KanCare reform measures grab attention of House, Senate committees

By Jonathan Shorman, January 31, 2017

Rep. Jim Ward is shown giving testimony to the House Health and Human Services Committee

House Minority Leader Jim Ward, D-Wichita,
testifies as a proponent to bringing the
inspector general out of the Kansas
Department of Health and Environment,
the agency overseeing KanCare, and into
the attorney generals office during a hearing
with the House Health and Human Services
Committee Tuesday afternoon.
(Photo by Chris Neal/The Capital-Journal)

Lawmakers pushed ahead Tuesday with twin efforts aimed at reforming KanCare, the Kansas Medicaid program faulted by federal officials, but the state budget director said he would oppose one measure because of its cost.

A House committee mulled a bill to move the KanCare inspector general position, dormant since 2014, to the attorney general’s office in hopes of reviving it. Meanwhile, a Senate panel contemplated legislation overhauling the appeals and administrative process for medical providers in the state’s managed care system.

The hearings come during a tumultuous time for KanCare. In mid-January, the federal Centers for Medicare and Medicaid Services denied the state’s request to extend the authorization for KanCare by a year, from the end of 2017 to the end of 2018. The agency cited multiple problems with the program, though state officials argued the federal analysis was flawed.

House Minority Leader Jim Ward, D-Wichita, told the House Health and Human Services Committee that bringing the inspector general out of the Kansas Department of Health and Environment, the agency overseeing KanCare, and into the attorney general’s office doesn’t offer a “silver bullet” but represents an important first step in changing the system. In endorsing House Bill 2047, he argued the inspector general needs independence.

“In order to ensure the (Office of Inspector General) can properly investigate the services being provided it must be able to provide its findings to a neutral third party and not a position that has hiring and firing controls of the OIG,” Ward said.

Advocates for KanCare recipients back the measure, and no one testified in opposition. KDHE was neutral.

The inspector general position has been open since 2014, when the last inspector general departed after questions arose about his personal behavior. State Medicaid director Mike Randol said KDHE has attempted to fill the position but that candidates either weren’t the right fit or didn’t agree to the salary.

On the Senate side, state budget director Shawn Sullivan said he will testify against Senate Bill 69, which would alter administrative rules governing providers and the managed care organizations. Sullivan is concerned about the bill’s price tag, which he estimates at about $23 million a year in state general funds. His opposition over a relatively small amount of money in a multibillion dollar state budget comes amid continuing financial strain in Kansas government.

Before a hearing on the bill began in the Senate’s Public Health and Welfare Committee, Lt. Gov. Jeff Colyer announced the formation of a working group to streamline KanCare procedures. The task force will consist of KanCare providers, managed care organizations and lawmakers.

The working group appears to be an attempt by the administration to offer a path to improving the Medicaid system while potentially bypassing Senate Bill 69.

“We are listening to the concerns of providers regarding the processes within KanCare,” Colyer said in a statement. “KanCare is not a perfect system, but it is far superior to the old Medicaid system. The working group’s recommendations should produce a simpler, smoother, more efficient set of processes that will ultimately benefit all KanCare consumers by improving the quality of healthcare they receive, and their access to that care.”

While KDHE is officially neutral on Senate Bill 69, Randol endorsed the use of the working group.

Providers offered support for Senate Bill 69 during the hearing, however, saying they are under financial pressure treating KanCare recipients. Bob Finuf, a vice president at Children’s Mercy in Kansas City, said the hospital takes a $60-65 million annual loss from treating KanCare patients.

The hospital has provided 30 percent more services to KanCare recipients over the past five years while their reimbursement has declined 17 percent, Finuf said. The hospital recovers about 65 percent of the cost of care.

“Senate Bill 69 matters to us. The oversight, standardization, et cetera, is important,” Finuf said. “From our perspective, it’s a bit of a adding insult to injury scenario — we’re already faced with difficult economic challenges, and then to have administrative burden placed on top of that is very difficult.”


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