Frankfort, Ky. – Over $57 million in unspent grant money to establish a state health exchange, Kynect, will have to be returned if the program is transitioned to a federal exchange.
In a letter (first reported by Insider Louisville), Andrew Slavitt, acting administrator for the U.S. Department of Health of Human Services, writes that “grant funds can only be sued for establishment activities” and cannot be used for costs “associated with a transition to the (federally facilitated marketplace).”
When it was first established under former Governor Steve Beshear’s administration, Kynect received $289 million in federal subsidies to establish and initially maintain the program. In December, fulfilling a campaign pledge, current Governor Bevin wrote informed federal health officials of his plan to dismantle Kynect.
Slavitt also lists a number of steps state officials will have to undertake immediately to meet the 2017 transition deadline, such as appointing a state contact responsible for transition activities, illustrating how the state will meet obligations to Kynect members through 2016, facilitating discussions between Medicare and Medicaid providers and issuers participating in Kynect, and providing a detailed plan for how Kentucky will meet its statutory and regulatory requirements to Kynect consumers.