Appalachian hospital chain, facing loss of 25,000 Medicaid patients, sues managed-care firms and state

"Appalachian Regional Healthcare, the largest health care system in Eastern Kentucky, has filed lawsuits against two of the state's Medicaid managed care companies, alleging that the managed care companies had not paid claims promptly," report Valarie Honeycutt Spears and Beth Musgrave of the Lexington Herald-Leader. ARH said it treats about 25,000 Medicaid patients at its eight Kentucky hospitals.

The moves came after Coventry Cares, one of three managed-care organizations hired by the state, said it would cancel its contract with ARH as of May 4. ARH sued Coventry in federal court on Monday; the previous Thursday, April 12, it sued "in Franklin Circuit Court against Kentucky Spirit Health Plan Inc. and the Cabinet for Health and Family Services." On March 29, "Coventry Coventry told ARH that it was terminating its contract with ARH effective May 4."

Coventry spokesman Matthew Eyles told the Herald-Leader, "We were effectively forced to break our ties with ARH until the Commonwealth takes steps to treat all MCOs equally and makes some key decisions to guarantee greater stability in the program, such as paying MCOs fairly based on whether they have healthier or sicker members." Cabinet spokeswoman Jill Midkiff said the issues don't indicate a problem with the managed-care system the state adopted Nov. 1. (Read more)

Read More

Knox County Hospital bounces employees' checks; blames old, bad debt and late Medicaid payments

Debt inherited from previous management and late Medicaid payments caused some Knox County Hospital checks to bounce. Most of the facility's employees could not cash their checks last Friday afternoon.

"It was more of an accounting issue than anything and had we known that this was going to happen, we would have put personal money into it and this wouldn't have happened," said Dr. Satya Chatterjee, a management owner. Hospital CEO Craig Morgan said, "That money is starting to come; it's just not coming fast enough, so hopefully we're past the worst of it." Morgan said he "takes the blame for the billing issue and actually had all people in administration hold their checks so other employees were paid as soon as possible," Jerrika Insco reports for WYMT-TV.

It is not the first time the hospital has bounced checks, . "Ever since Medicaid was implemented, the CEO says the hospital has struggled financially," Insco reports.

Presumably, she means managed care for Medicaid, which has prompted many complaints from health-care providers. Since the legislative session began, lawmakers have heard gripes about the state's three new managed-care companies, who took over Kentucky's Medicaid program outside the Louisville region Nov. 1. The companies have been too slow to reimburse providers and require burdensome pre-authorizations before treatment can be provided, critics say. State Auditor Adam Edelen said the companies are sitting on "north of a quarter billion dollars of taxpayer dollars. That's something that requires an explanation to the people of Kentucky." (Read more)

Read More

Switch to managed care happened too fast with too little knowledge, former Medicaid commissioner says

States like Kansas are looking at Kentucky as a precautionary tale for what not to do when transitioning to managed care, former Kentucky Medicaid commissioner Shannon Turner told Ryan Alessi on CN|2's "Pure Politics" Wednesday. Kansas Gov. Sam Brownback "was heralding Kentucky . . . in the beginning," she said. "And last week, his office released what I call a 'Kansas is not Kentucky' statement."

Turner, who was fired from Passport Health Plan after she was linked to excessive travel expenses and is now a health-policy consultant, said Kentucky rushed into managed care too quickly — rather than a few months, the state really needed a year, she said. In Turner's view, there also isn't enough expertise in the Cabinet for Health and Family Services to deal with the three new managed-care operators. "I think the managed-care companies really don't have the resources that they need at the state level to give them direction," she said. "On the state side, you have people looking at managed-care processes that they really aren't familiar with."

In other states that switched to managed care, Turner said there was a turnover in state staffing. In Kentucky, "There haven't been cuts, there haven't been layoffs . . . so what are the people who are there at Medicaid focused on, and is there adequate training?"

On Nov. 1, 560,000 Medicaid recipients were switched to managed care, which is "essentially outsourcing" to the managed-care operators, Turner said. Lawmakers have heard complaints about delayed payments and rigid pre-authorization requirements, including one instance Alessi mentioned, involving a woman in labor who was required to get pre-authorization before she could deliver her baby.

Turner said the MCOs are "excluded from the majority of the rules that apply to HMOs," including one that would prevent them from "sitting on" payments." Turner called the process a "bloodbath" for independent pharmacists because of those delayed payments, as well as community mental health centers, who were "seeking pre-authorization . . . but the managed care companies said, 'You can't send it to us electronically.' They were literally snail-mailing these things." (Read more)

Read More

State and companies were unprepared for quick move to managed care, state auditor concludes

Kentucky officials and the companies in charge were unprepared for the switch to Medicaid managed care, State Auditor Adam Edelen said Wednesday.He sent the Cabinet for Health and Family Services 10 recommendations to improve the system, which provides health care for 560,000 Kentuckians who are poor, disabled or elderly.

Since the legislative session began, providers and patients have bitterly complained that the three new managed-care companies are "too slow to reimburse providers" and have "cumbersome pre-authorization processes to allow treatment," reports Beth Musgrave for the Lexington Herald-Leader. The state moved to managed care Nov. 1, a move meant to save the state $1.3 billion in three years.

In addition to the recommendations, Edelen said he will form a Medicaid auditing unit designed to improve the system. He recommended: hiring more managed-care staff to fix backed up claims payments and treatment authorizations, developing a system to measure whether providers are receiving payments in a timely way, and considering removing mental health services from the contracts. Kelly Gunning of the National Alliance on Mental Illness told lawmakers last week that she had asked mental health to be removed from the contracts in January, saying it had not worked in other states either. The companies are reportedly asking psychiatric patients to switch medications, even if the ones they are already on are working. The move has "meant that more people with serious mental illness have had to return to state psychiatric treatment centers," Musgrave reports.

Edelen said Kentucky officials "did not learn from the 1997 launch of Kentucky's first managed care contract — Passport in the Louisville area — and seemed ill-prepared to monitor and enforce the three new managed care contracts," Musgrave reports.Under managed care, the companies are paid a predetermined per-patient, per-month amount regardless of what care is needed. Because they won't be paid using a fee-for-service model — believed to be more costly — and will try to streamline care, managed care is meant to save money. (Read more)

Read More

Lawmakers hear more complaints about managed care

Patients with mental illness are being denied medication, forced to try cheaper drugs that have already been proven not to work for the patient, or not getting them in time because of delays in approval. These were some of the complaints of the state's new Medicaid managed-care system, reports Deborah Yetter of The Courier-Journal.

"If this is how it's going to be, it is scary," Dr. Scott Haas, chief medical officer of the Bluegrass Mental Health/Mental Retardation Board, told the state Senate Health and Welfare Committee Wednesday. "It is dangerous, and it ultimately is going to cost us a lot of lives."

The testimony is the latest that highlights the weaknesses of managed care, which the state changed to on Nov. 1 to for 560,000 Medicaid recipients living outside the Louisville area. Executives of the three companies hired to provide the care — CoventryCares of Kentucky, Kentucky Spirit Health Plan and WellCare of Kentucky — last week pledged to do better.

The majority of yesterday's testimony focused on the system's problems in dealing with mental illness, but Deb McGrath, executive director of the Epilepsy Foundation of Kentuckiana, said she's been inundated with "complaints about delays or rejections in medications patients need to control seizures," Yetter reports. "Something has to be done," McGrath said. "It's just a vicious cycle." (Read more)

Read More

Kentuckians talk about health care on new video channel

Featuring stories of Kentuckians telling their stories about their experiences with the health care system, Kentucky Voices for Health has launched a video advocacy channel.

"The mission of Kentucky Voices for Health is to advocate for the needs of the Kentucky health care consumer," Executive Director Jodi Mitchell said. "That means our main priority is helping to ensure that all Kentuckians have access to the quality care they deserve. This new video advocacy effort will ensure that legislators, media and the public can always hear firsthand about the healthcare concerns facing our state."

KVH is a coalition of more than 250 health care organizations, individuals and advocates. The stories will initially focus on stories relating to the move to Medicaid managed care. For more information, click here.

Read More

Managed-care executives acknowledge problems, say they're trying to fix them

Executives of three managed-care companies who run most of the state's Medicaid program told a legislative committee yesterday that they are aware of "significant problems" with their management since they took over in November, and they are "committed to fixing them," reports Deborah Yetter of The Courier-Journal. Health-care providers have complained to lawmakers for months about late payments, claims processing and battles over new rules requiring "pre-authorization" to guarantee payment. The executives said they're meeting with providers to solve the problems.

Health care providers implied last week during testimony that the companies were withholding payments to "maximize their profits," Yetter notes. All three executives denied the claim, saying they have to pay interest on payments delayed more than 30 days. They said some late payments "weren't getting past billing clearinghouses" that many health-care providers use to process Medicaid claims. Claims have been delayed in those facilities for a number of reasons, the executives said, including new billing requirements under managed care. They said they are working to identify and pay those claims. (Read more)

Read More

Legislators hear from new managed-care firms; lawmaker rates their performance with a show of hands from pharmacists

Kentucky Health News

The three companies recently hired to manage Kentucky's Medicaid program outside the Louisville region defended themselves yesterday against complaints that they are squeezing independent pharmacies to the breaking point. One of the three firms, Kentucky Spirit, fared better in a hearing held by a House-Senate committee before a crowd that included many pharmacists.

When Sen. Vernie McGaha, R-Russell Springs, "asked for a show of hands from pharmacists in the audience to learn which of the three pharmacy-benefits companies they think underpay on generic drugs, nearly everyone raised their hands for Medco Health Solutions, which is Coventry [Cares]'s partner, and Catalyst Rx, which is WellCare [of Kentucky]'s. No one seemed to object to US Script, which is Kentucky Spirit's partner," reports John Cheves of the Lexington Herald-Leader.

Kentucky Spirit is the only firm that continues to pay pharmacists a dispensing fee of $4.50 to $5 per prescription, the rate that had been paid by the state. WellCare pays $3, and CoventryCares $1 to $1.50, the pharmacists told Deborah Yetter of The Courier-Journal. "Pharmacists have told lawmakers at previous hearings that pharmacy-benefits companies sometimes pay less for generic drugs than it costs pharmacies to acquire them," Cheves notes.

Read more here: http://www.kentucky.com/2012/02/13/2067444/medicaid-managed-care-companies.html#storylink=cpy

Rep. John Will Stacy, D-West Liberty, left, whose business interests include co-ownership of at least two pharmacies, got into it with G. William Strein, Medco's vice president for provider relations. "Stacy cut off Strein several times while he was attempting to answer," Cheves reports.

“Why is it fair that you can reimburse us below costs?” Stacy asked Strein, who "disputed Stacy’s assertion and said managed care attempts to strike a balance between its estimated cost of the drug and the costs of the pharmacy to buy and dispense it," Yetter reports. "But that claim was disputed by some of the roughly 30 pharmacists at the hearing who operate independent drugstores. Though the hearing ended before they got a chance to testify, several said afterward that they intended to keep making their case before lawmakers."

Jason Wallace, owner of Grant County Drugs, told Yetter, “It’s a real burden for Kentucky pharmacists. That’s why I’m here.” All the companies told members of the Joint Program Review and Investigations Subcommittee that they are committed to resolving the problems.

"Much of Monday’s testimony was devoted to the complex pricing formula known as the maximum allowable cost, or MAC, that managed care companies consider proprietary," Yetter writes. "Under the Medicaid plan before managed care, the formula was provided to pharmacists, who said they knew what they would be paid. Now, they said, they don’t find out what a company will pay for a specific drug until they file claims.And too often, they say, it’s less than they paid to buy the drug.

“How would you like to go to a gas station and fill your car up with gas and then be told what the charge is?” Breckinridge County pharmacist Jonathan Van Lahr asked after the hearing. (Read more)

Kentucky Health News is a service of the Institute for Rural Journalism and Community Issues, based in the School of Journalism and Telecommunications at the University of Kentucky, with support from the Foundation for a Healthy Kentucky.

Read More

Legislators hear about serious problems in managed-care system

The switch to the new Medicaid managed-care system is proving to be a nightmare, health officials told lawmakers Wednesday, with long delays in payment to providers and treatment for patients.

"It appears to me the only place the savings can come from is the delay and denying of care," said Dr. Shawn Jones, president of the Kentucky Medical Association and physician in Paducah. "Patient care is being delayed and, in some cases, simply prevented." (Video from cn|2)

Jones was one of several officials who testified at a meeting of the Senate Health and Welfare Committee. The new system requires pre-authorization for procedures that were once routinely covered, so patients spend hours in waiting rooms or are told to go home and return after their procedures have been given the go-ahead. In one instance, a woman in labor came to the hospital to deliver "and the managed-care company insisted that her care be pre-authorized," reports Deborah Yetter of The Courier-Journal.

"Fourteen days later, mom and baby are home and we still have no pre-authorization," said Joe Grossman, chief financial officer of Appalachian Regional HealthCare.

Problems started Nov. 1 when the state turned its Medicaid program outside the Louisville region to three managed care companies. (Louisville-area recipients have long been managed by Passport Health Plan.) The move is intended to save the state money and fill a hole in the Medicaid budget. But officials said the three companies — CoventryCares of Kentucky, Kentucky Spirit Health Plan and WellCare of Kentucky — seem to be purposefully delaying claims payments, though the state has already paid them $135 million since Nov. 1.

"I feel like I've become a bank to these out-of-state insurance companies," said Grossman, whose eight-hospital chain is owed $8 million. "I've lent them money."

The managed care companies did not testify Wednesday, but issued statements saying they intend to address the issues at hand. Neville Wise, the state's acting Medicaid commissioner, " said he believes the issues are just temporary bumps that can be ironed out," Ryan Alessi of cn|2's "Pure Politics" reports. The requirement that childbirth be pre-authorized, for example, has since been rectified, Yetter notes. State Sen. Julie Denton, R-Louisville, asked Wise, "How many more ludicrous scenarios can there be?" (Read more)

Read More

Responding to complaints about new managed-care companies, state auditor asks for claims data; lawmakers threaten subpoena

With complaints piling up about the three Medicaid managed-care companies that coordinate care for 560,000 poor and disabled Kentuckians, lawmakers and officials are taking action to get to the bottom of the situation.

After health providers complained reimbursements have been wrongly rejected, delayed or ignored, state Auditor Adam Edelen asked to see the companies' claims-processing data, reports Deborah Yetter of The Courier-Journal. Legislators are threatening to subpoena the companies "after the state's 550 small pharmacists complained that they're being pushed out of business by the companies' low Medicaid reimbursements," Yetter and Mike Wynn report for the C-J. (C-J photo: Pharmacist Mac Bray at Capital Pharmacy in Frankfort)

Some providers said they are having to borrow money to offset the shortage until the claims are reimbursed. Others are worried they will go out of business because they can't afford to wait for claims to be paid.

Audit: Edelen told CoventryCares of Kentucky, Kentucky Spirit Health Plan and WellCare of Kentucky he wants the claims data by Feb. 17. He also asked for information from Passport Health Plan, which has long coordinated care for 170,000 Kentuckians in the Louisville area. No complaints have been voiced about Passport, but an Edelen spokeswoman said they want to get information to paint "a complete picture."

The move to managed care was the Beshear administration's answer to fill a hole in the Medicaid budget, but lawmakers have complained the transition has been bumpy. "They never know when they are going to get paid," said Sen. Joey Pendleton, D-Hopkinsville. "I can see why it saves money — if you don't pay your bills, you have more money." (Read more)

Pharmacies: The House-Senate Program Review Committee has asked officials from the three companies to appear Feb. 13 to answer questions. If the committee doesn't get the information it seeks, it will issue subpoenas. "This is a drastic measure, but they are putting our independent pharmacists out of business," said Sen. Jimmy Higdon, a Lebanon Republican who co-chairs the committee. "You can't see things for less than they cost and stay in business."

With traditional Medicaid, "pharmacists were paid a dispensing fee of $4.50 to $5, plus the cost of medication, based on an industry formula called the maximum allowable cost," Yetter and Wynn report. "But two of the three companies under contract with the state have cut the dispensing fee to $1 to $3. And pharmacists say that under managed care, the maximum allowable payments don't cover their costs of buying the drugs from the wholesaler."

The committee has not used its power to issue subpoenas in more than 10 years, Higdon said. (Read more)

Read More

More complaints lodged about Medicaid managed care; lawmakers demand answers

Complaints continue to pile up about the state's new Medicaid managed care plans, which cover about 560,000 Kentuckians. Lawmakers are hearing gripes from providers who say they are not getting paid, and from patients and clinics who say the three managed-care companies take too long to give permission for certain care.

"It's a drastic change to the system," Neville Wise, the state's acting Medicaid commissioner, told the Senate Health and Welfare Committee yesterday. "We didn't expect the level of issues that we had."

Sen. Julie Denton, a Louisville Republican who chairs the committee, "expressed outrage about a case in which she recently called the president of one company trying to get care authorized for a battered domestic violence victim who sought treatment at a Lexington clinic on a Friday afternoon," reports Deborah Yetter of The Courier-Journal.

Despite Denton's call to Coventry Health Care, the woman was not able to get a scan for a shoulder injury until the following Monday. "This woman had to go in pain all weekend because she couldn't get the services she needed," Denton said. "This is not acceptable, and this is only one instance that I know of."

Denton also asked about late payments to providers. "The payment issues have gone on way too long, and it should have been better," Wise responded.

Kentucky moved to three managed care companies Nov. 1, in an effort to save the state money and balance the Medicaid budget. (Read more)

Read More

Home-health industry is the latest to complain about late payments since state switched to managed-care Medicaid

Kentucky's new Medicaid managed-care system is three months late in making payments to home-health agencies, officials told the House Health and Welfare Committee Thursday.

Nurses Registry and Home Health has outstanding claims of $300,000 to $400,000, Jeannie Lemaster, chief compliance officer, told lawmakers. "Kip Bowmar, executive director of the Kentucky Home Health Association, said only 8 percent of the claims from the approximately 150 home-health agencies have been paid since the switch to managed care Nov. 1," reports Beth Musgrave of the Lexington Herald-Leader.

"If these problems don't get corrected, there is a likelihood that some agencies could go out of business," Bowmar said.

Therapists who work with abused, neglected and at-risk children have likewise told lawmakers of back payments. Independent pharmacists have said "reimbursement rates are much lower than they were under traditional Medicaid, which means they are having to lay off employees," Musgrave reports.

In November, Kentucky made the switch to managed care for its 500,000 Medicaid recipients outside the Louisville region. The move is expected to save the state more than $1 billion in the next three years. Three companies, Coventry Cares, Wellcare of Kentucky and Kentucky Spirit, broker the care and are paid on a per-patient, per-month rate.

Lemaster said most of her agency's problems are with Coventry, which has denied 82 percent of their claims. "Lemaster said that because there are differences in the managed care companies and what is being approved for payments, there are inequities in the Medicaid system," Musgrave reports. "Some people are receiving services and others aren't."

Jill Midkiff, spokeswoman for the Cabinet for Health and Family Services, said problems related to the changeover are being ironed out. "The primary focus of the Medicaid program staff is and continues to be the prompt resolution of any issues that arise as we ease the transition of providers to managed care," she said. (Read more)

Read More

Passport to lose exclusive contract for Louisville-area Medicaid at end of 2012; more choice needed, federal agency says

The exclusive contract the state has with Passport Health Plan, which provides Medicaid coverage for 170,000 people in Jefferson and 16 neighboring counties, has been extended until the end of next year. But after that, the state must adopt a different "delivery model that ensures adequate choice for Medicaid beneficiaries" in that area, a letter from the federal Centers for Medicare and Medicaid Services reads.

Since 1997, Passport has exclusively provided coverage for that population, reports Tom Loftus of The Courier-Journal. Gov. Steve Beshear said Tuesday the state will start looking at alternatives for how to provide choice for the area. In the rest of Kentucky, Medicaid recipients can choose from three managed care organizations.

Sen. Julie Denton, R-Louisville, said she is "very concerned" about the major changes that will be involved. "We don't know what's going to happen," she said.

A year ago, Passport received a scathing report from state auditor Crit Luallen, who found wasteful spending "and said it had improperly transferred millions of its reserves to the health care provider organizations represented on its board," Loftus reports. After an investigation by Attorney General Jack Conway, those providers paid $26.4 million to pay for the transfers. (Read more)

Read More

Move to managed care involves a steep learning curve, patients and providers tell Noelle Hunter of The Morehead News

Patients and providers are "ascending a steep learning curve as they implement Medicaid managed care," reports Noelle Hunter in a two-part series in The Morehead News. Even for a proactive patient, the changeover has its challenges, and vulnerable populations are at risk of falling through the cracks, providers say. For health administrators, it means getting accustomed to three new systems, all of which require pre-authorization before treatment can begin.

The move to managed care, which took place Nov. 1, was intended to fill a $166 million shortfall in the Medicaid budget. Gov. Steve Beshear pushed hard for the switch and estimates it will save the state $1.3 billion in the next three years. Managed care will be handled by four organizations — Kentucky Spirit, CoventryCares, WellCare and Passport — across the state. Passport was already handling the Louisville region.

When the switch took place, Medicaid recipient Mary Jo Long discovered "45 percent of Medicaid recipients were automatically enrolled in Kentucky Spirit," Hunter reports. "None of the doctors (in Rowan County) take Kentucky Spirit," Long said. Discovering this, she waited on hold 30 minutes before being switched to CoventryCares and doesn't "anticipate any problems from here," she said.

While Long was able to navigate the challenge, many patients, particularly those with mental or behavioral health issues, might find it difficult, said Kimberly McClanahan, CEO of Pathways, Inc., a drug or alcohol rehabilitation center. "A lot of our patients are seriously mentally ill and they don't or cannot always pay attention to the information they are getting in the mail about the change," she said. "When they got their first letter about the changes, it was seven pages long. A lot of our consumers just threw it in the trash."

Health administrators are likewise dealing with lengthy forms from managed care organizations. "We've essentially gone from a one-page document to a sometimes 25-30 page document that has to be faxed to the MCOs before any care can be given," said G.R. "Sonny" Jones, chief financial officer at St. Claire Regional Medical Center.

The paper overload stems from the fact that Medicaid patients must be pre-authorized before they can receive any treatment, the likely key to savings in such a system. "I was talking to a case manager who said she spent an hour and 45 minutes on the telephone trying to obtain a pre-authorization," said Charlotte Walker, administrative director for clinical operations at St. Claire.

Moreover, the existing network of providers is not extensive enough, in part because the move to managed care happened in just 120 days, as per the state's directive, "when it usually takes a year or two to develop a satisfactory network," Jones said.

Behavioral health organizations and pharmacies are also experiencing challenges, with some patients not able to access their prescriptions "because each MCO has different prescription formularies," Hunter reports.

Whether the move will indeed save money remains to be seen, administrators say. "In the long run, the financial incentives are there to pay hospitals and providers less," Jones said. "It will make it more difficult for us."

An op-ed piece in the Lexington Herald-Leader indicated likewise. "There will now be four bureaucracies, with each sopping up Medicaid money to pay for the bureaucrats needed to keep track of everything," writes Edward L. Smith, a charter member of Northern Kentucky's Mental Health/Substance Abuse Regional Planning Council. "Where will the money for the bureaucrats come from? From services, of course." (Read more)

To read Part 1 of Noelle Hunter's series Mandatory Medicine, click here. For Part 2, click here.

Read More

Independent pharmacists say managed care costs them money

Because two of the three new Medicaid managed-care companies have slashed the dispensing fee they will pay them, independent pharmacists are in danger of going out of business all over the state, pharmacists told the interim joint Health and Welfare Committee yesterday.

But one managed-care firm said that's the cost of saving money for the taxpayers, the reason the state implemented managed care statewide. "We recognize ... there's a big change here for everyone," said Barb Witte, CEO of CoventryCares. "All health care providers are going to have to tighten their belts."

Under the traditional Medicaid system, "pharmacists were paid a 'dispensing fee' per prescription of $4.50 to $5 plus reimbursement for their actual cost of the drug based on an industry formula called the 'maximum allowable cost,'" reports Deborah Yetter of The Courier-Journal.

But the dispensing fee of CoventryCares is only $1 to $1.50. WellCare increased its fee to $3 from $1.50, but cut reimbursement for cost, making the increase only worth about 80 cents. Kentucky Spirit is still paying $4.50 to $5.

Because the maximum allowable cost fluctuates on a monthly basis, pharmacists don't know their return until they file a claim. Often, "pharmacists find they are being paid less than it cost them to buy the drug from a wholesaler," Yetter reports.

"How long will I be able to stay in business losing money?" asked Mayfield pharmacist Sam Willett. "Not very long."

Rep. Tom Burch, D-Louisville, told the MCOs and pharmacists to come to an agreement. "There must be a way to work this out," he said. (Read more)

Read More

State's Medicaid program will be handled by managed care companies starting tomorrow

Update, Nov. 1: Kentucky Voices for Health, a coalition of more than 250 health care organizations, individuals and advocates, released its views on the move to managed care, which they said must be as much about improving the quality of health care as it is about saving money. "We want Medicaid managed care to be a positive move for both the fiscal health of Kentucky and the health of Kentuckians, so we must continually strive to ensure that all who are eligible have access to high-quality, affordable, effective health care regardless of poverty status or disability," said Dr. Rev. Marian McClure Taylor, KVH board member and executive director of the Kentucky Council of Churches.

The transition must also run smoothly, said Jody Mitchell, KVH executive director. "Our priority is ensuring that the 540,000 Medicaid members affected continue to receive the best health care possible, without interruption." (Read more)

About 560,000 Kentuckians on Medicaid will have a new way of getting health care starting tomorrow when the state switches to managed care.

So far, 68 acute-care hospitals, including some out-of-state facilities, have signed on to at least one of three of the managed care organizations chosen earlier this year by the state to run the program, reports Beth Musgrave of the Lexington Herald-Leader. Excluding the Louisville area, which has long been and will continue to be served by the Passport managed-care organization, there are 96 acute-care hospitals in Kentucky.

"A significant number of hospitals have signed in the last couple of weeks, and we anticipate that these numbers will continue to grow," said Jill Midkiff, spokeswoman for the Cabinet for Health and Family Services. The state had delayed the switch to managed care, which had been scheduled to begin Oct. 1, by one month to give providers time to sign contracts.

Gov. Steve Beshear said today the federal Centers for Medicaid and Medicare Services have approved the transition. "We have worked hard to make the transition as seamless as possible, and I appreciate the collaborative efforts that allowed us to reach this goal under aggressive deadlines."

Switching to managed care has been Beshear's answer to overcoming a Medicaid budget deficit. The program will be run by four managed care companies, which will be paid a predetermined per-patient, per-month amount regardless of what care is needed. Because they won't be paid using a fee-for-service model — believed to be more costly — and will try to streamline care, Beshear (right, photo by H-L's Pablo Alcala) said the move will save $1.3 billion in the next three years.

Delaying the move by another month could have cost the state $9.2 million in savings, Musgrave reports. (Read more)

Read More

Some worry that patient care will get shortchanged as Kentucky Medicaid moves to managed care

While moving Kentucky's Medicaid patients to managed care for will likely reduce costs to the taxpayers, patient care shouldn't be shortchaged in the effort to save a buck, Deb McGrath writes in an op-ed piece in The Courier-Journal.

"It is critical for quality patient care to always remain a priority," writes McGrath, executive director of the Epilepsy Foundation of Kentuckiana. "All citizens, including the 540,000 Kentuckians under the new managed care plans, deserve access to the best possible care recommended by their doctors."

McGrath is concerned about the "fail first" policy, also known as step therapy. "In this practice, the insurer will initially cover only the least costly medication in any drug class, forcing doctors to prescribe these medications first," she writes. "This is problematic because many times there are different medications that the physician feels would be the most effective treatment."

The policy can adversely affect Kentucky's 90,000 patients who have epilepsy, a disease that comprises 40 different seizure types and epileptic syndromes. "Fail first is not something a person with epilepsy wants to hear, especially when this policy can compromise their well-being and even their life," McGrath writes. "I urge Gov. Steve Beshear, the Cabinet for Health and Family Services, our state legislators and the new managed care organizations to keep patient care in mind as they get ready to implement this new system on Nov. 1." (Read more)

Read More

Medicaid's move to managed care delayed until Nov. 1; hospitals need more time to sign contracts

The move to managed care, which the state has touted as the answer to improve the quality of its Medicaid system and solve a budget deficit, has been delayed by a month in response to the Kentucky Hospital Association saying hospitals need more time to sign contracts and prepare for implementation.

"We have made great progress in Medicaid managed care since we first announced the contract awards in July," said Janie Miller, secretary for the Cabinet for Health and Family Services. "Thousands of providers have signed up with the managed care organizations ... but we still need the hospitals to sign contracts before we can implement managed care across the commonwealth."

Mike Rust, president of the KHA, said of about 100 hospitals that will be affected by the changes, only about 20 have signed contracts so far, reports Deborah Yetter of The Courier-Journal.

Four managed-care organizations, including the previously established Passport Health Plan in Jefferson and surrounding counties, will take over health-care management of the state's 730,000 Medicaid recipients. The companies will be paid a per-patient, per-month amount set by contract negotiations. Because they won't be paid using a fee-for-service model — believed to be more costly — and will try to streamline care, the move is expected to save $1.3 billion in the next three years, Miller has said.

Earlier this month, Kentucky got the green light from the federal Centers for Medicaid and Medicare Services to proceed with the transition to managed care. (Read more)

Read More

Feds OK managed-care Medicaid; firms advertise for enrollees

The move to managed care for Kentucky's Medicaid patients is one step further to being implemented. The federal Centers for Medicaid and Medicare Services have approved the state's plan to have three managed-care organizations provide care for 560,000 people statewide, The Courier-Journal reports.

Services will not change for about 170,000 people in Jefferson and 15 nearby counties, who have been receiving managed care services through Passport Health Plan for several years. Local newspapers are running advertisements from the three managed-care companies seeking enrollees.

Moving to managed care is Gov. Steve Beshear's answer to fill a $166 million hole in the Medicaid budget, created by a lack of expected federal funding. The federal government pays more than 70 percent of Medicaid costs, bringing the expected savings to $1.3 billion over three years. Under a managed care model, the companies will be paid on a per-patient basis. State officials say there will be an incentive for the companies to keep costs down because the lump sum received for each patient will stay static, unlike in the fee-for-service model in which the state has paid for whatever bills are incurred. (Read more)

Read More

Move to managed care on track for Oct. 1, secretary says

Despite a recent request to delay by an advisory council, and a low number of signups by hospitals so far, the move to managed care for Kentucky's Medicaid patients should be completed by Oct. 1.

"We are prepared to proceed with an Oct. 1 timeframe," said Janie Miller, secretary of the Cabinet for Health and Family Services, right, as she updated the Medicaid Oversight and Advisory Committee Monday. "I know it is quick and it is coming."

The advisory council had asked the cabinet to delay, saying the Oct. 1 deadline did not give providers enough time to review contracts. Several legislators also feel the move is happening too quickly. "Oct. 1 just seems a little scary for some of us," said Sen. Julie Denton, R-Louisville. She said "doctors, pharmacists and other providers have contacted her to voice concerns that they don't have enough information about which managed care company to sign on with," Deborah Yetter of The Courier-Journal reports.

As of last Wednesday, "Only 15 or so of the state’s [109] hospitals had signed on with one of the three managed care providers," according to Miller, Ronnie Ellis reports for CNHI News Service. "She said she wants to see about 89 hospitals join one or more of the three networks but the contracts provide for “out of network” services if enough hospitals don’t join in rural or isolated areas." (Read more)

The move to managed care organizations is the state's answer to plug a $139 million hole in the Medicaid budget. Privatizing the program by using managed care will mean providers will be paid on a per-patient, per-month basis, which Gov. Beshear said will save $1.3 billion over three years. Right now, providers are paid on a fee-for-service basis, meaning they bill for each service that is provided. The move will affect more than 730,000 Kentuckians and will be run by four MCOs statewide, including Passport. As it has for several years, Passport will continue to provide managed care for 170,000 Kentuckians in Jefferson County and the surrounding area.

Within two weeks, 560,000 Kentuckians outside of the Passport jurisdiction will receive information packets about which of the other three companies will handle their care. Membership cards will be mailed in September, Yetter reports. Before the new program can be launched, the state must showed the federal Centers for Medicare and Medicaid Services it is ready. Miller said that if the program is not deemed to be ready, there would be a delay, Yetter reports. (Read more)

Read More