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How do Medicaid managed care insurers give the ol’ heave-ho to physicians who might have too many high-risk Medicaid patients in Kentucky’s poorest counties?

Apparently, they send out letters to members announcing those physicians no longer work at their respective practices, even though the doctors are still very much in place.

For example, last Friday, insiders started telling Insider Louisville that Medicaid managed care members in Eastern Kentucky were getting letters from Bethesda, Md.-based Coventry Health stating their physicians were no longer at Big Sandy Health Care.

Big Sandy is a private, non-profit corporation based in Prestonsburg that operates medical clinics, dental clinics and women’s practices  in various parts of southeastern Kentucky including Pikeville.

Big Sandy CEO Ancil Lewis confirmed yesterday his system’s Medicaid patients have received letters from Coventry stating certain doctors are no longer with the health care system.

Whether they were sent to deceive Medicaid members into leaving Big Sandy and possibly shifting them ultimately to one of the other two Medicaid managed care contractors isn’t clear, Lewis said. “Those letters are in error. I can’t say whether it’s a ploy or incompetence. But the letters are in error.

“The doctors named in the letters are still with Big Sandy.”

Other sources say Medicaid patients in Eastern Kentucky received similar letters from Coventry notifying them their doctor is no longer employed at their clinics, or their pharmacy was no longer covered under Coventry.

The common denominator in the moves is the doctors, clinics and pharmacies all have large numbers of high-risk patients, our sources say.

This latest issue arises after Coventry ended up with a disproportionate share of high-risk patients for several reasons including the insurer waiving drug co-pays during the initial open enrollment period.

Matt Eyles, vice president of Public Affairs and Policy at Coventry’s headquarters in Bethesda, Md. initially asked for time to research the issue, but did not get back to Insider Louisville.

Circulating inaccurate information is only one issue Big Sandy is having with Coventry. Coventry’s reimbursement methods make it impossible for Big Sandy’s accounting system to document whether the system is getting properly reimbursed for services.

“Their accounting is very different” from the previous system, Lewis said. “We don’t know exactly what we’re being reimbursed for, or whether we’re being reimbursed the correct amounts.”

The letters and other problems are the latest round of breakdowns as Kentucky shifted to a Medicaid managed care system from a fee for services system starting last November.

Insider Louisville, the Herald-Leader in Lexington and newspapers out in the state have documented the problems, ranging from suits accusing the MCO of not paying health care providers such as Appalachian Regional Healthcare to a decision – later rescinded – that Coventry would stop covering an opiate-withdrawal drug to notifying Louisville-based Baptist Healthcare System that Coventry intends to renegotiate for more favorable reimbursement rates and other changes.

The back story on Medicaid changes in Kentucky: In April, 2011, state officials asked health insurers to submit managed-care proposals for the $6 billion worth of care 800,000 poor and elderly Kentuckians receive annually under the federal/state Medicaid program. At the time, Gov. Steve Beshear touted the switch to managed care from fee-for-services as saving the state $375 million over the life of the initial three-year contracts. Insiders said officials in other states such as Georgia took as long as 18 months to make the change while Kentucky tried to do it in less than six months.

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Terry Boyd
Terry Boyd has seven years experience as a business/finance journalist, and eight years a military reporter with European Stars and Stripes. As a banking and finance reporter at Business First, Boyd dealt directly with the most influential executives and financiers in Louisville.

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