increases in the Medicaid program was a goal of the Patton administration. His administration was able to gain agreement from the providers in Region 3 to voluntarily help the commonwealth achieve a 5 percent reduction in cost during the first year of operation of the program.
So, how did Passport perform when compared to these initial goals?
First, access to care for Medicaid beneficiaries is unfettered. Ninety-one percent of primary care physicians and every single hospital in Region 3 participate in Passport, with comparable percentages in every other provider category. When it comes to the choice that matters, the member’s choice of his or her doctor, Passport is unequaled.
Second, Passport has achieved national recognition for the quality of care provided to its members, including unusually high levels of member and provider satisfaction. This was achieved because it was the focus of the plan from the very beginning. The sponsoring providers believed that a focus on quality would represent an investment in the future and would lead to lower costs. This required meaningful collaboration with providers, continuing to this day, that experimented with using financial incentives to control cost, something that has gained widespread acceptanceonly recently and is embodied in the Affordable Care Act.
Finally, while it has received little fanfare, Passport was successful in reducing the rate of growth in costs. A recent study commissioned by Passport reports that from 2008 to 2010, the commonwealth’s cost (the amount it paid to Passport) in Region 3 increased by 0.7 percent annually while costs in the other regions of the state increased by almost 8.5 percent annually. Over the 15-year life of Passport, the commonwealth paid Passport $8 billion. Of this $8 billion, Passport has reported an excess of revenues over expenses during that time of only $34 million, or less than one-half of 1 percent. During that same time, Passport spent 91 percent of revenues on medical care in sharp contrast to the level of spending for commercial insurance carriers.
Recently, the commonwealth announced a new approach to managing care for Medicaid beneficiaries in Region 3. Under the new approach, Passport will now be one of four plans competing for Medicaid patients in this region; however, Passport will continue to be unique among the four plans. We will be the only locally controlled, provider-sponsored and community-affiliated plan that is focused solely on improving the health and quality of life of our members. Passport will work in close collaboration with the provider community, the folks who have a direct impact on the lives of our members.
While we question the wisdom of the decision to change the approach to serving Region 3, we will strive to serve all of the Medicaid beneficiaries in this region, either directly through our provider network, or indirectly through collaboration with the commonwealth and the other organizations coming to Region 3. We look forward to continuing our collaboration with the commonwealth, our providers and member advocates as we seek to help Kentuckians lead healthier lives.
Chief Executive Officer –
Passport Health Plan –
Louisville 40229 –