CORRECTION APPENDED

A concept paper outlining the pending Medicaid waiver request that is part of Gov. Sam Brownback's KanCare plan has been completed and was sent Thursday to federal officials, according to the Governor's Office.

The "concept paper" outlining the changes the administration seeks also was posted on the state health department website.

Submission of the paper was a first formal step in the administration's effort to gain approval from the U.S. Department of Health and Human Services to implement its desired Medicaid changes.

Brownback officials said the paper will start negotiations that if successful will culminate in the actual waiver.

"The concept paper starts our negotiations with the federal government," said Sherriene Jones-Sontag, a spokesperson for the governor. "Those negotiations will lead to the final waiver letter, which will detail the waivers being granted and any special terms and conditions."

The federal government covers roughly 60 percent of Kansas Medicaid's costs with the state funding the other 40 percent. Any significant changes to the program must meet federal approval.

With KanCare, the administration has proposed farming out Medicaid services to three large managed care companies. They would oversee and coordinate services provided to all Kansas Medicaid beneficiaries, including the elderly, disabled and the mentally ill.

Currently, large managed care companies only provide services to children and pregnant women from low-income families through the state's HealthWave program.

Administration officials have said they can move forward with some provisions of their Medicaid makeover plan without federal approval.

The administration's KanCare plan was unveiled Nov. 8, 2011, and has been the subject of several legislative hearings.

Among the things described in the concept paper is the establishment of "safety net care pools," that would allow the state to use Medicaid dollars to pay hospitals for "uncompensated and non-hospital care."

The paper also said officials were considering an incentive program to reward hospitals that reduce Medicaid costs and achieve "other measurable delivery system improvement outcomes."

The administration seeks to negotiate a so-called Section 1115 waiver that will allow it latitude from federal Medicaid regulations to enact its plan.

Section 1115 of the Social Security Act, which includes Medicaid, gives the secretary of U.S. Department of Health and Human Services authority to waive provisions of major health and welfare programs, including certain Medicaid requirements and let states use federal Medicaid money in ways otherwise not allowed under federal rules.

The HHS secretary, who happens to be former Kansas Gov. Kathleen Sebelius, can grant rule waivers if it is determined that the changes would promote Medicaid objectives.

Correction:

An earlier version of this story and its headline incorrectly stated that the administration had completed and submitted the Medicaid waiver request, as opposed to beginning the process. That mistake was due to erroneous information provided by the Governor's Office. We regret the error.