Medicaid Provider To Terminate Contract With State

Oct 17, 2012

FRANKFORT, Ky.  --  A Medicaid managed care provider will terminate its contract with the Kentucky Cabinet for Health and Family Services after only a year, a move that would cut some 200 jobs in Lexington.

Kentucky Spirit Health Plan, a subsidiary of St. Louis-based Centene Corp., announced Wednesday that it is exercising its right to end the contract effective July 5, 2013.

Kentucky Spirit said in a statement that it is committed to helping the 140,000 clients it serves transfer to one of Kentucky's three other Medicaid contractors.

Centene Chief Administrative Officer Carol Goldman said the company regrets the loss of the Kentucky jobs, which represent over $12 million a year in wages and benefits. The company will seek to transfer some employees to other locations.

"The company is working closely with its employees to provide them with the appropriate levels of support and resources during this transition," Goldman said.

Kentucky Spirit began operations in Kentucky last November. Since that time, "there have been concerns about the sustainability of the commonwealth's Medicaid managed care program," the company said in a statement Wednesday.

"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," according to the statement.

Kentucky Spirit President Jean Rush said the organization has achieved a 17 percent decrease in medical and surgery costs to the Medicaid program and a 30 percent reduction in pharmacy costs over the past year.

Rush also said Kentucky Spirit cut Medicaid spending by 94 percent for people illegally going from doctor to doctor seeking narcotics.

"We are proud of the outcomes we have achieved in the short time under the contract," Rush said.

Rush also said Kentucky Spirit has increased wellness checkups for children by 30 percent and diabetes testing by 53 percent.

Cabinet for Health and Family Services spokeswoman Jill Midkiff had no immediate comment.