Medicaid Transformation

The purpose of the Medicaid Transformation process is to produce and publish program reviews to monitor, assess, diagnose and address policy issues in each major program area within Medicaid. The presentation of these reviews is designed to serve as the basis for Division of Health Care Finance (DHCF) budget initiatives in the Medicaid program on an ongoing basis. The recommendations contained in this report are based on the findings of 14 program reviews completed in 2008. They address issues related to decreasing expenditures, improving reimbursement policy, expanding coverage, and enhancing program oversight. 

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Chapter 1: Executive Summary

Background, key findings, and summary of recommendations.

Helpful Documents

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Chapter 9: Medicaid Pharmacy Services

In the Fiscal Year 2008, Medicaid fee-for-service pharmacy services were provided to 113,446 unique beneficiaries through 745 contracted pharmacies, with nearly 2 million prescriptions dispensed.

Updated March 25, 2009, to reflect additional information that has become available since the original publication. For a full description of the changes and updates, please click here.

Helpful Documents


Division of Health Care Finance Background

  • Medical Services: In 2006, KHPA was designated as single state agency responsible for Medicaid and SCHIP. However, KHPA only directly administers public insurance programs that provide medical care services, or $1.2 billion of the 2.2 billion spent on Medicaid - SCHIP in the fiscal year 2007. HealthWave (managed care) and HealthConnect (fee-for-service with an additional $2 per beneficiary per month to provide managed care services) are KHPA's two primary public insurance programs. On a monthly basis, we provide medical coverage to over 300,000 people, including more than 125,000 infants and children, and nearly 88,000 elderly and disabled Kansans.
  • Long Term Care and Mental Health: The Kansas Department of Social and Rehabilitation Services (SRS) and the Kansas Department on Aging (KDOA) administer programs that provide long-term care and mental health services, accounting for the remaining $1 billion in fiscal year 2007 Medicaid/SCHIP spending.

Medicaid Transformation Key Findings

  • Cost drivers: While children and families account for most of Medicaid enrollment, much of the increase in expenditures is driven by aged and disabled beneficiaries.
  • Spending increases: Reviews demonstrate increases in spending for hospital and hospice services, durable medical equipment, and pharmaceuticals.
  • Cost Containment: Reviews indicate that KHPA efforts to reduce costs are meeting with some success. For example, recent changes resulted in a significant slowdown in the escalation of costs for transportation services. KHPA also had success in reducing the cost of home health services, saving over $16 million.
  • Recommendations: Reviews demonstrate significant opportunities for Medicaid cost containment and health improvement.

Kansas Medicaid Compared to Other States

Total spending
Overall Medicaid spending per beneficiary is relatively high in Kansas: $5,902 per beneficiary in fiscal year 2005, compared to the national average of $4,662. Per-person spending is higher than average for each major population group (aged, disabled, adults, and children), with the aged and disabled ranking highest among those three populations.

Spending on Aged & Disabled Is Above Average
Compared to other states, Medicaid spending in Kansas is somewhat concentrated among the aged and disabled populations. Kansas ranks above-average spending per person for both the aged (16th highest) and the disabled (also 16th highest), and ranks 14th highest in the percentage of the Medicaid population who are disabled.

Spending on Poor Adults Is Far Below Average
While coverage of children is typical at 200% of the poverty level, coverage for non-disabled adults is very low. Kansas ranks 39th in the percentage of Medicaid eligibles who are low-income, non-disabled, working-age adults, and is ranked between the 41st and 46th in the income threshold for adults in this category. Partly as a result, Kansas ranks near the bottom (43rd) in the percentage of its population covered by Medicaid (13%).