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On January 1, 2017, the KHI News Service became part of KCUR public radio’s new initiative, the Kansas News Service. The Kansas News Service will continue to cover health policy news and broaden its scope to include education and politics. All stories produced by the former KHI News Service are archived here. Stories and photos may be republished at no cost with proper attribution and a link back to KHI.org.

State gives no advance Medicaid payments to nursing homes

Officials who promised half-payments instead push applicants to front of processing line

By Andy Marso | July 25, 2016

State gives no advance Medicaid payments to nursing homes
Photo by Mission Village Living Center At Mission Village Living Center in Horton, CEO Patricia Raasch wondered why the facility hadn’t received advance payments for residents whose Medicaid applications were caught in a state processing backlog. Instead of making those advance half-payments, the state has used those requests to prioritize which Medicaid applications are moved to the front of the processing queue.

The state has not made any advance payments under a program that promised financial help for nursing homes while they wait for residents’ Medicaid applications to process.

Nursing homes were told in March that they could apply for half-payments for their Medicaid-pending residents until the state resolves a backlog of thousands of applications.  

But the state instead has used requests for advance payments to prioritize which Medicaid applications are moved to the front of the processing queue.  

“To clarify, we have made no advance payments under the program,” Angela de Rocha, a spokeswoman for the Kansas Department for Aging and Disability Services, said last week via email. “Rather, what the State has done is to determine the eligibility of the individuals involved and to approve regular payments to the nursing facilities when advance payment requests are made. This reduces the administrative burden on both the state and the nursing facilities.”

De Rocha said the state had received requests for advance payment for 287 nursing home residents and responded to 246 of them.

Medicaid benefits have been extended to 39 percent of the 287 and denied to 38 percent, she said. The state had no Medicaid application on file for 4 percent.

The state is still trying to verify information for 12 percent of the advance payment applicants and continues to evaluate the financial assets of 6 percent to make sure they’re below Medicaid limits.

“Some of these are extremely complicated,” de Rocha said.

Another disruption?

Nursing home representatives heard details about how the state has used the advance payment requests during a meeting last week with KDADS officials and Mike Randol, director of the Division of Health Care Finance at the Kansas Department of Health and Environment.

Linda MowBray, director of the Kansas Center for Assisted Living, said the fact that the state is speeding the processing of certain Medicaid applications is not in itself a bad thing.

But she said that strategy requires putting aside other applications and could create new problems at the KanCare Clearinghouse, the Forbes Field outpost where state workers and contractors process Medicaid applications.

“How in the world is the Clearinghouse ever going to get a routine?” MowBray asked. “It just seems like it’s another way to disrupt the flow.”   

It appears there has been miscommunication between the state and nursing facilities about the advance payment program from the start.

MowBray’s organization and its affiliate, the Kansas Health Care Association, thought that the state and its Medicaid contractors would recoup any advance payments after the Medicaid application was completed and then reprocess the claim before making payments in full.

“How in the world is the Clearinghouse ever going to get a routine? It just seems like it’s another way to disrupt the flow.”   

- Linda MowBray, director of the Kansas Center for Assisted Living

The cash flow concerns that would raise caused a struggling nursing home in Shawnee, Sharon Lane Health Services, to decide not to pursue the advance payments.

De Rocha said the plan was to only recoup advance payments for residents whose Medicaid applications were denied. For those approved, the advance payments would be subtracted from the back pay owed to facilities.

But the financing details are largely irrelevant because the state is not granting advance payments.

Nursing home administrators who had been applying for them did not know that.

Charla Roberts, billing manager at Villa St. Francis in Olathe, said she had filled out the forms and had been wondering why she had not received any advance payments or any indication that she wasn’t correctly completing the forms.

She began to suspect no payments were being made even before the state confirmed it.

“That’s what I was afraid of,” Roberts said. “At first I wondered if it was just me.”

Roberts said her facility, which is affiliated with the Catholic Church, serves a lot of residents on Medicaid as part of its mission.

She will continue to complete the advance payment requests to get applications fast-tracked but fears the rush to get certain applications done may lead to processing errors. It’s not what the state promised, she said.

“I think it’s public knowledge what they said,” Roberts said. “If it’s approved for advance payment, we get half.”

Delays began last summer

As of June 19, there were 11,585 Medicaid applications awaiting processing — including 7,724 pending more than 45 days, which is the limit for a Medicaid determination under federal rules. As of Friday, de Rocha said the number pending more than 45 days had been reduced to 6,117.

Nursing home associations pushed hard for a presumptive eligibility program to help members saddled with uncompensated care as they wait for Medicaid applications to process.

The associations were among the first groups to raise alarms about long processing times, because Kansans rely on Medicaid to pay for assisted living once their savings are spent.

But Kansas Medicaid, or KanCare, also serves low-income children, pregnant women and people with disabilities. Groups that represent those Kansans also have reported long waits for the past year.

The delays began last summer when the state rolled out a new Medicaid processing program called the Kansas Eligibility Enforcement System, or KEES.

The backlog that started with KEES worsened in January when the state began funneling all applications through the Clearinghouse, including many that were previously the responsibility of the Kansas Department for Children and Families. The change came at the same time as a rush of applications due to the federal Affordable Care Act open enrollment period.

The state has added and shifted staff to try to resolve the backlog. But pressure is building to do more, especially since KDHE Secretary Susan Mosier revealed to federal officials last month that reports showing the backlog receding were erroneous and the number of Kansans waiting actually was several times larger than previously reported.

In response, the Kansas Disability Rights Center requested documents about the backlog under the Kansas Open Records Act.

Deb Zehr, president and CEO of a group called LeadingAge Kansas that represents nonprofit nursing homes, sent letters last week to the federal Centers for Medicare and Medicaid Services and the state’s U.S. House congressional delegation, asking them to intervene.

‘Held hostage’

Patricia Raasch, CEO of Mission Village Living Center in Horton, said her small nonprofit facility struggled to pay its bills as it applied for advance payments that never came.

She had to ask vendors to delay bill collections until more of her residents’ Medicaid applications were processed.

Photo by Mission Village Living Center Patricia Raasch, CEO of Mission Village Living Center in Horton, said her small nonprofit facility struggled to pay its bills as it applied for advance Medicaid payments that never came.

View larger photo

“We got gas shutoff notices,” Raasch said. “Notices that we were going to have our cable and telephone shut off. …  (We) couldn’t pay our food bills. We have all these service charges now that were incurred for us.”

Raasch said the longest-pending applications for her facility’s residents now have been processed and approved. The residents are covered, with back payments, but she said those do not account for the service charges incurred for late payments to vendors. Nor do they restore her facility’s goodwill with those vendors.

Raasch wondered why no one from the state explained that the advance payments weren’t coming.

“I just want some accountability, and I haven’t seen any,” she said. “I haven’t heard one apology for any of this. … Yeah, we still finally got our money. But it got held hostage three or four months. Taking care of seniors here in Kansas sometimes just doesn’t pay.”