Kansas Health Institute | Information For Policy Makers. Health for Kansans.

TOPEKA — TOPEKA — Gov. Mark Parkinson says that an overhaul of the nation’s health care system is urgently needed.

But he says governance changes at the state’s lead health policy agency are not.

Federal reform and an emerging debate about the role of the Kansas Health Policy Authority were two of the topics Parkinson covered during an interview with KHI News Service. He also discussed the potential budget consequences of expanding eligibility for the state’s $2.4 billion Medicaid program, which could result from federal health reform.

Health reform and Medicaid

If Congress doesn’t pass a meaningful reform bill, Parkinson said more than 330,000 uninsured Kansans would continue to receive inadequate health care, the cost of care and insurance would continue to rise and hospitals across the state would continue to lose more than $800 million a year treating patients that either have no insurance or can’t afford to pay their bills.

Though he generally supports the reform proposals crafted by the Democratic majority in Congress to expand coverage to the uninsured, Parkinson said he is concerned they won’t do enough to reign in health care costs, which at $2.5 trillion a year consume approximately 16 percent of the nation’s gross domestic product.

“If I have a concern, it’s that we would address coverage but not costs,” Parkinson said. “We really need to do some things to bring down costs.”

One of the ways in which the federal bills would expand coverage is to increase eligibility for Medicaid, the government health insurance program for the disabled and those with low income that is jointly funded by states and the federal government. The U.S. House reform measure and the plan crafted by Senate Finance Committee Chairman Max Baucus, D-Mont., would raise Medicaid eligibility to include adults with incomes up to 133 percent of federal poverty guidelines — about $14,400 a year for an individual or $24,350 for a family of three.

That would be an especially dramatic change for Kansas. Low-income adults here aren’t eligible for Medicaid unless they have children and then only if they make less than 27 percent of poverty — about $3,250 a year for an individual or $5,500 for a family of three.

Kansas officials don’t yet have precise numbers, but they estimate that the change would add at least 100,000 more people to the approximately 265,000 people now enrolled in Medicaid. That would significantly increase the cost of what is now about a $2.4 billion program. The state’s share of that cost is about $1 billion.

It’s not yet clear how much of the additional cost the federal government would pick up. With the Baucus plan, the federal government would fully fund the eligibility increase through 2014 but states would be required to pay 10 percent of the ongoing costs starting in 2015.

Uncertainty about what would be required of cash-strapped states has many governors nervous. But Parkinson said he wasn’t concerned.

“I would be concerned if I felt that the federal government would end up passing an unfunded expansion of Medicaid,” he said. “But I’m comfortable that if Medicaid is expanded the federal government will pick up the cost.”

That comfort, Parkinson said, is rooted in his belief that congressional leaders would do what was necessary to gain the support of governors who have expressed strong concerns about states’ ability to absorb additional Medicaid costs.

“I think those voices have been heard and there is a low probability of an unfunded federal mandate,” he said.

KHPA controversy

Some Republican legislators have been talking recently about their desire to change the governance of the Kansas Health Policy Authority. They claim that the agency, which was created by the Legislature in 2005 to guide state health policy and manage Medicaid, the Children’s Health Insurance Program and the state employee health plan, has exceeded its charge by proposing and advocating for initiatives to ban smoking, increase tobacco taxes and provide state-subsidized health insurance to low-income adults who don’t qualify for Medicaid.

Rep. Scott Schwab, R-Olathe, a member of the House Health and Human Services Committee, said last month during a forum sponsored by the Greater Kansas City Chamber of Commerce and two health foundations that some GOP legislators were eager to make “drastic changes” to the health policy authority once Republican U.S. Sen. Sam Brownback becomes governor, assuming that happens.

“It went a direction that folks didn’t want it to go,” Schwab said of the agency, which unlike most major ones is governed by an independent board appointed by the governor and legislative leaders from both parties. “The main job of the KHPA was to leverage the buying power of the state and it has gone way beyond that.”

Schwab said because of anticipated opposition from Parkinson, a Democrat, he doubted that attempts would be made during the 2010 session to change the agency’s governance and charge.

Parkinson confirmed that he would oppose any such attempts.

“If you set up an independent agency and you tell them to be independent and to tell you what they are truly thinking, you shouldn’t be surprised if from time to time they tell you something that you don’t want to hear,” Parkinson said, adding that policymakers sometimes need to be reminded that what makes good politics doesn’t necessarily make good policy.

“We need an independent agency that has the authority and the chutzpah to occasionally tell us what we ought to be doing,” he said.

—Jim McLean is a staff writer for KHI News Service, which specializes in coverage of health issues facing Kansans. He can be reached at jmclean@khi.org or at 785-233-5443, ext. 110.