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Lawmakers Continue the Push to End Medicaid Privatization

May 24, 2018 10:00 am by: Category: 2018 Session Information, Featured, Recent News Leave a comment A+ / A-

Ever since the Governor unilaterally privatized Medicaid in 2016, the results have been disastrous for the people of Iowa. Since this time, people have been systematically denied critical care, essential medical equipment, and have had their services severely reduced or cut altogether.

Lawmakers learned this year the situation keeps getting worse. According the State Ombudsman’s Report, where there has been a 157% increase in Medicaid-related problems reported to the agency in 2017. The Ombudsman Office is an independent department responsible for investigating complaints against state and local governments. Many of the complaints dealt with late or missing payments to the providers, lack of adequate notification, and denial of services.

To help fix the Medicaid mess, a bipartisan bill that passed the House standardized Medicaid provider forms to lessen the confusion for those providers entering into contracts with the managed care organizations (MCOs). The bill also provided more Medicaid oversight by directing the Department of Human Services (DHS) to create a workgroup to review health home programs, initiated a review process of prior authorizations by the MCOs, and guided DHS to hire an independent auditor to perform an audit of small dollar ($2,500 or less) claims paid or denied to Medicaid long-term services and supports providers.

However, many lawmakers are concerned the changes made this year did not go far enough and will not fix the privatization disaster.

Concerns continue to be raised about the high cost of Medicaid privatization. In addition to getting an additional $60.6 million in FY 18 from the Reynolds Administration, the for-profit MCO’s can keep up to 15% of taxpayer dollars to administer the program. Before privatization, just 4% of Medicaid dollars were spent on administration. The Medicaid budget was passed this year, but it did not include any funding for the MCO rate increases, which have yet to be released. It is anticipated this will cost the state an extra $60 million or more.

Medicaid is a federal and state partnership that provides health care to 600,000 Iowans, including nursing homes. According to recent estimates, about 70% of Medicaid dollars are used for the elderly, severely disabled, and poor.

Medicaid

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