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KS: Medicaid beta test comes up short in Massachusetts

By   /   September 11, 2012  /   News  /   1 Comment

By Gene Meyer | Kansas Reporter

A Kansas-style Medicaid managed-care plan didn’t produce expected savings in Massachusetts, a state inspector general reports.

FAIRWAY –  Kansas plans to rein in skyrocketing Medicaid costs by turning to a managed-care plan, but a similar move in Massachusetts elicited criticism from that state’s inspector general.

Insurers that contracted with Massachusetts to manage the care for Medicaid patients paid higher treatment fees – up to 2 1/2 times the standard Medicaid rates – to some of the biggest. most prestigious hospitals in the state, according to a report by Massachusetts Inspector General Gregory W. Sullivan.

The higher payments cost Massachusetts taxpayers $328 million in 2011, says the report, which Sullivan issued just three days before he retired last month.

“We’re talking about a lot of money, especially a lot of money that’s being paid to select providers with geographical and other market power, not to others,” Sullivan told the Boston Globe.

Sullivan was unavailable to discuss the report Tuesday, said a man who answered the phone at his home. Glen Cunha, Massachusetts’ current Inspector General, also declined to talk to Kansas Watchdog.

Medicaid is a joint federal and state funded health plan, run by the states, to provide medical services for low-income people and people with extreme developmental disabilities.

Kansas spends about $3 billion annually to provide care for 380,000 Medicaid patients, or about one-eighth of the state’s population. Kansas Gov. Sam Brownback and the state are asking the federal Centers for Medicare and Medicaid Services for permission, beginning Jan. 1, to stop paying doctors, hospitals and other service providers directly, thus allowing management specialists from three health insurance companies to run the program instead.

Such a change will slow a rise in program costs that is outpacing tax collections needed to pay for Medicaid and provide better care for Medicaid patients, backers say.

But could Kansas’ planned savings evaporate, just as they have in Massachusetts?

No, says Sherriene Jones-Sontag, the administration’s communications director.

She’s speaking for Brownback and Lt. Gov. Jeff Colyer, the administration’s point man during a more than two-year effort to convert the state’s traditional fee-for-service Medicaid plan into a managed-care operation.

“Kansas consulted with a number of other states who have reformed their Medicaid programs,” Jones-Sontag said. “We believe we have avoided their mistakes in creating KanCare.”

KanCare, the state’s name for the managed-care Medicaid plan that backers hope federal regulators will approve, is different than Massachusetts’ plan, said Joel Menges, executive vice president of Special Needs Consulting Services, a Washington, D.C., consulting firm that promotes managed-care operations across the U.S.

“Massachusetts is a little unusual,” Menges said. “It offers both managed care plans and fee-for-service plans that compete with each other.”

Kansas offers only one plan – a managed-care plan if federal authorities approve or a traditional fee-for-service plan if they don’t. Either way, the competitive bidding for providers that Sullivan recorded in Massachusetts wouldn’t happen in Kansas, Menges said.

Federal regulators are putting off any further decision on Kansas’ request until the formal public comment period ends Sept. 20.

Kansas Department of Health and Environment Medicaid executives have set a series of 12 meetings across Kansas Sep. 24-27 to explain the program and answer questions in Manhattan, Pittsburg, Colby, Dodge City, Atchison, Chanute, Russell, Pratt, Olathe, Emporia, Hutchinson and El Dorado.

The department, which is in charge of the financial administration of the proposed program, has opened a new website, at www.kancare.ks.gov,  to serve as an online portal to KanCare.

Contact Gene Meyer at [email protected]


Gene formerly served as staff reporter for Watchdog.org.

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