Kansas Medicaid backlog hits nursing homes financially
Kansas Gov. Laura Kelly’s first proposed budget calls for hiring 313 additional state workers at a beleaguered Medicaid application center to take over some functions that were privatized by then-Gov. Sam Brownback.
The KanCare Clearinghouse in Topeka has been a target of criticism from legislators, nursing home advocates and other groups since Brownback established it in 2015 and contracted with a Virginia-based company called Maximus to run it.
Under Maximus, a backlog of Medicaid applications ballooned into the thousands, leaving nursing homes to wait months or even years for compensation. Some had to stop taking in people whose applications were still pending, leaving them to search elsewhere for a bed.
“It’s just been a cluster-mess for everybody,” said Cindy Luxem, the president and CEO of the Kansas Health Care Association, a nursing home advocacy group.
Maximus spokesman James Dunn said via email that since October the company has processed more than 99 percent of applications within the contract’s required timeline.
“We take our responsibility for serving Kansans seriously and personally,” Dunn said. “We remain committed to delivering unparalleled service levels and processing applications timely and accurately to ensure that the most vulnerable Kansans receive the immediate support they need.”
Still, Luxem’s group and others that represent nursing homes said they were encouraged by the budget proposal Kelly released Thursday. It would use about $7 million in state money over the next 18 months to hire more help, provide training and quality improvement and, starting in July, take some Medicaid applications away from Maximus and put them back under the care of state employees at the Kansas Department of Health and Environment.
“The expected outcome of bringing back in-house some of the work currently done by Maximus is to improve the quality and provide enhanced ‘hands on’ customer service, particularly for the most complex Medicaid applications,” said Kelly spokeswoman Ashley All.
The changes are overdue, said Rachel Monger, vice president of government affairs for LeadingAge Kansas, a nonprofit nursing home advocacy group.
“Our Medicaid eligibility system has been broken for three years, leaving seniors without care and their care providers on the verge of financial collapse,” Monger said. “It is long past time to move elderly and disabled applicants out of the hands of private contractors, and back into a state agency with oversight and accountability. It is appalling what past KDHE leaders allowed to happen to so many vulnerable people.”
Republicans criticized aspects of Kelly’s overall budget, but the Democratic governor may find allies for the KanCare proposal even among the conservative wing of the opposition party. Rep. Dan Hawkins, a Wichita Republican who just became the House majority leader, has been a persistent critic of Maximus as chairman of the House health committee.
Hawkins didn’t respond to a phone message left Friday.
When Jeff Colyer took over for fellow Republican Brownback last year, he installed new leaders at KDHE who took a harder line on Maximus, threatening to levy fines or even sever the contract if performance didn’t improve.
Former KDHE secretary Jeff Andersen told legislators he thought the company underbid the contract and was never prepared to handle the volume or complexity of Medicaid applications.
“While the bid was appealing from a cost-savings perspective, you get what you pay for,” Andersen wrote in an August legislative update. “The subsequent performance has been unacceptable.”
It was Andersen who first proposed taking back state control of the long-term care Medicaid applications in July. But Luxem said he’d also expressed some doubt about whether that timeline was realistic.
“I’m encouraged that the Kelly administration is recognizing that we need to continue to get that back into the hands of people that really understand the process,” Luxem said, “and not just people who are answering phones and shuffling papers.”
Rodney Whittington, the CEO of Villa St. Francis in Olathe, said Maximus’ performance had improved some of late. At the peak of the backlog he regularly had 40-plus residents with Medicaid applications pending, and the amount of care he provided without reimbursement topped $1 million.
Today he said the pace of processing has improved so that he usually has only about 15 residents waiting on coverage. But he said Maximus only deserves some of the credit for that. The rest goes to his accounts receivable manager, Jackie Hollis, who helps residents with their applications.
“We’re still having Jackie train Maximus folks on the phone and catch their mistakes for them,” Whittington said.