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Radar on Market Access: Kansas Works Out Medicaid Expansion Deal

Posted by Lauren Flynn Kelly on Jan 21, 2020


Kansas Gov. Laura Kelly (D) and Republican Senate Majority Leader Jim Denning on Jan. 9 said they’d reached a compromise proposal to extend Medicaid coverage to an estimated 130,000 more low-income Kansans, AIS Health reported.

If approved, Kansas will pursue a full expansion of Medicaid to 138% of the Federal Poverty Level (FPL) with a 90/10 funding match. The state will also seek Section 1332 waiver approval to establish a reinsurance program and Section 1115 waiver approval to transition individuals whose incomes fall between 100% and 138% of the FPL from Medicaid to the exchange no later than Jan. 1, 2022, although expansion is not dependent on those waivers. If CMS denies either waiver, full Medicaid expansion will be implemented on Jan. 1, 2021, according to a summary of the pending legislation.

Kansas would be the 37th state to expand Medicaid. Ballot initiatives are pending in Missouri and Oklahoma, while voters in Nebraska and Utah have already approved expansion. The 10 remaining non-expansion states are largely concentrated in the South.

According to a summary of the pending Kansas legislation, the compromise proposal would feature a "robust work referral program," "modest" premiums of up to $25 per month for an individual (or $100 per family) and no lockout provisions. But the expansion deal does not include work requirements.

Compared with other states that have attempted to require able-bodied expansion enrollees to seek work or other volunteer activities or risk losing their Medicaid coverage, the Kansas tactic is "a kinder, gentler approach to work," remarks Jerry Vitti, founder and CEO of Healthcare Financial, Inc.

In a Jan. 9 research note from Evercore ISI, securities analyst Michael Newshel noted that if the approximately 130,000 additional lives that would be covered by expansion were split evenly among the state's three contracted MCOs — which are units of Centene Corp., CVS Health Corp.-owned Aetna and UnitedHealthcare — they would each gain roughly $250 million in annual revenues.

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