Dems: Inside the Iowa House: Time to Pull the Plug on Branstad’s Medicaid Mess

August 5, 2016

Dear %%First Name%%,

A few months ago, Governor Terry Branstad and Republicans privatized health care for over 500,000 Iowans on Medicaid. After months of delays, confusion, and scandal, Branstad’s privatization scheme is now officially a disaster.

All around the state, we’ve been hearing horror stories from Iowans and local providers dealing with the new private, out-of-state companies Branstad picked to manage Medicaid (called MCO’s).

Providers are facing huge financial burdens because of payment delays and lower reimbursement rates from the MCO’s. According to a recent survey, nearly 80% of providers said they aren’t getting paid on time while nearly every provider said their own administrative costs have increased trying to navigate the new system.

We heard similar stories from providers at a legislative health committee hearing at the State Capitol last week. I held a listening post in my hometown of Marshalltown just a few weeks ago to get feedback as well. When I asked what was going well with Medicaid privatization, the room went silent.

My biggest fear about Branstad’s privatization scheme has always been the impact on health care services Iowans depend on.

We now know that Iowans on Medicaid will suffer as a result of privatization. The provider survey found 46% of providers said they have or will be reducing services, while 61% said quality of services is suffering as a result of privatization. These health care professionals also said 38% of their clients are no longer able to continue seeing specialty providers out-of-network.

The reality here is higher costs and lower reimbursement rates for providers is resulting in fewer services for Iowans.

But that’s not what was supposed to happen, according to Branstad. His sales pitch last year on this was all about efficiency: Iowans will get the same – or even better — services and we’ll save money. That clearly isn’t the case so far.

So Branstad did what he always does when he has a mess on his hands: digs in his heels, tries to cover his tracks, and then blames someone else.

Branstad still says everything is going great. He released some phony numbers to try and prove more providers are participating in Medicaid now than before privatization. For example, he touted 16,821 new contracts with doctors, but there are actually only 6,830 doctors working in Iowa. That’s a lot of double – and triple – counting to make things look good and cover his tracks.

Next, Branstad tried out a new excuse: the Medicaid mess is really the fault of Iowa providers who are upset because he’s “checking” on them now. He’s implying that doctors, nurses, mental health counselors, and those helping Iowans with disabilities were cheating the system or doing something wrong before Medicaid privatization.

It’s absolutely shameful, but not surprising. It’s just the latest in a series of reckless moves from Branstad who often ignores the impact of his decisions on everyday Iowans.

Worse yet, Republicans in the House aren’t interested in providing any meaningful oversight or even asking any tough questions about Medicaid privatization. Of course, they certainly don’t want any of the blame in this Medicaid mess to fall back on them before November.

Branstad has a window here to fix the problems before the Legislature convenes again in January 2017. But he better make some dramatic improvements quickly and stop shifting the blame to providers who are doing the best job possible under terrible circumstances.

Right now, Branstad’s privatization plan is running on life support. If Iowans can’t get the services needed or patients start to fall through the cracks, the Legislature should be prepared to pull the plug on the whole mess in January.

Contact Leader Mark Smith

Iowa Statehouse
Des Moines, IA 50319

PHONE: 515-281-3054



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