This year, Kansas will spend approximately $3.2 billion on Medicaid. With the new KanCare program, the state hopes to save about $1 billion over five years.

Within KanCare, Kansas has awarded contracts to three Managed Care Organizations (MCOs) --- Amerigroup, based in Virginia Beach, Va.; Centene, based in St. Louis; and United Health Care, based in Minnetonka, Minn.

Each is charged with building a statewide network of providers for the full range of Medicaid services. Starting in 2013, each company will be assigned a proportional share of the Kansans in Medicaid, representative of different regions, age groups and populations, including people with disabilities, the elderly and low-income children. There is a three-year KanCare contract period.

One way to measure the financial performance of an MCO is to determine how much of its revenue is used to pay for health care services. This is known as the health benefits expense ratio. Each of the three MCOs selected for KanCare contracts reported a health benefits expense ratio as part of its financial report to the U.S. Securities and Exchange Commission.

These three companies' ratios range from 81 cents to 85 cents of every premium dollar going to pay for health services. The remainder is used for administrative costs and company profit. Kansas did not specify a specific ratio these companies must achieve during the KanCare three-year contract.

Nursing homes that have not contracted with a care manager may continue to have residents' bills paid for up to a year after Jan. 1, so the residents aren't tossed out if they are living in a facility that isn't now a contracted provider with any of Kansas MCOs.

Statewide meetings will be starting soon, and there will be an attempt to answer the many questions Kansans have about this new program. I have volunteered to serve on a legislative oversight committee if there is a decision to have one.

State. Rep. Ward Cassidy, R-St. Francis, represents the 120th District in the Kansas House.