If any state needs to expand Medicaid, it’s Kansas

If Gov. Sam Brownback and the Kansas Legislature care about the long-term health of the state and its citizens, they will heed a letter from the executives of six health care foundations.

The authors note that the state recently hired a consultant for $2.6 million in hopes of wringing more efficiencies out of a decimated budget, while shunning a solution within its grasp.

They shared a new analysis by Manatt Health Care Solutions, a national consulting firm, that concludes the state would benefit financially by expanding Medicaid eligibility to low-income, mostly working Kansans.

“Expansion, in fact, may generate savings and new revenue in excess of the costs of expansion,” the report states.

About 150,000 Kansans fall into a coverage gap. They earn too little to purchase insurance in the Affordable Care Act’s marketplace, but they make too much to meet Kansas’ very low eligibility threshold for Medicaid. Adults without dependents aren’t eligible at all.

If Kansas were to approve an expansion, the federal government would pay 95 percent of the cost next year, and never less than 90 percent. The consultants estimate the state’s cost at $53 million a year, or a total of $264 million through 2020. But savings would cancel out that expense.

Kansas currently spends $75.3 million a year to finance mental health services, for instance. Many of the people who use those services could be covered under a Medicaid expansion.

Likewise, the state would save money on reimbursements it pays to hospitals and clinics for treating uninsured patients. And much of the $9.3 million a year it spends on inpatient care for prison inmates could be picked up by Medicaid. Also, Kansas would be expected to save millions of dollars from citizens shifting from disability payments to Medicaid.

Manatt notes that its report is limited. “It does not consider the impact on the finances of hospitals or other providers, nor the ripple effect from hundreds of millions of federal dollars flowing into the state’s economy,” it states.

If any state should be looking at Medicaid expansion, it is cash-strapped, economically stagnant Kansas, where one rural hospital recently closed and others are struggling. But key lawmakers have cited irrational opposition to “Obamacare” to avoid a meaningful discussion. Brownback disingenuously tries to entwine Medicaid expansion with other priorities.

Thirty states have decided that Medicaid expansion makes sense for them. Surely Kansas lawmakers can find a model that would work here.

“We call upon legislators to give KanCare expansion serious consideration and an open debate,” the foundation executives wrote.

Good call. Lawmakers would be foolish to ignore it.

This story was originally published December 9, 2015 at 6:05 PM with the headline "If any state needs to expand Medicaid, it’s Kansas."