Topeka ? A special council of Kansas officials on Wednesday approved releasing $1 million to implement the state’s new system for administering Medicaid services.

The Kansas Department of Health and Environment asked the State Finance Council to approve the funds for the billing system for KanCare, the state’s revised Medicaid program.

KDHE’s Kari Bruffett, who oversees the Division of Health Care Finance, said the billing system will help with the transition to the new KanCare format, allowing providers to continue to bill for payment for services without interruption.

The state already has awarded three-year contracts to Kansas subsidiaries of three multibillion-dollar, out-of-state companies and assigned each Medicaid participant to one of them. The state covers medical services for about 395,000 poor, disabled and elderly Kansans. Bruffett said providers will have the option to continue to bill the state for services or go through one of the managed care organizations as the new system begins functioning.

Legislators approved spending the money on the billing system during their 2012 session, if federal officials approved a waiver sought to allow Kansas to make changes to the Medicaid program. That approval came Friday, allowing the changes to begin Jan. 1.

The changes are aimed at reducing the growth in the state’s health care costs without reducing services or raising eligibility for recipients. The state has not elected to expand coverage to more Kansas residents as allowed under the new federal Affordable Care Act. Brownback has said he is consulting with legislators and seeing what other states are doing before expanding coverage.

The council also approved spending $559,000 in the latest installment of pay raises for state workers who earn below the market wage. The increases covered correctional workers and juvenile justice employees.

“It doesn’t fully fund it, but I think at some point in the future we’ll take care of the remaining” state employee positions, budget director Steve Anderson said.

The state has been trying to increase the pay of some public employees to levels comparable to the private sector, in particular those positions like corrections officers where salaries paid by private companies are more attractive and lead to higher turnover at state prisons.