Month: April 2014

‘Woodwork effect’  projected to add another 13,400 people by July 2015
by Mike Shields, KHI News Service

Topeka — State officials said they expect more than 13,000 Kansans currently eligible but not enrolled in Medicaid will sign up for it by July 2015 due to greater awareness of the program from the Affordable Care Act and KanCare.
Kari Bruffett, director of the Division of Health Care Finance at the Kansas Department of Health and Environment, said Medicaid enrollment so far this year already has outpaced “normal growth” patterns and that trend was expected to continue at least over the next year or more thanks to the so-called “woodwork effect.”
KanCare, the name given Medicaid in Kansas after the administration of Gov. Sam Brownback rebranded it in 2012, is being promoted on billboards and ads by the three managed care companies competing to attract enrollees to their health plans. And the Affordable Care Act, commonly known as Obamacare, has heightened awareness of the various options available to those needing health coverage, officials said.
How much credit or blame for the growth should be assigned to either initiative hasn’t been parsed yet, legislative and agency analysts said. But they pledged they would try to find out and report back to legislators on that later.
Medicaid, which covers more than 400,000 Kansans, is the federal-state program that provides health care for the poor and disabled.
Packed agenda
Bruffett’s comments came as part of a day-long meeting of the Robert G. Bethell Joint Committee on Home and Community Based Services and KanCare Oversight.
The panel had a packed agenda and heard from a stream of state officials, insurance executives, Medicaid providers and beneficiaries.
The providers mostly registered complaints of the sorts legislators have heard in previous meetings about frustrations with KanCare’s administrative complexities and persisting difficulties getting paid in timely and complete manner by the state’s KanCare contractors: Amerigroup, UnitedHealthcare and Sunflower State Health Plan, a subsidiary of Centene.
A couple of providers also told the committee members they were pleased with the KanCare changes, but more said they were having problems.
‘No significant improvement’
Bob Finuf, vice president of payor relations at Children’s Mercy Hospital in Kansas City, Mo., and a member of the hospital working group that has been trying to resolve KanCare payment problems in regular meetings with officials from the state and the KanCare companies, said from Children’s Mercy’s perspective KanCare has improved since its troubled launch in January 2013, “but not significantly.”
Finuf said the hospital has $14 million in unpaid and overdue KanCare payments with two-thirds owed by a single KanCare company: Sunflower State Health Plan.
“From our perception,” he said, “there’s an unwillingness (on the part of the company) to fix reasonable problems.
“We simply did not encounter the number or magnitude of operational and claim payment delays or denials that we have encountered since the implementation of KanCare,” Finuf told the panel. “Kansas Medicaid is our lowest and slowest payer source and the biggest demand on resources in our organization.”
Officials from Newman Regional Health, a small county-owned hospital in Emporia, described the same type of problems and also named Sunflower as particularly difficult to deal with.
“Newman Regional Health continually maintained accounts receivable, productivity and claims processing financial indicators in the top 75 percent of hospitals across the country,” said Karen Hastert, the hospital’s patients accounts supervisor. “Prior to the KanCare implementation, our processes were efficient and effective. It is disappointing to have little or no control over an issue that is so significantly impacting productivity and cash collections.”
‘Not an entitlement’
Top executives of each of the KanCare companies generally struck a conciliatory tone and told committee members that they were working to improve their payment processes and talking with providers about ways to smooth things.
But at one point, Mike McKinney, chief executive of Sunflower, bluntly told the committee that although Medicaid is an entitlement for enrollees, “it is not an entitlement for providers.”
He said managed care is different than fee-for-service care. In so many words, he suggested that providers should just get used to the new way of doing business.
McKinney said managed care works because managed care companies give greater “scrutiny” to bills submitted by providers, disallowing “waste.” He said that hospitals typically note accounts receivables on their ledgers at sums three, four and five times more than they expect in actual payment from insurance companies.
“They show what they billed,” he said. “Not what they’re owed.”
But Committee Chair David Crum, an Augusta Republican who has been among KanCare’s strongest supporters in the Legislature, told McKinney he wanted to see the problems with provider payments settled.
“I’m trying to be patient,” Crum told him. “But it is becoming more difficult. … I’d like to see some positive development.”
‘We’ll do better’
McKinney and the other executives confirmed after questioning by Rep. Jim Ward, a Wichita Democrat, that their companies had lost money the first year of KanCare. But they, and state officials, also said the losses weren’t entirely unexpected because managed care companies sometimes lose money in the first year of a contract.
Laura Hopkins, chief executive of Amerigroup Kansas, said the company expected to become profitable this year. According to filings with the National Association of Insurance Commissioners, the company lost about $32 million.
The Sunflower filings showed about $70 million in losses.
In a later interview, McKinney wouldn’t confirm that, saying he didn’t know exactly how much the company had lost “because it’s not all settled up.”
But he said it was a “considerable amount.”
“I just know we lost money. We’ll do better,” he said.

The KHI News Service is an editorially independent initiative of the Kansas Health Institute. It is supported in part by a variety of underwriters. The News Service is committed to timely, objective and in-depth coverage of health issues and the policy-making environment. More about the News Service at khi.org/newsservice or contact 785-233-5443.

Expansion issue dominates discussion at Washburn forum on the Affordable Care Act
by Jim McLean, KHI News Service

Topeka – The decision by Gov. Sam Brownback and Republican legislative leaders not to expand Medicaid is denying care to thousands and costing Kansas hospitals millions of dollars, participants in a panel discussion said on Monday.
Randy Peterson, president and chief executive of Stormont-Vail HealthCare in Topeka, said that hospitals agreed to reductions in reimbursement rates for Medicare and other federal programs in exchange for increasing the number of Americans with private or Medicaid coverage. Negotiators assumed the increase in coverage would more than offset the reductions.
“The coverage hasn’t happened; the cuts did happen,” Peterson said.
Peterson said not expanding Medicaid eligibility to more low-income adults is largely responsible for a $10 million annual gap between what the reimbursement reductions are costing his hospital and the offsetting revenues that were expected.
A “ticker” on the Kansas Association of Hospital’s website keeps track of how much federal money the state has forgone since the first of the year by not expanding Medicaid. By day’s end Monday it was closing in on $110 million.
“Any Kansan that is paying federal income taxes is subsidizing all the other states that have adopted Medicaid expansion,” said Maynard Oliverius, the former CEO of Stormont-Vail HealthCare, who moderated the panel discussion sponsored by Washburn University.
In addition to Oliverius and Peterson, panelists included Cindy Samuelson, vice president of communications for the hospital association; Dr. Kent Palmberg, a Stormont-Vail senior vice president, and Kansas Insurance Commissioner Sandy Praeger.
Brownback and legislative leaders have given various reasons for opposing expansion. Initially, they questioned the reliability of the federal government’s promise to pay 100 percent of expansion costs for the first three years and not less than 90 percent thereafter. More recently, the governor has said he doesn’t want to increase Medicaid enrollment until the state can afford to serve Kansans with physical and developmental disabilities who are now on waiting lists.
Peterson said the argument that the federal government can’t be trusted to keep its funding promise “doesn’t hold water.” If that were the case, he said, the Brownback administration wouldn’t be accepting federal dollars for other programs and projects.
“We’re taking a lot of money for NBAF in Manhattan,” Peterson said, referring to the $1.1 billion National Bio and Agro-Defense Facility being built on the Kansas State University campus.
Praeger said the reform law’s continued unpopularity with Kansas voters is the reason that Republican leaders don’t want to discuss Medicaid expansion. Doing so, she said, would deprive them of a powerful wedge issue heading into the November elections.
“It’s politics, pure and simple,” she said.
Currently, most of the approximately 380,000 Kansans enrolled in Medicaid – called KanCare – are children, new mothers, the disabled and seniors in nursing homes. Able-bodied adults with children are eligible only if they earn less than 33 percent of the federal poverty level, which for a family of four is $7,770. No matter their income, adults without children aren’t eligible unless they are disabled.
Expansion would extend Medicaid coverage to all those earning less than 138 percent of FPL – about $32,500.
Nearly 80,000 uninsured Kansas are expected to fall into what is being called the “Medicaid gap,” because in addition to being ineligible for Medicaid they earn too little to qualify for federal subsidies to help them purchase private coverage.
“Absent Medicaid expansion, we’ll continue to have people fall through the cracks,” Praeger said. “I care passionately about this because it just doesn’t make sense that we’re not doing it.”
The panelists said that on balance the health reform law was making positive changes in the American health care system by forcing doctors and hospitals to provide more holistic, coordinated and evidenced-based care.
Palmberg, the Stormont-Vail vice president who oversees the hospital’s physician group, said the push for quality was evident in the new ways doctors are practicing. As an example, he said he’s watched surgeons use cell-phone applications to access the latest information from their professional associations before heading into the operating room.
“The way your doctor is thinking about your care is changing dramatically,” he said.
Each of the panelists said they would rather see Congress fix problems with Obamacare rather than continuing efforts to repeal it.
“I don’t see us going back,” Praeger said. “I’d rather see us stick with this for a while and make it work.”

The KHI News Service is an editorially independent initiative of the Kansas Health Institute. It is supported in part by a variety of underwriters. The News Service is committed to timely, objective and in-depth coverage of health issues and the policy-making environment. More about the News Service at khi.org/newsservice or contact 785-233-5443.