Kansas Governor Brownback returns $31 million health care grant

August 11, 2011

Governor Sam Brownback of Kansas announced on Tuesday that his state would return a $31.5 million “Early Innovator” grant received in February to “design and implement the Information Technology (IT) infrastructure needed to operate Health Insurance Exchanges” as mandated by the ACA.

The U.S. Department of Health and Human Services (HHS) awarded grants to seven states, including Kansas, so they could lead the way on, “building a better health insurance marketplace, one that allows individuals and small-business owners to pool their purchasing power to negotiate lower rates. Using these new funds, the Early Innovator states will develop Exchange IT models that can be adopted and tailored by other states.” Of the seven states that received a grant, Kansas is the second to reject it. Oklahoma returned its $54 million grant in April.

In his statement justifying the return, Governor Brownback said, “There is much uncertainty surrounding the ability of the federal government to meet its already budgeted future spending obligations. Every state should be preparing for fewer federal resources, not more. To deal with that reality Kansas needs to maintain maximum flexibility. That requires freeing Kansas from the strings attached to the Early Innovator Grant. The early innovator grant does not address the most important issue in health reform, which is slowing the rate of cost growth in health care.” Others have indicated that the decision may be due, at least in part, to political pressure from special interest groups.

Note that Governor Brownback does not provide any suggestions for how health care growth costs might be slowed, although it does say Kansas will search for solutions that will work for the state. Extend Health would argue that state exchanges will play a critical role in cost containment by introducing consumer empowerment and carrier competition to the market – helping consumers to find and pay for health care plans that cover only their specific needs at a cost they can afford.

The governor’s statement is available here.
You can read the HHS press release announcing the “Early Innovator” grants here.

Visit Extend Health — the nation’s largest private Medicare exchange.

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