TOPEKA Citing a host of problems and noncompliance with federal laws and regulations, the Center for Medicare and Medicaid Services has denied the state’s request to extend a waiver that allowed it to operate its privatized managed care Medicaid system known as KanCare.
In a letter dated Jan. 13, CMS said that throughout 2016 it received numerous complaints from Medicaid patients and health care providers, complaints it said were verified during an on-site review in October.
“Due to the severe and pervasive nature of the on-site review findings and the resulting impacts this has on the beneficiaries and providers, CMS is requiring Kansas to develop a Corrective Action plan (CAP) describing the actions it will take to correct the identified noncompliance,” James G. Scott, CMS’s associate regional administrator in Kansas City, said in the letter.
The official notification of CMS’s denial came in a separate letter dated Tuesday, Jan. 17.
Some of the deficiencies cited relate to the very core concepts that were supposed to make KanCare superior to traditional Medicaid programs.
The idea behind KanCare was that the state would hand over administration of the program to private insurance companies that would operate it as a “managed care” program, meaning each patient would have a plan of care, agreed to by the patient, and the companies, known as Managed Care Organizations, or MCOs, would ensure that patients were getting the care outlined in the plan.
In order to do that, however, the state needed a waiver from CMS to operate its Medicaid program differently from the traditional fee-for-service model. That waiver is set to expire Dec. 31, 2017.
Kansas applied for a one-year extension. The letters indicate that CMS is denying that request for the time being, at least until state officials submit a corrective action plan detailing how they will come into compliance.
In the Jan. 13 letter, CMS said it uncovered “significant compliance deficiencies” in the planning process, such as MCOs asking patients to sign incomplete forms, and even revising the plans without input from the patient.
CMS also said there was a lack of coordination between the Kansas Department of Health and Environment and the Kansas Department for Aging and Disability Services, the two agencies responsible for KanCare.
It also noted that, “The State’s oversight of the MCOs has diminished over the four years of KanCare operation.”
It noted that the first annual report of the KanCare program was a comprehensive document that identified issues and included corrective action plans for the MCOs. But the 2014 and 2015 reports “were each two pages long, with little content of substance.”
Lt. Gov. Jeff Colyer, who is considered the chief architect of KanCare, was in Washington Thursday to attend the inauguration of President-elect Donald Trump and to meet with congressional leaders about the future of Medicaid. He issued an email statement dismissing CMS’s action as politically motivated and said the renewal process is “on track.”
“This is simply an ugly parting shot from the Obama administration at Governor Brownback on their way out the door,” Colyer said. “It is politically motivated pure and simple, and we expect this situation to be resolved quickly once the new administration in Washington comes into office.”
Colyer said the state received a preliminary audit report in November and that it had already begun to address issues raised in that report.
“In November the state received a preliminary audit report and we had already begun to address these issues,” Colyer said. “There are no revelations in this most recent audit report.”
Kansas lawmakers, however, had a far different response to the news, which was first reported on the Topeka Capital-Journal’s website Wednesday night.
Sen. Vicki Schmidt, R-Topeka, who chairs the Senate Public Health and Welfare Committee, said she plans to hold hearings starting Monday to ask questions of KDHE Secretary Susan Mosier, whose department is primarily responsible for administering KanCare.
“Secretary Mosier was in my office for a half-hour yesterday (Wednesday) and never mentioned this,” Schmidt told reporters Thursday.
Sen. Laura Kelly, of Topeka, the ranking Democrat on the health committee who has also served on the joint KanCare oversight committee, said lawmakers have known for some time about the problems identified by CMS.
“We were telling CMS before KanCare was officially established (in 2013) that these problems were going to exist,” Kelly said. “We have been in regular communication with CMS over the last few years, keeping them abreast of what the issues were with the program.”