WKU Public Radio News Staff
Managed Care Cuts
Tue January 24, 2012
Subpoenas Issued to Managed Care Health Providers
For only the second time in its history, a Kentucky legislative committee will issue subpoenas-this time over Medicaid managed care and locally-owned pharmacies.
The Program Review and Investigations Committee voted to authorize subpoenas to Kentucky’s three new managed care providers over reimbursement rates to independent pharmacies. Passport, based in Louisville, is exempt from the subpoena.
At its weekly meeting, the committee heard testimony from independent pharmacy owners who said two managed care providers were squeezing them too tight by drastically cutting reimbursements. It is believed that Passport and Kentucky Spirit are not the two providers referenced. Even so, Kentucky Spirit will be sent a subpoena to testify.
Rosemary Smith, a pharmacy owner in Eastern Kentucky, said providers are reaping their savings off the backs of independent pharmacies. And if it continues, Smith says those small and mostly-rural pharmacies will be forced to close.
“The state is right on the verge of losing independent pharmacies at an alarming rate," Smith said. "There is no more meat to trim from independent pharmacy. We are dying."
Smith said other locally-owned health organizations were unhappy with the switch to managed care. But that none of them were hit as hard as pharmacies were.
"I’ve spoken with other local health providers and while they have felt the effects of the switch to managed care, they have been kept relatively intact," Smith said. "Why is the state allowing us to take the main brunt of the cuts?”
Many lawmakers were upset over the testimony Smith gave. And they said they must introduce legislation to fix the major problems managed care has caused. State Representative John Will Stacy says if things don’t change, rural areas will be without local pharmacies.
“There will not be a dozen, there will not be a hundred," Stacy said. "There’ll be hundreds of these small pharmacies that’ll be gone.”
Neville Wise, the state Medicaid commissioner, says the Cabinet for Health and Family Services is trying to broker deals between the operators and pharmacies. But apparently it’s not enough for the committee.
The committee is drafting the wording of the subpoena immediately and hopes to serve it in a few days. Lawmakers said they must fix problems with Medicaid managed care before the end of the 2012 session or risk have enormous holes in health providers for Medicaid.