TOPEKA — House Republicans who oppose Medicaid expansion are pushing a one-time influx of cash for local hospitals as a way to save the state’s teetering rural health care system.
House Republican leadership said increasing the state’s medical reimbursement rates would increase access to care for the state’s “truly needy.”
“By increasing shockingly low Medicaid reimbursement rates, we’re strengthening Kansas health care from within,” said House Speaker Dan Hawkins, R-Wichita. “This practical, sustainable solution increases access for the current Medicaid population, enables better care at a lower cost for all patients, and expands the provider workforce so providers and hospitals can continue to provide essential services to their communities for years to come.”
House lawmakers on a budget committee recommended an additional $33.9 million to increase physician provider codes and $45.2 million to increase outpatient hospital rates. Those numbers are subject to negotiations and votes by both full chambers before they could head to the Gov. Laura Kelly’s desk for consideration.
Low Medicaid reimbursement rates tend to limit access to quality care, worsening health outcomes for Medicaid beneficiaries. States determine their own reimbursement rates, but many, including Kansas, tend to set them at low levels, leaving hospitals to shoulder extra costs. GOP leaders have not made raising rates a priority since the state privatized the Medicaid system in 2012.
An American Hospital Association survey of U.S. hospitals found hospitals received approximately 88 cents for every dollar spent on Medicaid patient care in 2020. Medicare and Medicaid account for more than 60% of all care provided by hospitals for that time frame, leading to a large disparity in payment.
In the state, Kansas Reflector reporting has documented 59 of the state’s rural hospitals are in jeopardy of closing. Twenty-eight are at immediate risk of failures, and 84 of the state’s 102 rural hospitals recorded financial losses on patient services in the most recent data available, according to the Center for Healthcare Quality and Payment Reform.
Rep. Les Mason, a McPherson Republican and head of the committee that worked on budget recommendations, said funding would help underserved communities.
“The funding we proposed is a continuation of our commitment to enhance access to care for our most vulnerable populations,” Mason said. “The administration has largely ignored these adjustments for years, instead banging their Medicaid expansion drum. It’s clear that these adjustments would be necessary even with expansion. What we’re doing is a better path for Kansans who truly need our help.”
Medicaid expansion, an option strongly supported by Kelly, along with health care officials and advocates for low-income families, also would pump much-needed funding into failing hospitals.
The state would unlock $682.4 million in annual federal funding with expansion. The federal government covers 90% of the extra cost of Medicaid services in exchange for expanding eligibility to 138% of the federal poverty rate.
While the governor and a majority of Kansans support Medicaid expansion, Republican leaders have blocked Medicaid expansion attempts for four years. Most of the estimated 150,000 Kansans who would benefit from Medicaid expansion are low-income workers or Kansans suffering from chronic illness, but Hawkins and Senate President Ty Masterson have characterized expansion as a way to expand the “welfare state.” The two argue that the “truly vulnerable” need to be helped instead of placing “able-bodied” Kansans into government programs.
