Gov. Sam Brownback is reluctant to expand Medicaid because he is concerned that the federal government won’t honor its promise to pay for it. He should be more concerned about how KanCare isn’t paying Kansas hospitals. And how not allowing the Medicaid expansion hurts the hospitals even more.
When Brownback proposed having private insurance companies manage Medicaid, hospitals and other providers worried about not being paid on time. After all, that is what happened in other states that privatized Medicaid. But Brownback officials said that incentives in the contracts with the insurance companies would help ensure timely payments.
Almost 10 months into privatization, that isn’t happening. Hospitals across the state are still fighting to get paid.
In “the past three months, we’ve averaged approximately 400-plus thousand dollars a month in denials,” Matt Leary, the chief financial officer at Wesley Medical Center in Wichita, told The Eagle. That’s more than five times what Wesley averaged last year.
Via Christi Health has had similar problems, seeing a nearly 50 percent increase in Medicaid claims that remained unpaid 90 days or more.
Smaller hospitals are also frustrated. Allen Van Driel, chief executive of Smith County Memorial Hospital near the Nebraska border, recently said his hospital had yet to receive a single correct payment from one insurance company.
“The party line is that the managed-care plans are working and that KanCare is a huge success, that it’s processing claims and all that,” Van Driel told the Kansas Health Institute New Service. “But that’s simply not factual.”
Sandra Montes, the director of patient financial services at Southwest Medical Center in Liberal, complained that “we sometimes feel like we’re beating our heads against the wall.”
Brownback officials have described such problems as “bumps in the road.” But these bumps are causing big headaches for hospitals.
Hospitals will be hurt even more by Brownback’s refusal to allow a federal expansion of Medicaid. That is because fewer patients will have health insurance and because the Affordable Care Act reduces payments to hospitals that serve low-income uninsured patients (in expectation that those patients will join Medicaid).
As for Brownback’s fear that the federal government won’t honor its funding promise, U.S. Health and Human Services Secretary Kathleen Sebelius addressed that at a Council of State Governments conference last weekend in Kansas City, Mo. She noted that the expansion is “fully funded within the health care bill” and that states can always opt out later if the federal government reneges on the funding.
Sebelius also said that the important conversations that need to happen are between state political leaders and the local hospitals and communities that will “bear the cost of uncompensated care.”
The hospitals are talking. Will Brownback listen?
For the editorial board, Phillip Brownlee