Looming Medicaid changes leave Johnson County patients in limbo

Concerns arose this week about whether the Mayo Clinic would work with Iowa's new managed care companies. -- photo by Tripp
Concerns arose this week about whether the Mayo Clinic would work with Iowa’s new managed care companies. — photo by Tripp

This is the first in a two-part series on the privatization of Medicaid in Iowa, which is set to begin this Friday, Apr. 1.

Iowa’s Medicaid program is being torn apart for the sake of profits.

That’s according to Della Mull, and she is not happy about it. The 63-year-old is a board member for Families Inc., a non-profit home care service based in West Branch, whose client base is primarily made up of Medicaid recipients. Mull also has five adopted children and raises two of her grandchildren, who receive services through the Medicaid program.

She’s worried about the assistance she both provides and receives, though. On Feb. 23, the federal government gave the final go ahead on a plan from Gov. Terry Branstad to privatize all Medicaid services, and turn over management of the program to three out-of-state companies starting Apr. 1.

“The state of Iowa ran the program that covers all of the needs in the people in the state, and the governor decided he would like profit-making companies to take over that program,” said Mull.

But what does that mean for the hundreds of thousands of Medicaid recipients across the state, many of whom receive services and treatment here in Johnson County? What does it mean for Johnson County service providers? And what does it mean for everyone else?

“I hope it goes well but there are some concerns about how this new system is supposed to save millions of dollars,” said State Rep. Sally Stutsman (D-Riverside). “I’m concerned the only way is by cutting services. I hope not, but I don’t see any other way.”

The move to managed care

Medicaid, or Title 19, is run jointly by the federal government and the state for those who need medical coverage but don’t have the income to afford it. There are a number of additional requirements to be considered eligible, according to the Iowa Department of Human Services. Just a few of the people who are eligible include children under 21, parents with children under 19, pregnant women and people who are disabled according to Social Security standards. All in all, such recipients make up about 560,000 people in Iowa.

Over the past few decades in the United States, Medicaid has been making a gradual movement towards “managed care,” which is centered around techniques aimed at reducing the cost of healthcare. In Iowa’s case, this means turning over the administration of Medicaid to three managed care organizations (MCOs) and in essence privatizing Iowa’s Medicaid program.

The reason for this move is simple, said Stutsman. It’s money. “It was costing a lot of money and costs kept going up every year. People felt we needed to get a handle on this, and to make sure that people are getting the appropriate services when needed,” she said. “But I don’t know if we’re going to accomplish that.”

More than just being exceedingly expensive, if the program was left alone it would have eventually caused drastic cuts to other state services, said state Rep. Bobby Kaufmann (R-Wilton). “For the state it’s a big change. It’s a change that is yet to be determined with its success,” he said. “But I believe it’s a change that had to be made. Medicaid costs were rising at a rate that was unsustainable.”

However, the real trouble with the move to managed care, according to critics, is the time frame for the change. The plan was first proposed last August and will be going into effect this week — the entire process taking less than a year.

“Managed care is here to stay, this is the way health services are going to be provided.”
— State Rep. Sally Stutsman

“It’s not enough time. This has been on a fast track from the very beginning,” said Stutsman. “Managed care is here to stay, this is the way health services are going to be provided, so I don’t have a problem with that. But other states have taken years. In Iowa, we’re doing this all in six months.”


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Kaufmann is more confident in the timing of the plan. Originally the transition was slated to begin in January, but the federal government has implemented delays twice, and approved the April start day to help ensure the state was ready.

“The Obama administration gave final approval. I think Obama’s people would have found that if we weren’t ready,” he said. “Maybe we’re more ready than we thought. But that doesn’t mean people aren’t scared.”

Mull can testify to that. While 31 states have begun privatizing parts of their public healthcare services, Kansas is one of a few to have turned its Medicaid program entirely over to managed care in a fashion similar to Iowa.

“They are having tons of tons of trouble,” said Mull, of the Kansas care system. “They’ve reduced hours and cut services. People have actually got fed up and given up on filing things. Only in Kansas it took them 20 years to do this, and we have a few months.”

Stutsman is worried that Iowa may be following the same model as Kansas, and more worried about what that may mean for care recipients both in Johnson County and the state.

“Kansas is a mess,” she said. “And I think Iowa is headed down that path. I think the states that have taken it slow have had a much better transition. I’m just floored when we get reports from the Department of Human Services about all the systems that need to be changed.”

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