Joe P. Asher
Recent cutbacks in funding and other financial issues have contributed to a situation in which payments from the Cumberland Valley Health Department to Kentucky Retirement Systems are running behind. Although employee checks have had deductions taken out for retirement, the money has not been paid into the Kentucky Retirement System for the last two months.
Allison Gardner Martin, spokeswoman for Kentucky Attorney General Jack Conway’s office, confirmed a complaint concerning the Cumberland Valley Health Department was received by the criminal investigations unit with her agency, but would not confirm or deny whether an investigation is under way concerning the retirement funds.
Cumberland Valley Health Department Interim Director Lynette Renner said payments are two months behind due to some issues with funding in recent years that have affected the health department’s ability to make all payments on time.
“In 2011, Medicaid required health departments to be part of a Medicaid match. What that means is for every Medicaid service you do you have to pay 20 percent back,” said Renner.
Renner says that percentage is now at 29 percent and, according to the state, can go as high as 35 percent.
“The second thing is managed care organizations,” said Renner. “We went for five months with no payments from them at all.”
Renner said Kentucky has contracted out to three different managed care organizations, Kentucky Spirit, Coventry and WellCare.
Renner said there is legislation in the works that could remedy some of the problem.
“House Bill 42 has been proposed and it will be to remove health departments from that Medicaid match and managed care,” said Renner.
According to Renner, the health department program is running at a loss.
“With reduced funding and all these other things… we finished the year (fiscal year 1012) with a $2,000,000 deficit,” said Renner. “We’ve caught up on everything, but we’re two months behind on retirement payments, and that’s what the issue is.”
Renner stated the issue was not that there were no payments being made, but that payments were late.
“We are late by two months,” said Renner. “We are in constant communication with retirement. We’re hoping within the next two months that it will be entirely caught up.”
Renner said recent reductions in work force, which took effect just ten days ago, were done in order to fix the problem.
“If you’re into a plan that’s gone just ten days that’s not enough. You have to be allowed some time to fix the problem,” said Renner.
Renner pointed out that as of Jan. 17, 14 people had been laid off.
Renner said that the money deducted from employee’s checks will be sent to Kentucky Retirement Systems as soon as possible.
“That money is still there designated for retirement,” said Renner. “That money has not been used for anything else.”
According to Renner, Kentucky Retirement Systems will not accept a partial payment, so no payments can be made until the full amount is available.
“You have to have the employee contribution and the employer contribution,” said Renner. “When the match is there, then it’s sent.”
Renner said payments will be caught up before the end of the current fiscal year.
Calls to Kentucky Retirement Systems were not returned by press time.
Reach Joe P. Asher at 606-573-4510 or email@example.com