5100 Commerce Crossings

We may be reading tea leaves a bit here, but it looks like Passport Health Plan may be moving past its problems and toward a more certain future.

The Medicaid managed care provider – overhauled earlier this year after a critical state auditor’s report – is moving to a larger building at Commerce Crossings from downtown.

Passport officials signed a lease last month for the new space, a space scheduled to be fully occupied by early August, said Jill Bell, Passport vice president of public affairs.

At Commerce Crossings, Passport employees will move into a seven-year-old building that’s about 30 percent larger – 80,000 square feet on two floors from 58,073 square feet on four floors of the Fincastle Building downtown at Third and Broadway.

“We’ve outgrown this building,” Bell said.

Passport has about 250 employees in offices on four floors in Fincastle, she said. “We’re on (floors) six, five, four and three. We’ve got nowhere to go to.”

The newer building is “more attuned to this type of business … a call center, with clerical people and nurses on the phones,” Bell said.

Passport, which was created by local hospital groups including the University of Louisville and Norton Healthcare, currently has a $740 million contract to manage Medicaid in Jefferson County and 15 surrounding counties. The contract covers about 165,000 people, or 30 percent of the 550,000 Kentuckians covered by Medicaid.

Passport employees field questions about what is and isn’t covered under a plethora of Medicaid plans, along with other duties such as member services, provider relations to contract healthcare providers and compliance with state regulations.

That contract ends this month.

Whether Passport will continue in that role was further complicated in early April after Cabinet for Health & Family Services sent out a request for proposal that seemed to suggest they were thinking about replacing Passport.

State officials at the time declined to comment on whether the proposal signaled their intent to dump Passport and KenPAC, which manages fee-for-services reimbursement in sections of Kentucky not under Passport, opening the door to giant healthcare companies.

State officials won’t say how many companies or which companies responded to the RFP, which closed last month. However, officials at healthcare giant United HealthCare, based in Minneapolis, have acknowledged publicly they bid.

The RFP came after Kentucky Auditor Crit Luallen issued a finding last November of poor oversight at Passport including high salaries and lavish spending on travel and entertainment.

But Passport’s move to a larger space seems to hint at a developing deal to retain its portion of Kentucky’s managed care contracts.

“That’s certainly our intent,” Bell said. “Mark Carter, our interim CEO, is in meetings with state officials, and we are renegotiating to be (the managed care) provider for 16 counties.”

Part of Carter’s initiative when he took over at Passport was to look for potential cost savings and improvement, Bell said.

She pointed out the newer space at 5100 Commerce Crossings, which had housed operations of Yum! Brands Inc., is a better deal than the current space.

The per-square-foot base rate for the Commerce Crossings space is $8 compared to $12.50 per square foot at the Fincastle Building, Bell said.

With add-ons, such as parking and building upgrades, the Commerce Crossing building goes to $15 per square foot versus $22 for the Fincastle, she added.

“I think Mark would say he’s confident for our future,” Bell said. “We’re moving forward.”