Ky. turns to managed care plan to balance Medicaid

FRANKFORT, Ky. (AP) — Faced with a growing financial burden, Kentucky is turning to managed care organizations to run Medicaid, the $6 billion government program that provides health care to more than 800,000 poor, elderly and disabled residents.

Gov. Steve Beshear said Thursday that the change could save $375 million in the state's General Fund over the next three years and potentially $1.3 billion overall.

The governor said the shift from a purely government-run program will not only save money but provide improved medical care to the state's Medicaid recipients.

"There, of course, will be bumps in the road as we implement this model, but we will act quickly and aggressively to smooth those bumps out," Beshear told reporters in a Capitol news conference, a day before he was to embark on a statewide tour to explain the change to Kentucky residents.

The Beshear administration has been working much of this year on the move toward privatizing Medicaid services, announcing last week that the Kentucky Cabinet for Health and Family Services was in the final stages of reviewing potential contracts.

Beshear unveiled three companies that will oversee Medicaid services to about 560,000 people across most of the state — Coventry Health Care of Maryland, WellCare Health Plans of Illinois and Centene Corp. of St. Louis. All three will open offices in Kentucky, creating more than 500 jobs in the state.