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CMS conflict-free case management rule explained to Kansas committee; states must separate case management and service provision
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Summary
A subject-matter speaker summarized the federal HCBS conflict-of-interest rules, and committee discussion focused on Kansas’ path to compliance, potential 'only willing and qualified provider' exceptions for rural areas, and the need for clear safeguards and oversight.
A subject-matter expert briefed the Kansas special committee on federal Home and Community-Based Services (HCBS) regulations that require separation of case management and direct service provision to prevent conflicts of interest. The speaker reviewed key regulatory citations, CMS guidance and examples from other states such as Vermont, Rhode Island, South Dakota, Alaska and Colorado.
The presenter told the committee that CMS’s HCBS final rule (effective March 17, 2014) requires that providers of HCBS or entities with an interest in providers not provide case management or develop a person-centered plan for the same individual, except where the state demonstrates that only a willing and qualified entity exists in a geographic area. The speaker said CMS expects states to provide documentation, safeguards and periodic oversight when granting such an exception.
The committee heard that possible safeguards include administrative separation of staff who develop person-centered plans from staff who provide services to the same individual; accessible dispute-resolution and appeal procedures for individuals who believe the state’s determination is incorrect; disclosure and informed-choice documentation for participants; and periodic state audits reviewing whether the “only willing and qualified” condition remains true in a geography.
The presenter described a range of state responses. Some states created dedicated conflict-free case management agencies (South Dakota, Colorado, Alaska with specific safeguards). Other states implemented phased approaches with stakeholder engagement (Vermont, Rhode Island). In frontier or rural areas, Alaska and others obtained limited “only willing and qualified” exceptions, paired with training and state review requirements. Managed-care organizations can provide case management only if they do not deliver direct services to the same person or they demonstrate they are the only willing and qualified entity in that area, and the state must retain oversight of eligibility determinations.
Committee members pressed for specifics about Kansas implementation. Chair Carpenter said KDADS must meet CMS expectations to avoid federal disallowance of Medicaid funding. Legislators asked whether the department would create a new state-level agency or rely on private organizations to serve as conflict‑free case managers. The presenter and KDADS staff said models differ by state and by rural/urban context; Kansas is exploring multiple pathways, including allowing providers to divest, establishing independent case-management entities and drafting an “only willing and qualified” policy for limited geographies with appropriate safeguards.
No formal committee votes were recorded. Committee members asked KDADS to publish membership and minutes for a policy-alignment team that will draft the operational policy and to provide clear timelines and reporting to the Legislature on progress toward compliance.
The committee stressed that implementation must minimize disruption for people currently served while meeting federal expectations. KDADS told the committee it expects to publish planned membership and ongoing meeting notes and to continue stakeholder engagement.
