Medicaid Operator Kentucky Spirit Plans to Break Contract, Beshear says He’s Disappointed

By KENNY COLSTON 

 

WFLP.org 

 

Governor Steve Beshear says he’s disappointed that one statewide Medicaid operator has announced it is leaving the state.

Kentucky Spirit, part of Centene Corporation from Missouri, announced today that they would terminate their operations next July, before their contract is up.

Kentucky Spirit is one of the private Medicaid operators that took over the program for the state last year. The company encountered problems, however, and was in dispute with the state and doctors over reimbursement rates and other details of Medicaid operations.

Recently, its CEO blasted Kentucky officials for how they are handing privatized Medicaid.

The company is owned by Missouri-based Centene. In a release, company officials say they’ve notified the state Cabinet for Health and Family Services of their intent. Kentucky Spirit says it will stop working in Kentucky on July 5, 2013.

The company also plans to recover money from the state it says it lost unfairly.

Beshear says the state will help members of Kentucky Spirit transition to the other statewide MCOs, CoventryCares and WellCare, before July.

“There won’t be a problem with folks having the care, I’m just disappointed that a company that ought to know better is stepping up and breaking its contract,” Beshear says.

Kentucky Spirit claims the state isn’t making the Medicaid system affordable for the private companies. Because of that dispute, Kentucky Spirit says it will close it’s Lexington office and eliminate 200 jobs as it exits the state by July 5, 2013.

Beshear says Kentucky Spirit’s decision is likely to end up in court. 

“Well Kentucky Spirit is breaking their contract and that will end up in court, because they don’t have a right to break their contract. There’s a dispute system that’s built into the contracts and they could have availed themselves to that. But there’s no right to just arbitrarily quit and go home,” he says.

Beshear says the two other statewide MCOs, CoventryCares and WellCare, will be able to pick up the slack.

In a release, Cabinet for Health and Family Services Secretary Audrey Haynes called Kentucky Spirit’s move “frustrating.”

“I am deeply frustrated that this publicly traded, Fortune 500 company has chosen to put profits above people and will not honor the terms of its contract. The managed care model is working in many states and is working here in Kentucky.  The recent RFP process in Region 3 demonstrated that the managed care market in Kentucky is healthy and viable,” she says.

And the state is unlikely to invite any other private company to bid to finish out Kentucky Spirit’s contract. Instead, Beshear says the state will just send out requests for proposals next year to bid out 2014 to 2016.

That also raises questions about savings in the private operator program, since Kentucky Spirit gave the lowest bid fees of the three original statewide operators. 

In response to questions from lawmakers that Kentucky Spirit’s departure would add costs to the state, a cabinet spokeswoman says the state would try to recover those additional costs fromKentucky Spirit. The state also says there shouldn’t be issues with the federal government’s approval of statewide privatized Medicaid in Kentucky with Kentucky Spirit’s departure.

 Here is the full announcement from Kentucky Spirit:

Kentucky Spirit Health Plan (Kentucky Spirit), a wholly-owned subsidiary of Centene Corporation (NYSE: CNC), has notified the Cabinet for Health and Family Services that it is exercising a contractual right that it believes allows Kentucky Spirit to terminate its Medicaid managed care contract with the Commonwealth of Kentucky effective July 5, 2013. In addition, Kentucky Spirit has filed a formal dispute with the Cabinet for damages incurred under the contract.

Kentucky Spirit entered the market in November 2011 with the intent of helping the Commonwealth achieve a high-quality healthcare program at a significantly reduced cost for tax payers. Since the inception of the contract, there have been concerns about the sustainability of the Commonwealth’s Medicaid managed care program. The decision to terminate the contract comes after months of effort by Kentucky Spirit and the Cabinet to resolve these concerns and only after it has become clear that there is not a viable path to a sustainable Medicaid managed care program in Kentucky,

“We are proud of the outcomes we have achieved in the short time under the contract. In keeping with our mission of providing high-quality, cost-effective care delivered locally to the Medicaid population, Kentucky Spirit has achieved many successes,” said Kentucky Spirit President and CEO Jean Rush. These include: ·

                        a 30 percent increase in well child visits; ·

                        a 53 percent increase in diabetes testing; ·

                        a 94 percent decrease in ‘doctor shopping’ for narcotics; ·

                        a 30 percent reduction in pharmacy costs; ·

                        a 30 percent decrease in one-day hospital admissions; ·

                        a 23 percent reduction in hospitalreadmissions; and

                        a 17 percent decrease in medical and surgery costs.

Rush continued, “Kentucky Spirit remains committed to a smooth transition for the more than 140,000 individuals and families it serves.” Centene recognizes that the only way to achieve outcomes like these is through a strong local approach. As a result, Kentucky Spirit created more than 200 high-paying technical and specialized jobs in Lexington in order to meet the health needs of Medicaid recipients across Kentucky.

“We regret the loss of these high quality jobs, which represent over $12 million in annual wages and benefitseliminated from the local economy and state tax base,” said Carol E. Goldman, Executive Vice President and Chief Administrative Officer of Centene. “The company is working closely with its employees to provide them with the appropriate levels of support and resources during this transition.”

Kentucky Spirit also will continue to offer excellent service to its members and healthcare providers through thetermination date and will work with the Kentucky Department for Medicaid Services to make sure the transition for members is easy. Members may call Kentucky Spirit’s Member Services at 1.866.643.3153 for more information.

Link: https://wfpl.org/post/medicaid-operator-kentucky-spirit-plans-break-contract-beshear-says-hes-disappointed

Kentucky Spirit Health Plan to terminate Medicaid contract with state

Written by
Tom Loftus
The Courier-Journal

FRANKFORT, KY. — In a bitter split with Gov. Steve Beshear’s administration, Kentucky Spirit Health Plan said Wednesday that it will terminate its Medicaid managed care contract with the state effective July 5.

The company also has filed a formal dispute with the Cabinet for Health and Family Services for damages it has incurred.

But the Beshear administration fired back later Wednesday saying that Kentucky Spirit’s decision violates its contract, which runs through July 5, 2014. Any damages, state officials said, will be paid by the company — not the state.

“We will hold this company accountable to its contractual commitments through whatever means necessary on behalf of both the members and the taxpayers,” Beshear said in a news release.

State Sen. Julie Denton, a Louisville Republican who heads the Senate Health and Welfare Committee, said the company told her in a “courtesy call” Wednesday that it is losing $10 million a month under the contract.

Termination of the contract also will cost the Lexington area, where Kentucky Spirit is based, “more than 200 high-paying technical and specialized jobs,” the company said in its announcement.

Cabinet Secretary Audrey Tayse Haynes said in the state news release that she was “deeply frustrated that this publicly traded, Fortune 500 company has chosen to put profits above people and will not honor the terms of its contract.”

Coventry Cares and Wellcare also operate Medicaid managed care programs in the 104-county area in which Kentucky Spirit operates, and state officials said the more than 125,000 recipients who are now covered by Kentucky Spirit will be moved to one of those providers without interruption in care.

The area does not include Jefferson County, which is part of a separate 16-county region that is now served by Passport but will be served by four providers starting in January.

The move by Kentucky Spirit, a subsidiary of Centene Corp., is the latest setback in the state’s effort to cut costs by having outside providers manage Medicaid recipients’ care. Earlier this year, KentuckyOne Health, the state’s largest health system, terminated its contracts with Coventry Cares.

(Page 2 of 2)

When Beshear launched the Medicaid effort last year, he said it would save $1.3 billion over three years in the 104 counties, including $375 million in state funds.

The state took bids and awarded three contracts in July 2011. The cabinet said Wednesday that Kentucky Spirit had the lowest bid, charging the state an average $311 a month per covered member. Coventry Cares bid $341 and Wellcare $360 per member per month.

The state awarded three contracts because the federal government required that Medicaid recipients have a choice.

Based on the per-member numbers, if the 125,000 Kentucky Spirit members were to be evenly split between the other two companies, its move would cost the Medicaid program about $60 million more in 2013-14. About three-fourths of that would be federal dollars, with the rest coming from the state.

But Haynes told the legislature’s Interim Joint Health and Welfare Committee on Wednesday that Kentucky Spirit must pay for any loss. “They are responsible for the damages and the cost,” Haynes said. “They are responsible for upholding the contract.”

Haynes told the committee that Centene’s stock rose as a result of Wednesday’s announcement, estimating that the company earned about $230 million. “Sounds like enough to cover any expenses we might have,” she said.

The state’s news release Wednesday did not specify what legal actions Kentucky may take against Kentucky Spirit. But both Beshear and Haynes said they expect the matter to end up in court.

Deanne Lane, Centene’s vice president for media and community affairs, said she could not elaborate on the statement Kentucky Spirit released, but would have more to say “in the coming days.”

Kentucky Spirit said in its news release that it had discussions with the state for months, but the talks were unable to resolve its concerns about its contract. “It has become clear that there is not a viable path to a sustainable Medicaid managed care program in Kentucky,” the company said.

Haynes took issue with that opinion. “The managed care model is working in many states and is working here in Kentucky,” Haynes said.

She noted that Centene offers Medicaid managed care services in 19 states and that she expected it had a “sound and tested business strategy” when it bid for a Kentucky contract last year.

Denton said she was told the company will be pulling out of the state completely.

“Now it’s a matter of moving those Medicaid recipients to one of the other two companies,” she said.

Sen. Alice Forgy Kerr, R-Lexington, said she was “devastated” by the pending loss of 200 jobs.

Sen. David Givens, R-Greensburg, said, “I’m struck by the loss of good jobs. … But just as frightening is this: What if what this company is saying is true and Kentucky’s whole managed care approach is unsustainable?”

When Beshear launched the Medicaid effort last year, he said it would save $1.3 billion over three years in the 104 counties, including $375 million in state funds.

The state took bids and awarded three contracts in July 2011. The cabinet said Wednesday that Kentucky Spirit had the lowest bid, charging the state an average $311 a month per covered member. Coventry Cares bid $341 and Wellcare $360 per member per month.

The state awarded three contracts because the federal government required that Medicaid recipients have a choice.

Based on the per-member numbers, if the 125,000 Kentucky Spirit members were to be evenly split between the other two companies, its move would cost the Medicaid program about $60 million more in 2013-14. About three-fourths of that would be federal dollars, with the rest coming from the state.

But Haynes told the legislature’s Interim Joint Health and Welfare Committee on Wednesday that Kentucky Spirit must pay for any loss. “They are responsible for the damages and the cost,” Haynes said. “They are responsible for upholding the contract.”

Haynes told the committee that Centene’s stock rose as a result of Wednesday’s announcement, estimating that the company earned about $230 million. “Sounds like enough to cover any expenses we might have,” she said.

The state’s news release Wednesday did not specify what legal actions Kentucky may take against Kentucky Spirit. But both Beshear and Haynes said they expect the matter to end up in court.

Deanne Lane, Centene’s vice president for media and community affairs, said she could not elaborate on the statement Kentucky Spirit released, but would have more to say “in the coming days.”

Kentucky Spirit said in its news release that it had discussions with the state for months, but the talks were unable to resolve its concerns about its contract. “It has become clear that there is not a viable path to a sustainable Medicaid managed care program in Kentucky,” the company said.

Haynes took issue with that opinion. “The managed care model is working in many states and is working here in Kentucky,” Haynes said.

She noted that Centene offers Medicaid managed care services in 19 states and that she expected it had a “sound and tested business strategy” when it bid for a Kentucky contract last year.

Denton said she was told the company will be pulling out of the state completely.

“Now it’s a matter of moving those Medicaid recipients to one of the other two companies,” she said.

Sen. Alice Forgy Kerr, R-Lexington, said she was “devastated” by the pending loss of 200 jobs.

Sen. David Givens, R-Greensburg, said, “I’m struck by the loss of good jobs. … But just as frightening is this: What if what this company is saying is true and Kentucky’s whole managed care approach is unsustainable?”

 

Link:  http://www.courier-journal.com/apps/pbcs.dll/article?AID=2012310170073

 

Small-group plans driving insurance exchange benchmarks

Pediatricians in particular remain concerned that minimum benefits levels for private plans on the exchanges won’t cover children’s services adequately.

By JENNIFER LUBELL, amednews staff. Posted Oct. 15, 2012.

Washington Uncertainty continues to surround the essential health benefits provision of the Affordable Care Act, which will determine the minimum level of care that health plans must cover in upcoming health insurance exchanges. Roughly half of the states have yet toselect a plan option to serve as the benchmark for these benefits. Among those states that have chosen their benchmarks, however, small-group plans are emerging as a popular, cost-effective option.

Starting in 2014, qualified plans on state health insurance exchanges, and some plans outside of the exchanges, must offer essential health benefits packages covering 10 broad categories of services. States had until Oct. 1 to submit benchmark plans to the Dept. ofHealth and Human Services, but HHS officials assured states that this wasn’t a hard deadline and that the department would work with any state whose plan decision came in after this date. States drew from guidance HHS issued in 2011 to make their decisions.

In reviewing some of the most popular health plans operating in their jurisdictions, each state had the option ofselecting a benchmark plan from one of four plan types: small-group, federal employee, state employee or commercial HMO. Most appear to be choosing the small-group option, according to initial estimates.

At this article’s deadline, Statereforum.org, which tracks health reform implementation, reported that 23 states and the District of Columbia had made recommendations on what their benchmark plans should be, with 16 choosing small-group options.

The Institute of Medicine’s recommendation that HHS look to the small-group market for guidance on whatbenefits an exchange plan should offer is partly why Connecticut ended up choosing ConnectiCare, a popular small-group HMO plan, said Kevin Counihan.He’s the chief executive officer of the state’s health insurance exchange.

IOM had been concerned about the impact of the ACA’s minimum benefits requirement on small businesses that offer coverage to their workers through the exchanges. If the benchmark plan had been too generous with its coverage, it would freeze out these businesses and make it difficult for them to retain employer-sponsored insurance, Counihan said. “I think there was pretty strong, inherent logic on why they picked small-group.” In setting guidance for essential benefits, HHS said the largest small-group plan in the state would become the default benchmark if that state declined to choose one.

It makes sense that states are choosing these types of plans on their own, said Matthew Katz, executive vice president and CEO of the Connecticut State Medical Society. “When you develop an exchange that allows small businesses and individuals to buy insurance, you want to have something that’s familiar” and in line with what the market already is offering, he said.

The Connecticut medical society does not take an official position on the plan option the state selected. ConnectiCare’s benefits package is not as generous as some and not as limited as others, “so it seems to be the middle-of-the-road selection they’ve gone with. But coverage does not necessarily mean access,” Katz said. ConnectiCare’s plan may serve as the model for benefits coverage, but ultimately it’s how those benefits are going to be interpreted and applied by the other insurance plans on the exchange that will matter more than the plan design, he said.

Concerns about children’s benefits

Counihan said the state’s selection also was based on the ability to serve a wide segment of people, “children being one of them.” Pediatric services, including oral and vision care for kids, are one of the 10 required categories of services an essential health benefits package must offer. However, various medical organizations, such as the American Academy of Pediatrics and the American Medical Association, have voiced concerns that too many of the private benchmark plan options available to states would fall short on needed children’s benefits.

In its own research, the AAP found that public insurance options such as Medicaid and the Children’s Health Insurance Program provided more expansive children’s coverage than the private-plan options, and it has advocated that these public programs serve as the benchmark for children’s benefits. Under current HHS guidance, public programs are not among the benchmark plan options available to states.

AAP President Robert Block, MD, acknowledged that some states might end up choosing benchmark plans that “have a thorough menu for coverage for what kids are going to get.” But a problem might arise if a neighboring state fails to pick a plan that covers all of those needed benefits, he said.

Many commercial insurance plans have incomplete benefits for children, Dr. Block said. Whether it’s behavioral health or well-child care, “all of those things are worthy investments, because the long-range outcome of lack of care is simply more sickly adults, and then we have to spend lots of dollars trying to fix what we could have prevented. And that just doesn’t make economic sense,” he said.

Counihan said physicians in Connecticut had yet to raise concerns about inadequate children’s coverage in the benchmark benefits package. A former pediatrician sits on the state’s insurance exchange board, and physicians on the board’s advisory committees also had theopportunity to weigh in on this decision, he said. The state medical society, nevertheless, was disappointed that final decisions on the essential benefits benchmark “were made by the board, which does not have a practicing physician,” said the society’s Katz.

The small-group Blues plan that Kansas recommended, as its benchmark option did not include pediatric vision, dental and habilitative services. But in the event such a required category of service isn’t in the plan a state selects, “you have to pull it from something else,” said Sandy Praeger. She’s the state’s insurance commissioner and chair of the health insurance and managed care committee of the National Assn. of Insurance Commissioners.

Praeger said HHS ultimately would determine how these services will be covered. Under these circumstances, federal officials could opt to use CHIP to cover the missing pediatric services, although the Federal Employees Health Benefits Program, which also has some level of coverage in these areas, is another possibility.

Based on the coverage the two programs offer, “we would hope they’d choose the CHIP plan,” she said.

Link: http://www.ama-assn.org/amednews/2012/10/15/gvsb1015.htm

Mark Carter | Passport strives to provide quality care

6:32 PM, Oct 14, 2012   | The Courier-Journal

 Written by

MARK CARTER

                               

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 –

Link: http://www.courier-journal.com/article/20121015/opinion02/310150021/mark-carter-passport-strives-provide-quality-care

Passport Health Plan Welcomes the Opportunity to Continue Serving Medicaid Members in Region 3.

 

 

Commonwealth of Kentucky

Cabinet for Health and Family Services

FOR IMMEDIATE RELEASE Contact: Jill Midkiff

502-564-7042

502-330-1185

 

Medicaid Managed Care Contracts Awarded for Jefferson and Surrounding Counties

Coventry Cares, Humana, Passport and Wellcare will provide coverage beginning in 2013

 FRANKFORT, Ky. (Oct. 4, 2012) – The Commonwealth of Kentucky has signed contracts with four managed care partners to provide health care services to approximately 175,000 Medicaid recipients in Louisville and 15 surrounding counties. These managed care organizations (MCOs) will provide services in Region 3, which is comprised of Breckinridge, Bullitt, Carroll, Grayson, Hardin, Henry, Jefferson, Larue, Marion, Meade, Nelson, Oldham, Shelby, Spencer, Trimble and Washington counties.

The four MCOs awarded contracts for Region 3 are Coventry Cares, Humana, Passport and Wellcare of Kentucky. The contracts are for an initial 18 months with four, one-year renewal options. The new contracts will take effect Jan. 1, 2013.

Earlier this year, the Centers for Medicaid and Medicare Services (CMS) advised the Cabinet that Region 3 could no longer operate with a single managed care provider. Beginning Jan. 1, 2013, CMS requires that Medicaid recipients in Region 3 have a choice of more than one provider for health care services.

“The managed care approach is familiar to Medicaid recipients in the Jefferson County area, but having a choice of managed care organizations is new,” said Cabinet for Health and Family Services Secretary Audrey Tayse Haynes. “Passport has been a good partner and has served the region’s recipients well for 15 years, but the federal government now requires that individuals have a choice of providers. The Cabinet is pleased with the level of interest from the managed care community and we look forward to their work on behalf of our Department for Medicaid Services and the individuals who rely on Medicaid for their health care coverage.”

The Cabinet for Health and Family Service’s Department for Medicaid Services has contracted with Passport to be the sole provider of Medicaid-covered services in Region 3 since 1997. Medicaid recipients in the remaining 104 counties in the Commonwealth have a choice of three MCOs that have been providing managed care services since Nov. 1, 2011.

Over the last four fiscal years, the Medicaid cost for Passport members was reduced 6.5 percent even though health care costs in the southern region of the United States have increased an average of nearly 3.5 percent. The new contracts maintain those savings for the biennium, and protect the Medicaid program against rising health care costs over the next 18 months.

The new contracts will include behavioral health services, as is the case in Medicaid managed care contracts for the rest of the state.

Medicaid recipients and providers in Region 3 will soon receive a letter about these changes. 

The Department for Medicaid Services will enroll Medicaid recipients in Region 3 with the MCO that is determined by a high-tech matching system to be the best fit based upon available provider networks and any special health care needs the individuals may have. Members will receive notice by early November of the MCO with which they have been matched. Upon notice of this match, Medicaid recipients will have 30 days to select a different MCO before the Jan. 1, 2013 effective date of coverage. The Department for Medicaid services will provide information about how Medicaid recipients can choose the best MCO for their needs. Medicaid recipients who wish to switch to a different MCO after Jan. 1, 2013, will have another 90 days in which to request a change.

As required by state procurement law, the Cabinet solicited proposals from managed care companies interested in offering services in Region 3 beginning Jan. 1, 2013. The RFP was issued on June 19, 2012 and contracts with vendors were finalized today.

 

-30-

The Cabinet for Health and Family Services is home to most of the state’s human services and health care programs, including Medicaid, the Department for Community Based Services and the Department for Public Health. CHFS is one of the largest agencies in state government, with nearly 8,000 full and part-time employees throughout the Commonwealth focused on improving the lives and health of Kentuckians.

 

Link:  http://www.passporthealthplan.com/pdf/news/commonwealth-of-kentucky.pdf

 

Consumer Advocates Worry New Medicaid Operators in Louisville Region Will Cause Problems

By Kenny Colston, WFPL

The Louisville Medicaid region will now be home to four different managed care operators. State officials announced the change today.

Joining Passport Health Plan is Humana, CoventryCares and WellCare.

WellCare and Coventry already have statewide contracts for Medicaid and Passport has operated in Louisville for years.

Passport officials say they will still try to continue maintain their high level of care, despite no longer holding an exclusive contract for the region. 

But the new dynamic has consumer advocates like Kentucky Voices for Health’s Jodi Mitchell saying patients are likely to see their quality of care decline.

“That’s really where it comes down to not consumer choice, but who the provider contracts with, because we have seen across the state where there are hospitals who chose to not do business with some of the managed care companies,” she says.

She points to Coventry as one example. The company has broken contracts with many hospitals statewide. And that could affect its provider contracts in Louisville as well.

The new organizations will officially start insuring Medicaid patients on Jan. 1

Link:  http://wfpl.org/post/consumer-advocates-worry-new-medicaid-operators-louisville-region-will-cause-problems

Humana, Passport Join Two Others as New Louisville Medicaid Operators

By Kenny Colston, WFPL

After decades of having one company oversee Medicaid, the Louisville area will now have four private Medicaid providers.

The Louisville area was the first part of the state to have Medicaid privatized, and Passport Health Plan has administered the program ever since.

But the rest of the state has since been privatized, and multiple operators compete for patients across the commonwealth.

The Cabinet for Health and Family Services announced today that Passport will now have competition from CoventryCares, WellCare and Humana.

Medicaid patients will be automatically assigned by the Cabinet to their new insurance provider, with letters informing people of their provider being sent out by November 1st.

The new MCOs will start managing on January 1st.

 

Link:  http://wfpl.org/post/humana-passport-join-two-others-new-louisville-medicaid-operators

 

Editorial | State must avoid Medicaid chaos

By Courier Journal, Published: 12:17 AM, Oct 9, 2012

You could argue, “If it ain’t broke, don’t fix it.”

But “If it ain’t broke, don’t break it” seems more to the point in the Louisville region where Passport Health Plan suddenly is facing competition from three, for-profit companies when it comes to serving about 175,000 Medicaid beneficiaries in Jefferson and 15 surrounding counties.

The state’s hasty launch of managed care statewide last year outside the Passport region clearly was disastrous and chaotic — reports of delays and denial of care still ripple through the system.

Nonetheless, the Cabinet for Health and Family Services has introduced competition in the Louisville area to Passport by announcing it has signed contracts with three companies that will vie with Passport for business.

Passport, a non-profit consortium of doctors, hospitals, pharmacies, dentists and other health care providers, has operated for 15 years as an efficient managed-care service, establishing a solid track record providing high-quality care at low costs. Some unfortunate excesses by previous executives, mostly in travel and entertainment costs, have been corrected and should not detract from its record as a health care agency.

Cabinet Secretary Audrey Tayse Haynes said the change is to satisfy the federal government, which provides about 70 percent of Kentucky’s Medicaid money and wants more competition and choice.

It is essential that Secretary Haynes’ cabinet give its full attention to this transition to ensure people served through Passport do not encounter the disruption that roiled the rest of the state last November. That’s when Kentucky rushed into managed care contracts with three outside companies for some 500,000 Medicaid beneficiaries statewide, prompting an outcry over repeated claims of delays and denials of care.

Payments to health care providers screeched to a halt — forcing some small offices to borrow money just to meet payroll. And providers including doctors, dentists and pharmacists barraged lawmakers with individual stories of patients refused urgently needed procedures and medications.

One crucial area to be affected in the Passport region is mental health services, which currently are provided to Medicaid patients through community mental health centers based in Louisville and Elizabethtown.

Seven Counties Services serves Jefferson and six surrounding counties and Communicare, based in Elizabethtown, serves additional patients in the Passport region. They now are being forced into the same managed-care model that applies to the rest of the state’s mental health agencies.

Mental health advocates from around Kentucky were particularly outraged by last year’s changes they said caused major disruptions for people with mental illness, who depend on medications and regular care to remain stable.

Seven Counties President Tony Zipple said he’s concerned about the potential impact on that agency’s about 30,000 patients, most of whom rely on Medicaid for care. He hopes the state has learned from last year’s rocky transition, noting that there are “some real risks and challenges” for patients with mental illness.

Other advocates have responded with alarm to changes in the Passport region, including Kentucky Youth Advocates which noted the “mass confusion” of last year’s changes and disruption of health care for kids.

Jodi Mitchell, executive director of Kentucky Voices for Health, said the changes in the Passport region threaten “disruption for a lot of members who have been served many years by Passport.”

The cabinet needs to provide close oversight and swift action to ensure the smoothest transition possible. And Passport members need to remember since this is all about choice, they may choose to stay with Passport.

One crucial area to be affected in the Passport region is mental health services, which currently are provided to Medicaid patients through community mental health centers based in Louisville and Elizabethtown.

Seven Counties Services serves Jefferson and six surrounding counties and Communicare, based in Elizabethtown, serves additional patients in the Passport region. They now are being forced into the same managed-care model that applies to the rest of the state’s mental health agencies.

Mental health advocates from around Kentucky were particularly outraged by last year’s changes they said caused major disruptions for people with mental illness, who depend on medications and regular care to remain stable.

Seven Counties President Tony Zipple said he’s concerned about the potential impact on that agency’s about 30,000 patients, most of whom rely on Medicaid for care. He hopes the state has learned from last year’s rocky transition, noting that there are “some real risks and challenges” for patients with mental illness.

Other advocates have responded with alarm to changes in the Passport region, including Kentucky Youth Advocates which noted the “mass confusion” of last year’s changes and disruption of health care for kids.

Jodi Mitchell, executive director of Kentucky Voices for Health, said the changes in the Passport region threaten “disruption for a lot of members who have been served many years by Passport.”

The cabinet needs to provide close oversight and swift action to ensure the smoothest transition possible. And Passport members need to remember since this is all about choice, they may choose to stay with Passport.

 

Link:  http://www.courier-journal.com/apps/pbcs.dll/article?AID=2012310090014

Passport Medicaid region to be split among 4 companies

US says Jefferson County region must offer Medicaid patients choices

By Courier Journal, Tom Loftus, Published: 2:58 AM, Oct 5, 2012  

FRANKFORT, KY. — Beginning Jan. 1, four companies will start managing the health care of roughly 175,000 Medicaid patients in the Jefferson County region — a major change that some say raises concerns about disrupting care.

For the past 15 years, the nonprofit Passport Health Plan has served all Medicaid recipients in the 16-county region.

But on Thursday, the state Cabinet for Health and Family Services said it had signed 18-month contracts with Passport and three other companies — Humana, Wellcare of Kentucky and Coventry Cares — to manage Medicaid recipients’ care starting next year.

Other details of the contracts, including payment provisions, were not released.

Cabinet Secretary Audrey Tayse Haynes said the federal government told Kentucky it could no longer operate with a single managed-care company in the Jefferson County region and must give patients a choice among several providers.

In addition to Jefferson, the region’s other counties are Breckinridge, Bullitt, Carroll, Grayson, Hardin, Henry, LaRue, Marion, Meade, Nelson, Oldham, Shelby, Spencer, Trimble and Washington.

“Passport has been a good partner,” Haynes said. “… But the federal government now requires that individuals have a choice of providers.”

Passport, an organization of major health care providers in the region, was disappointed in the cabinet’s action, and its chief executive, Mark Carter, released a statement expressing concern that the continuity of patient care could be interrupted.

“We will be working with providers and community advocates to minimize disruption in the care of our members,” he said.

Passport had hoped that, if the state went with multiple companies, it initially would assign all recipients to it and then give them an option of moving to another company. Instead, the cabinet initially will assign recipients to one of the four companies.

The cabinet said the state will use “a high-tech matching system” that assigns a person based on “available provider networks and any special health care needs.”

Medicaid recipients will be notified which company they have been assigned to by early November, the cabinet said. They will then have 30 days to change if they wish.

Carter acknowledged that, because Passport’s current business will be shared with three other companies, cutbacks and layoffs are possible.

But he said Passport will begin an advertising campaign soon that will ask recipients to stay with the company. “And if we retain a significant percentage of the population, it may not be necessary to have layoffs.”

A federal decision

Medicaid is the federal- and state-funded health insurance program for the poor and disabled. The federal government pays about three-fourths of the cost, while the state pays the rest.

Passport is the product of an attempt during the early 1990s to save money in Medicaid through managed care. But attempts to form similar organizations in other parts of the state failed.

Last year, under great pressure to curb soaring Medicaid costs, the Beshear administration expanded managed care statewide. Direct management of the program by the state Department of Medicaid Services was handed over to three managed-care companies in Kentucky’s remaining 104 counties.

The transition to managed care in the rest of the state has been bumpy — primarily because of disputes between managed care companies and hospitals within their network of providers.

One dispute raises questions about the network of hospitals and providers that one of the new managed care companies in the Jefferson County region — Coventry Cares — may be able to assemble.

Coventry is already serving the other 104 counties, and KentuckyOne Health said in August that it would terminate its contracts with Coventry.

KentuckyOne Health is the company that resulted from the merger of Jewish Hospital & St. Mary’s HealthCare with St. Joseph Health System early this year.

KentuckyOne said it terminated its contracts with Coventry because Coventry first terminated “without cause” the contracts it had with Our Lady of Peace, a psychiatric hospital that’s part of KentuckyOne, and Taylor Regional Hospital in Campbellsville, which KentuckyOne manages.

Barbara Makovic, spokeswoman for KentuckyOne, said Thursday there’s been no change in the status of KentuckyOne’s decision to terminate its contracts with Coventry. She said she did not immediately know whether KentuckyOne would be part of Coventry’s network of providers in the Jefferson County region.

Coventry released a statement saying it is talking with Kentucky One “and we would be pleased to have them in our network if we can reach an agreement on a new contract.”

Disruption concerns

Passport Board Chairman Bill Wagner, who is executive director of Family Health Centers in Louisville, said he is concerned that “the chaos that has engulfed the rest of the state over the past year” will come to the Jefferson region.

“Confusion over plan enrollment, increased denials, payment delays and new layers of bureaucracy will definitely have an effect on access to patient care,” Wagner said.

Various health care advocates also expressed concerns about the move to multiple managed care companies.

“The transition is likely to cause disruption for a lot of members who have been served for many years by Passport,” said Jodi Mitchell, executive director of Kentucky Voices for health. “Problems have been documented elsewhere in the state about timely payment of claims to providers, pre-authorization of services causing hurdles to treatment, adequate provider networks and drug treatments might change depending on what plan you’re on.”

Andrea Bennett, deputy director of Kentucky Youth Advocates, said the past year’s experience with managed care out in the state has produced “story after story of parents having difficulty navigating the system. We’ve heard providers threaten to give up on Medicaid altogether because they are frightened and still not receiving proper payment.”

Bennett said that, when the state went to managed care last fall, “sometimes siblings were assigned to separate plans and parents didn’t understand how to switch their child to another plan.”

She strongly encouraged the cabinet to clearly communicate the options to Medicaid recipients in the Jefferson region “in a format that is easy for them to understand.”

Link:  http://www.courier-journal.com/apps/pbcs.dll/article?AID=/201210041554/PRIME07/310040073&nclick_check=1

Reporter Tom Loftus can be reached at (502) 875-5136.

Some states to partner with HHS on insurance exchanges

October 08, 2012 | Mary Mosquera

Government Health IT

 

WASHINGTON – A number of states will partner with the federal government to get their health insurance exchanges up and running, at least initially, because they were unable – for political or timing reasons – to get authority or plans ready by an imminent deadline.

States must send their blueprints for putting health insurance exchanges in place to the Department of Health and Human Services by Nov. 16.

“We have 14 governors who have sent in letters to the secretary that they are planning to establish an exchange in their state, and we’re actively working with those states and others to complete the requirements to be approved to be a state-based exchange,” said Amanda Cowley, director of state health exchanges in HHS’ Center for Consumer Information and Insurance Oversight (CCIIO). HHS will announce the exchanges in early January.

To make sure that states have adequate financing to build their exchanges, HHS has provided 34 states and the District of Columbia with significant exchange establishmentgrants. Seven of the financing grants are multi-year and aim to cover the full cost of the exchange construction and implementation. Those went to Rhode Island, Washington, Connecticut, Maryland, Nevada, Vermont and D.C. 

Exchanges will take one of three forms: state-based, state/federal partnership around claims management or consumer assistance or both, and federally facilitated, Cowley said.

“State-based exchanges, we believe, are the best models for states because of the flexibility they are given under the law,” she said at an Oct. 5 conference sponsored by America’s Health Insurance Plans (AHIP).

Under the Patient Protection and Affordable Care Act, coverage will be available through the exchanges in all 50 states on Jan. 1, 2014.

In a state-based exchange, states operate and have oversight over all exchange activities and functions, including certifying health plans, developing and launching consumer outreach campaigns, determining eligibility, establishing enrollment for insurance portability programs, coordination with other insurance affordability programs, as well as tax subsidies and building and owning their IT platform.

[See also: Northrop Grumann steering big data analytics toward health agencies.]

“We recognize that most states will ultimately want to operate their own state-based exchange but some states will need more time to build the necessary infrastructure to run their own,” said Cowley.

In the interim, they may choose to work as a state partner with HHS. In a claims management partnership, the state is responsible for all decision around health plans and issuers on its exchange, including selection and certification of qualifiedhealth plans, recertification and de-certification of health plans, data collection and transmission and issue oversight management.

In the consumer assistance partnership, the state partner takes the lead in assuring the availability of in-person assistance to individuals, including support for individuals filling out and submitting applications, comparing and selecting qualified health plans and enrolling in coverage.

“We know that states are skilled at performing activities like these. It’s the bread and butter of many of their government agencies do today,” said Cowley.

The state/federal partnership enables states “to continue to perform some of what we consider their most important roles and to help assure a more tailored and high quality experience for consumers in the state, even though those states perhaps aren’t quite ready for state-based exchanges,” she added.

Arkansas is one of the states planning for a state partnership exchange. Arkansas has many individuals earning low per capita income, adults with chronic diseases, and a large and growing percentage of uninsured individuals, said Cynthia Crone, exchange partnership director, for the Arkansas health benefit exchange.

“We have a real problem that the exchange helps us to move towards solving,” she said.

But it hasn’t been easy.

Republicans in the state legislature held up the budget and authority to begin planning for an exchange, and the Democratic governor did not want to do an end run around the legislature with an executive order. Ultimately, a budget passed, but time was limited. HHS recently awarded Arkansas with a planning grant to move toward the partnership model, Crone said.

[See also: HITsm: How do providers start?]

Arkansas consumer assistance will work closely with the federal navigator program to assure aseamless experience and little confusion for consumers. The state will contract for in person assisters to move people toward enrollment and will have a strong role for brokers and agents.

The state anticipates getting policy decisions and processes defined by the end of the year, place requests for proposals for consumer assisters in early 2013 with awards in May and starting to educate consumers in the summer about enrollment, which will start in October 2013, she said.

While Arkansas selected its essential health benefits benchmark and set timelines for qualified health plans certification, the federal government will perform more of the administration and plan management activities.

A small number of states may choose not to operate a state-based exchange or a partnership, Cowley said. In these states, HHS will establish and operate a federally facilitated exchange.

The Centers for Medicare & Medicaid Services is developing the infrastructure, and it will be able to perform all of the major functions of an exchange – claims management, eligibility and enrollment activities, consumer assistance, premium tax credit calculation and financial management, such as payments to issuers, she said.

 

Link: http://www.govhealthit.com/news/some-states-partner-hhs-insurance-exchanges