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March 2012 St@teside

Kansas Seeks Waiver from Federal Medicaid Requirements

Kansas submitted a “concept paper” to the Centers for Medicare & Medicaid Services (CMS) requesting an 1115 Medicaid waiver. The plan is to proceed on two separate tracks.  Under the first track, the state would work with CMS to develop and implement a new person-centered integrated care system, KanCare. Under the second track, it would begin discussions with the agency to pursue a global waiver that would allow the state to create an outcomes-based Medicaid and CHIP program under a per-capita block grant.

The state intends to roll out the implementation of the first track by January 1, 2013.  The first track includes four initiatives that would:

  • Move all Medicaid recipients into managed care organizations. Currently the disabled and the elderly are in fee-for-service Medicaid while the rest of the Medicaid beneficiaries are in managed care.  If approved, this would be the first time that the state tries to cover services for the disabled and elderly population through a managed care program.
  • Cover all Medicaid services through managed care including long-term services such as nursing facility care.  In addition, it would include changes to the delivery system that would encourage care in the beneficiaries’ homes and communities rather than in nursing homes.  Kansas ranks sixth highest among the states in terms of the percentage of seniors living in nursing homes.
  • Include both financial incentives and penalties linked to performance and quality and evaluate managed care organizations under both population-specific and statewide outcome measures. For example, one outcome measure for the provision of long-term care delivery services is a decrease in the use of institutional care.
  • Establish safety-net care pools to help pay hospitals for uncompensated care and provide payments to critical access and other essential hospitals.
  • Create and support alternatives to traditional Medicaid such as programs that would help Medicaid beneficiaries transition to private insurance coverage. Among these programs would be: a COBRA-like option; health savings accounts (HSAs) that can be used to pay insurance premiums for high-deductible health plans; and an enhanced Medicaid to Work program that would match potential workers with employers.

Under the second track, the state would use a federal block grant—a fixed payment—to redesign its Medicaid program.  Some of the changes to the program include:

  •     Modifying Medicaid eligibility standards for those with access to affordable, accessible coverage;
  •     Encouraging consumer choice and responsibility through health-opportunity accounts;
  •     Increasing premiums and cost-sharing;
  •     Implementing payment reforms to improve provider performance;
  •     Improving care coordination for dually eligible and disabled individuals;
  •     Increasing the use of prevention strategies; and
  •     Decreasing the administrative and reporting burden on providers.