Kansas committee weighs privatization, IMD waiver and workforce steps as contract nursing costs mount

Representative Bealick opened the special committee by warning that the state’s contract nursing expense is unsustainable, saying, “spending $46,000,000 a year in contract nursing at Larner Hospital is, quite frankly, a disservice to our people and it's just not an option.”

Committee members and witnesses spent the session reviewing options to reduce reliance on contract staff and to increase inpatient and community capacity. National and state experts — Wendy Morris of NASMHPD, Ted Letterman of the NASHPD Research Institute, consultant Kevin Ann Hupshorn and KLRD analyst Leanne Thorne — described the mixed record states have had with privatizing whole psychiatric hospitals, steps to protect state interests in contracts, and alternatives such as expanding community crisis centers and pursuing a federal IMD (Institution for Mental Disease) waiver so Medicaid can help pay for certain adult inpatient care.

Why this matters: committee members said the immediate driver is growing contract nursing bills and a statewide shortage of psychiatric staffing and beds. Testimony emphasized that privatization has helped some states recruit staff and achieve clinical goals, but also creates long-term contract, oversight and continuity risks unless contracts preserve state control over records, admissions, quality metrics and transition plans.

Most important facts - Committee members repeatedly identified contract nursing as a core budget pressure; Representative Bealick cited roughly $46 million in contract staffing costs at Larner/Larned campus this year. - National survey data presented by Ted Letterman showed widespread shortages: the consultants reported 43 of 48 responding states seeing…