LOUISVILLE, Ky. (WDRB) – Passport Health Plan, the Medicaid provider in the Louisville area, on Friday said it would halt construction on its west Louisville headquarters building and health campus.
The move escalates the nonprofit’s fight with Gov. Matt Bevin’s administration over rate cuts that Passport says will leave it insolvent within months if not reversed.
The Medicaid managed care organization, which serves over 200,000 in the Louisville and over 300,000 in Kentucky, sued Bevin’s Cabinet for Health & Family Services last week and is asking a judge for an immediate order to reverse the cuts.
An initial hearing in the case is scheduled Tuesday morning.
Passport, which rents office space in southern Jefferson County, announced in 2018 that it would relocate nearly 700 employees to a new building at 18th and Broadway, on vacant land that city leaders once hoped would become a Walmart.
The building – part of a broader “health and well-being campus” planned on the 20-acre site – is under construction and had been set to open next year.
“While we remain passionate about the continued revitalization of west Louisville and hope to play a significant role in those efforts in the future, we have no choice but to delay any further work on Passport’s new headquarters building,” Passport CEO Mark Carter said in a press release. “This greatly saddens me because of the promise it holds for a vital part of our community. But, our immediate priority is to preserve the future of our organization, for the more than 310,000 members we serve and our nearly 700 employees.
The state pays Passport fixed amounts for low-income population that Passport covers. Passport uses the money -- most of which ultimately comes from the federal government -- to pay doctors, hospitals and other healthcare providers when they treat Passport members.
The state health cabinet has said the rate cuts enacted last year were based on sound actuarial data that Passport has not refuted -- a claim Passport disputes in the lawsuit.
The state has also said that Passport's plan to revitalize west Louisville with its headquarters and well-being campus, while admirable, is not a factor in setting Medicaid rates.
"Whether or not a (managed care organization like Passport) needs additional resources to build a new headquarters is irrelevant to that process," Health & Family Services Secretary Adam Meier said in a statement on Friday.
Meier even applauded Passport's decision to delay the construction.
"While we certainly recognize and appreciate Passport’s community investment in recent years, we agree it is a prudent move to delay costs associated with the new headquarters in order to ensure Passport’s payments are made to the many providers registering complaints with the Department for Medicaid Services about Passport’s nonpayment of claims,” Meier said.