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

TOPEKA — Sen. Dick Kelsey today called on the administration of Gov. Sam Brownback to delay and modify its plan to remake the Kansas Medicaid program.

"Eleven hundred questions by the possible bidders to a 170-page (contract proposal) show that even the professionals don't understand what is being suggested, let alone the providers of Medicaid services and those receiving those services," the Goddard Republican said, referring to follow-up queries submitted to state purchasing officials after the administration solicited bids for managed care services last November.

In an unusual move, Kelsey read from a prepared statement at the end of a final day of hearings on the governor's KanCare proposal. The hearings were held by the Senate Public Health and Welfare Committee, which is chaired by Sen. Vicki Schmidt, a Topeka Republican.

Kelsey also questioned the Republican administration's claim that its plan would save $850 million in federal and state spending over the next five years.

"Many people have doubted the reality of those savings," he said, "and nothing was presented to the committee to show how the proposed savings would be realized."

Administration officials were among those testifying during the six days of hearings. In response to questions, they said the savings would result from better care coordination that would help control unnecessary or duplicated treatments. But they did not provide details or actuarial studies supporting their claims.

Kelsey said other committee members were welcome to sign on to his statement, which included these recommendations:

• Delay KanCare implementation by six months. Administration officials have scheduled a Jan. 1, 2013, launch of the program. Kelsey said that should hold until July 1, 2013.
• Schedule hearings throughout the state during that postponement to get feedback on the contract proposal currently out for bid. The administration has said it wants to award contracts to three managed care companies. Bids currently are due Feb. 22, having already been pushed back from an earlier Jan. 13 deadline. Brownback officials have said they want to have contracts negotiated and signed by summer in order to meet their implementation deadline.
• Remove services for the developmentally disabled from the plan and reconsider including them two years after the plan has been in effect. KanCare would extend Medicaid managed care to the elderly, disabled and mentally ill. Currently, only services for children and pregnant women enrolled in the state's HealthWave program are in plans overseen by large managed care companies.
• Reconsider the plan to have three managed care companies each providing services statewide. Instead, divide the state into three regions and award each region to a single company in order to ease administrative complexities for doctors, hospitals and other Medicaid providers. (Administration officials said federal Medicaid regulations don't allow the option of a single managed care company. The rules require that Medicaid beneficiaries have a choice between at least two plans.)

Kelsey said his recommendations were made with the hope of "helping assure a wider acceptance of these massive changes and to have a more effective implementation of the plan."

Other committee members also have said they were concerned about the governor's plan.

Sen. Roger Reitz, a Manhattan Republican, is a physician who has been consistently skeptical of it in remarks made over the course of the hearings.

Sen. Laura Kelly of Topeka, the committee's ranking Democrat, said today, "I'm very concerned that the speed and magnitude of this plan is almost going to guarantee that it will fall on its face."

She said she would like to see the administration try some pilot programs before fully implementing KanCare.

The Senate Public Health and Welfare Committee was the first legislative panel to begin reviewing the governor's Medicaid plan, which was unveiled Nov. 8, 2011. The panel's members devoted all or part of six meetings to the topic since the 2012 Legislature convened earlier this month.

The governor's plan was endorsed by the Kansas Medical Society and also had qualified support from the Kansas Hospital Association and the Association of Community Mental Health Centers of Kansas. But the provision that would include day-to-day services provided to the developmentally disabled has drawn uniform opposition from groups that provide those services and from families of the developmentally disabled. They have called the plan hasty and untested.

Those concerns apparently are shared by Kelsey and at least some other legislators.

Rep. Jim Ward, a Wichita Democrat, has introduced House Bill 2457, which would force removal of services for the developmentally disabled from the managed care contracts sought by the administration.

Kansas Department on Aging Secretary Shawn Sullivan was present during Kelsey's remarks and has been meeting regularly with representatives of the developmentally disabled for the past several weeks, trying to explain the administration's plan and build support for it.

"I don't believe I've heard a compelling reason to carve out services for the developmentally disabled" from the KanCare contracts, he said after the meeting.

He cited a June 2010 study by researchers at the University of Kansas Medical Center for the defunct Kansas Health Policy Authority that indicated the developmentally disabled were less likely to receive routine screening for cancer and diabetes care than other people.

The administration's plan, he said, through better coordination of care, would improve the health of the developmentally disabled.

He also discounted Kelsey's recommendation that the plan be postponed.

"We think we have a reasonable timeline," he said.

The fact that legislators and some service providers are resisting the administration's plan could spell trouble for it down the road, even if it goes forward without modification, according to a report prepared by the American Academy of Actuaries.

That early study of Medicaid managed care, published in 1996, reviewed plans implemented across the nation. It warned that those that failed to gain support among providers and the public or were implemented across-the-board and quickly were less likely to succeed.

"Medicaid risk transfer programs are inevitably complex," the report stated. "They involve myriad issues that pertain to communications, systems, public policy, and public perception. While it is important not to delay implementation unnecessarily, it is advisable to implement (managed care) on a phased-in basis. Two alternatives are gradual implementation, by county or other geographic subset of the state, or implementation by eligibility category."