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Other states watching Kansas as it implements ‘unprecedented’ Medicaid model

For the first in the U.S., managed care companies will assume full control over long-term care for developmentally disabled

By Jenni Bergal | December 05, 2013

This KHN story was produced in collaboration with <img src="" />

Photo by Jenni Bergal for KHN.

Neil Carney, 18, who is autistic and developmentally disabled, enjoys a swing in the backyard of a house where he lives with a professional caregiver.

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WICHITA—Aldona and Pat Carney call their son, Neil, “a 24-7 kid.” He’s profoundly autistic, severely mentally retarded and attends a special school. He has tried to eat light bulbs and charcoal briquettes and can be aggressive, sometimes scratching people near him.

Neil, 18, who walks with a limp and carries around a grey sock that calms him, lives in a beige single-family home with a professional caregiver who’s known him for years. The house is equipped with cameras to track his movements.

Come January, the Carneys — and thousands of parents and relatives of developmentally disabled Kansans — fear that the world to which their loved ones have become accustomed may turn topsy-turvy.

That’s when Kansas’ Medicaid managed care system — called KanCare — will take charge of all home- and community-based services for about 8,500 developmentally disabled people, most of them adults.

What concerns families and advocates the most is that the three for-profit national insurance companies that run KanCare will be responsible for a statewide program that they’ve never managed in Kansas or elsewhere.

They’re also worried that the need to make a profit ultimately will destroy a system families and advocates think works well.

File photo of Rocky Nichols, executive director of the Disability Rights Center of Kansas.

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‘Unprecedented model’

While Kansas will become the first state to make such a leap, it is being watched closely elsewhere, as at least two other states — Louisiana and New Hampshire — are considering moving in the same direction.

“This is an unprecedented model. No state has ever taken a developmental disability population and placed it in an arrangement like this, with an out-of-state managed care system, all at once,” said Rocky Nichols, executive director of the Disability Rights Center of Kansas, a legal advocacy group. “It’s almost like throwing everyone into the deep end of the pool.”

Aldona Carney said her family and others are “extremely concerned” because these services, such as in-home care and daytime activities, affect people’s day-to-day lives.

“This type of model has not been done in any other state,” Carney said. “We’re worried that the managed care companies don’t have a clue about what it takes to keep developmentally disabled people healthy and safe in their home.”

Kansas officials have assured parents and advocates that services will remain unchanged and that payment rates to agencies that provide care won’t be cut.

But many are skeptical. They fear that the managed care companies will seek to boost profits by reducing services or driving some small providers out of business because of payment delays or denials. The companies say these concerns are unfounded and insist that services will be maintained and providers paid promptly.


Medicaid Managed Care Enrollment Report as of July 1, 2011

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Many states are scrambling to place large numbers of people on Medicaid — the state-federal program for the poor and disabled — into managed care in hopes of cutting costs and improving quality. Nearly 30 million Americans on Medicaid are in private managed care plans.

and millions more will become eligible for Medicaid in January under the federal health law. Many will be placed in managed care.

Disabled often need extensive care

By next year, more than two dozen states are expected to have set up programs to transfer frail elderly, mentally ill or physically disabled people into managed care for home- and community-based services.

But in most states, the developmentally disabled — people with impairments such as cerebral palsy, Down syndrome and autism — have been excluded from managed care for these services because their needs are so specialized.

They live with their families or in apartments, single-family homes or group homes. Some need round-the-clock supervision and many require assistance with dressing, bathing and preparing meals, as well as transportation. Some need help finding a job or volunteer work, and many attend daytime activity centers.

In Kansas, where a network of community-based nonprofit organizations and county agencies oversee these services, individuals can choose a case manager, who visits them at home and coordinates their care. In some cases, those relationships go back decades. While these organizations will continue to determine what services clients are eligible for and case managers will work with families to arrange that care, ultimately the health plans will be responsible.

“There is a great deal of fear in the community that these big private health plans don’t know much about this population,” said Maureen Fitzgerald, disability rights director for The Arc, a national advocacy organization for the developmentally disabled. “These are such vulnerable people. Mistakes that are just inconvenient to some can be devastating to them. If the home care person doesn’t show up, you could be lying in your bed all day. It’s kind of scary.”

Full control over long-term services

Only a handful of states, including Michigan and Vermont, have moved the developmentally disabled into managed care for long-term services. They’ve mostly relied on existing networks of community-based nonprofits or county agencies or have made themselves the managed care organization. None has turned exclusively to national managed care companies.

But that’s exactly what Kansas Gov. Sam Brownback had in mind when his administration decided to transfer virtually all of the nearly 380,000 people on Medicaid into KanCare, starting in January 2013.

Kansas contracts with three companies — Amerigroup, UnitedHealthcare Community Plan and Sunflower State Health Plan, a subsidiary of Centene. It gives them a fixed amount per member each month. As of Sept. 30, it had paid them a total of $1.3 billion for this year.

The companies provide medical, pharmaceutical and mental health care to KanCare members, including the developmentally disabled.

Chad Simmons was among the hundreds at the Statehouse urging lawmakers and Gov. Sam Brownback to not include services for the developmentally disabled in KanCare, the administration's Medicaid managed care plan.

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Brownback, a Republican, has said that KanCare will improve care coordination and reduce growth in Medicaid spending for the state and federal government by $1 billion over five years.

Although the frail elderly, physically disabled and mentally ill are now getting long-term services through KanCare, inclusion of the developmentally disabled was delayed until 2014 by the legislature following bitter protests from parents, advocates and providers.

Lawmakers wouldn’t yield again, even as more than 1,000 people rallied outside the Capitol in Topeka in May, many wearing red T-shirts that read: “Not Worth the Gamble.”

Kansas State Rep. Nancy Lusk, a Democrat from Overland Park, said she received so many “passionate e-mails” opposing the state’s plan that she put together a video highlighting the stories of families who would be affected, posted it online and sent a message to her colleagues.

Shawn Sullivan, secretary of the Kansas Department for Aging and Disability Services

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Shawn Sullivan, Secretary of the Kansas Department for Aging and Disability Services, said in an interview that providers who are fearful of change had gotten families riled up unnecessarily. He said families and advocates need not be worried because clients will be able to keep their case managers and agencies that provide services won’t have reimbursements slashed. The major difference, Sullivan said, is that the insurance companies will hire care coordinators who will work in conjunction with case managers and providers.

Sullivan, a former nursing home administrator, conceded that state officials should have done a better job interacting with families and providers from the start.

“I think there are a lot of lessons learned,” he said. “I would have gone and worked with families and guardians and all the providers to address their concerns and do a better job of communicating the protections we have in the system.”


Residential Services for Persons with Intellectual and Developmental Disabilities: Status and Trends Through Fiscal Year 2011

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Sullivan said the upcoming changes, which still have to be approved by federal health officials, won’t produce cost savings initially. But they will improve outcomes for clients who will receive more employment opportunities and better coordination of their medical and mental health care, he said. Ultimately, that will save money because of fewer hospitalizations and medical costs.

Companies say they won’t cut services

Kansas currently spends about $349 million a year on home and community-based care for the developmentally disabled — about 10 percent of its Medicaid budget. A study released this year by the University of Minnesota found that Kansas paid on average $40,464 a person in fiscal 2011, which was mid-range in national rankings.

Jean Rumbaugh, president of Sunflower State Health Plan, said money can be saved by reducing inefficient care and better coordinating services. “We want to provide solutions to states and have a holistic approach to this population,” she said. “It is a new opportunity and one that I think Centene is very interested in.”

Rumbaugh said Sunflower’s goals – which are similar to the other two plans’ — are to support families, meet individuals’ needs, focus on competitive employment and make sure clients have access to medical and mental health care.

Amerigroup Kansas President Laura Hopkins said her plan wants to protect the array of services for clients. “There’s no incentive for us to cut services, from a contract perspective or from a human perspective,” she said.

Debra Lipson, a senior researcher for Mathematica Policy Research, a nonpartisan think tank, cautioned that Kansas’ blueprint presents “huge challenges.”

Jean Rumbaugh, CEO of Sunflower State Health Plan, one of three managed care companies overseeing Medicaid administration in Kansas.

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“They’re entering into virgin territory,” she said. “They don’t have a lot of models to follow, and it’s a highly vulnerable population, and therefore you can’t skimp on oversight. And there’s a risk when you’ve got national companies that don’t bring a tremendous amount of experience in this area.”

The health plans say that while they may not have much experience with this particular type of program, they have been handling similar services for physically disabled and elderly members. They also have been hiring workers and managers with expertise in developmental disabilities in Kansas.

Kansas official Sullivan dismissed criticism about the companies’ lack of experience, noting that the state will maintain a high level of oversight and stringent contractual requirements, such as withholding 3 to 5 percent of payments to the plans to ensure performance requirements are met.

Already experiencing problems

But some family members say they’re not optimistic because they’ve already experienced problems with KanCare on the medical side.

Kay Soltz, of Wichita, said her 32-year-old son, Zachary, was initially assigned to a pediatrician as his primary care doctor when KanCare launched. After she complained, the health plan assigned him to a doctor located 20 miles away, and Soltz said she jumped through more hoops to get it changed.

Zachary, who is in constant motion, is autistic and mentally retarded. He spends much of his time watching 30-second snippets of old TV game shows from his childhood and listening to TV theme songs on his Walkman over and over. He attends a day program and, like Neil Carney, lives in a single-family home with a caregiver.

Soltz, 63, said she has “no confidence” in the health plans taking over management of long-term care for Zachary.

“At my age, I’d like to think my son has something stable, something that will protect him if I’m not here,” she said. “Boy, I don’t feel that way at all.”

In recent months, KanCare has also come under attack from hospitals and some providers, who have charged that the health plans have improperly denied or delayed reimbursements and created serious financial and bureaucratic obstacles for them.

The companies say they have been meeting with providers to work out the bugs and have been trying to resolve any systemic problems on their end. But they note that providers also need to become more familiar with the billing and claims process.

Many long-term services agencies for the developmentally disabled fear the same thing will happen to them in 2014 — and that some smaller providers and mom-and-pop operations won’t be able to stay in business if they can’t pay their bills. They say this would leave clients with fewer choices and could result in them losing their case managers and caregivers.

File photo of Tom Laing, executive director of Interhab.

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“It’s very personal and intimate direct care — and home care workers are not paid very much. For small providers, if they don’t get paid, they don’t stay,” said Tom Laing, executive director of InterHab, an association of Kansas providers. “The system was running very well, and now it will be operating on flat tires and worn-out spark plugs.”

‘What's going to happen if KanCare goes wrong’

In Hutchinson, Ginger Zyskowski worries that the nonprofit agency that cares for her brother, Kyle Hulet, could suffer financial instability under KanCare if the health plans don’t pay on time and in full.

Hulet, a cheerful 63-year-old quadriplegic with cerebral palsy who loves watching wrestling and singing at church, lives in an apartment. He works next door at the agency’s front desk, earning about $29 a week for four hours’ work, answering phones in tandem with another client. He also uses a computer to type up banners and notices by pushing a button with his head.

Photo by Jenni Bergal for KHN.

Kyle Hulet, 63, with his sister Ginger Zyskowski at his apartment.

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“Right now, my brother is in a pretty safe place. I’m not sure what the future’s going to hold,” said Zyskowski, 67. “There is a fear among older caretakers like me that if this thing with KanCare goes wrong, what’s going to happen? He could outlive me, and what’s in place for him?”

Aldona and Pat Carney share similar thoughts about their son, Neil.

He lived with them for years, but it no longer was safe for him — or them — in his family home. He didn’t do well in a group home, so, with the help of two of Pat’s brothers, they purchased and renovated the house he now lives in with his caregiver, who teaches him about tasks such as brushing his teeth and dressing himself. Aldona Carney said the state pays a nonprofit agency about $71,000 a year for his residential services — the maximum rate because of his extreme disabilities, which is cheaper than if he were institutionalized.

Carney, 51, said she envisions the house as a place for Neil to live the rest of his life. But she fears that at some point with KanCare, that could change because of the cost.

“There’s a definite lack of trust among parents and families in this state,” she said. “We had a system that worked really well, so why are they trying to fix something that’s not broken?”

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Video produced by Rep. Nancy Lusk highlighting stories of families who will be affected



KHI News Service coverage of KanCare

Hutchinson Clinic's letter throws a curve to KanCare open enrollment (1/28/14)
National Disability Council again urges CMS to hold off on Kansas DD carve-in (1/14/14)
DD carve-in not approved for Jan. 1 launch (12/27/13)
National Council on Disability urges one-year delay of KanCare DD carve-in (12/13/13)
KDADS chief describes lessons learned with KanCare (12/5/13)
Other states watching Kansas as it implements ‘unprecedented’ Medicaid model (12/5/13)
KanCare reimbursement problems continue for providers (11/25/13)
Kansas dental program for children on hold because of KanCare MCO (11/11/13)
Kansas Medicaid providers complain to oversight committee (10/7/13)
Wichita hospital execs describe problems with KanCare (8/29/13)
KanCare to adopt “health home” model for treating mentally ill (7/22/13)
Kentucky’s rush into Medicaid managed care: A cautionary tale for other states (7/18/13)
DD groups largely reconciled to KanCare carve-in (7/15/13)
Advocates urge more government oversight of Medicaid managed care (7/8/13)
Independent pharmacists push for KanCare contract enforcement (7/1/13)
Payroll agents for the disabled on Medicaid say they are struggling under KanCare (6/3/13)
Personal Care Attendants: KanCare's unheralded workers (5/20/13)
House GOP leaders pen letter backing DD supports in KanCare (5/17/13)
More than 1,000 rally at Statehouse for DD carve-out (5/8/13)
Nothing to be done about coverage gap in states not expanding Medicaid, feds say (4/29/13)
As KanCare continuity of care period ends, problems persist; legislators starting to hear about it (4/8/13)
Advocates raise concerns over possible reductions in KanCare services (3/28/13)
Conferees agree on KanCare oversight committee (3/28/13)
DD advocates push to extend KanCare "carve-out" (3/20/13)
Safety-net clinics struggling with KanCare (3/4/13)
Major medical provider groups ask for longer KanCare transition (2/13/13)
Lawmakers and providers assess KanCare transition (1/28/13)
Five-part series: "Lower cost and better care: Can KanCare deliver?" (1/14/13)
Independence of KanCare ombudsman questioned (1/7/13)
KanCare special terms and conditions spelled out by CMS in a document (12/28/12)
KanCare workforce shift hampering local agencies (12/10/12)
Governor announces KanCare approval by feds (12/7/12)
More KanCare implementation details outlined (12/3/12)
Federal officials say they hope to act soon on KanCare waiver request (11/28/12)
New KanCare info included on state website (11/20/12)
Groups call for KanCare delay (11/8/12)
Go/no-go date looms this week for KanCare (10/15/12)
KanCare benefit packages outlined (9/26/12)
Provider groups nervous about lack of KanCare details (9/13/12)
KanCare Confidential (9/10/12)
KanCare contracts awarded (6/27/12)
KanCare plan panned again at public hearing (6/20/12)
Wichita KanCare forum draws more than 200 (6/19/12)
Medicaid makeover: Can Kansas learn from Kentucky? (6/11/12)
Hundreds protest inclusion of disability services in KanCare (4/25/12)
Counties weighing in on KanCare (4/9/12)
Hospital administrator to chair KanCare Advisory Council (3/29/12)
Brownback Medicaid makeover an “ambitious” plan (3/28/12)
KanCare bidders heavily courting Medicaid providers (3/19/12)
Legislators push to delay KanCare start (3/7/12)
Brownback announces managed care for all in Medicaid (11/8/11)
Kansas Medicaid makeover in the works (3/7/11)

Full Medicaid and KanCare coverage

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