Gov. Laura Kelly on Friday vetoed a bill expanding the power of the Medicaid inspector general – a division of Attorney General Kris Kobach’s office – to investigate welfare benefits for fraud.
Kelly called the legislation “completely redundant, inefficient, and a waste of taxpayer dollars,” adding that she was unsure what problem the bill was trying to solve.
“Within the Kansas Department for Children and Families, there already exists a Fraud Investigations Unit that conducts this work with experts who have specific knowledge of how these programs work and what federal and state laws require,” she said.
“This bill also removes statutory protections for participants’ data and health privacy,” she said in a statement. “It makes no sense from a legal, policy, or fiscal standpoint to make this change.”
For two sessions, Medicaid Inspector General Steve Anderson has been seeking expanded authority to investigate public assistance fraud beyond the state’s $5.5 billion Medicaid program serving 467,000 Kansans.
The bill would change the legal power of the Medicaid inspector general from only Medicaid investigations to overall statewide health care and welfare programs, including including cash, food and health assistance.
The expansion is estimated to cost about $1 million with the addition of nine new staffers.
Last year, Anderson sought a similar expansion but asked for 20 new full-time positions at a cost of $2.98 million in fiscal year 2025 and $2.4 million in fiscal year ’26.
The bill passed the House on an 85-37 vote. It was approved in the Senate 30-10.
“After the $700 million unemployment fraud debacle on this governor’s watch, one would think she’d learn from past mistakes and work toward ending waste, fraud, and abuse in the welfare system,” Senate President Ty Masterson and House Speaker Dan Hawkins said in an joint statement.
“Republicans will not stand for the squandering of taxpayer dollars and are ready to override this veto and bring commonsense reform and accountability to our welfare system,” they said.
The top Democrat in the House – Rep. Brandon Woodard of Lenexa – called the bill a “blatant power grab that undermines those who need help the most.”
Anderson told the Health committee in February that he wanted to expand his authority to conduct investigations of programs where he said there was a “severe lack of oversight.”
“Our goal is to increase the effectiveness and efficiency of those programs to help ensure those entitled to benefits receive them,” he said.
“We have no intention of removing people rightfully receiving benefits. We’re focused on making the program work better for everyone,” he said.
Republican state Rep. Carl Turner of Leawood said the bill was about protecting existing welfare benefits for Kansans.
“These programs are essential to taking care of Kansans who need it the most. However, unfortunately these programs are often taken advantage of by bad actors,” Turner said.
“The goal here is to increase effectiveness and efficiency of these programs to help ensure that only those entitled to benefits are receiving them,” he said.
But Democrats made the issue about Kobach, pointing to past examples in his career where he came up short, notably the prosecution of voter fraud when he was the secretary of state.
Kobach worked for years to get the Legislature to give him the ability to prosecute voter fraud, something he argued was widespread in Kansas.
In 2015, he was given prosecutorial authority.
With 15 cases filed after about three years, critics say that Kobach’s claims about voter fraud in Kansas were proven to be exaggerated.
“Remember when he asked for the power to prosecute election crimes?” asked Democratic state Rep. John Carmichael of Wichita.
“He searched high and low and found virtually nothing after wasting the public money in those attempted prosecutions,” Carmichael said.
Turner said that the inspector general worked independently from Kobach even if the agency is housed within the attorney general’s office.
“This is an independent operation in the attorney general’s office,” Turner said.
“The attorney general doesn’t guide their work, doesn’t have any view of what they are doing, doesn’t give them direction, but they do, in fact, operate in that group,” he said.
“I understand the dissatisfaction with the attorney general’s office, but this, this is really a separate group that operates very independent of the attorney general,” he said.
Democratic state Rep. Susan Ruiz of Shawnee questioned whether the inspector general was truly independent of the attorney general.
“This office is not independent if it is under the attorney general. It’s impossible. It will not be independent. It would have the influence of the attorney general,” Ruiz said.
Anderson said he needs probable cause to start an investigation. He said he’s independent from Kobach in the sense that the attorney general doesn’t direct the inspector general or have access to what that office does.
Further, Anderson said Kobach would not have authority under medical privacy laws to see records accessed by his agency.
All budgeting, purchasing, related management functions and personnel of the office of inspector general shall be administered under the direction and supervision of the attorney general, according to the statute.
The inspector general may be removed by the attorney general for cause, a point that Anderson emphasized with the committee.
Anderson said that while his staff is hired through the attorney general’s office, he still supervises each of those employees.
“I can also assure you that both when it was under former Attorney General Schmidt as well as Attorney General Kobach, there has never been a single moment of attempted influence or direct who we hire or don’t hire for our staff,” Anderson said.
