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Kansas Nursing Homes Struggle To Cope With Medicaid Processing Backlogs

Andy Marso
Heartland Health Monitor
Allen Wagner's family says it took months for his Medicaid application to be approved. His daughter, Amy Flanigan, left, and wife, Charlene Wagner, recalled their frustration as he was moved from hospital to hospital.

Judy Kregar is not a member of the Rotary Club in nearby Greensburg, but she decided to go when she heard Gov. Sam Brownback would be at the club’s recent meeting.

Kregar, the administrator of a small nursing home in nearby Bucklin, wanted to tell Brownback in person about the struggles some of her residents are having getting their Medicaid applications and annual renewals processed.

“It is such a huge pressing issue for, as I understand it, all the nursing facilities in Kansas,” Kregar said in a phone interview last week. “Anyone who has Medicaid residents, we are all frustrated.”

  For months the processing system for Medicaid in Kansas, a privatized program known as KanCare, has been plagued with problems caused by two rocky transitions. In July the state switched to new software — the Kansas Eligibility Enforcement System, also known as KEES — to determine eligibility, and in January the Kansas Department of Health and Environment took over eligibility processing duties that had been handled by the Department for Children and Families.

The new computer system requires state employees to use dozens of time-consuming workarounds, while funneling all applications through KDHE has caused a bottleneck. The result is a backlog of Medicaid applications waiting to be processed that has been as high as 10,000.

Members of all KanCare-eligible populations — children, pregnant women and Kansans who are elderly or disabled — have been affected by the processing delays.

But financially the burden may have fallen most acutely on the state’s nursing homes, which rely heavily on Medicaid. Some nursing homes have provided more than $1 million in uncompensated care as they wait months for residents’ Medicaid coverage to process.

Credit Courtesy Judy Kregar
Judy Kregar, administrator of a small nursing home in Bucklin, Kansas, says delays in the Medicaid processing system are creating 'a huge pressing issue' for Kansas nursing homes.

Kregar said she had three residents who are Medicaid-pending. An administrator from Haviland who also attended the Rotary meeting told Kregar her facility had 15.

“That’s huge,” Kregar said. “But even with three, we’re a small facility. … It’s affecting cash flow. We still have to keep our staff and pay the payroll and give the services, and when you don’t have the income coming in, it’s a real problem. I just think it’s a disservice to our frail elderly.”

Administration efforts

The Brownback administration has made some accommodations to help nursing facilities.

Providers can complete an online spreadsheet that is sent directly to state contractor Maximus to check the status of their residents’ pending applications. That helps providers avoid a call to the KanCare Clearinghouse, which handles the applications and has seen long hold times.

Cassie Sparks, a spokeswoman for KDHE, said the agency also brought on 20 new employees to help with the DCF transition who may work longer than their six-month contracts if needed.

Sparks said KDHE temporarily stopped terminating Medicaid benefits for failure to renew, to account for people getting caught in the backlog for more than the 90-day grace period.

Meanwhile, the processing delays are playing a small role in helping the state balance the budget.

The latest budget for the current fiscal year assumes $7 million in savings “as enrollment eligibility continues to lag since implementing KEES.” The governor’s supplemental budget has banked another $3 million in savings for the next fiscal year, which implies that the delays will continue past July.

Sparks said that would not affect KDHE’s approach to resolving the backlog.

Brownback, at a wide-ranging news conference last week, said it’s a high priority.

“We’re on top of it,” Brownback said. “We’re working it.”

Groups that represent for-profit and nonprofit nursing facilities met with KDHE officials Thursday and sent a letter to Gov. Sam Brownback about the issue.

Until the backlog is resolved, they said their members need presumptive eligibility: The state should presume those admitted to long-term care facilities are eligible for Medicaid and pay their Medicaid bills while their applications process.

The administration has given mixed signals on that.

KDHE Secretary Susan Mosier expressed openness to presumptive eligibility last month, calling it “a good concept."

In an email last week, though, Sparks said presumptive eligibility is “not a viable option” for nursing home residents because the state has to review their assets to ensure they don’t have too much money to qualify for Medicaid.

When asked about presumptive eligibility at the news conference a day later, Brownback sounded cautious but willing to consider it.

“I don’t know about doing this presumption,” he said. “That’s a different idea. I’m willing to review it and we’ll look at that, because several of them (nursing homes) are telling me they’ve had people that have been wait-listed for some period of time. They’d really like to get — and I’d like to get them — a determination.”

Nursing home officials say that without presumptive eligibility, the Medicaid payment delays limit their options. Kregar’s facility and some others are supported in part by local property taxes, so they could ask cities and counties to help by raising mill levies.

Some facilities have stopped taking residents who are Medicaid-pending, leaving elderly Kansans with no place to go.

Shuttled from hospital to hospital

Until recently, 77-year-old Allen Wagner was one of those lost in the Medicaid backlog.

Wagner grew up on a farm in Eskridge and began working on a nearby ranch at age 16. From there he moved into milk delivery and eventually a job with Santa Fe Railway in Emporia. After 32 years with the railroad, he retired.

“Allen is a hard worker,” his wife Charlene said. “Always was”

“He would never ask for help,” his daughter Amy Flanigan added. “A ‘do it yourself’ kinda guy.”

But over the last five years Wagner’s health deteriorated. He eventually was diagnosed with Lewy body dementia, a multisystem disease that has debilitating cognitive and physical effects.

After exhausting his finances, the family applied for Medicaid in September.

Then they waited.

Lewy body dementia requires intense medical support, and Wagner’s wife and daughter found that no qualified facility near their home in Olathe would take him long-term without assurance of Medicaid coverage.

The University of Kansas Medical Center discharged him to a nursing home in Tonganoxie temporarily. Then he was shuttled to Saint John Hospital in Leavenworth to get his medications straightened out. That hospital discharged him to a facility in Oskaloosa.

Charlene got him moved to a facility in Olathe, but it was not equipped for dementia patients and he ended up back at Saint John Hospital in January.

All the while, his Medicaid application was pending and his health was deteriorating.

“Every time they move him, he declines,” Flanigan said. “Then it’s just that much harder to try to recover.”

Calling the Clearinghouse and searching for nursing facilities that would take a Medicaid-pending dementia patient became almost a full-time job for Charlene, who struggled to explain to her husband why he kept moving.

“There’s times he thinks he can come back home,” Charlene said. “He pleads with me.”

After reading news reports about other Kansans getting their backlogged applications sped up by contacting their legislators, Charlene and her daughter turned to Sen. Rob Olson and Rep. Larry Campbell.

Within days, Wagner’s Medicaid was approved — five months after he applied. He moved into Garden Terrace at Overland Park, a facility with a memory care unit, on Feb. 22.

But Charlene said she remains frustrated with the system that let her husband down.

“I would like to see other people step forward too, because I know there’s other patients stuck in the process as well,” she said. “Not only my husband.”

Mitzi McFatrich, executive director of Kansas Advocates for Better Care, confirmed that.

McFatrich’s organization advocates on behalf of nursing home residents. She said she’s hearing from families and nursing home administrators about elderly Kansans stuck in hospitals as they await long-term care placements.

“One business manager at a nursing home told me that their local hospital for the first time ever is calling them before discharging a patient to ask if the nursing facility will accept Medicaid-pending,” she said via email.

McFatrich fears that as the backlog persists, families will settle for lower-quality facilities more willing to gamble on a resident whose Medicaid application is pending.

Legal implications

Credit Courtesy Molly Wood
Molly Wood, a Lawrence attorney who specializes in elder law, says this isn't the first time in her 25 years of work that Medicaid applications have been backlogged. But she says things are as bad as or worse than the last time, and she's struggling to find nursing homes that will take some clients.

McFatrich also has been in touch with Molly Wood, a Lawrence attorney who specializes in elder law.

Wood said this isn’t the first time in her 25 years of work that Medicaid applications have been backlogged.

In 2009, a rush of recession-driven applications overwhelmed the aging system KEES was built to replace

But Wood said this time is as bad or worse than the last, and she’s struggling to find nursing homes that will take some clients.

“They don’t want you unless you’re able to pay privately because they don’t want to be providing you (unpaid) care for six months,” she said.

Wood said she was happy that Allen Wagner’s family and others have seen results by contacting their legislators, but not satisfied that’s the solution.

“That doesn’t address the fact that some people aren’t empowered to do that,” Wood said. “And it doesn’t address the fact that maybe your particular legislator would be more or less active. And it doesn’t address the fundamental question of, how come they don’t have to follow their own darn rules?”

Medicaid is administered by the states, but the federal government provides 60 percent of the funding. The federal Centers for Medicare and Medicaid Services requires states to respond to Medicaid applications within 45 days unless a disability determination is necessary.

According to Sparks, there were about 7,000 Kansas applications that had been pending more than 45 days at the end of February.

Wood has started requesting an administrative hearing with state officials every time one of her clients’ applications has passed that mark.

“My new rule is that I file it on day 46,” Wood said. “I used to sort of cut them some slack.”

She said the hearings generally aren’t necessary because soon after she files the request, her client’s application gets processed.

Wood suspects those applications and the ones that state legislators check on are being pushed to the top of the stack, which still leaves thousands of applications in limbo.

She’s not confident federal officials will step in and demand Kansas comply with the 45-day rule, though they did in 2010.

A class action lawsuit on behalf of the 7,000 is an option, but it would require that some of them come forward as named plaintiffs — and require some outside legal help.

“That’s a huge project,” Wood said. “I’m a lawyer in a small firm in Lawrence.”

Mother fights for kids’ coverage

Wood said presumptive eligibility would be a solution for the nursing homes, but it would not help seniors trying to get Medicaid support services that allow them to live at home. Nor would it address the problems other Medicaid populations are having.

Donna Edgar’s story illustrates the dangers of the backlog for some of those populations.

Edgar, a working single mother from Arkansas City, submitted Medicaid renewals for her son and daughter in September.

For months she thought everything was fine.

Then she tried to take her daughter to the eye doctor to get her prescription lenses updated and was told her Medicaid had been canceled.

In addition to vision problems, Edgar’s daughter is on medication for ADD/ADHD. Edgar couldn’t afford to pay for the glasses and medications out of pocket, so she tried calling the KanCare Clearinghouse to find out what happened to the coverage.

“I kept calling and telling them, ‘I really need this,’” Edgar said.

She said she was told several times that her case had been marked “urgent,” but still the renewals weren’t processed.

Her daughter’s school helped her get a temporary prescription refill through the Children’s Miracle Network Hospitals. That ran out too.

Edgar said she then got a visit from a child welfare specialist with DCF, who told her she had been getting reports that Edgar’s daughter was acting up at school.

“I told her, ‘Yeah, she’s acting out in school because she doesn’t have her medicine,’” Edgar said.

As soon as the visit was over, Edgar was back on the phone with the Clearinghouse.

“I said, ‘Y’all need to get my Medicaid active now,’” Edgar said. “If my daughter gets taken because I can’t get her Medicaid, I’ll sue.”

Within days, both of her kids’ renewals were approved.

Andy Marso is a reporter for KHI News Service in Topeka, a partner in the Heartland Health Monitor team. You can reach him on Twitter @andymarso

Andy Marso is a reporter for KCUR 89.3 and the Kansas News Service based in Topeka.
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