A committee of state legislators heard Monday from health-care executives who said claim denials and slow payments by the state’s KanCare managed-care system threaten their businesses; they also heard emotional testimony from a man with muscular dystrophy who says KanCare cuts are threatening to destroy his family.
At the first meeting of the Joint Committee on Home and Community Based Services and KanCare Oversight, representatives of hospitals and other health-care and disability service providers said that the new system – which promised to reduce bureaucracy – has instead increased it by adding a layer of administration between them and the state.
KanCare, which took over Medicaid administration on Jan. 1, is Gov. Sam Brownback’s program of privatizing services for poor families, the elderly and the disabled.
Under KanCare, the state contracts with three managed-care insurance companies to administer the health services and pays a flat rate per client in an effort to contain state costs. The program will be complete on Jan. 1, 2014, when KanCare takes over home- and community-based services for people with developmental disabilities.
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State officials gave presentations Monday indicating that by their measures, KanCare appears to be going well.
But Finn Bullers of Prairie Village said it is not working well for him and his family.
Bullers came to the hearing in a specialized electric wheelchair with his respirator attached to the back. He said he’s facing a planned reduction from 168 service hours a week to 40, “which my wife says will force her to file for divorce.”
Bullers, 49, was a journalist for the Kansas City Star until about five years ago. Since then, he’s had full-time home care, allowing him to live at home with his wife and two children – a 13-year-old son and 9-year-old daughter – rather than going to a nursing home.
Bullers is almost completely paralyzed by his muscular dystrophy and said that without an overnight aide, his wife would have to lift him in and out of bed, take him to the bathroom and wake up every two hours to turn him over and check his respirator.
“They’re expecting my wife to work eight hours a day and then come home and be a 16-hour nurse to me,” he said. “This is what the state defines as ‘improved outcomes.’ ”
Under questioning by lawmakers, Shawn Sullivan, director of the Kansas Department of Aging and Disability Services, said he couldn’t go into details of Bullers’ case because of privacy issues but that he personally reviewed the case and agreed with the decision to cut the service hours.
“I have taken a look at Mr. Bullers’ plan of care and the reduction request, as have five of my staff,” Sullivan said. “I’ve reviewed it and thought the action was appropriate.”
Speaking of the entire system, Sullivan said KanCare is cutting hours for some home-care clients to avoid having a paid aide to a disabled person performing housekeeping tasks that can and should be done by able-bodied family members. He said that had long been a state policy, but enforcement of it had become lax under the old system.
He said that before KanCare, often a single company would be responsible for determining a client’s care needs and providing the services, which he called a conflict of interest.
Bullers’ was far from the only complaint at the meeting, which was called to update lawmakers on how KanCare is working so they could determine whether the Legislature needs to fix anything.
The meeting came amid a backdrop of complaints by hospitals and other care providers that the system is plagued with denials and delays that have increased bureaucracy rather than reducing it.
“Any time you have a change this major, you’re going to see glitches,” said Tom Bell, president and executive director of the Kansas Hospital Association.
But, he added, “We have some areas that we feel like the process hasn’t improved or gotten to the point where it should be.
“They tend to boil down to … the process of approval or denial and ultimately payment.”
A parade of providers gave examples in which the three managed-care insurance companies have messed up billing by denying what providers contend are legitimate claims and forcing the provider and patient to go through a lengthy process to get it fixed. They also said the managed-care companies have been underpaying – and in some cases, overpaying – claims, forcing the providers to spend more work hours on corrections.
While major hospitals such as Wichita’s Wesley Medical Center and Via Christi systems have gotten the most attention to their complaints, the problem is especially difficult for small and rural providers who don’t have the cash flow to cover expenses while waiting for payments, several people testified.
Marilyn Kubler, owner of JENIAN Inc., a case management company in Shawnee, said she serves a handful of clients in KanCare. But her entire base of 128 clients will transfer into the system when care for people with developmental disabilities switches over on Jan. 1.
“So far, I have been able to absorb the delay in payments and make my monthly payroll,” she said. But she questioned whether she’ll be able to continue in business once all her clients are on KanCare.
“We’re not billers,” she testified. “That’s not our job. We’re case managers.”
In addition to saying KanCare appears to be going well, state officials emphasized that they hold back 3 percent of the managed-care companies’ payment to assure they meet quality measures.
Executives from all three managed-care companies – Amerigroup, United Healthcare and Sunflower State Health Plan – defended their overall performance but acknowledged that things could be better. They identified the problem as primarily one of better training for their own workers and the billing agents with the health-care providers.
Many of the denials came because providers, unfamiliar with new requirements, had failed to seek required pre-approval for services or had submitted incomplete backup documentation, they said.
All three company leaders said they’ve stepped up meetings, workshops and other contact with providers to try to get things running more smoothly.
“The implementation was a little bit bumpy, and there were some issues that we had to work out, and I think we worked through a lot of those issues,” said Jean Rumbaugh, president and CEO of Sunflower State, a division of Centene Corp. “I will tell you from Sunflower’s perspective that we did a system upgrade, and we broke some of the things we had fixed earlier.”
Sunflower has restarted what it calls a “payment excellence team” to work on a daily basis to determine whether problems are systemwide or with a particular provider, and then to take action accordingly.
“We have to pay providers timely and accurately, and we have to have authorization criteria that work with them,” she said.
Lawmakers asked for several additional reports from the managed-care companies, including data on the number and reasons for claim denials. They are expected to meet one more time before the next legislative session in January.