Medicaid agency cleaning up act

Pressed by Gov. Steve Beshear's administration, Passport Health Plan apparently is getting the message that it needs to clean up its act in the wake of a scathing report from state Auditor Crit Luallen's office about the wasteful spending of public money.

Passport, which provides managed care for Medicaid recipients in 16 counties surrounding Louisville, announced Tuesday it has canceled all of its lobbying contracts.

The recent audit report criticized Passport for spending $1 million on lobbying and public relations in a three-year period from 2007 through 2009. The Legislative Ethics Commission reported this week that Passport spent $635,000 lobbying the Kentucky General Assembly since 2005.

Every dollar Passport receives comes from state or federal taxes and is meant to be spent administering Medicaid services.

In effect, then, Passport was diverting Medicaid dollars from the intended purpose and spending them on lobbying designed to keep its Medicaid dollars pipeline open to the max.

Eliminating the use of contract lobbyists was one of the demands the Beshear administration made in the wake of the the audit report. Another of those demands was the ouster of CEO Dr. Larry Cook and two other top Passport officials.

Wednesday, after meeting with representatives of the five Louisville-area health care entities that formed Passport, Beshear said the managed-care provider is trying to hire Mark B. Carter to replace Cook.

As a former executive at one of those five entities, Jewish Hospital & St. Mary's Healthcare, Carter seems well qualified for the job. But his selection could create a bit of a perception problem for Beshear.

According to Kentucky Registry of Election Finance records, Carter contributed a total of $2,000 to Beshear's 2007 campaign. And his son-in-law, John Esham, now works as a deputy policy advisor in the governor's office.

Beshear made that latter circumstance clear Wednesday. And Carter's name reportedly was broached by Passport people, not the governor. But the situation no doubt will raise some eyebrows.

Still, the termination of lobbying contracts and the search for a new CEO are positive signs that Passport now "gets it" in regard to the handling of Medicaid dollars.

As Beshear emphasized Wednesday, many more steps must be taken to ensure renewal of its contract with the state. But it appears Passport is at least pointed in the right direction.