Franklin County health department lays off 5; blames Medicaid managed health claim denials for budget shortfalls

The Franklin County Health Department has laid off five employees effective today, four of those are part-time workers. The layoffs are being made in the midst of a $1.7 million drop in revenue from last year. The staff reductions should save the agency $120,000 annually, health department director Paula Alexander told The State Journal. The news comes only two weeks after the Madison County Health Department announced it has been forced to lay off seven workers because of budget shortfalls. Those cuts affected home-health workers in Madison, Estill and Powell counties.

In both instances, department directors have explained that they had expected to receive reimbursements from Kentucky’s three Medicaid managed care organizations. A massive increase in those denied claims were reasons both directors gave for their sudden inability to meet budget goals.

Earlier in the year, the Fayette County Health Department lost 25 employees. Faced with similar Medicaid payment issues, several Kentucky counties have tried to cut costs by cutting to a four-day workweek.