Lawrence Memorial Hospital officials say the three insurance companies managing Kansas’ Medicaid system routinely turn down legitimate claims to hold down costs.
The three contractors for the state’s privatized Medicaid system, known as KanCare, deny the accusation. Other hospitals have made such accusations in the past, the Lawrence Journal-World reports.
Officials from the Lawrence hospital testified at a meeting of the state Legislature’s joint committee overseeing KanCare. Taryn Schraad, who deals with insurance claims appeals at the hospital, told the panel that the facility frequently gets denial notices, often with no explanation.
“I believe there is a pattern of behavior to just deny claims and see if the provider will spend the time and the energy and the money to pursue them through the appeal process,” Schraad told reporters after the hearing.
Linda Sherman, the hospital’s director of patient accounts, said she knows all insurance companies deny some claims. The problem, she said, is “when they don’t meet deadlines, and they don’t provide denial reasons.”
About 35 percent of claim denials appealed by the hospital are overturned and paid, Schraad said. The hospital has a roughly 90 percent success rate, she said, in overturning Medicare denials.
Officials from the three companies that manage the system insisted they don’t send out denial notices without an explanation.
United Healthcare Community Plan CEO Tim Spilker said the company denies about 7 percent of claims overall. Amerigroup Kansas Plan CEO Laura Hopkins said the denial rate for her company was around 11 or 12 percent.
Sen. Laura Kelly, D-Topeka, said she has heard similar complaints since KanCare began. She said contractors have worked with individual providers on “patchwork fixes,” but said there needs to be a “global” solution.
But Sen. Mary Pilcher-Cook, R-Shawnee, who chairs the joint panel, disagreed and said past problems tended to be caused by how hospitals submit claims.
“What really needs to happen is for everyone to work together and not point fingers and say that the system is not working, but instead find solutions,” she said.
The committee encouraged Lawrence hospital officials to return to the next meeting with examples of claim denials they found were unreasonable or unexplained.