Integrated Medical Eligibility and Exchange Solution and

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Integrated Medical Eligibility and Exchange Solution and Powered By Docstoc
					FOR IMMEDIATE RELEASE                                             For more information, contact:
Feb. 16, 2011                                                                        Bob Hanson
                                                                      Public Information Officer
Details about the Early Innovator Grant
     A total of $31.5 million was awarded to the Kansas Insurance Department (KID) for use
      in building a technology system to provide eligibility services for both Medicaid/CHIP
      and a Kansas Health Benefits Exchange. The funding is coming from the Department of
      Health and Human Services and is one of seven, two-year grants awarded to states that
      submitted early innovator exchange implementation proposals.

     This grant continues the understanding that the Governor’s office, Insurance
      Commissioner Sandy Praeger and KHPA/KDHE proposes that any health insurance
      solutions for Kansans should be directed by Kansans.

     Kansas is in an advanced state of readiness to serve as an early innovator and lead the
      way for other states because the state has already designed and received bids for a new
      state-of-the art medical eligibility system. A project organization is in place to execute
      the K-MED (Kansas Medical Eligibility Determination) project. Under this grant the
      current K-MED team will be supplemented and the exchange will be integrated from
      design through deployment in a well-coordinated manner. This will result in a better
      end-to-end solution in a shorter period of time.

     The expanded K-MED project supported by the grant will provide a one-stop, single door
      determining eligibility for a health benefits exchange and Medicaid/CHIP beginning with
      open enrollment in the fall of 2013. CHIP is the Kansas Children’s Health Insurance
      Program, commonly known as HealthWave.

     The grant will work to coordinate the efforts of the Kansas Insurance Department and the
      Kansas Medicaid and CHIP systems (through KHPA/KDHE). Oversight for the project
      will be provided by expanded K-MED/Exchange Executive Sponsors and Steering
      Committee including representatives from KHPA/KDHE, Insurance Department, SRS,
      Department of Administration, Executive Branch Chief Information Technology Officer
      and the Governor’s office.

Page 2

        The application for the grant was submitted in December, with encouragement from the
         Kansas Legislature’s Joint House-Senate Health Policy Oversight Committee.

        The health exchange approach is something that Kansas has been looking at for more
         than 10 years—since the passage of the Kansas Business Health Partnership Act in 2000.
         That act is in Section 40-4701 of the Kansas Statutes, but it has remained unfunded.

        Any Kansas health benefits exchange proposed through work from this grant may be
         procured under a software-as-a-service contractual arrangement with an outside vendor.

The Kansas Insurance Department, established in 1871, assists and educates consumers,
regulates and reviews companies and licenses agents selling insurance products in the state.
More about the department is online at
                                                                                                                      OCCIO Early Innovator Grant
                                                                                                                          Budget Narrative
                                                                                                                          February 11, 2011
                                                                                                                                                                                                                     OCCIO Early
                                                                                                                                                                 Year 1                           Year 2                                                         Other Funds                              Total
                                                                                                                                                                                                                    Innovator Grant
Federal funding Requested: OCIIO cooperative Agreements to Support Innovative Exchange Information Technology Systems- $31,537,464        $                          15,768,732                         15768732 $         31,537,465                                                  $                       31,537,464
Other funds from SHAP Grant and Partner State Agencies                                                                                    $                          15,574,039 $                      15,574,039                     $                                     31,148,078 $                       31,148,078
                                                                                                                            TOTAL REVENUE $                          31,342,771 $                      31,342,771 $        31,537,465 $                                     31,148,078 $                       62,685,542

                                                                                                                                                                                                                             OCCIO Early
                                                                                                                                                                 Year 1                           Year 2                                                         Other Funds                              Total
                                                                                                                                                                                                                            Innovator Grant
Project Director for K-Med Plus, Darin Bodenhamer, 0.50 FTE @ $70,000 for year 1, w/2.5% annual increase year 2                                          $35,000                      $35,875                                      $35,438                           $35,438                    $                    70,875
Contracts/ Procurement Manager, (to be determined), 0.40 FTE @ $68,000 for year 1, w/ 2.5% annual increase year 2                                        $27,200                      $27,880                                      $27,540                           $27,540                    $                    55,080
Eligibility Program Advisor, Jeanine Schieferecke, 0.40 FTE @ $60,000 for year 1, w/ 2.5% annual increase year 2                                         $24,000                      $24,600                                      $24,300                           $24,300                    $                    48,600
Technical Advisor, Tom Laughlin, 0.40 FTE @ $75,000 for year 1, w/ 2.5% annual increase year 2                                                           $30,000                      $30,750                                      $30,375                           $30,375                    $                    60,750
Grant Coordinator, (to be hired), 1.00 FTE @ $53,600 for year 1, w/ 2.5% annual increase year 2                                                          $53,600                      $54,940                                      $54,270                           $54,270                    $                   108,540
K-Med Plus Plus-Exchange Project Manager (Travis Haas and to be hired), 2.00 FTE @ $70,000 for year 1, w/ 2.5 % annual increase year 2                   $140,000                     $143,500                                    $141,750                          $141,750                    $                   283,500
K-Med Plus Document Specialist, Eric Meyer, 1.00 FTE @ 42,000 for year 1, w/ 2.5% annual increase year 2                                                 $42,000                      $43,050                                      $42,525                           $42,525                    $                    85,050
K-Med Plus-Exchange Project Analyst (to be hired), 1.00 FTE @ $55,000 for year 1, w/ 2.5 % annual increase year 2                                        $55,000                      $54,941                                      $54,971                           $54,971                    $                   109,941
Technical Implementation and Operations Manager (to be hired), 1.00 FTE @ $75,000 for Year 1, w 2.5% annual increase year 2                              $75,000                      $76,875                                      $75,938                           $75,938                    $                   151,875
Technology Lead, Dominic Llamas 1.00 FTE @ $65,000, for year 1, w/ 2.5% annual increase year 2                                                           $65,000                      $66,625                                      $65,813                           $65,813                    $                   131,625
Technology Support Consultants, (to be hired0, 2.00FTE @ $66,656, for year 1, w/ 2.5% annual increase year 2                                             $133,372                     $54,942                                      $94,157                           $94,157                    $                   188,314
Systems Administrator (to be hired), 1.50 FTE @ $65,000 for Year 1, w 2.5% annual increase year 2                                                        $97,500                      $99,938                                      $98,719                           $98,719                    $                   197,438
Database Administrators (to be hired) 2 FTE @ $80,000 for Year 1, w 2.5% annual increase in year 2                                                       $160,000                     $164,000                                    $162,000                          $162,000                    $                   324,000
Network Administrators (to be hired) 2 FTE @ $80,000 for Year 1, w 2.5% annual increase in year 2                                                        $160,000                     $54,943                                     $107,472                          $107,472                    $                   214,943
Desktop Support (to be hired) 1 FTE @ $65,000 for Year 1, w 2.5% annual increase in year 2                                                               $65,000                      $66,625                                      $65,813                           $65,813                    $                   131,625
Exchange Senior Business Analyst (to be hired), 1.00 FTE @ $60,000 for Year 1, w/ 2.5% annual increase year 2                                            $60,000                      $61,500                                      $60,750                           $60,750                    $                   121,500
Exchange Business Analyst (to be hired), 1.00 FTE @ $50,000 for Year 1, w/ 2.5% annual increase year 2                                                   $50,000                      $54,944                                      $52,472                           $52,472                    $                   104,944
Administrative Support Staff (April Jepson, Amy Boyles and to be hired) 3.00 FTE , @ $36,000 annually per FTE w/2.5% annual increase for year 2          $108,000                     $110,700                                    $109,350                          $109,350                    $                   218,700

Information Technology Enterprise Architect, (to be hired), 1.00 FTE @ 65,000 for year 1, w/ 2.5% annual increase year 2                                     $65,000               $66,625                                         $65,813                           $65,813                   $                   131,625
Webmaster (to be hired), 1 FTE @ $50,000 w/ 2.5% annual increase in year 2                                                                                   $50,000               $54,945                                         $52,473                           $52,473                   $                   104,945
Trainers/Outreach (to be hired), 2.00 FTE @ $50,000 for Year 2                                                                                                                     $100,000                                        $50,000                           $50,000                   $                   100,000
                                                                                                           Sub-Total, Salary for Staff Supporting K-Med Plus            $1,495,672              $1,448,198                       $1,471,935                        $1,471,935                  $                 2,943,870
                                                                               Fringe benefits for staff supporting K-Med Plus, include the following items:              $352,231                $341,051                        $346,642                          $346,641                   $                   693,281
      payroll taxes, including FICA @ 7.65%                                                                                                                        $114,419               $110,787                                $112,603                          $112,603                   $                   225,206
      health insurance premiums @ 7.65%                                                                                                                            $114,419               $110,787                                $112,603                          $112,603                   $                   225,206
       unemployment/Workers Comp. @ 2.0%                                                                                                                            $29,913                $28,964                                 $29,439                           $29,439                   $                    58,877
      life insurance premium @ 0.75%                                                                                                                                $11,218                $10,861                                 $11,040                           $11,040                   $                    22,079
      employer retirement contribution of 4.0%                                                                                                                      $59,827                $57,928                                 $58,877                           $58,877                   $                   117,755
      professional development @ 1.5%                                                                                                                               $22,435                $21,723                                 $22,079                           $22,079                   $                    44,158
        technical training on ESB/SOA - estimated $15,000 per class for 4 state staff ($15,000 * 4 = $60,000)                                                       $30,000                $30,000                                 $30,000                           $30,000                   $                    60,000
Partner State agencies will assist the K-Med Plus project. The following state agencies will provide staff to develop the K-Med Plus system: Social and            $340,000               $340,000                                   $0                             $680,000                   $                   680,000
Rehabilitative Services (SRS), Kansas Department of Health and Environment (KDHD), Kansas Department of Labor (KDOL) and Kansas Department of
Revenue (KDR). 8,500 hours estimated @ $40/hour average for salary and fringe (8,500 hours X $40=$340,000) per year.
                                                                                                                                    Total, Salary and Fringe            $2,187,903              $2,129,248                       $1,818,576                        $2,498,575                  $                 4,317,151

                                                                                                                                                                          S:\MP\Project Management\Active Projects\KATCH\OCIIO Grant- Ins. Exchange\Budget\$31,537,464.KS Health Insurance Exchange Budget Narrative 02.11.11.xlsx
                                                                                                                                         1                                                                                                                                                                              2/11/2011
                                                                                                                         OCCIO Early Innovator Grant
                                                                                                                             Budget Narrative
                                                                                                                             February 11, 2011
                                                                                                                                                                                                                           OCCIO Early
                                                                                                                                                               Year 1                           Year 2                                                         Other Funds                              Total
                                                                                                                                                                                                                          Innovator Grant
Two staff members will attend four information sharing meetings per year in Washington, D.C. (per grant requirements). Expense is projected for three                   $14,336                           $14,336             $28,672                                  $0                     $                    28,672
days/person (6 days x 4 trips = 12 days @ $64 per diem, the State rate = $1,536). Airfare is estimated @ $500/person x 2 persons x 4 trips = $4,000.
Hotel is estimated @ $300/night x 3 nights x 2 persons x 4 trips = $7,200. Ground transportation, local mileage, parking and incidentals is estimated at
$200/trip x 2 persons x 4 trips = $1,600.
Four staff members will attend one week of training for ESB/SOA architecture. Training will be spread over two years with one team of two attending in                   $3,240                             $3,240                $6,480                               $0                     $                      6,480
Year 1 and two attending in Year 2. Expense is projected for 5 days/person (5 days x 4 trips = 20 days @ $64 per diem, the State rate = $1,280). Airfare
is estimated @ $500/person x 4 persons x 1 trips = $2,000. Hotel is estimated @ $150/night x 4 nights x 4 persons x 1 trips = $2,400. Ground
transportation, local mileage, parking and incidentals is estimated at $200/trip x 4 persons x 1 trips = $800.
Four staff members will attend four (two per year) Exchange-related conferences (location varies) throughout the life of the grant. Expense is projected                $17,248                           $17,248                $34,496                               $0                     $                    34,496
for four days/person (16 days @ $64/day per diem, the State rate = $1,024). Airfare is estimated @ $500/person x 4 persons = $2,000. Hotel is estimated
at $300/night x 4 nights x 4 persons = $4,800. Ground transportation, local mileage, parking and incidentals is estimated at $200 x 4 persons = $800.
Conference registration fee is $500 per person x 4 = $2,000.
Travel to other States for knowledge transfer. Expenses are projected assuming an average of two persons on four trips per year to adjacent states (2 days               $4,024                             $4,024                $8,048                               $0                     $                      8,048
@ $64/day per diem, the State rate = $256 x 2 persons = $512). Airfare is estimated @ $400/person = $800. Hotel is estimated @ $150/night x 1 night x
2 persons = $300. Ground transportation, local mileage, parking and incidentals is estimated at $200/trip x 2 persons = $400.
Local Travel: Two Trainers/Outreach will begin traveling in May 2011 (five months in Year 01 and 12 months in Year 02), averaging approximately                         $10,664                           $21,976                $32,640                               $0                     $                    32,640
1,600 miles per month with reimbursement estimated @ $0.505 per mile. It is projected they will have 12 days away from home per month @ $36 per
diem and will average 10 hotel nights per month @ $86.
                                                                                                                                              Total Travel              $49,512                           $60,824               $110,336                               $0                     $                   110,336
                                                                                                                                                                                                                           OCCIO Early
                                                                                                                                                               Year 1                           Year 2                                                         Other Funds                              Total
                                                                                                                                                                                                                          Innovator Grant
Equipment is required to furnish the workspace of members of the Project Team to be hired. Equipment consists of the following for 14 staff members:                    $42,000                                   $0          $42,000                                  $0                     $                    42,000
Herman Miller cubicle @ $1,000, desk chair @ $200 and PC/monitor @ $1,800 (total of $3,000 x 14 = $42,000). One single purchase will be made in
Year 01 to ensure bulk purchase discount.
PCs (10 @ $1000 = $10,000) will be installed and configured, while laptops (5 @ $1,500 = $7,500) will be used by Trainers/Outreach staff. Two high-                     $18,500                                   $0             $18,500                               $0                     $                    18,500
speed printers will be purchased and installed in the project team room (2 * $500 = $1,000). Total cost of equipment = $18,500.
SAN storage ($220,000).                                                                                                                                            $220,000                                    $0               $110,000                          $110,000                   $                   220,000
Dev/Test Servers (web, apps, database) (18 @ $6,000 = $108,000); QA/Prod Servers (web, apps, database) (12 @ $12,000)                                              $108,000                              $144,000               $126,000                          $126,000                   $                   252,000
Firewalls (6 @ $4,000 = $32,000) and domain controllers (8 @ $2,000 = $16,000); job automation and monitoring tools ($300,000)                                     $198,000                              $150,000               $174,000                          $174,000                   $                   348,000
Database licenses                                                                                                                                                  $750,000                              $750,000               $750,000                          $750,000                   $                 1,500,000
Additional technical data storage capacity will be added in Year 02, necessary to enable application and eligibility systems upload, and to store supporting             $0                                $9,224                $4,612                            $4,612                    $                     9,224
documentation (HP Storage Works MSA 60), 2 @ $4,612.
Networking: gear to build additional capacity, redundant connectivity and additional network capacity to Wichita mirrored data center, VPLS network               $1,200,000                             $500,000               $850,000                          $850,000                   $                 1,700,000
connectivity to Wichita
Enterprise Service Bus (2 @ $280,000 = $560,000)                                                                                                                    $280,000                            $280,000                $280,000                          $280,000                   $                   560,000
                                                                                                                                           Total Equipment        $2,816,500                          $1,833,224               $2,355,112                        $2,294,612                  $                 4,649,724
                                                                                                                                                                                                                           OCCIO Early
                                                                                                                                                               Year 1                           Year 2                                                         Other Funds                              Total
                                                                                                                                                                                                                          Innovator Grant
Office supplies used in support of theK-Med Plus program by the Project Staff are estimated at $175/month/FTE throughout the course of the Project                      $36,645                           $36,645             $36,645                              $36,645                    $                    73,290
Period ($175/month x 12 months x 17.45 FTEs = $36,645 annually).
Outreach/marketing/educational supplies will be used to explain the Exchange to individual consumers, eligible businesses and insurance providers.                             $0                         $30,000                $30,000                               $0                     $                    30,000
Supplies consist of pamphlets (@ $1.00 each, with 20,000 projected for Year 2 = $20,000) and posters (@ $5.00 each, with 2,000 in Year 2 = $10,000).
                                                                                                                                          Total Supplies                $36,645                           $66,645                $66,645                           $36,645                    $                   103,290

                                                                                                                                                                        S:\MP\Project Management\Active Projects\KATCH\OCIIO Grant- Ins. Exchange\Budget\$31,537,464.KS Health Insurance Exchange Budget Narrative 02.11.11.xlsx
                                                                                                                                            2                                                                                                                                                                         2/11/2011
                                                                                                                        OCCIO Early Innovator Grant
                                                                                                                            Budget Narrative
                                                                                                                            February 11, 2011
                                                                                                                                                                                                                         OCCIO Early
                                                                                                                                                             Year 1                           Year 2                                                         Other Funds                              Total
                                                                                                                                                                                                                        Innovator Grant
Contract with a vendor for development of the online application, eligibility system and integration of the exchange service. Contractor will be selected      $22,500,000                        $22,500,000             $22,500,000                         $22,500,000                 $               45,000,000
through RFP process The system cost is estimated at $45,000,000.
Contract for the selected Exchange vendor to make modifications to their Exchange service provider product to integrate with K-MED                               $250,000                              $450,000               $700,000                                                    $                  700,000
Contract with Service Oriented Architect (SOA) consultant to assist w/ specification and procurement strategy for ESB. Estimate 4,000 hrs @ $280/hr              $560,000                              $560,000               $560,000                          $560,000                  $                 1,120,000
over two years.
Contract with Security consultant to assist w/ security planning and testing. Estimate 2,000 hrs @ $220/hr over two years.                                        $220,000                            $220,000                $220,000                          $220,000                  $                  440,000
Contract with Performance consultant to assist w/ performance design/testing/tuning. Estimate 2000 hrs @ $280/hr over two years.                                  $280,000                            $280,000                $280,000                          $280,000                  $                  560,000
Contract with Project Management consultant to manage K-Med Plus project. Estimate 4000 hrs @ $180/hr                                                             $360,000                            $360,000                $360,000                          $360,000                  $                  720,000
Contract with Business Analysts consultants to perform and oversee requirements analysis, design, testing, deployment. Estimate 11,240 hrs @ $120/hr            $1,236,400                          $1,236,400               $1,236,400                        $1,236,400                 $                 2,472,800
each year.
Contract with Application Testers to perform system testing. Estimated 3200 hours @ $45/hr for two years                                                         $144,000                              $144,000               $144,000                          $144,000                      $                288,000
Contract for ADA assessment and compliance. Estimate 500 hours @ $200/hr over two years.                                                                          $40,000                               $60,000                $50,000                           $50,000                  $                   100,000
Contract with a vendor for an independent verification and validation of the system development to assure the eligibility system meets specifications and        $153,600                              $153,600               $153,600                          $153,600                  $                   307,200
the system fulfills its intended purpose. Estimated, 3 people, for 2 weeks every quarter @ $160/hr. (240 hours X $160 X 4) per year
Contract with a vendor to perform a study to estimate the number of end users during open enrollment and other times of the year. Estimate 200 hours @                $24,000                                   $0             $12,000                           $12,000                  $                     24,000
Ummel Group, an Enterprise Architecture, will provide the K-Med Plus management team a means of governing the change and transformation process                  $175,000                              $175,000               $175,000                          $175,000                  $                   350,000
of the project (estimated 1,0000 hours @ $175/hour) for each year of the grant
Contract with Salvaggio, Teal & Associates (STA) for vendor selection and management for the most effective implementation for a quality end product.            $388,800                              $388,800               $388,800                          $388,800                  $                   777,600
Estimated 2,160 hours per year @ $180/hour. (2,160 hours X 2 years X $180)
Contract with the Kansas Health Institute (KHI) to serve as the External Evaluator of the K-Med Plus system, developing objective programmatic                   $100,000                              $100,000               $100,000                          $100,000                  $                   200,000
standards, monitoring performance against those standards, providing annual reports and assisting KHPA with the development of the final report to be
issued upon completion of the project. Estimated $100,000 per year
Memorandum of Agreement w/ Social Rehabilitation Services (SRS) to prepare conversion of existing data on legacy system and interfaces. (estimated                $91,490                                       $0                 $0                            $91,490                  $                     91,490
1016.56 hours @ $90 per hour)
The communications contract for Internet connectivity for the system and associated computers will be $7,500 annually, with the contract signed in Year                $7,500                             $7,500               $15,000                               $0                   $                     15,000
01 to ensure no increase in fees during the Project Period.
The contract for all hardware maintenance is estimated at $120,000 annually.                                                                                      $120,000                           $120,000                $240,000                              $0                     $                  240,000
                                                                                                                                                               $26,650,790                        $26,755,300               $27,134,800                       $26,271,290                  $               53,406,090
                                                                                                                                                                                                                         OCCIO Early
                                                                                                                                                             Year 1                           Year 2                                                         Other Funds                              Total
                                                                                                                                                                                                                        Innovator Grant
Lease Agreement: 2 high volume color copier (industrial model) is leased @ $200/month/ copier (less expensive than purchase and ensures servicing and                  $4,800                             $4,800            $4,800                                $4,800                    $                      9,600
replacement with latest technology on annual basis), ensuring staff members are supported in preparation of high volume print jobs.
Software licenses for 14 staff members @ $300 will be purchased in Year 01 to obtain a bulk discount. Year 2 support and maintained $840                               $4,200                               $840                $5,040                              $0                      $                     5,040
Telecommunication expenses for 17.45 FTE staff members (wireless Internet, telephone and PDA service) are estimated at $47.50/month, with services                     $9,947                             $9,947                $9,947                            $9,947                    $                    19,894
obtained in Year 01 to ensure bulk purchasing discounts.
Rent/utilities in support of the 17.45 FTE are estimated at $16.78/sq. ft./year x 110 sq. ft. x 17.45 FTEs dedicated to the Program = $25,841 annually.               $32,209                           $32,209                $32,209                           $32,209                    $                    64,418

                                                                                                                                               Total Other            $51,156                           $47,796                $51,996                           $46,956                    $                    98,952

                                                                                                                                      TOTAL EXPENSE            $31,792,506                        $30,893,037               $31,537,465                       $31,148,078                                $62,685,543

                                                                                                                                                                      S:\MP\Project Management\Active Projects\KATCH\OCIIO Grant- Ins. Exchange\Budget\$31,537,464.KS Health Insurance Exchange Budget Narrative 02.11.11.xlsx
                                                                                                                                           3                                                                                                                                                                        2/11/2011
Integrated Medical Eligibility
and Exchange Solution and
Knowledge Sharing
Response to Cooperative Agreements to Support Innovative Exchange
Information Technology Systems
CFDA: 93.525

December 21, 2010


Introduction ...................................................................................................................................................................3

Commitment ..................................................................................................................................................................6

Opportunities to Share, Leverage, and Re-use Exchange IT Systems’ Components .....................................................8

Readiness to Establish an Exchange IT Systems ............................................................................................................9

Technical Architecture ...................................................................................................................................................9

Accessibility for Individuals with disabilities ................................................................................................................14

Security ........................................................................................................................................................................15

EXCHANGE RESEARCH AND Stakeholder Engagement ................................................................................................16

Exchange Governance .................................................................................................................................................18

Planning and Resource Capabilities .............................................................................................................................18

Resource Plans .............................................................................................................................................................19

Program requirements ................................................................................................................................................22

Project scope ...............................................................................................................................................................24

Overview ......................................................................................................................................................................25

Functional Scope .........................................................................................................................................................26

Business Rules..............................................................................................................................................................28

Technology Platform ...................................................................................................................................................28

Resources and capabilities ..........................................................................................................................................30

Evaluative measures ....................................................................................................................................................31

Budget NARRATIVE ......................................................................................................................................................31

Appendix 1 – Detailed descriptions of current systems ..............................................................................................33

APPENDIX 2 – Projected K-MED and Exchange Project Expenditures and ftes ...........................................................35

appendix 3 –K-MED/Exchange Project Organizational Chart ......................................................................................36

APPENDIX 4 – PROJECT PLAN and WORKPLAN............................................................................................................37

APPENDIX 5 – Letters of agreemnt and/or description(s) of proposals/existing project ............................................38


Kansas proposes to provide leadership as an early innovator in developing and implementing an
end-to-end solution linking the State’s new Kansas Medical Eligibility Determination (K-MED)
system to the Kansas Health Insurance Exchange. Kansas, under the auspices of the Kansas
Insurance Department (KID) and the Kansas Health Policy Authority (KHPA), is uniquely
positioned to take the initiative in implementing a state-of-the-art end-to-end solution in
support of ACA deadlines. The Kansas solution will provide a single point of entry for Kansas’
citizens and eligible businesses to obtain the appropriate healthcare coverage, whether
Medicaid, CHIP or other federal and state programs, as well as subsidized or non-subsidized
private coverage. Kansas will provide leadership by assisting other states either through
technology and/or knowledge transfer. Kansas will share work products developed under this
grant. These products will be disseminated to states, OCIIO, and other entities through a web-
based clearinghouse, regular webinar briefings and presentations at national and regional
conferences as appropriate. There is also the potential that Kansas could provide states access
to these integrated applications by providing separate copies of the application in a cloud
computing environment, scaling the system as needed to make it available to other states and
avoiding the cost of each state implementing its own complete system.

What makes Kansas unique is that the
State is in the process of procuring and
implementing       a      state-of-the-art
scalable medical eligibility system. The
procurement is well underway and the
timeframe for standing up an Exchange
could not be better as the design phase
for K-MED will coincide with the design
phase of the Exchange. This will result
in an optimized solution which will
benefit users of the Exchange, i.e.
Kansas citizens, businesses, insurance
providers. The end-to-end solution will
rely more on technology and less on human resources lowering operational costs to the state,
enabling available personnel to focus on true exceptions, and improving the customer

In 2009, KHPA was awarded a multi-year State Access Planning (SHAP) grant from the Health
Resources and Services Administration (HRSA), an arm of the US Department of Health and
Human Services (HHS), to improve access for Kansas citizens to Medicaid and other federal and

state medical services. This grant enabled the Kansas Medical Eligibility Determination (K-
MED) project. The K-MED project seeks to provide a new eligibility determination system for all
Medicaid and CHIP programs. A request for proposal is currently on the street with proposals
due from vendors on January 4, 2011. Using the Early Innovator grant award, K-MED can easily
be expanded to include seamless enrollment into the Kansas Health Insurance Exchange.

With procurement of such a large system underway and implementation set to begin in June
2011, Kansas currently is working on system/vendor selection and pre-implementation
activities and is therefore in an advanced state of readiness to execute the Exchange project.
Listed below are seven factors which affirm the state’s readiness:

   1. As part of the K-MED project, KHPA has mobilized an experienced project team and has
      initiated an extensive procurement process to purchase and implement K-MED. K-
      MED’s design matches the requirements included in newest guidance from CMS.
   2. Kansas has begun the process to plan structure, and govern the Exchange. For the K-
      MED project, a multi-agency project steering committee (including representation from
      the State CIO) is in place and functioning effectively.
   3. The Kansas Insurance Commissioner and Kansas Medicaid agency head are in positions
      of national leadership and will be able to assist in facilitating technology and knowledge
   4. Kansas has developed a coherent strategy to deploy an end-to-end solution in time to
      meet the ambitious federal guidelines; the solution involves contracting for Exchange
      services from a private sector firm through a competitive bidding process and having
      the selected vendor mobilized in time to participate in the detailed planning and design
      for extending the K-MED functionality to integrate with the Exchange; from this point
      forward the Exchange vendor will be closely involved with the K-MED project during the
      build, test and deployment phases.
   5. From a technology perspective, KHPA has mapped out an enterprise-wide IT strategy to
      upgrade, integrate and streamline most of the State’s healthcare systems.
   6. The State has convened a task force of health and human services agencies to develop
      service oriented architecture standards for securely interfacing all state eligibility
      systems with the myriad of other federal and state systems.
   7. The timing of executing an extended project from an OCIIO grant award in parallel with
      the requirements analysis phase of the K-MED project provides a unique opportunity to
      design and build more integrated capabilities than if the design tracks for medical
      eligibility and the Exchange are executed independently. For example, the “no wrong
      door” principle can be most elegantly and efficiently integrated into the eligibility
      determination functionality if designed as an end-to-end solution for the spectrum of

       end users, i.e. public assistance, private citizens and eligible businesses. Integrated
       design enables intelligently nested questions during application/intake process to
       channel the end user to the correct coverage determination and enrollment. Other
       states choosing to follow Kansas strategy can leverage Kansas system and reap the
       benefits of a unified, simple and easier to maintain system.

To integrate K-MED with the Exchange and within the prescribed deadline will be a challenge.
Fortunately, Kansas has established project governance and a systems and governance

Governance – Kansas has begun the process to plan the structure and governance of the
Exchange. Under the direction of the Insurance Commissioner stakeholder groups will begin
meeting in early 2011 to recommend Exchange governance. The Commissioner will seek
authority to enter into required initial contracts until governance can be adopted legislatively.
One possible governance model that will be considered is expansion of the existing Business
Health Partnership legislation. In 2000, this organization was legislatively established to help
small businesses in Kansas access affordable coverage. Under this scenario the scope of the
Kansas Business Health Partnership would be expanded to include oversight of the Exchange
and eligibility and enrollment for private citizens.

Systems Strategy – the
state’s new K-MED
medical        eligibility
system       will      be
expanded to include
determination          for
subsidized and non-
subsidized individuals
and               eligible
businesses. K-MED will
be interfaced with an
Exchange application
deployed under an
administrative services
contract with one of
the leading vendors. Functions of the Exchange will include providing comparative information
on KID certified plans, managing enrollment, administering premium tax credits and cost
sharing assistance. Additional functionality will include data capture for performance metrics.

K-MED, integrated with the Kansas Health Insurance Exchange will provide an end-to-end
solution. For these reasons, the State of Kansas (KHPA and KID) is perhaps as well positioned as
any state to lead the effort to both design and implement a model end-to-end solution
consisting of an Exchange application elegantly integrated with an advanced eligibility
determination system.

A high-level schedule is provided below. KS will execute the Exchange project in parallel with K-
MED using the System Development Lifecycle (SDLC) process. This approach and the work
products from this effort could be a model for other states. A more detailed MS Project plan is
provided as an attachment. The plan identifies key dependencies, activities and durations and


Kansas has current leadership and will enact the legislative underpinning and the organizational
bodies to quickly implement the Exchange after extensive consultation with stakeholders,
including legislators and legislative action. The American Health Benefit Exchange Model Act
will be used as a template for legislation authorizing the Kansas Health Insurance Exchange.

K.S.A. 40-4706 directs KHPA to use the “Kansas Business Health Partnership” to work towards
linking the Kansas medical programs for families and individuals with programs for eligible
employees employed by a small business. K.S.A 40-4706:

       Kansas health policy authority; duties. The Kansas health policy authority shall investigate and
       pursue all possible policy options to bring into this partnership title XIX and the title XXI eligible
       families of any eligible employees employed by a small employer. On and after July 1, 2006, the
       Kansas health policy authority shall develop and seek federal approval of any appropriate
       variance or state plan amendment for the state children's health insurance program established
       by K.S.A. 38-2001 et seq., and amendments thereto, and the state medical assistance program
       required toaccomplish the purposes of this act. On and after July 1, 2006, the Kansas health
       policy authority shall work with the health partnership to develop a single employee application
       that may be used by the health plan and the Medicaid and state children's health insurance
       program to determine eligibility.

This alignment of legislation similar to the above governance, and the KID’s and KHPA’s
readiness will accelerate implementation of a well-integrated Exchange and permit more focus

on systems development to achieve the tight deadlines for project design deliverables under
this grant. Furthermore, this proposal is supportive of prior legislation which envisions
coordinated insurance market and a single-door approach. KID, in addition to providing for the
enabling IT systems under the Exchange, will become an even stronger advocate for individuals
and small Kansas businesses in the health insurance area by certifying plans and providing
comparative plan information thereby more actively assisting private citizens and businesses to
obtain the best medical coverage for them. The Exchange, integrated with the state-owned K-
MED system will realize the vision of a single-door, end-to-end solution for individuals whether
through public programs or the marketplace. By sharing its system with other states, either
through knowledge sharing or providing access to the system directly, Kansas is committed to
maximizing this investment to lower the costs for other states.

From a tactical standpoint (i.e. design/build/test/deploy), KHPA will be responsible for
integrating the Exchange with K-MED. Although the Exchange and K-MED will be two separate
systems they will be managed as an integrated project. The parallel timeline makes integration
possible and central to the overall execution strategy. This will lead to a more elegant solution
for users (consumers and insurance companies) and better integration at the business and
technology layers. A co-located team will afford close collaboration in key areas of design and


Kansas is in discussions with other states regarding leveraging investments in systems. The
State of Missouri, with whom Kansas shares a large metropolitan area, has expressed interest in
a potential partnership.

If other states are authorized to proceed, Kansas will include them on an advisory panel and
regularly invite them to participate in requirements and design reviews. Kansas’ solution, i.e.,
a new eligibility system coupled with a commercially available off-the-shelf Exchange, should be
applicable to other states and relatively easily replicable. As a condition of this grant the State
of Kansas commits to share its architecture with other states. This will include all design and
decision documents as well as access to business and technical personnel. Due to the
modularity of the applications, the encapsulation of business rules and the flexibility of the
messaging architecture, this solution, either in its entirety or in parts, may be transferable to
other states where it can be modified/customized. Alternatively, it may be possible for Kansas
to provide a derivative application for one or more states in a “cloud” computing arrangement.
In this scenario, states would not have to implement a system locally, but Kansas would agree

to provide an instance of the application for a state and operate the system for it. Cost of the
system would then be allocated to the state based on its needs and usage.

There are several benefits for this model. First, while states may not have as much input into
design as they would if they were implementing locally, many of the difficult decisions will
already be made for them. Similar to the choices that must be made with COTS packages, states
will be able to modify some critical aspects of the system, but not all. The tradeoff is reduced
time to make the system available for their state. Second, this scenario allows for quicker
acquisition. Rather than states having to go through an entire procurement process, they would
simply need to sign a service level agreement (or some other such legal document) in order to
implement. The development of an RFP and the procurement process usually adds 12 to 18
months to a project—time that can be shaved off of other states’ projects. Additionally, with
most key components already in place and many business rules already written, states will not
have as much expense in bringing up their own instances of the system. At this point, it is
impossible to estimate what the cost would be for each state and is dependent upon a number
of variables, but it is safe to assume that it would be a fraction of the cost of developing and
implementing an entire solution locally.


The State of Kansas (KID and KHPA) has performed a self-assessment and concludes that the
State is in an advanced state of readiness to implement the Kansas Health Insurance Exchange
and to integrate the Exchange with the new K-MED Medicaid/CHIP eligibility system. From a
governance perspective, although governmental authority over the Exchange needs to be
formally established by the Legislature and the Governor, KID and KHPA have been authorized
to proceed with current planning. On the systems side, the K-MED RFP contains requirements
that fully align with the NIEM framework and other ACA requirements and recommendations.
Architecturally, there is a clear alignment and understanding of how the new systems will need
to interact to support the business more seamlessly.


With the K-MED project, Kansas is on the verge of major upgrades in IT systems to support
federal and state healthcare programs.       Over the next three years two legacy medical
eligibility/enrollment systems will be de-commissioned and the State’s claims management
system will undergo significant modifications. A new Exchange application will come on-line
under a administrative services contract between KID and a vendor. The figure below
illustrates the “as-is” (2010) systems and the “to-be” (2013) systems across the current and

future Exchange-related business functions. More detailed descriptions of current systems
affected by implementing K-MED and the deploying an Exchange are provided in Appendix 1.

Over the past twelve months KHPA has developed a long-range enterprise architecture to guide
the strategic replacement of the state’s medical IT systems over the next five years. The figure
below illustrates KHPA’s enterprise architecture for applications.

Kansas is committed to using the National Information Exchange Model framework in
implementation of the K-MED project and interfaces between K-MED and the Exchange and
between the Exchange and insurance agency and KID systems. This project has the potential to
serve as a test bed for full scale implementation of the framework (beyond current
abstractions) for the healthcare system.

                                                                                                             Provide r
                                                             Custome r

                                                                                                              Othe r Users                                                    M anage me nt / Analysis /
                                                                                                                                                                                    Re se arch

                                            Use r

                                                                                                              Core Telecommunication Component
                                                                                                                    Common Interface Components

                                                                                                                                                            Common Use r Inte rface (Portal)
                                                                                Ide ntity M anage me nt

                                                                                                                                                                External M essage Broke r

                                                                    Inte grate d Use r Interface and Se curity                                                            Transform
                                                                                                                                                                            Rule s
                       business partner messages (inbound)

                       business partner messages (outbound)                                                                                                Protocol                          Inte rnal
                                                                                                                                                          Conv erte r                         Route r
                                                                                Security M anage me nt

  External Busine ss                                                                                                                                          Email/Collaboration Handle r
   Partner Syste ms

                                                                         Core Application Components                                                Core Reporting/Analytic Components
                                                                                    Case M anage me nt

                                                                 K-M e d
                                                                              M M IS CM     HIT CM         HIE CM                                                                  Data Analytic
                                                                  CM                                                                                                                                          DAI User
                                                                                                                                                                                    Inte rface
                                                                                                                                                                                                              Inte rface

                                                              He alth Care                                                                                                              Ad Hoc
                                                               Eligibility                                                                                      Core Data               Queries                            Staff
                                                               (K-M e d)                                                                                        Ware house

                                                                                                                                                                                    Staff Data                HR / Staff
                                                                                                                                               Data                                                           Analysis
                                                                                                                                                                                      M art
                                                                              M M IS                                                         Staging,
                                                                                                                                           Inte gration
                                                                                                                                            Re porting

                                                                                          He alth Info
                                                                                       Te chnology (HIT)

                                                                                                                                                                    Standard            standard reports (electronic)
                                                                                                                                                                    Re porting
                                                                                                           He alth Insurance

                                                                                                                                                                        external data

                                                                                                                 Core Shared Service Components

                                                                                                                    Workflow Engine

                                                                                                               Ente rprise Se rv ice Bus                                                    Busine ss Rules Engine

                                                                             Database M anage me nt                               Docume nt/Conte nt M anage me nt

Adherence to the NIEM framework will enable enterprise‐wide information exchange standards
and processes to enable automation and real-time sharing of health information for better
customer service and more efficient operations.

The timing of the K-MED project and the evolution of NIEM made it practical to specify NIEM
requirements in the K-MED RFP. The K-MED RFP (EVT0000186, Section A4.4 INTERFACES
REQUIREMENTS #13) states that: “All inbound and outbound interfaces must comply with
National Information Exchange Model (NIEM), National Institute of Standards and Technology
(NIST), HIPPAA-compliant standards, and other standards.”

In the upcoming selection process the K-MED Evaluation Committee will grant bidders no
exceptions to these requirements. Bidders will be required to address 25 additional data
transmission requirements in Section A4.4 of the K-MED RFP. Ten of these NIEM-relevant
requirements are provided below:

      The K-MED System must have the ability to send and receive different types of media.
      Outbound interfaces must have the ability to recreate and resend datasets.
      Inbound interfaces must have the ability to check for duplicate files, and validate and
       manipulate data prior to loading it into the system.
      The K-MED system must automatically trigger the request for interface information for
       specific interfaces as determined by the State.
      The K-MED system must automatically log and communicate to the appropriate parties
       that the data was successfully or unsuccessfully transmitted or received.
      All inbound and outbound interface data must be associated with a security profile.
      All inbound and outbound interface data must have security profiles at the record level
       and at the data element level.
      Interfaces must capture an audit trail (e.g. a date/timestamp, worker id, action taken)
       from the interface data and according to the interface data source.
      The K-MED system must have the ability to back files out of the system one by one, and
       limit the adverse impacts when necessary.
      The K-MED system must archive all interface files and retain these files according to
       Federal, State and agency statutes, regulations and policies.

In the K-MED RFP each of the recommendations in Section 1561 of the Affordable Care Act are
explicitly addressed. K-MED will access data from federal systems in real-time using a set of
standardized Web services that will support all health programs and also federal and state
human services programs.

The K-MED project will keep abreast of standards for obtaining verification of a consumer’s
initial eligibility, renewal and change in circumstances information from Federal agencies and
States. However, as the K-MED and Exchange projects have real deadlines, if standards are not
available implementation may have to proceed based on the best information available at the
time. Under this grant, or in any event, Kansas expects to be working closely with the cognizant
federal agencies and other states.

The K-MED RFP has extensive requirements for business rules to address system flexibility and
to reduce the need for modifying application code in order to make changes to eligibility
programs. K-MED rules will be identified and grouped into various families and hierarchies and
relate to core data elements identified in the NIEM. The K-MED solution will have a robust
business rules engine that can be applied uniformly across programs and agencies. By

enforcing business decisions within the processing of the system, consistency is improved,
error-rates are reduced, and the time to train new knowledge workers is shortened. Also,
through implementation of modern information system architecture and an encapsulated rules
engine, business rules will be implemented and maintained without the need to make
significant application changes. This architecture will increase flexibility, decreases cost, and
reduces the time needed to implement changes to a system. The K-MED RFP includes other
business rules-related requirements such as the capability to display rules associated with any

For the Exchange and for K-MED, KID and KHPA are committed to using the Health Insurance
Portability and Accountability Act (HIPAA) adopted transaction standards (e.g., ASC X12N 834,
ASC X12N 270, ASC X12N 271) to facilitate transfer of consumer eligibility, enrollment, and
disenrollment information between Affordable Care Act health insurance coverage options
(including Medicaid and CHIP), public/private health plans and other health and human service
programs such as SNAP and TANF. The figure below provides some perspective of where the
Exchange, K-MED and the MMIS fit within the overall framework of adopted transmission

According to Appendix E of the HIT, for eligibility the HIPAA 270/271 transaction set will be
used to determine if a consumer has coverage with a particular public or private health
insurance program. The HIPAA 270 standard is used to send an eligibility inquiry and the 271
standard is commonly used to respond to that inquiry. For enrollment and dis-enrollment
HIPAA 834 transactions will be used to transmit enrollment information necessary to enroll
consumers into public and private health coverage options.

Both the Kansas Health Insurance Exchange and K-MED will provide consumers and businesses
with timely, electronic access to their eligibility and enrollment data in a format they can use
and reuse. Disclosures will be provided on how their eligibility and enrollment information will
be used and shared across programs to facilitate additional enrollments. The systems will
provide information on controlling release/use of their information. The systems will also
provide the ability for users to request or make corrections and/or updates of their data.

The ability of designated third parties to access eligibility and enrollment data and to
create/modify/view data on behalf of others will be incorporated into the security model. This
will include separate log-ins for third parties as well as an audit trail.

Section (Security) of the K-MED RFP requires that the K-MED system, and by
extension integration between K-MED to the Exchange to ensure data confidentiality, including
protection from unauthorized access, while in transit – through execution of secure,
authenticated, two-way transactions as well as ensuring that all other data is encrypted beyond
the reasonable threat of a successful brute force attack, or comparable risk-based mechanisms
and in storage – ensure that confidential data in databases from which public data is being
extracted will not be compromised. Related RFP requirements include preventive and

detective access controls and reporting mechanisms to ensure a timely and reliable process for
notification to the user, custodian, owner, and/or customer in the event of a security breach.
Valid encryption processes for data in motion, although not specified will be required to comply
with NIST SP 800-52, 800-77, or 800-113, or others which are Federal Information Processing
Standards (FIPS) 140-2 validated. The K-MED eligibility systems shall record actions related to
the PII provided for determining eligibility. The date, time, client identification, and user
identification must be recorded when electronic eligibility information is created, modified,
deleted, or printed. An indication of which action(s) occurred must also be recorded.


Through statute Kansas is committed to deploying systems that provide access to all individuals
including persons with disabilities and those using assistive technology. In Kansas all purchases
of software and systems must be 508 compliant. In Kansas a 508 compliance review is required
prior to deployment. The K-MED RFP (Section 1.5.23, Accessible Technology) states:

       Computer Hardware, Software, Other Technologies: All products and services provided
       or developed as part of fulfilling this contract shall conform to Section 508 of the
       Rehabilitation Act of 1973 and any amendments thereto, (29 U.S.C. & 794d), and its

       implementing Electronic and Information Technology Accessibility Standards (36 CFR §
       1194). Section 508 requires that electronic and information technology is accessible to
       people with disabilities, including employees and members of the public. Information
       regarding accessibility under Section 508 is available at,
       and a technical assistance document can be found at http://www.access-

       Web Development: Websites, web services, and web applications shall be accessible to
       and usable by individuals with disabilities. This means that any websites, web services,
       and/or web applications developed in the fulfillment of this contract — including but
       not limited to: ((a) any web-based training material, user documentation, reference
       material, or other communications materials intended for public or internal use related
       to the work completed under this contract; and (b) any updates, new releases, versions,
       upgrades, improvements, bug fixes, patches, customizations, or other modifications to
       the above — shall comply with Kansas Information Technology Policy 1210: State of
       Kansas Web Accessibility Requirements (IT Policy 1210), IT Policy 1210 is located at For additional reference, supporting
       information     for    implementing IT        Policy 1210      can    be found        at

       Affirmation of Conformance: The contractor shall provide a description of
       conformance with the above mentioned specifications by means of a completed
       Voluntary Product Accessibility Template (VPAT) or other comparable document (VPAT
       information is available at
       Resources). A VPAT is only necessary when the Contractor is using pre-existing (off the
       shelf) software. This conformance claim becomes a contractual term between the
       contractor and the contracting state agency.

These requirements will also be included in the upcoming RFP for the Kansas Health Insurance
Exchange service provider.


A guiding principle for the K-MED system is the safeguarding and stewardship of consumer and
business data and information. Best practices in implementing Fair Information Practices will
be followed. To this end the K-MED system and integration with the Exchange will be designed
to only collect data and information applicable to the eligibility determination process and
collect information for program evaluation and improvement. Although some information may
be shared with other systems such as human services for Medicaid-eligible consumers, the

consumer will be notified of this intended sharing, i.e. with whom and for what purpose(s).
Consideration will be given to when/where to provide the option to the consumer of “opting
out” of sharing personal information using privacy notices prior to the collection of personally
identified information within the K-MED and Exchange systems. To improve data quality K-
MED will implement extensive matching rules that will reduce the probability of identifying the
wrong person or entity.


Among the early planning steps taken by KID will be a focus on assembling and consolidating
information relevant to the development of the Kansas Exchange. Assembling the best data
will be a byproduct of questions asked by a health benefits exchange advisory panel (discussed
below in Stakeholder Involvement). The following approach is envisioned:

   1. Appoint an advisory panel to frame a set of information requirements that support
      decision making for a design phase and an operational phase.
   2. Staff the project and task out work; conduct an inventory of available data sources;
      evaluate data quality; design prototype tables and charts; manage Requests for
      Information with organizations hosting selected data sources.
   3. Staff will work with the advisory panel to match the assembled information with their
      policy and decision points; the point is to ensure that all relevant subgroups and
      segments, benefits choices and other factors receive attention.

KID staff will identify information gaps. They will specify which steps and sources or suppliers
are needed to produce new data or revise outdated information. A core set of tables, charts,
and technical notes will be designed and adopted for reporting. Benchmarks and performance
standards will be collected where available. Relevant comparative information from U.S. or
state sources will be acquired to help round out comparisons. Specific target topics will

      Kansas and regional market characteristics and trends.
      Estimated numbers of uninsured (individual, small groups, other).
      Estimated potentially eligible for participation in an Exchange.
      Estimated eligible but not enrolled in Medicaid or employer coverage.
      Current plan options, pricing, and benefit design.
      Profiles of utilization, health status, claims history.
      Identifying and noting special demographic, socioeconomic and other subgroups.

Update KID’s Kansas Health Insurance Study. This August 2001 telephone survey (8,000
interviews; 160 in Spanish) estimated uninsured by region, under age 65, annual family income,

percent under the federal poverty level, age, ethnicity/race, employment status, education, and
gender. It was conducted by a university department.

Update KID’s Small Business Health Insurance Survey. Conducted in 2000, the survey estimated
the numbers and characteristics of employers/employees, examined recent cost increases, and
documented coverage differences. It was conducted by a university department.

Update KID’s 2005 Uninsured Report for the State of Kansas (purchased from Mercer
Government Humans Services Consulting). The report noted that 80% of 70,000 small
businesses in Kansas have fewer than 100 lives. Information was provided on benefit design,
cost sharing, utilization, cost trends, and income.

Create a plan to mine data from the Kansas Health Insurance Information System (KHIIS). This
all payer database for large groups, Medicaid, and the state health plan has a wealth of baseline
data on utilization, claims, pricing, and benefits design.

KID will be responsible for coordinating a vibrant, inclusive statewide planning process with an
effective steering function that ensures buy-in and maximizes participation. Leadership will
spell out the preferred process for working together to make decisions, implement actions, and
effectively operate an exchange function. Our planned outreach process will include input from
the following stakeholders – legislators, regulatory staff, consumers and consumer advocacy
groups, small businesses and chambers of commerce, healthcare providers (physician groups,
hospitals, long-term care), insurers, agents and brokers, health underwriters, state and federal
agencies, and influencing organizations across the state. Involvement with legislative bodies
and regulatory agencies is covered below.

Outreach Methodology and Partnership Development – KID leadership will make its best initial
judgments on candidate organizations and groups to engage as stakeholders and prospective
partners. A list of contact names and organizations will be developed, maintained, enhanced
over time, and reported out. The outreach lists will span each of the groups mentioned above.
The lists will be made representative to include all entities pertinent to developing an exchange
or meeting more immediate developmental objectives. The extent of ongoing communications
and effective working relations among the candidate partner groups will be assessed as part of
an effort to tailor a communications plan and work regimen maximizing chances for success.

Designation of Exchange Planning Leadership Groups – KID will recruit for an advisory panel to
serve the critical role of steering, policy setting, and decision making during the planning and
implementation process. This temporary, transitional governing body appointed by the
Commissioner will work in alignment with KID’s project leader. The advisory panel will be
supported by KID dedicated staff, other staff supported by the grant, and potentially dedicated

staff at other partner agencies in Kansas. Leadership groups and their representation may
change over time to accommodate differences in ensuing phases of work. The Advisory Panel
may task out and fund several temporary groups empowered to meet defined assignments in
key areas. The proposed leadership and steering structure will be as follows:

      The Advisory Panel, responsible for the project steering function including coordination,
       research questions, outreach, and policy decisions with KID.

      The Legislative and Regulatory Work Group, responsible for effective working relations
       with elected officials and staff on statutory and regulatory issues affecting the exchange
       mechanism; included is interaction with NAIC staff for input on model language and best

      The Insurance and Finance Work Group, responsible for macro issues like the availability
       of government funding for subsidies and losses. The group will aid in developing the
       organizational model, business rules, required actuarial analyses, and benefits design.

      The Organization and Operations Work Group, responsible for overseeing discussions on
       functional integration, information technology, capacity analysis, other infrastructure
       elements and systems, and ultimately operational issues; this will include interaction
       with NAIC staff to synchronize system design and shared services functions.


As discussed in a previous section, the Kansas Business Health Partnership Act provides a
potential governance framework to bring together state agencies and other appointees to
govern the Exchange.


A preliminary project plan, developed in MS Project, is included with this proposal. The project
plan contains approximately 110 activities and includes dependencies and milestones. The plan
includes all SDLC reviews. The table below shows the projected date for the K-MED/Exchange
deliverables and the target dates in the review timeline called out in the solicitation. The
Preliminary Design Review deliverable date is problematic. Completing this deliverable will
require: a) the K-MED contractor to be mobilized and beginning the design for the eligibility
system, and b) the Exchange service provider to be under contract. However, in order to
contract with the Exchange vendor the authority to contract for the Exchange must be
established and much of the stakeholder research and consensus building must be completed.
On the positive side, the table below shows the gaps between Kansas’ milestones and the
milestones in the Early Innovator timeline shrinking after Preliminary Design Review.

Milestone/Deliverable            Kansas Preliminary Project Plan      Early Innovator Timeline
Architectural Review                       03/15/2011                         03/16/20011
Project Startup Review                     03/15/2011                             TBD
Project Baseline Review                    04/22/2011                         04/13/2011
Preliminary Design Review                  10/05/2011                         06/08/2011
Detailed Design Review                     12/19/2011                         09/14/2011
Final Detailed Design Review               02/01/2012                         12/07/2011
Pre-Operational Readiness                  04/26/2012                         06/13/2012
Operational Readiness Review                06/11/2012                        10/10/2012

The detailed K-MED/Exchange project plan will be developed after award of the grant and will
reflect the ten phases of the CMS Integrated IT Investment & System Life Cycle Framework

1. Initiation Phase.
2. Concept Phase.
3. Planning Phase.
4. Requirements Analysis Phase.
5. Design Phase.
6. Development Phase.
7. Test Phase.
8. Implementation Phase.
9. Operations & Maintenance Phase.
10. Disposition Phase.


Integration of the Exchange with K-MED will be executed by extending the K-MED project team
and expanding the role of the state’s central IT organization (DISC) by obtaining additional state
staff and contractor resources. KHPA has already mobilized a project team. This team is
functioning in project “mode”, i.e. major procurement activities, pre-implementation activities,
working across multiple state agencies (Kansas Social and Rehabilitation Services, Kansas
Department on Aging, Kansas Department of Health and Environment, Kansas Insurance
Department), etc. Project momentum is critical in order to have any chance to achieve the
target milestones defined for the grant.

Additional contractor resources are needed for a 2-3 year period during ramp-up. Contractor
resources will include several high-caliber consultants working directly for the state. The to-be
selected K-MED contractor will provide significant resources and the to-be selected Exchange
service provider will have an implementation team.

There are 4 primary funding sources for this combined project:

      HRSA grant for the core K-MED system 25% will be allocated to the Early Innovator
      Early Innovator Grant for integration of the Exchange with K-MED.
      Future funding for establishing the Exchange.
      Future Medicaid 90-10 matching funds for modification of MMIS and other state
       systems to integrate with K-MED.

Presented in Appendix 2 are estimated quarterly budgets and FTE count by project participant.
Peak project activity in terms of staffing and expenditures are projected to occur between Q4 of
Fiscal Year 2012 and Q3 of Fiscal Year 2013 due to simultaneous activities across all
workstreams and bringing up the remaining hardware. Project staffing for the K-MED
contractor is unknown at this time, however this is a fixed price contract with payments based
on achieving milestones/deliverables so variability of the K-MED contractor’s staff for this FTE
estimates should not impact the overall project budget. It is expected that the K-MED
contractor will have 20-40 staff working on the project at any one time. To augment state staff
the state has hired several highly skilled consultants to ensure the state’s interests are
adequately guarded.

The K-MED PMO has established a risk management approach whereby on a monthly basis
project risks are identified and reviewed. For each risk beyond a specific threshold (probability
and impact) mitigation actions are developed and implemented. Approximately 20 risks have
been identified and are being monitored. Mitigation measures are in progress for several key
project risks identified below:

      Funding for the HRSA grant is year-to-year; pressure to reduce federal spending could
       mean the loss of support for the program; if so the state intends to use the new 90-10
       match for Medicaid systems to supplement HRSA funding.
      As other states ramp up their efforts to modify systems and implement new systems to
       support ACA, the talent pool in the marketplace will become stretched thin which could
       affect quality and timelines; since Kansas is currently a leader due to the K-MED project
       this may be mitigated. However, if a large number of states implement their Exchanges
       using a similar strategy as Kansas, the ability of a limited number of service providers
       could introduce delays. Kansas intends to contract for these services as soon as
       possible, i.e. fall of 2011.
      The SOA platform being introduced in the K-MED project creates technology risk. To
       mitigate the risk of the state’s inexperience in this area a state SOA taskforce has been
       established to address skills gaps, standards, governance and criteria for product and
       vendor selection.

The K-MED Project Management Office is responsible for project reporting. The K-MED RFP
contains requirements for extensive reporting (from both a systems perspective and a project

management perspective). Monthly reports on project activities (scope progress, actual
expenditures vs. budget and timeline planned vs. actual) are generated and presented to the
Steering Committee on a monthly basis. Extensive quarterly reporting to the state’s project
office (KITO) is required for IT projects of this size. As required by the RFP, the K-MED
contractor will provide weekly and monthly status reports as specified in the RFP. Finally, the
K-MED project will have quarterly Independent Validation and Verification (IV&V) reviews
resulting in a quarterly report.

For reporting related to operation of the Exchange, numerous reporting constituencies are
being identified as part of the upcoming stakeholder meetings. Reports to the Insurance
Commissioner will address use of the Exchange (number of users and quality of experience) by
consumers, navigators, eligible business and insurance agents. Reports will be available to
consumers on value comparisons of plans and carrier complaints. The Exchange portal will
provide consumer information and will be enhanced over time based on feedback from citizens
and eligible businesses. Health plan data will be analyzed by KID using the new statewide
integrated health insurance information platform (See DAI in the APD table below) to
determine if the needs of consumers, businesses and insurers are being adequately served by
the Exchange so that corrective actions may be taken by KID and the Exchange service provider.
Some of this data, such as percentage of insured through the Exchange, will be analyzed for
internal (KID) purposes such as program performance and some data, such as the most popular
plans, will be made available to the public.

The Exchange is expected to share data with insurers via application messaging. This data will
be bi-direction with plan and coverage information sent from insurer’s systems to the Exchange
and complaint and other information sent from the Exchange (or KID systems) to insurers.
Once HHS data requirements are identified processes will be put in place to provide requested
information. Similarly, reporting requirements from other federal agencies such as the
Treasury have not been fully defined and will have to be addressed as encountered. To this end
the K-MED RFP contains numerous “contingency” interfaces and reports to address the “known
unknowns.” Also, K-MED and KID senior leadership participate in national policy discussions
and decisions and strive to keep the project team informed of new and upcoming
developments at the federal level.

Both K-MED and the Exchange will operate call centers to handle public inquiries and
complaints. The K-MED call center will be staffed by the K-MED M&O contractor. Details of the
operation of the Exchange call center will be determined after the stakeholder information
gathering process is complete. Call center requirements will be reflected in the upcoming
Exchange RFP.

Both K-MED and the Exchange will likely share a central web portal. Depending on a user’s
response to 1-2 initial questions the user will be routed to a channel for an individual/family or
an eligible business. The portal will provide eligibility information for individuals and eligible

businesses as well as information on subsidies. The Exchange portal will provide private plan
information and an entry point for insurers.


This proposal and the current K-MED project lay the foundation for a state-of-the art end-to-
end solution that meets all requirements delineated in this proposed cooperative agreement.

       Kansas has identified governance structures that are already in place or soon to be in
        place in order to successfully execute a project of this magnitude, impact and visibility.
       The PMO has the project management skills required. Some internal and consultant
        technical resources exist. Additional technical resources will be obtained from
       The IT solution proposed here will meet all key principles and fulfill all core exchange
       Kansas intends to use HHS (Medicaid, and Exchange) IT standards in implementation
        and deployment of K-MED and the Exchange; the fact that K-MED will be a new system
        eliminates the need to modify a legacy system to meet new and evolving IT standards.

Kansas has had extensive interaction and a strong partnership with CMS, for many years.
During the past three years the State of Kansas has submitted the following Advanced
Planning Documents (APDs) to the Center for Medicaid and Medicare.

         APD                                      Scope and CMS Response

 APD 16B-MMIS NPI          This APD was submitted to CMS on August 25, 2006. CMS approval was received
 Enhancement Phase 2       September 19, 2006. Kansas CITO (Chief Information Technology Officer) approval
                           was received September 1, 2006. Project was completed in 2008.

 APD 20 – Reporting        APD was approved 7/14/06. This project is complete and implemented 12/4/08.

                           APD was approved by CMS July 2008. The Medicaid and the State Employee Health
 APD 25 – Data Analytic    Plan portions of the project were implemented in early 2010 are being used by the
 Interface (DAI)           department’s staff.

 APD 26-MITA               APD was approved by CMS January 2007. Project was completed in October 2007.

        APD                                        Scope and CMS Response

PD 27 – ICD-10 Phase 1     This APD was submitted to CMS on September 19, 2008 and approved November,
MMIS Detailed Design       2008. KHPA has done sufficient work reviewing MMIS policies and procedures tied
                           to current diagnosis codes to give us more detailed idea of the work that needs to
                           be done. The agency has now begun to work on business requirements as basis for
                           the design documentation. KHPA is also working on a test approach document and
                           a more detailed project plan. Staff continues to work on making the required
                           changes to implement version 5010 of the electronic transactions which are
                           needed before ICD-10 can be implemented.

APD 28- MSIS 2009
Changes                    APD approval was received from CMS May 2008. Project was completed January

APD 29 – MMIS Durable      APD was approved by CMS August 2010 and is on target for completion in early
Medical Equipment (DME)    2011.
Competitive Bidding

                           This APD was submitted June 27, 2008 and approved July 9, 2008. Project is
APD 31 – MMIS Upgrade      underway and on schedule to meet the federally mandated 2012
of Standard Transactions   implementation.
to Version 5010

        APD 32 - MS-       APD was approved by CMS 8/25/08. Project was completed in 2009.

APD 36 – CMS Reporting     This APD was submitted to CMS December 10, 2009 and approved January 21,
Changes                    2010. Design is complete and construction continues.

                           This APD was submitted to CMS March 26, 2010 and approved April 7, 2010.
APD 37- Enhanced Prior     We continue in the procurement process with bids received, reviewed, and a
Authorization              recommendation made to our procurement committee. It will be awarded
                           once CMS and the procurement committee approve.

MMIS P-APDs, KS Health     In preparation for the creation of the State Medicaid HIT Plan (SMHP) document, a
Information Technology     provider survey and environmental scan was completed. A vendor was retained
(HIT) Initiative           which executed the Provider Survey (targeting individual providers, hospitals, and
                           other health care organizations i.e. Critical Access Hospitals, etc.). The
                           Environmental Scan focused on the larger institutional organizations and was

         APD                                           Scope and CMS Response

                              performed by the State Medicaid personnel. The results will be included within the
                              SMHP showing the Kansas’ “as is” position regarding current technology use and
                              future plans for technology use. The survey process was accomplished through a
                              collaborative effort involving the Kansas Department of Health and Environment
                              (KDHE), Kansas Hospital Association (KHA), Kansas Foundation for Medical Care, the
                              State IT Architect, Kansas Association of Homes and Services for the Aging, and
                              Kansas Health Policy Authority (KHPA – Medicaid). We anticipate awarding a
                              contract for a vendor to draft the SMHP in January 2011.

 Multi-State                  Kansas partnered with Pennsylvania in a 12-state collaborative to submit an
 Collaborative for the        APD in October 2010. The APD was approved in November 2010. The project
 HIT Medical                  is underway.
 Assistance Provider
 Incentive Repository


The following definition of an Exchange and high-level implementation requirements are taken
from These statements provide a common definition and basis for defining the scope
of the Exchange and by extension the interaction between the Exchange and the new K-MED
eligibility system.

        An Exchange is a mechanism for organizing the health insurance marketplace to help consumers and small
        businesses shop for coverage in a way that permits easy comparison of available plan options based on
        price, benefits and services, and quality. By pooling people together, reducing transaction costs, and
        increasing transparency, Exchanges create more efficient and competitive markets for individuals and
        small employers.

        Beginning with an open enrollment period in 2013, Exchanges will help individuals and small employers
        shop for, select, and enroll in high-quality, affordable private health plans that fit their needs at
        competitive prices. Exchanges will assist eligible individuals to receive premium tax credits or coverage
        through other Federal or State health care programs. By providing one-stop shopping, Exchanges will
        make purchasing health insurance easier and more understandable.


With this definition and the current scope of the K-MED eligibility system as a basis, the scope of work under this
Early Innovator grant proposal is to integrate the Exchange provider’s solution with the K-MED eligibility system.
As shown below the end-to-end solution has a single entry point for private citizens and eligible businesses. The
Exchange will have two major components: 1) the Exchange Management System primarily used by insurance
companies and KID, and 2) the Exchange Marketplace which will be used by private citizens not eligible for federal
or state medical assistance that are channeled to private provider plans and eligible businesses.

The additional K-MED scope will integrate the application process and program determination
for private citizens and channel them to either the Exchange Marketplace or further into K-MED

if it appears they are eligible for publicly funded coverage assistance. This K-MED scope
extension will include additional business rules, an enhanced user interface, data structures and
several additional interfaces between K-MED and the Exchange.


The functional scope was investigated at a high level. The business objectives and IT enablers
were derived from this research. For each functional area the IT enablers including interfaces
are identified in the table below. Core functionality of the Exchange will be procured and
deployed under a contract with a service provider.

K-MED/Exchange                     Key Business Objectives                         IT Enablers to Support
   Function                                                                        Key Business Processes
                    Determine eligibility for individuals and eligible
Eligibility         businesses:                                                    Development and
                     Medicaid and CHIP and/or other federal and state             deployment of Kansas’ K-
                        programs                                                   MED eligibility system
                     Subsidies for private insurance for individuals*
                                                                                   Extend K-MED eligibility to
                     Non-subsidized private insurance for individuals*
                                                                                   non- Medicaid consumers
                     Subsidies for private insurance for eligible
                        businesses*                                                Use same rules engine,
                     Non-subsidized private insurance for eligible                identify management
                     Capture required stats/measures*                             Interfaces: K-Med to/from

                    Enroll consumers, businesses and providers in Exchange:
Enrollment           Certification, recertification and decertification of        Procure exchange “system
                        plans; providers enter/maintain information on             for service”, i.e. COTS
                        available plans and qualifications and plans are           products
                     Consumers enter required information not captured
                        during eligibility determination process (federal,         K-MED to/from Exchange
                        state, provider)
                     Licensed insurance agent access to assist consumers          Coverage providers to
                     Information on the availability of in-network and out-       Exchange
                        of-network providers as identified in Section
                        1311(c)(1)(B) and (C), including provider directories      Exchange to KID systems
                        and availability of essential community providers
                     Public disclosure of plan data identified in Section
                        1311(e)(3)(A), including claims handling policies,
                        financial disclosures, enrollment and disenrollment
                        data, claims denials, rating practices, cost sharing for
                        out of network coverage, etc.
                     Match consumers with provider plans
                     Provide means to record coverage
                     Capture required stats/measures

                       Certification of individuals exempt from the               Interface: Federal system(s)
Exemptions              individual responsibility requirement*                     for exemption from mandate

K-MED/Exchange                    Key Business Objectives                        IT Enablers to Support
   Function                                                                      Key Business Processes
                       Assignment of a price and quality rating to plans        Interface(s) from coverage
Plan Ratings and       Presentation of plan benefit options in a standardized   providers to the Exchange
Presentation of         format                                                   Content management for
Plans                  Consideration of plan patterns and practices with        plan review, ratings and
                        respect to past premium increases and submission of      presentation
                        plan justifications for current premium increases
                        under Section 1311(e)(2)

                    Administer and calculate tax credits:                        Interfaces:
Premium Tax          Provision of an electronic calculator to determine the     Federal system(s) for cost
Credits Admin          actual cost of coverage taking into account eligibility   sharing parameters
                       for premium tax credits and cost sharing reductions*      From coverage providers to
                                                                                 the Exchange

                       Establishment of a Navigator program that provides       Federal system(s) for cost
Cost Sharing            grants to entities assisting consumers as described in   sharing parameters
Assistance Admin        Section 1311(i)                                          Content management for
                       Timely information for consumers requesting their        cost sharing information
                        amount of cost sharing for specific services from
                        specified providers as described in Section

                       Provision of information on certain individuals          Interfaces: K-MED to/from
IRS Interface(s)        identified in Section 1311 (d)(4)(I) to the Treasury     Exchange
                        Department and to employers*

                       Presentation of enrollee satisfaction survey results     Content management
Additional              under Section 1311(c)(4)*
Exchange               Provision for open enrollment periods under Section
Functions               1311(c)(6)*
                       Consultation with stakeholders, including tribes,
                        under Section 1311(d)(6)
                       Publication of data on the Exchange’s administrative
                        costs under Section 1311(d)(7)

                       Operation of a toll-free hotline                         Customer support
Operations             Maintenance of a website for providing information       management software
                        on plans to current and prospective enrollees
                       Information for participants in group health plans as
                        described in Section 1311(e)(3)(D)
                       Information on plan quality improvement activities as
                        specified in Section 1311(g)
* Denotes items that are additions to the scope of the K-MED project.


Business rules to drive eligibility determination will be encapsulated in the K-MED system using
a consistent, technology-neutral standard format. If available, K-MED will utilize federally
established business rules to administer ACA health insurance coverage options (including
Medicaid and CHIP). The business rules engine will also contain state-specific rules which may
be re-configured to meet different states’ requirements. This will help enable technology
transfer of the Kansas solution. To
allow for seamless integration of all
health and human services programs,
business rules for other health and
human services programs such as
SNAP and TANF will be able to be
added to the repository when

The figure on the right shows several
conceptual       categorizations     of
business rules. These rules will be
isolated from the transactions and
will interact with core data elements
such as demographics, socio-
economics, program parameters,
inter-dependencies among programs
and other key data elements. This
will enable flexibility in the business
logic to manage program changes
with minimal maintenance and technical support.


Enterprise architecture specified in the RFP will allow the separate, standalone systems (K-MED,
Exchange, MMIS, KID, insurance providers’ systems, federal agencies, etc.) to communicate
using exposed, shared services through a common architecture. Service Oriented Architecture
(SOA) and messaging will have a prominent role in K-MED. The SOA developed for K-MED will
be used to facilitate functional re-use and data sharing among loosely coupled services. The K-
MED/Exchange end-to-end solution is expected to employ an Enterprise Service Bus (ESB)
based solution. The ESB will support a variety of standard messaging protocols and transform
data into a common data format. The platform will be required to have primary application
functions and data available via external industry standard APIs, web service calls, or other
acceptable processes. The architecture will support a High Level Client Index (HLCI) that is

facilitated by services. Similarly image requests are expected to be messaged to the end user
from various sources. The benefits of real-time data, delivered quickly from many disparate
systems will provide a higher level of worker productivity, enhanced customer service and
reduced system life-cycle costs.

Another possible architectural alternative is to use two ESBs between K-MED, the Exchange and
the MMIS and external systems. This architecture will enable future expansion for human
services and centralized data exchange with federal and local government systems.

The figure below shows the conceptual view of the technology platform that is being
established for managing the exchange of health information in Kansas. It is expected that
messaging between K-MED, the Exchange and other state and federal systems will be several
hundred thousand per day. Between K-MED and the Exchange it may be in the order of tens of
thousands per day and perhaps 5-10 times higher during open enrollment. Due to the
expected message traffic between the systems, the preferred architecture is to implement one
(and more likely two) ESBs to connect K-MED with the Exchange and the MMIS and external
systems. This architecture will enable future expansion for human services and centralized data
exchange with federal and local government systems.


KID and KHPA working in partnership have the vision, strategies, capabilities and commitment
to successfully execute this ambitious project. The K-MED project is supported by the State
CIO, key Legislators, Legislative Committees and the Governor. The project is being managed
by an extremely capable and experienced project manager, Mr. Gary Schneider. Mr. Schneider
has over 20 years of experience successfully implementing large IT projects – many with
leading-edge technologies in the public and private sectors. Mr. Schneider recently managed
implementation of Kansas’ statewide financial management system. Mr. Schneider is assisted
by Mr. Travis Haas who has four years of experience in KHPA managing IT projects for agency
healthcare systems. Mr. Haas is PMP-certified. The K-MED team includes Mr. Ken Orr who is
serving as senior architect. Mr. Orr has authored several books on IT architecture. Mr.
Woerman, CIO for KID, has worked in IT for over 25 years. Finally, Mr. Darin Bodenhamer,
KHPA Director of Medicaid Eligibility and the K-MED Project Director, has extensive experience
in the IT arena as well as an M.S. in MIS. Appendix 3 contains an organizational chart and
information on key staff.

An extension of the K-MED / Exchange team will be resources from other state agencies. The
state has a large health and human services agency, Social and Rehabilitation Services (SRS),
with which KHPA works very closely. This is important since SRS staff will be using K-MED to
provide medical eligibility services and to make determinations. SRS has two members on the
K-MED project Steering Committee. The state’s central IT organization (DISC) will most likely be
responsible for hosting the K-MED application, while the Exchange will be hosted by the service
provider. DISC is a capable organization responsible for many large state administrative
systems and several agencies’ mission critical programmatic systems.

The K-MED project has an established governance structure. It includes Executive Sponsors of
KHPA, SRS, State CIO, the Secretary of Administration and the Governor’s Office. The K-MED
project also includes a steering committee that meets each month. The Steering Committee is
made up of several Program and senior IT manages from KHPA, SRS and the State CIO. K-MED’s
governance structure includes two advisory committees. The first is composed of multiple
representatives from approximately 10 health and human services state agencies. The second
advisory committee is made up of health organizations throughout Kansas. The K-MED
governance structure is shown below.

To support the Exchange, this governance structure will be modified to include the Insurance
Commissioner as an Executive Sponsor. KID will also be invited to join the K-MED Steering
Committee. Given the established K-MED project governance, the senior leadership on the
state side of the K-MED project and the pace of the current procurement and pre-

implementation activities, Kansas is ready to immediately take on the challenge of integrating
K-MED with the Exchange with minimal ramp up. This quick start is crucial in order for early
innovators to provide benefit to other states.


The following preliminary evaluation measures presented include internal as well as public data
and information on the goals and objectives of the Exchange and the measure of attainment of
those goals and objectives. These will be enhanced based on stakeholder involvement.

     Phase                    Evaluation Plan                       Methods to Evaluate
Planning &         Clear path towards legislation or         Monitor political movement
Governance         Exec Order; Authority for Exchange        towards objective
Implementation     On-schedule and On-budget; need to        Standard project mgmt techniques
                   meet the 01/01/13 for certification
                   of Exchange
Implementation     Scope controlled                          # of change requests brought
                                                             before CCB and disposition
Operations         # of plans Entered in the System by       Analyze data
                   Providers and certified by KID
Operations         # adverse sections                        Analyze data
Operations         # of insured, change, trends              Analyze data
Operations         Consumer surveys re streamlined           Analyze survey responses
                   access and continuity of care
Operations         # and type of outreach activities         Plan vs. actual and analyze
                   planned vs. actual and feedback           responses from stakeholders
                   from stakeholders
Operations         Consumer satisfaction with                On-line customer surveys.
                   characteristics of the Exchange, i.e.     Monitoring and analyzing help desk
                   standardized data reporting on price,     calls/complaints
                   quality, benefits, consumer choice
                   and other factors
Operations         Internal controls on fiscal position of   Annual financial and operations
                   Exchange                                  audits


The budget narrative is included as Attachment A.

Cost allocation between the new State Medicaid system (K-MED) and the Exchange have three

   1. IT infrastructure costs for system hosting by the state IT organization (DISC) attributable
      to extension of K-MED (i.e. a step increase in load due to an expanded customer base) is
      estimated to be approximately $5.5 million and is fully allocated to the Early Innovator
   2. Costs to extend K-MED functionality to fully integrate with the Exchange are estimated
      to be approximately $4 million and are fully allocated to the Early Innovator grant.
   3. Cost allocation of the base K-MED system to support the Exchange is as follows: 75% (K-
      MED) and 25% (Exchange); assume K-MED system costs is $20 million; 25% of $20
      million = $5 million which will be allocated to the Early Innovator grant.

In summary, Kansas’ proposed coupling of the Medicaid eligibility and Health Insurance
Exchange projects enables the Exchange to benefit by leveraging the new Medicaid eligibility
system, and the cost allocation is reflective of this situation.


    KAECSES-AE – The Kansas Automated Eligibility (KAECSES-AE) system supports eligibility
    determination for multiple programs. KAECSES-AE provides the automated support that
    assists the case worker with establishing clients, cases, eligibility determination, service
    delivery, case management, and a repository for case information. KAECSES-AE serves
    Medicaid, CHIP, ADAP, and state-funded medical programs. It also serves TANF, General
    Assistance, Food Assistance, Refugee Assistance, Chafee Independent Living, Adoption,
    Permanent Custodianship, Foster Care in Out-of-Home placements, and Family
    Preservation cases. The majority of information and data for current and past medical
    decisions is held by KAECSES-AE. The K-MED System will serve as the sole system for
    medical eligibility determination, assuming responsibility as the medical eligibility system
    of record. A bi-directional interface will be developed between KAECSES-AE and the K-
    MED System to share specified information between the programs. Data conversion from
    KAECSES-AE will be required. KAECSES-AE is a mainframe system developed using COBOL
    and Natural2 for the batch routines and COBOL/CICS for the online transactions. ADABAS
    is the database management system (DBMS). KAECSES-AE will be de-commissioned after
    K-MED is deployed.
    MMIS (Medicaid Management Information System) – The MMIS is the system operated
    by the State’s fiscal agent and includes beneficiary data maintenance, claims payment,
    managed care assignment, and federal reporting. HP-Enterprises Services is the current
    fiscal agent operating the interChange MMIS. KAECSES-AE is the primary source of
    beneficiary eligibility, demographic and long term care information. Information received
    from KAECSES-AE is used to determine what benefits the member will receive. KHPA
    provides a large number of different benefit plans, and each plan offers a different
    package of services.
    InterChange Premium Billing and Collection (ICPBC) – The ICPBC system provides
    premium billing and collection services for KHPA. HP-Enterprises Services provides these
    services, including a customer service center and the associated system. Currently, the
    MMIS serves as the source system for the ICPBC by providing eligibility and premium
    information for both the HealthWave and Working Healthy programs. An account is
    created in this system for each case where a premium responsibility is noted. The system
    sends premium statements and posts collections of payments for these accounts. It also
    provides various reports concerning premium information and operations. This system
    uses an Oracle 11g database. A bi-directional interface between the K-MED System and
    the Source ICPBC will be required. The K-MED System will also become the source

    ImageNow – KHPA uses ImageNow from Perspective Software as a secure enterprise
    document imaging application. ImageNow is also required to be used by KHPA’s
    contractors, including the HealthWave Clearinghouse operated by Policy Studies, Inc. This
    solution offers a client server sequel server environment with a web access component.

The Contractor will integrate their proposed K-MED solution with the current version of
KHPA’s ImageNow system.

PSI Platform – The PSI Platform is a system provided by the Clearinghouse Operations
vendor, Policy Studies, Inc., and is used by Clearinghouse staff to supplement the
KAECSES-AE system. It provides workflow, program income worksheets, Clearinghouse
operations reports, and an electronic case log. The Platform is beginning to use VHI
functionality to “push and pull” data to/from KAECSES-AE. The PSI Platform was
developed using a Service Oriented Architecture and utilizes Java J2EE and Google Web
Tool kit as the primary development languages supported by an Oracle database. Other
key supporting technologies include Oracle Server Bus and Oracle’s AquaLogic Business
Process Manager. The K-MED System will replace the PSI Platform and data conversion
from the PSI Platform to the K-MED System will be required.
Data Analytic Interface (DAI) – The DAI is a data repository for Medicaid, State
Employee’s Health, and private insurance data. Thompson-Reuters is the vendor for this
service. The DAI functionality allows a wide range of KHPA staff with varying levels of
expertise to produce reports through an interface. Analysis based on episodes of care of
individual beneficiaries, disease management, predictive modeling, and evaluative
analysis to measure costs and outcome effectiveness is possible. The DAI is designed to
use data to compare health care service and utilization patterns, and to identify trends
and areas for focus and improvement. KHPA uses the data to develop programmatic
improvements in Medicaid and the State Employee Health Program and to advance health
policy for the state as a whole. The data resides on an Oracle server that is maintained by
Presumptive Application and Referral Tracking System (PARTS) – PARTS is a system used
by the Presumptive Medical Disability Team (PMDT) to support the disability
determination process. It is primarily a workflow tool with documentation and reporting
capabilities. It also includes functionality such as fuzzy searches, customized workflow
views, and calendar components. PARTS is an APEX application residing in an Oracle 11g
database, a scalable and rapid application development framework running on enterprise
class servers. The K-MED System will include all functionality currently provided by PARTS
and conversion from PARTS will be required.


                                        Oct-10             Jan-11                 Oct-11                   Jan-12                  Oct-12                  Jan-13                  Oct-13               Jan-14
                        Total        Q1 FY11 Q2 FY11 Q3 FY11      Q4 FY11     Q1 FY12    Q2 FY12     Q3 FY12        Q4 FY12    Q1 FY 13     Q2 FY13    Q3 FY13      Q4 FY13    Q1 FY14    Q2 FY14   Q3 FY14
Total Funding             43,930,000 250,000 280,000     400,000    1,000,000 2,250,000    3,250,000   3,000,000     5,500,000 6,000,000     7,000,000 5,000,000     4,000,000 2,500,000 2,250,000 1,250,000
HRSA Grant (K-MED Only)   21,930,000 250,000 280,000     400,000      500,000   750,000    1,500,000   1,000,000     3,000,000 3,000,000     3,500,000 2,000,000     2,000,000 1,500,000 1,500,000    750,000
Early Innvator Grant      22,000,000      -       -          -        500,000 1,500,000    1,750,000   2,000,000     2,500,000 3,000,000     3,500,000 3,000,000     2,000,000 1,000,000    750,000   500,000

Estimated Total Combined
Project FTE                                 16       16          26         40         46          50         52            54        60            68        68           66         54         48        40
State                                       13       13          13         18         18          18         20            20        24            30        30           30         24         20        18
State Consultants                            3        3           3          6          6           8          8             8        10            10        10           10          8          6         4
K-MED Contractor                             0        0           8         14         20          22         22            24        24            26        26           24         20         20        16
KID                                          0        0           2          2          2           2          2             2         2             2         2            2          2          2         2


Illustrated below is the K-MED organizational chart which has been supplemented by the
proposed staffing to support the Early Innovator grant and the associated activities. There are
approximately 17 additional staffing positions requested under this proposal. Several of these
staff (e.g. testers and trainers/outreach) will not be brought on to the project until Year 2.

Information on key personnel and job descriptions are provided as Attachment B


The Work Plan and Project Plan are included in Attachment C.


Letters of agreement are provided as Attachment D

      Governor of the State of Kansas
      State Medicaid Director

                                          Kansas Insurance Department Early Innovator Work Plan

                         Tasks                                Timetable     Responsible Agency or                      Evaluation/
                                                                                  Person                              Measurement
1.0 K-MED/Exchange Governance
  1.1 Modify K-MED governance structure (Executive         March 2011       K-MED PMO                   Governance charter revised and KID
  Sponsors and Steering Committee) to include KID                                                       members appointed and in place attend
                                                                                                        meetings in early March
2.0 Staffing
  2.1 Develop staffing plan for additional staff to        Complete         K-MED PMO                   Updated plan after grant award to
  support Exchange integration                             (See proposal)                               reflect funding vs. plan submitted
  2.1 Fill positions based on phased staffing plan                          K-MED PMO                   Execution of plan, i.e. positions filled at
                                                                                                        appropriate times
     2.1.1 - Advertise for personnel for initial state   Reference          K-MED PMO                   Documentation of announcements
     positions in regional print and broadcast media, on staffing plan                                  maintained on file in Human Resources
     State website and in appropriate professional                                                      Department (HR).
     2.1.2. - After responses have been screened by HR,                     Project Director, Project   HR Department will maintain completed
     conduct interviews with ten most highly qualified                      Manager                     objective score sheets for candidates
     candidates for each position.                                                                      interviewed.
     2.1.3. – Select and hire for immediate positions    See plan           Project Director/HR         HR Department will maintain
                                                                            Manager                     documentation in personnel and payroll
     2.4. - Train all staff in KHPA policies, procedures   After hire       Technical/Program           HR Department will document (in
     and responsibilities (programmatic and technical)                      Team Leaders                personnel records) all orientation and
     for their respective positions.                                                                    training sessions that staff attend.
3.0 Project Infrastructure                                 March 2011       K-MED PMO
  3.1 Obtain and Prepare project space                     March 2011       K-MED Admin                 Space available as needed to support
                                                                                                        staffing plan.
4.0 Kansas Health Insurance Exchange Planning
Activities – See KID Workplan from Exchange
Planning Grant for details of each WBS element
                         Tasks                                Timetable     Responsible Agency or                Evaluation/
                                                                                  Person                        Measurement
  4.1 Create and organize KID HBE team                      January 2011    KID                     See KID Workplan for Exchange
                                                            December 2011                           Planning grant activities
  4.2 Background research                                   January 2011    KID                     See KID Workplan for Exchange
                                                            December 2011                           Planning grant activities
  4.3 Create stakeholder involvement                        January 2011    KID                     See KID Workplan for Exchange
                                                            December 2011                           Planning grant activities
  4.4 Governance model                                      January 2011    KID                     See KID Workplan for Exchange
                                                            December 2011                           Planning grant activities
  4.5 Regulatory / Policy Actions                           January 2011    KID                     See KID Workplan for Exchange
                                                            December 2011                           Planning grant activities
  4.6 Insurance and Finance                                 January 2011    KID                     See KID Workplan for Exchange
                                                            December 2011                           Planning grant activities
  4.7 Integration / Capacity / Systems / Operations         January 2011    KID/K-MED               See KID Workplan for Exchange
                                                            December 2011                           Planning grant activities
4.0 Kansas Health Insurance Exchange RFP and
Vendor Selection
  4.1 Consolidate high-level requirements from KID                          KID/K-MED
  that impact K-MED
  4.2 Gather information from potential Exchange                            KID                     Information adequate to understand
  service providers (RFI, vendor calls, other states [MA,                                           procurement strategy and
  UT, ?] to discuss integration                                                                     fundamentals of RFP
  4.2 Define functional requirements for Exchange                           KID                     Requirements comprehensive for
                                                                                                    procurement strategy completed in to
                                                                                                    issue RFP in June
  4.3 Define requirements for integration of Exchange                       KID/K-MED
  with K-MED
     4.3.1 Identify and document business                                   KID
     4.3.2 Identify and document interfacing                                KID/K-MED
     requirements                                                           (include K-MED vendor
                          Tasks                                  Timetable        Responsible Agency or                Evaluation/
                                                                                         Person                       Measurement
                                                                                 when on-board)
  4.4 Draft and Issue Exchange RFP                            June 2011          KID
  4.5 Bidders generate proposals                              August 2011        Vendor Community
  4.6 Review proposals, select Exchange vendor and            September 2011     KID/K-MED
5.0 Activities to Enable the Exchange and K-MED
Integration within the Exchange Application
(includes scope to enable selected Exchange
vendor’s system to integrate with K-MED)
  5.1 Implement Exchange and Integrate with K-MED             October 2011 –     KID/Exchange Vendor      Meeting grant deliverable dates and
  (design, build, test, deploy) (Level of detail will be in   October 2012                                other milestones in project plan; IV&V
  Exchange project plan that will be developed after                                                      reports
  grant award)
6.0 K-MED Execution (includes integration w/
  6.1 Develop K-MED detailed project plan including           June – July 2011   K-MED (PMO and           Combined project plan approved by KID
  functional and technical integration with Exchange                             Contractor)/KID          by August 2011
  6.2 Execute K-MED project phases (design, build, test,      August 2011 –      K-MED/K-MED              Meeting grant deliverable dates and
  deploy) including functional and technical integration      January 2014       Contracto/KID            other milestones in project plan; IV&V
  with Exchange (See project plan included in this grant                                                  reports
  application for more details)
  6.3 Implement (design, procure, build, test, deploy) IT     August 2011 –                               Meeting grant deliverable dates and
  infrastructure to support integration between K-MED         January 2014                                other milestones in project plan; IV&V
  and Exchange                                                                                            reports
      6.3.1 Expand network capacity to deal with load         August 2011 –      K-MED/K-MED              Meeting grant deliverable dates and
      from Medicaid expansion and others’ access to           January 2014       Contractor/DISC          other milestones in project plan; IV&V
      Exchange via K-MED                                                                                  reports
      6.3.2 Develop redundant sites (Topeka and               August 2011 –      K-MED/K-MED
      Wichita)                                                January 2014       Contractor/DISC
      6.3.3 Implement ESB (hardware and software),                               K-MEM/K-MED
      firewalls and load balancers                                               Contractor/DISC
                        Tasks                               Timetable     Responsible Agency or                Evaluation/
                                                                                 Person                       Measurement
                                                     August 2011 –
     6.3.4 Implement servers (web, apps, database) for                   K-MED/K-MED
     dev/test/QA/Prod environments                   January 2014        Contractor/DISC
     6.3.5 Implement storage solution                August 2011 –       K-MED/K-MED
                                                     January 2014        Contractor/DISC
     6.3.6 Implement monitoring tools and automation August 2011 –       K-MED/K-MED
     tools                                           January 2014        Contractor/DISC
     6.3.7 Implement backup solution                 August 2011 –       K-MED/K-MED
                                                     January 2014        Contractor/DISC
  6.4. Technical training for state staff                                K-MED/DISC
7.0 Training/Outreach/Communications/
Technology Transfer
  7.1 Training / Outreach
     7.1.1 Develop Training / Outreach Plans             August 2011 –   K-MED/K-MED              Plans developed and approved as
                                                         February 2013   Contractor/KID           reflected in project plan
     7.1.2 Execute Training / Outreach Plans             March 2013 –    K-MED/K-MED              Public, business and industry knowledge
                                                         January 2014    Contractor/KID           and understanding of options, changes
                                                                                                  in benefits plans
  7.2 Communications
        7.2.1 Develop Communications Plan (including     March 2011      K-MED/KID                Plans developed and approved as
        technology transfer to other states/entities)                                             reflected in project plan
        7.2.1 Execute Communications/ Technology                         K-MED/KID                Communication channels (who),
        Transfer Plan                                                                             communication methods (how), # of
                                                                                                  knowledge transfer sessions held with
                                                                                                  other states
8.0 Project Monitoring and KITO Requirements
  8.1 In appropriate phases, complete and submit all     March 2011 –    PMO                      KHPA will retain proof of submission,
  documents related to the information system to         January 2015                             and receipt by KITO, of all project-
  Kansas’ Chief Information Technology Office (KITO)                                              related documents that are submitted
  for approval                                                                                    to KITO, with associated
                                                                                                  submission/receipt dates.
      8.1. - Complete wrap-up activities, reviewing      January 2015    Vendor and Project       KHPA will maintain documentation of all
                 Tasks                             Timetable    Responsible Agency or                 Evaluation/
                                                                      Person                         Measurement
post-implementation outcomes and provide                       Team                     wrap-up activities on file in its office,
copies of documentation to the Kansas Health                                            with a copy of the report sent to KHI.
Institute (KHI).
8.2. - Develop and submit Post Implementation   January 2015   PMO                      KHPA will prepare a PIER, submitting it
Evaluation Report (PIER) to KITO and KHI, for                                           to KITO and KHI, and will maintain a
inclusion in evaluation reports.                                                        copy.
      December 20, 2010

      The Honorable Kathleen Sebelius, Secretary
      DepaItment of Health & Human Services
      200 Independence Avenue, SW
      Washington, DC 20201

      RE:     Cooperative Agreements to SUppOit Innovative Exchange Information Technology Systems
              CFDA: 93.525

      Dear Secretary Sebelius:

      At the request of Kansas Governor Mark Parkinson, it is my honor to submit this application for the
      Cooperative Agreements to Support Innovative Exchange Information Technology Systems grant. The
      Governor has designated the Kansas Insurance DepaItment, under my direction, as the lead state agency
      to direct the project described in this grant application, the Kansas Health Insurance Exchange.

      On behalf of the State of Kansas, the Kansas Insurance DepaItment is requesting $21 ,792,158 over the
      two-year project period .

      The principal contact person for this grant is Ms. Linda J. Sheppard, Director of the Accident and Health
      Division of my office, who will also serve as the project director for the program. The Kansas Insurance
      DepaItment will engage a number of stakeholders throughout the process, and will specifically paltner
      with the Kansas Health Policy Authority (KHPA), the state Medicaid depaltment. We also are in active
      communication with Missouri Insurance Director John M. Huff regarding potential Exchange paItnership
      oppOitunities, and we are eager to share with other states in the results of this project.

      On behalf of Governor Parkinson, and all Kansans, thank you for your consideration of this application.
      Please contact Linda J. Sheppard at the Kansas Insurance Depaltment if you require any additional
      information or suppOiting materials.

      Kansas Insurance Commissioner

    420 SW 9th Street                785-296-3071 Phone               Consumer Hotline                Website
Topeka, Kansas 66612-1678             785-296-7805 Fax                  800-432-2484   
          ~---¥                                                                        Mark Parkinson, Governor
     OFFICE OF THE GOVERNOR                                                          

                                                 December 16, 2010

     The Honorable Kathleen Sebelius, Secretary
     Department of Health & Human Services
     200 Indcpendence Avenue, SW
     Washington, DC 20201

     RE: Cooperative Agreements to Support Innovative Exchange Information Technology Systems
         CFDA: 93.525

     Dear Secretary Sebelius:

     I would like to express my support for the grant application being submitted by the Kansas
     hlsurance Department under the above title, also known as an "Early Innovator" grant, to design
     and develop information technology inii'astl1lcture needed to implement a Kansas Insurance

    Kansas is in a unique position to leverage the Kansas Medical Eligibility Determination (K-
    MED) system, for wl!ich proposals have already been solicited, to serve botl! the Exchange and
    Medicaid in Kansas. This system will be a cutting-edge, 21 st Century technological model for
    health care eligibility. Timing couldn't be better to coordinatc and integrate these systems, and
    this "Early Innovator" grant will provide the funding for this integration.

    The Kansas Health Policy Authority and Insurance Commissioner Sandy Praeger will coordinate
    their efforts to establish this integrated Insurance Exchange and medical eligibility system in
    Kansas as a model among the states. This coordination of efforts will maximize efficiency in
    support of both Medicaid and the Exchange. vVc are a11 committed to provide an Insurance
    Exchange for Kansans in the most cost elTective manner we can, and to share our solution with
    the other states.

    We appreciate this opporhmity to be innovative in our approach to the Exchange and to leverage
    the planning and funding already invested in the K-MED system.

    Sincerely,'      //)

    Mark P~, rkillson
    Governor of the State of Kansas

              Capitol Building, Room 212S, Topeka, KS 66612-1590 • (785) 296-3232 • Fax: (785) 296-7973

December 17, 2010

Commissioner Praeger
420 SW 9th Street
Topeka, KS 66612

RE:      Cooperative Agreements to Support Innovative Exchange Information Technology Systems
         CFDA: 93.525

Dear Commissioner Praeger;

I would like to express my support for the “Early Innovator” grant application that will be submitted by the
Kansas Insurance Department to design and develop the information technology infrastructure needed to
implement a Kansas Insurance Exchange.

The Kansas Health Policy Authority looks forward to coordinating our agency’s medical eligibility system
replacement project (K-MED) with your efforts to establish an insurance exchange. This coordination will
ensure that we will not duplicate efforts and will share functionality whenever possible. Furthermore, this
collaboration will provide those seeking health coverage a streamlined, seamless entry point into either the
Medicaid program or the insurance exchange as indicated in the Affordable Care Act (ACA).

It is my sincere hope that this application meets with OCIIO’s approval and this effort is funded. This project
will build upon the work Kansas is already fully engaged in to develop and implement a medical eligibility
system by mid- to late-2013. It will also move Kansas forward by developing real solutions that improve the
effectiveness of the health insurance programs we have now, and that dramatically improve the consumer
experience and organization of the insurance marketplace in the future. We share the Commissioner’s goal of
sharing information and innovative solutions with other states so that they, too, can benefit from the advances
Kansas is proposing in this application.


Barb Langner
Medicaid Director

                             Rm. 900-N, Landon Building, 900 SW Jackson Street, Topeka, KS 66612-1220
Medicaid and HealthWave:                         State Employee Health Plan:                            State Self Insurance Fund:
Phone:    785-296-3981                           Phone:    785-368-6361                                 Phone:      785-296-2364
Fax:      785-296-4813                           Fax:      785-368-7180                                 Fax:        785-296-6995

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