New contracts shake up KanCare: One insurance company out and a new one in

The state of Kansas announced new contracts Friday for its $3 billion privatized Medicaid program, KanCare, jettisoning one of the three insurance companies that have run the program since former Gov. Sam Brownback started it five years ago.

The new contracts, which start Jan. 1, went to Aetna, UnitedHealthcare and Sunflower State Health Plan, a division of Centene.

Aetna will replace Amerigroup, which applied for another contract but didn't get one.

The 124,357 Kansans who are enrolled in an Amerigroup KanCare plan will stay with that plan until the end of the year. But during the open enrollment period, which begins in October, they will have to choose a new plan for 2019. Consumers with questions about the change can call 785-766-9012.

Coventry Health Care of Kansas and WellCare of Kansas also bid on the three KanCare contracts but didn't get one of them.

Kansas Rep. Dan Hawkins, a Wichita Republican who chairs the House health committee, said Amerigroup was good to work with, but predicted Aetna will provide equal performance.

He said the administration, now led by Brownback's successor, Jeff Colyer, was thorough in evaluating the bids for the new contracts.

“I’m confident and actually very proud that they did make a great decision,” Hawkins said.

But state Sen. Barbara Bollier, a Mission Hills Republican, said she wanted more information about why the administration chose Aetna.

“I want to understand, what pulled them ahead of Amerigroup?" Bollier said. "What is it, and if it’s just bottom-line costs.”

The administration has made some of the contract documents available online and officials said more will be posted July 2.

According to its website, Aetna operates Medicaid managed care plans in 15 states: Arizona, California, Florida, Illinois, Kentucky, Louisiana, Maryland, Michigan, New Jersey, New York, Ohio, Pennsylvania, Texas, Virginia and West Virginia.

Of those states, West Virginia's Medicaid program is the most comparable to Kansas' in terms of population. Both states have just short of 400,000 people in health plans administered by insurance companies paid a flat rate rather than the traditional Medicaid program in which states pay providers directly based on services rendered.

The National Committee for Quality Assurance, an accrediting agency, gave Aetna's West Virginia plan a 3.5 overall quality rating on a 1-5 scale last year. It got a 3.5 for consumer experience, 3.0 in quality of preventative care and 3.0 in quality of treatment.

Amerigroup's KanCare plan got a 3.0 overall rating, with a 3.0 in consumer experience, 2.0 in prevention and 2.5 in treatment. Sunflower State's plan also was ranked a 3.0 overall and UnitedHealthcare's plan was a 3.5.

Brownback signed the first KanCare contracts in 2012, saying the program would save the state about $1 billion over five years while improving health outcomes and not cutting reimbursements to medical providers.

Reimbursements were cut by 4 percent in 2016 after income tax cuts left the state in a persistent budget hole, but they have since been restored.

Provider groups and some Medicaid recipients and their families have said that KanCare made the Medicaid system more complex and secretive, especially for Kansans with disabilities. A recent legislative audit found that the state's data on KanCare was not good enough to determine whether it was meeting the goals Brownback set.

House Democratic leader Jim Ward of Wichita said he wants to know more about what the new contracts will require, especially when it comes to keeping an eye on how the managed care organizations are performing.

“I want to know what, if any, new tools are in the toolbox to do oversight,” Ward said.

Jeff Andersen, the secretary of the Kansas Department of Health and Environment, said the new contracts will include greater oversight and accountability.

“We took into consideration the concerns we received from KanCare consumers, advocacy groups, legislators and other stakeholders," Andersen said. "We strive to provide Kansans with a cost-effective and dependable Medicaid program that serves their needs, and the new contracts will further that objective.”

Colyer played a major role in constructing KanCare as Brownback's lieutenant governor and a practicing physician. The Republican, who is running for re-election, said KanCare "has proven an effective and efficient delivery model for Medicaid in Kansas.”

“We have achieved cost savings," Colyer said in a statement, "but more importantly, we’ve seen greater preventative care access to improve health outcomes for Kansans.”

This story was originally published June 22, 2018 at 11:52 AM with the headline "New contracts shake up KanCare: One insurance company out and a new one in."