Legislators pose questions about Medicaid managed care

TOPEKA — Members of the Senate Ways and Means Committee today put questions to administration officials about Gov. Sam Brownback's plan to reorganize the state's social service agencies as part of his move to reform the state's Medicaid program.

Dr. Robert Moser, secretary of the Kansas Department of Health and Environment, which oversees the Medicaid program, and Mark Dugan, chief of staff for Lt. Gov. Jeff Colyer, told committee members that the administration had reconsidered its earlier decision to move various programs from KDHE and the Juvenile Justice Authority to the Kansas Department of Social and Rehabilitation Services.

"The administration still thinks there might be some merit to moving those programs," Dugan said. "But that won't be part of the Executive Reorganization Order."

How many EROs?

Now, the planned reorganization would only move programs for the disabled and mentally ill out of SRS into the Kansas Department on Aging, which would be renamed the Department on Aging and Disabilities, Dugan said.

Also, officials haven't decided yet whether they will deliver one or multiple Executive Reorganization Orders, or EROs, to the Legislature as part of their Medicaid makeover efforts, he said.

Once an ERO is introduced, the Kansas House and Senate have 60 days to reject it. If it is not rejected by either chamber, the reorganization would become effective July 1, 2012.

The administration's previous plan to move some delinquency prevention programs from JJA and child care programs from KDHE to SRS drew quick criticism from legislators, public health officials and others.

Medicaid questions

Committee members asked a number of questions about the request for proposal the administration has issued seeking bids from managed care companies to provide services to most of the state's Medicaid population. A third bidders' conference has been scheduled for Dec. 28 and bids are due from the potential contractors by Jan. 31.

Moser told the legislators that the administration aims to have the contracts in force by Jan. 1, 2013.

Two managed care companies currently have contracts through June 2012 to provide services to HealthWave beneficiaries. HealthWave is the state program that provides health coverage to children and pregnant women in low- or moderate-income homes.

Sen. Vicki Schmidt, a Topeka Republican, asked Moser what the administration intended to do to provide HealthWave services between June 2012 and Jan. 1, 2013, when the new KanCare program is scheduled by the administration to replace it.

Moser said KDHE officials currently are in talks with the HealthWave contractors to see if they would extend their contracts the additional six months until KanCare comes online.

"Why do you think people will extend their contracts six months?" Schmidt asked. "What's Plan B if those contractors say, 'I'm done.'?"

Moser didn't answer that question directly but said he assumed the contractors would want to keep the state's business for the extra six months. He said the current contractors also might be among the companies bidding on the new contracts. Children's Mercy Family Health Partners and Unicare are the state's two HealthWave contractors.

State budget stabilizing

The committee also heard presentations on the state and federal budgets.

"You have gone through an incredible period of time," said Duane Goossen, vice president for fiscal and health policy at the Kansas Health Institute. "The last three or four years have been the most difficult period, in terms of state finances, since the Great Depression."

Goossen said state revenue collections decreased each year between fiscal 2006 and fiscal 2009.

"That's unprecedented," he said. "That's never happened more than one year in a row."

Goossen, a former legislator, was state budget director for 12 years, serving Govs. Bill Graves, Kathleen Sebelius and Mark Parkinson. He joined the health institute earlier this year.

Barring significant increases or decreases in revenue in the second half of the current fiscal year, the state should close fiscal 2012 with an ending balance of $370.5 million, he said.

"The budget doesn't require that you make cuts or that you do things to stabilize it," Goossen said. "The budget is stabilizing. Now, there may be many good reasons for taking action or changing policies, but the fiscal outlook is not driving things as it has for the last three years."

Scott Brunner, a senior analyst and strategy team leader at the health institute, outlined provisions in the administration’s plan to let managed care companies run more of the state’s Medicaid programs. Brunner formerly was chief financial officer at the Kansas Health Policy Authority and served the same role when the authority was merged with KDHE and became the Division of Health Care Finance.

Roughly half the state’s 325,000 Medicaid beneficiaries already are exposed to managed care, he said. The administration's plan would extend managed care to nearly everyone else covered by Kansas Medicaid.

http://www.khi.org/news/2011/dec/20/legislators-pose-questions-about-medicaid-managed/