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Kansas on track for Oct. 1 Medicaid/insurance exchange connection

Despite months of political wrangling and federal rules writing, Kansas among the relatively few states expected to be ready, say KDHE officials

By Phil Cauthon | March 18, 2013

After months of trying to dance around the politically charged issue, the administration of Gov. Sam Brownback has openly acknowledged that the $139 million Medicaid enrollment system that it is building will be interconnected with the online health insurance exchange required by the Affordable Care Act, and that the system will be ready to go by the Oct. 1 federal deadline.

“It's just a connectivity kind of a thing,” said Dr. Robert Moser, secretary of the Kansas Department of Health and Environment, which is spearheading the project to overhaul the 26-year-old, paper-based system to a modern online one.

“I certainly appreciate the concerns that are tied to the political angst, but this program was well on its way when I came on board and my job is to make sure it gets completed successfully,” he said.

Entangled with the exchange

Overhauling the state’s antiquated Medicaid enrollment system has been in the works since at least 2009, when the project was called K-MED.

The project stalled briefly in August 2011, when Brownback returned a $31.5 million federal grant, most of which had been earmarked for developing the state’s new Medicaid enrollment system. Brownback said he was returning the grant because it was tied to the Affordable Care Act — which he he had pledged he would not implement prior to the U.S. Supreme Court ruling on the law, and later until after the 2012 federal elections.

Then that same month, administration officials announced a new contract with Accenture to develop the Kansas Eligibility and Enforcement System (KEES), using $118 million in federal funds to pay for the $139 million projected cost. K-MED became KEES.

Source: Xerox Corp.

A flow chart of the basic components of a health insurance exchange. Kansas will have a federally run exchange, but its new Medicaid eligibility system called KEES must be "interoperable" with the rest of the exchange. Oct. 1 is the scheduled launch date for both KEES and the federal insurance exchange, where consumers can shop for coverage that will begin Jan. 1.

View larger photo

A key condition of the federal funding was that the KEES system would have to be “interoperable” with the coming health insurance exchange — an online marketplace scheduled to launch Oct. 1 where consumers can compare and buy coverage that will begin Jan. 1, 2014.

In Kansas and the 25 other states that elected not to run their own health insurance exchanges, the federal government will build and operate them.

Political sensitivity

Moser said interoperability of KEES and the exchange means that — for consumers — there will be a single entry point for enrolling in private health insurance or in Medicaid, the state-federal health care program for low-income, elderly and disabled persons. Medicaid in Kansas is known as KanCare.

“You enter in some information, most of it is going to be yes/no. If you're eligible for Medicaid then it would pop up the KEES patient portal,” Moser said. “If it shows that your income level is such that you don't qualify for Medicaid…it's going to push your information over to the federal exchange. So those two systems literally will be handing back and forth inquiries.”

Moser said the fact KEES would interface with the insurance exchange was no different than integration with other federal computer systems, such as Homeland Security or the Internal Revenue Service.

“It doesn't really have that significant of an implication in my mind. But then again, I'm a physician and a little bit more patient-centered and look at the convenience factor. If that person is in a hospital setting and I think they need admitted, but they're worried about the cost because they don't have coverage, I'd like to be able to determine at that point in time 'Are they eligible for coverage' and use that as leverage to get them in to the hospital,” Moser said.

There also seems to be less concern among legislators this year about connecting KEES to the exchange. Last year, Rep. Charlotte O’Hara, a conservative Republican from Overland Park, was the most outspoken against the project, saying KEES and the health insurance exchange were “one in the same.” O’Hara did not win reelection.

House Speaker Ray Merrick (R-Stilwell) and Senate President Susan Wagle (R-Wichita) both said they have little concern with KEES connecting to the exchange.

"There are no plans to bring up this issue and I have not heard of interest from any legislators," Merrick wrote in an email.

Phase one complete, phase two underway

The first phase of the KEES project was completed in September with the launch of the online application portal. So far 7,719 applications have been submitted through the portal as of last week, accounting for around 20 percent of the applications, according to KDHE.

While the portal provides a paper-free way to apply for Medicaid, the back-end of the system is still paper-based until the second phase of KEES is completed in October, said Glen Yancey, who is overseeing the project as KDHE’s chief information officer.

"We're accepting applications online but ultimately we're using the old back-end system for determining eligibility," Yancey said.

Boxes of paper Medicaid application forms that have been scanned into the state's computer system. Officials say there will be some need to deal with hard copies of forms for the foreseeable future even with the new KEES system, but that they expect the new system will minimize the paperwork.

View larger photo

"The online application produces a paper application that is then data-entered into our current eligibility system," he said. "In the future, that step won't need to happen. I can't guarantee there won't be any paper, but the hope is that it will be all electronic."

Currently, KDHE is working on Kansas-specific modifications to the base Accenture system, Yancey said.

"A code release scheduled for May will contain the bulk of the Kansas modifications with the final code release in the summer of 2013," Yancey said. "Additional Kansas-specific functions will be added to the production system with phased releases scheduled through the spring of 2014."

KEES must be integrated with the federal insurance exchange by Oct. 1, 2013, when the exchange is scheduled to open for enrollment. Moser said the project was currently “on time,” but acknowledged that there was some anxiousness about meeting the deadline.

If there is not functional "two-way integration" of the exchange and KEES by Oct. 1, the federal government will also run the Medicaid side of the exchange, said Kansas Insurance Commissioner Sandy Praeger following a December forum on health reform implementation.

"If it's not integrated on time, they've told us that — at least initially — it would be the federally facilitated exchange doing (Medicaid) eligibility and enrollment," Praeger said. "They'd have to — if they're running the exchange and we're not ready to provide (KEES), they'd have to."

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