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Governor Steve Beshear's Communications Office
Gov. Beshear Announces Federal Approval of Medicaid Managed Care Contracts
Approval is final step before Nov. 1 program launch
FRANKFORT, Ky.– Governor Steve Beshear announced today that the state received notice from the federal Centers for Medicaid and Medicare Services (CMS) that it has deemed Kentucky’s Medicaid managed care systems prepared for this week’s transition of more than 500,000 Kentucky Medicaid recipients to managed care.
“This final federal approval means that beginning tomorrow, more than half a million Kentuckians will transition into managed care – a system which will deliver better health outcomes while saving hundreds of millions of dollars for Kentucky taxpayers,” said Gov. Beshear. “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.”
Gov. Beshear announced in July that Kentucky had awarded four contracts to managed care organizations (MCOs) to provide health care services to Medicaid recipients statewide. The move to statewide managed health care is projected to save taxpayers $1.3 billion over the course of the new, three-year contracts -- $375 million of which is in General Funds.
“This approval means that Kentucky has successfully completed the required readiness reviews,” said Cabinet for Health and Family Services (CHFS) Secretary Janie Miller. “CMS is satisfied that the managed care organizations have established adequate provider networks to serve the approximately 560,000 individuals who will soon begin receiving their health care coverage through a managed care delivery model.”
On Friday afternoon, CMS sent notice of approval of the three MCO contracts with Coventry Cares of Kentucky, Kentucky Spirit Health Plan and Wellcare of Kentucky and accepted the actuarially certified capitation rates for the period beginning Nov. 1, 2011.
Medicaid recipients who will be covered by one of the three managed care organizations have already received their member cards or will receive them prior to November 1. The managed care organizations have reported that thousands of contracts have been signed with providers, pharmacies and hospitals to date, and the Cabinet anticipates that these numbers will continue to grow.
The state’s annual contract with Passport, which had been Kentucky’s only managed care provider, was renewed in July to provide services to 170,000 Medicaid recipients in Jefferson and 15 nearby counties.
Certain groups, including Medicaid members who reside in institutional settings and in waivers that serve as alternatives to institutional care, will not be enrolled in managed care. They will continue to receive benefits administered by the Kentucky Department for Medicaid Services. Medicaid provides health care coverage for approximately 20 percent of the state’s population.
Two-thirds of the nation’s Medicaid enrollees receive services through some form of managed care. The managed care strategy emphasizes a holistic approach to health care, which can be particularly effective in helping coordinate the care delivery needs of individuals with a variety of health issues and multiple health care providers. The goal of the contracts is to improve health care outcomes, particularly as it relates to diabetes control, coronary artery disease, colon cancer, cervical cancer, behavioral health, prenatal care and oral health. The contracts also place a high priority on reducing inappropriate use of services, such as unnecessary ER visits; improving care coordination, especially for individuals with chronic illnesses; promoting wellness and healthier lifestyles and lowering the overall cost of health care.
The expansion of Medicaid managed care to cover the entire state also required waiver approval from CMS, which the Cabinet received in September. That waiver allows Kentucky to implement a mandatory managed care program for virtually all Medicaid recipients in the state outside of the Passport region, which operates under a separate CMS waiver. The waiver approval is effective for the period of Oct. 1, 2011 through Sept. 30, 2013.
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