By Dave Ranney
KHI News Service
TOPEKA, March 26
Kansas taxpayers spend almost $1 million a day on nursing home care.
“That”s a major, major investment,” said state Department on Aging Secretary Kathy Greenlee. “It”s huge.”
Fifty-five percent of the state”s 18,300 nursing home residents are on Medicaid, a 40:60 mix of state and federal funds that ensures health care for the poor.
It”s been that way for years. But a Medicaid reform bill introduced by House Republicans
conservatives, mostly
late last week calls for letting nursing home residents use their Medicaid to pay for long-term care insurance and takes aim at stabilizing what has been one of the fastest growing elements of state and federal Medicaid costs.
The bill”s proponents say the new system they propose would rein in costs by introducing “market” dynamics and reward those who purchase long-term care insurance.
“Right now it is cheaper to hire a lawyer to diminish your assets so you can get Medicaid,” said Rep. Jeff Colyer, R-Overland Park, one of the bill”s main authors.
Others are scratching their heads.
“Don”t get me wrong, I”m all for finding ways to use the private insurance market to assist in the challenges we face,” Greenlee said. “But I”ve read the bill a couple times now and I don”t see how it can work.
“From an actuarial standpoint, everybody you”d be selling to is already using the product
they”re already in the nursing home,” Greenlee said. “That would be like selling cancer insurance to people who already have cancer.”
Greenlee said she”s baffled by the language that calls for nursing homes being paid “on the basis of market based pricing mechanisms. . .”
It”s confusing, she said, because Medicaid dominates the nursing-home marketplace. Only 36 percent of the state”s nursing home residents pay their own way.
“It”s the private-pay people who set market-based pricing, and they”re paying more than the Medicaid,” beneficiaries, Greenlee said. “So, essentially, you”re giving people a set amount of money and expecting them to buy a product for more than what Medicaid pays now. I don”t see how that helps.”
Others say they, too, are having trouble understanding the move toward privatization.
“This is a humongous shift in policy,” said Debra Zehr, executive director at the Kansas Homes and Services for the Aging, an association representing the state”s nonprofit nursing homes.
“This is not something that”s going to come together in a couple months,” Zehr said. “There”s going to be a lot more discussion, a lot more information and very thorough debate to get to what this is about.”
Zehr said she was bothered by the bill not spelling out the fate of senior citizens who would not qualify for long-term care insurance.
“Our national association has done surveys that found 15 to 40 percent of the people who tried to buy long-term care insurance weren”t eligible due to pre-existing conditions,” she said.
But Zehr and Cindy Luxem, executive director at Kansas Health Care Association, which represents for-profit nursing homes, welcomed the bill”s support for launching what”s called a “long-term care insurance partnership program.”
“We”re certainly supportive of that,” Luxem said.
The program would encourage people to buy long-term care insurance by allowing them to hold on to some of their assets, if circumstances later cause them to go on Medicaid.
“It”s a carrot,” said Molly Wood, an elder law attorney in Lawrence. “That”s not necessarily a bad thing.”
The program is designed to prevent senior citizens or their families from sheltering their assets before claiming poverty and applying for Medicaid.
It”s unclear how many people skirt the system. Colyer says it”s commonplace; Wood insists it”s rare in Kansas. The Legislature has neither conducted nor commissioned a formal study of the issue. Georgetown University professor Ellen O’Brien
researched the question.
Her conclusion: “The argument that something needs to be done about abuses of the Medicaid eligibility rules is not supported by the facts…most people who end up on Medicaid are already paying what they can.”
Cindy Hermes, a spokeswoman for Kansas Insurance Commissioner Sandy Praeger, said her boss has been a “very strong advocate” for long-term care insurance partnerships and is already working on a prototype.
“Four states have already done this,” she said. “Their experience has been that very few people who purchase long-term insurance actually go on Medicaid. That”s because the average nursing home stay is 18 months. So this is a way to protect yourself and to reduce state spending.”
-Dave Ranney is a staff writer for KHI News Service, which specializes in coverage of health issues facing Kansans. He can be reached at
dranney@khi.org
or at 785-233-5443, ext. 128.