TOPEKA — A bipartisan cluster of House members, three Kelly administration agencies and a core group of advocates for the 440,000 Kansans in Medicaid shared unease with legislation blocking the rebidding of KanCare contracts with managed-care companies until after the governor’s race in November.
Officials working for Democratic Gov. Laura Kelly have been preparing to launch in October a competitive bidding process among for-profit companies and nonprofit organizations leading to selection in 2023 of three Medicaid contractors. Recipients of those contracts would share responsibility for delivering $3.9 billion in services to low-income children and adults as well as people with physical, intellectual or developmental disabilities.
The current contracts expire at the end of 2023, but legislation pending in the House would extend those deals to the end of 2025.
Rep. Brenda Landwehr, a Wichita Republican and chairwoman of the House Health and Human Services Committee, said the goal of the bill was to enable the Legislature to seize greater control of KanCare during a period covering the gubernatorial election and a portion of the next four-year term of a governor.
“The idea is to give whomever the next administration is the opportunity to go into long-term contracts with KanCare,” Landwehr said. “By extending it, then the next administration comes in and deals with it. That’s the intent.”
KanCare, the state’s privatized system of Medicaid, was launched in 2013 by Republican Gov. Sam Brownback. He extended the initial KanCare contracts by issuing an executive order, not by permission of the Legislature. Sunflower State Health Plan and United Healthcare have been KanCare contractors from the start. In 2018, GOP Gov. Jeff Colyer announced selection — seven months before his term as governor ended — Aetna Better Health of Kansas would replace the third original KanCare contractor Amerigroup Kansas.
Under House Bill 2463, the executive branch in Kansas would not have authority to make “substantive or material” changes to Medicaid until Jan. 1, 2026.
It would order the Kansas Department of Health and Environment to negotiate contract extensions with Sunflower, United Healthcare and Aetna. KDHE would be forced to seek federal approval to continue operating KanCare in the manner of an experimental program, but the state’s Medicaid director said any request for an extension of federal authorization beyond one year would be rejected by the U.S. Centers for Medicare and Medicaid Services.
Rep. Kathy Wolfe Moore, a Democrat from Kansas City, Kansas, said the bill deviated from a process established by Republican governors in which the executive branch took the lead in developing contracts with managed-care companies. So far, Kansas governors have guaranteed Medicaid recipients three options among MCOs.
She said the bill risked the state running afoul of federal regulators and jeopardized $2.9 billion in federal funding for Medicaid. A law requiring contracts with specific companies would soften the state’s leverage in management conflicts, she said.
“This would set up a no-bid process because these contracts would automatically stay. I’d love to be a contractor with the state if I knew I could do anything,” Wolfe Moore said.
Political motivations?
Kelly, who is seeking re-election to a second term as governor, has supported proposals to expand Medicaid eligibility to include at least 100,000 more Kansans. So far, the House and Senate have not consented to expand access to Medicaid. Kelly’s likely Republican opponent in November would be Attorney General Derek Schmidt, who has opposed Medicaid expansion and authorized legal challenges of the Affordable Care Act.
None of the current KanCare contractors expressed support for the bill during the public hearing in Landwehr’s committee. Two Cabinet secretaries in the Kelly administration, the state’s Medicaid director and representatives of four health advocacy organizations opposed the legislation. Three organizations, including the Kansas Medical Society, raised objections but didn’t declare outright opposition.
Legislators were puzzled by absence of testimony from any organization or individual making arguments in support of the bill.
