Lt. Gov. Jeff Colyer tells the Senate Ways and Means Committee
on Tuesday about his plan to contract out Medicaid to private
sector managed care plans. Sen. Laura Kelly, D-Topeka, questioned
the wisdom of the plan, noting that Connecticut was unsatisfied with
the results from a similar plan. (Photo by Andy Marso/Topeka Capital-Journal)
Sen. Laura Kelly, D-Topeka, questioned Lt. Gov. Jeff Colyer on Tuesday about the wisdom of his plan to contract out the state's Medicaid services to managed care plans run by the private sector.
Following Colyer's testimony to the Senate Ways and Means Committee, Kelly noted that Connecticut had decided to ditch its managed care plans after finding that the providers weren't achieving health outcomes that justified their overhead costs.
"I think what they found was that they didn't recognize the savings that they had anticipated," Kelly said. "They actually, after much deliberation and study, decided that they probably could do it better themselves."
Colyer, a plastic surgeon from Overland Park, said he wasn't familiar with the details of Connecticut's plan, but noted that many states with wholly public Medicaid plans have been forced to cut coverage or purge members from their rolls because of burgeoning costs.
He also said decreasing federal funding would force states to make more tough decisions.
"The choice in doing this is: Do we cut people off or do we cut rates across the board?" Colyer said. "That is not where we want to go, and so the choice is, how do we do this better?"
Colyer also said that under his plan, Kansas would withhold "significant" funds from the managed care providers that would be doled out as a reward for good health outcomes.
Kelly said she agreed that changes to Medicaid have to be made, but she wasn't sure managed care plans are the best solution.
Meanwhile, the managed care transition continues, with Kansas Department of Health and Environment official Kari Bruffett briefing a House committee on the state of the bids for the three statewide managed care contracts.
Bruffett, the director of the Division of Health Care Finance, told the House Social Services Budget Committee that the deadline for the technical specs of the bids is Jan. 31, and the deadline for bid costs is Feb. 22. Only after that will legislators get a look at the bids or find out the bidders' names.
Bruffett reiterated estimates that the managed care plan will result in about $850 million in savings over five years. She said a large chunk of those savings are estimated to come from keeping seniors in their homes, noting that Kansas currently has the nation's sixth-highest percentage of seniors living in institutions.
"Certainly my grandparents’ preference — long-fought preference — is to stay home and then stay in the community in some sort of assisted living prior to going to a skilled nursing facility or a full-care nursing facility," Bruffett said.
But some on the committee questioned how many people would be able to move out of or stay out of nursing homes. Rep. Barbara Ballard, D-Lawrence, noted that keeping people out of institutions had been a perennial priority in recent years, but the state hadn't been able to make much headway.
Rep. Jerry Henry, D-Cummings, said he thought it was already relatively difficult to get into a Kansas nursing home.
"What kind of services aren't we providing?" Henry said. "Surely there's a name for them. What can we have, that's not there now, that's directing those individuals to those nursing homes?"
Bruffett said that is why Gov. Sam Brownback's administration has proposed to contract with the private sector and leverage its ability to innovate.
"The RFPs have set very strong incentives for the managed care organizations to provide those services, in a way that, frankly perhaps the state hasn't incentivized before," Bruffett said.
Bruffett said the managed care contracts would also establish strong incentives for weight loss and smoking cessation, preventative measures which would also reduce costs.
"If we don't realize over $800 million in savings, then what do we do?" Ballard asked.
"We believe we will," Bruffett responded. "We feel very strongly that we'll see these kinds of savings from our baseline."
Andy Marso can be reached at (785) 233-7470 or andy.marso@cjonline.com. Follow him on Twitter @andymarso.
http://cjonline.com/news/2012-01-17/kelly-queries-colyer-medicaid-proposal