No insurance exchange in Kansas until court settles federal health reform, officials say

? Gov. Sam Brownback’s administration on Tuesday said Kansas would not implement a health insurance exchange until the U.S. Supreme Court decides whether the federal health reform law is constitutional.

The statement was made by Lt. Gov. Jeff Colyer as he and other Cabinet officials announced the award of a $135 million contract with Accenture of Austin, Texas, to put in place a computerized system that they said will make it easier for people to apply for social services and also increase identification of fraud in Medicaid and other programs.

The Brownback administration went out of its way to say that although 90 percent of the funding for the planned Kansas Eligibility Enforcement System, or KEES, would come from the federal government, it will not come from the Patient Protection and Affordable Care Act and it does not commit the state to develop an exchange.

The exchanges are required under the health reform law and are designed to help determine eligibility for people to get subsidies to purchase insurance.

Kansas had won a $31.5 million federal grant to implement the exchange. Brownback had initially supported the grant but then reversed field and rejected the funding. He said there were too many strings attached, but critics said he bowed to pressure within the Republican Party to fight the federal health reform law at every opportunity.

Kansas Insurance Commissioner Sandy Praeger, also a Republican, has vowed to continue working on the exchange issues. Colyer said she can continue working on it, but that Kansas will not implement it until a court challenge to the law has been settled. The U.S. Supreme Court could decide a case on the law next year.

KEES is expected to be operational by 2013. Officials said it will cost about $85 million to set up and $10 million per year to operate over the first five years. But they said it is expected to pay for itself through savings from curbing waste, fraud and abuse in state medical and cash and food assistance programs.

“We will achieve program reliability and integrity across all facets of health and human services in the state of Kansas,” said Colyer.

For example, officials said determining whether a person is eligible for Medicaid will be reduced from up to 45 days now to just several days under the new system.

Others at the news conference were Kansas Department of Health and Environment Secretary Robert Moser, Social and Rehabilitation Services Secretary Robert Siedlecki Jr. and Andy Allison, the director of KDHE’s Division of Health Care Finance.