A spokesman for the state’s 118 hospitals says there’s too much uncertainty about the Branstad Administration’s push to switch more than half a million Medicaid patients in Iowa to a managed care plan on January 1, 2016. The Iowa Hospital Association has filed a lawsuit, asking a judge to intervene.
“Put the brakes on this,” says Scott McIntyre, the vice president of communications for the Iowa Hospital Association. “Allow people time to talk things out, make things work and implement a plan that works for everybody.”
According to McIntyre, the Branstad Administration still hasn’t provided hospitals with the “rate card” hospitals must use in discussions with the four private companies that will manage care for Medicaid patients.
“Hospitals really don’t have that starting point from which to negotiate a contract or from which to make financial plans,” McIntyre says.
State officials have given hospitals and other Iowa health care providers a January 1 deadline to sign contracts with the managed care companies. On Monday, Branstad confirmed his administration will enforce a 10 percent penalty in Medicaid reimbursement to Iowa health care providers that fail to sign managed care deals by January 1st. McIntyre says lawyers tell him the state doesn’t have the authority to impose that 10 percent penalty.
“We don’t even know the base rates at this point, so we are talking about 10 percent of what?” McIntyre says. “It’s kind of another example of putting the cart before the horse and not being clear on what the state’s plans are.”
After initially opposing the idea, Branstad in 2013 did approve expanding the number of poor Iowans who qualified for Medicaid. That has led to a reduction in so-called “charity care” in Iowa hospitals, but McIntyre says hospital executives fear those gains may be lost in the switch to “managed care” for Medicaid patients.
“Our concern, one of many, regarding this plan is that these companies will deny care. Folks will go to the emergency room anyway, which won’t be covered even if they do have insurance, and once again our charity care costs will go up and those costs impact everybody,” McIntyre says. “The hospitals really don’t have a choice but to pass along that impact.”
On Monday Branstad accused Iowa hospitals of “objecting” to the Iowa Health and Wellness Plan. That’s the state’s version of expanding Medicaid coverage to more Iowans, a move that was authorized under the Affordable Care Act. Critics point out Branstad initially opposed expanding Medicaid coverage to more Iowans and McIntyre says hospitals actually championed the bipartisan Health and Wellness Plan.
“Because of the changes, the tweaks the governor wanted included in that, we went to bat for the state with the federal government and made sure those waivers happened,” McIntyre says, “so certainly it was a collaborative effort.”
Governor Branstad says 25 other states have shifted Medicaid patients into managed care and have saved money in the process.
(This post was updated at 12:30 p.m. after the Iowa Hospital Association notified Radio Iowa it had filed the lawsuit.)