Gov. Sam Brownback's office announced $97 million in budget cuts on Wednesday, with more than half of that coming from the state's Medicaid system.
Most state agencies will have a 4 percent cut. The governor exempted the Department of Corrections, the Kansas Bureau of Investigation, the Kansas Highway Patrol and state hospitals.
Public K-12 education, which represents half of the state's general fund budget, also was shielded from cuts. Lawmakers had written that provision into the budget bill.
Medicaid, which provides health care for low-income Kansans, accounts for 20 percent of the state's general fund budget and shouldered the brunt of the budget cuts. The Kansas Department of Health and Environment and the Kansas Department for Aging and Disability Services, the two agencies that administer the program, saw $57.4 million in combined cuts.
All but $1 million of that will come from Medicaid, according to Shawn Sullivan, the governor's budget director. That will trigger a loss of about $72 million in federal funding, because the federal government provides $1.28 for every $1 the state spends on Medicaid.
Higher-education funding was cut by $30.6 million, a 4 percent reduction to the state's regents universities. However, universities did not see equal cuts to their state aid, as they have in the past.
The governor adhered to a calculation crafted by Senate Republicans that cuts universities' funds based on their total operating budgets. That means the University of Kansas and Kansas State University each will see 5.1 percent cuts because they receive more money from federal and private grants.
Wichita State University will see a $2.8 million cut, a 3.8 percent reduction in state aid.
With Brownback's cuts, the state budget has a projected ending balance of $87.5 million in fiscal 2017.
"The actions taken by the Governor today continue to slow the growth of government spending while protecting public safety and providing support to state hospitals," a news release issued by the governor's office said.
But it cautioned: "If the Kansas Supreme Court orders an additional $40 million or more in funding for schools, it could result in additional cuts to Medicaid and higher education."
The state plans to cut Medicaid reimbursement rates for health care providers by 4 percent starting July 1. Sullivan said the change will need approval from the federal Centers for Medicare and Medicaid Services.
He noted that the portion of the Medicaid program that provides home services for disabled Kansans and 95 critical-access hospitals in rural areas would be exempt from the cuts.
That means that pharmacies, physicians, dentists and hospitals in urban areas, such as Wichita and Kansas City, will account for most of the $38 million cut to reimbursement rates.
"There are people out there who think larger, urban hospitals can absorb this level of cuts," said Bruce Witt, director of governmental relations for Via Christi. "The fact is that's really not the case. It has had very detrimental effects to us. We've had to eliminate jobs, and these are high-paying jobs -- they're not low-income jobs."
He said Via Christi estimates the reimbursement cuts will equal a revenue loss of around $2.8 million to $3 million for its health system.
Sullivan framed the Medicaid cut as a budgetary necessity in the face of the K-12 protection.
"Do we like reducing provider reimbursements? No, we don't," Sullivan said. "When you exempt K-12, the other two big slices of the pie are Medicaid and higher ed."
Jon Rosell, executive director of the Medical Society of Sedgwick County, which represents 1,250 doctors, said patients will be affected.
"It's going to be harder to gain access to care for our most vulnerable population," Rosell said.
He said Medicaid already pays less than other forms of reimbursement, so the cuts will place a greater burden on doctors who accept those patients.
"They have a loyalty to their patients and want to provide care, but also have a responsibility to keep their doors open and pay employees," he said. "It puts them in an untenable predicament."
(c)2016 The Wichita Eagle (Wichita, Kan.)
