Government & Politics

Push to change KanCare starts; budget director plans to testify against bill

Because of cuts in reimbursements, Children’s Mercy Hospital is losing about $60 million a year on KanCare patients, Bob Finuf, a vice president at the hospital, testified Tuesday.
Because of cuts in reimbursements, Children’s Mercy Hospital is losing about $60 million a year on KanCare patients, Bob Finuf, a vice president at the hospital, testified Tuesday.

Lawmakers and health care workers continued Tuesday to push for changes to KanCare, the state’s privatized Medicaid program.

But Gov. Sam Brownback’s administration seemed to offer an alternative approach shortly before the bill had its first public hearing, and the state budget director said later that he planned to testify against the Senate legislation.

Senate Bill 69 would bring a series of changes to the program, including capping administrative spending by the managed care organizations within KanCare.

It also would create an independent review process for denied claims and include other revisions that supporters say would make the system more efficient for patients and providers.

State budget director Shawn Sullivan said he planned to testify against the bill, citing issues with the appeals process in the legislation.

A fiscal note signed by Sullivan estimates that the bill would cost the state roughly $23.5 million in the next fiscal year.

A handful of health care professionals, including Bob Finuf, a vice president at Children’s Mercy Hospital, testified in favor of the legislation during the brief hearing Tuesday morning.

Finuf told lawmakers that in the last five years, Children’s Mercy has provided 30 percent more services to KanCare recipients.

But the reimbursement has fallen by 17 percent, Finuf said, and the hospital is recovering about 65 percent of the cost of care.

“So for us, that’s an estimated $60 to $65 million annual loss or subsidy that we provide for KanCare recipients,” he said.

Finuf said the bill “mattered to us.”

“From our perspective,” he said, “it’s a bit of an insult to injury kind of scenario, where we’re already faced with great difficult economic challenges and then to add the administrative burden placed on top of that is very difficult.”

Lawmakers have moved quickly in recent weeks to propose changes to KanCare. A federal review that was made public earlier this month found that the Medicaid program was falling short of standards. The federal government also denied the state’s request to extend the KanCare program through 2018.

The Lt. Gov. of Kansas said Friday that Medicaid expansion would not solve rural health issues in the state.

Lt. Gov. Jeff Colyer, who has championed the program and lashed out at the federal government for its critical review, took a different tone Tuesday when he announced the creation of a working group to improve KanCare.

“We are listening to the concerns of providers regarding the processes within KanCare,” Colyer said in a statement. “KanCare is not a perfect system, but it is far superior to the old Medicaid system.”

Michael Randol, the state Medicaid director, said he’d rather see changes to KanCare come from Colyer’s new working group “versus having some bill or statute.”

But he said the Kansas Department of Health and Environment was taking a neutral stance on the legislation.

“I think it’s much more beneficial for us to go through the working group and really identify all the issues and concerns that the (managed care organizations) have, that the Legislature has and that the providers have,” Randol said.

Sen. Vicki Schmidt, a Topeka Republican who heads the Senate’s public health committee, said the hearing would continue Thursday.

“If I were you as an opponent, I would be ready to defend that (fiscal) note,” Schmidt said to Sullivan shortly before the hearing ended.

KDHE also is staying neutral on another bill that lawmakers considered Tuesday.

A piece of House legislation would take the inspector general out of KDHE and place the post within the attorney general’s office.

The inspector general’s office has been left empty since 2014.

Supporters of the bill have said moving the post would make the KanCare program more accountable by ensuring state oversight.

“What HB 2047 attempts to do is not the silver bullet,” House Minority Leader Jim Ward, a Wichita Democrat, said. “But it’s one step in improving the delivery of those critical services to our most vulnerable citizens.”

No one spoke against the legislation during Tuesday’s hearing.

“We’re not for or against it,” Attorney General Derek Schmidt said. “If you want to assign this to us, we’ll do our best to make it work and we’ll be happy to. But it’s not something we covet.”

Hunter Woodall: 785-354-1388, @HunterMw