Health care

Providers fear speed, complexity of Iowa's Medicaid transition

'This will be like the Wild West'

Mercy Medical Center CEO Tim Charles reads a report in his office at Mercy Medical Center in Cedar Rapids on Thursday, Nov. 12, 2015. (Liz Martin/The Gazette)
Mercy Medical Center CEO Tim Charles reads a report in his office at Mercy Medical Center in Cedar Rapids on Thursday, Nov. 12, 2015. (Liz Martin/The Gazette)

Part 1 in a series on Iowa's Medicaid changeover

CEDAR RAPIDS — Plenty of things keep Tim Charles, chief executive officer of Mercy Medical Center in Cedar Rapids, up at night.

But the one giving him the most trouble these days? The state's decision to move about 560,000 Medicaid recipients over to plans managed by four private, out-of-state companies on Jan. 1.

Gov. Terry Branstad announced the idea earlier this year, and the state awarded contracts to four managed-care companies — Amerigroup Iowa, AmeriHealth Caritas Iowa, UnitedHealthcare Plan of the River Valley and WellCare of Iowa — in August. The governor has defended the plan, and has said increased Medicaid costs are the driving reason for the switch — costs have increased 73 percent since 2003, according to the state — and the move has the potential to save $51 million in its first six months.

Iowa Senate Democrats have come out against the plan, holding public meetings across the state to garner input and even asking the federal government to delay the implementation. Meanwhile, the companies who were not awarded contracts have challenged the state, claiming improper contact between the state and a winning bidder.

But outside all the shouting, there are more than 42,000 providers who must implement these changes and continue to provide care to Iowa's most vulnerable population — the elderly, the intellectually disabled, and low-income women and children.

With the New Year's Day deadline rapidly approaching, area providers have expressed confusion and frustration in regard to contract negotiations and policies with managed-care companies, a timeline they believe is unrealistic, and a lack of answers.

“I haven't heard of a hospital yet to sign a contract,” Charles said. “It's a real question if a network will even be available.”


The plan still needs approval from the federal government — the Centers for Medicare and Medicaid Services — and to get that, the managed-care companies must establish a network of providers. CMS told the state last week that it had readiness concerns, and set up four “listening sessions” to get additional comments from consumers and providers.

However, the first two sessions did not run smoothly. The first call, held this past Tuesday and which had more than 500 consumers and advocates participating, was disorganized with people talking over one another and the moderator periodically muting the participants.

CMS postponed the second call, but Linda Fanton, with Eastern Iowa Visiting Nurses, said that information wasn't properly distributed, and hundreds of providers still got on the line Thursday afternoon.

“We would like some answers,” she said.

But Medicaid providers from large hospitals to tiny not-for-profits have said the move is too rushed, and many have serious questions about reimbursement rates and pre-authorization, or preapproval from the companies, for services, which is leaving contracts thus far largely unsigned.

Percentage of Iowans on Medicaid has jumped since 1998

About: This chart shows the percentage of Iowans enrolled in Medicaid since 1998. The number of recipients was divided against the population of Iowa in each year to get the total. To download the data, click here.

At a November Health Care Policy Legislative Oversight Committee meeting with the Iowa Department of Human Services and the managed-care organizations, three of the four organizations were unable to answer questions dealing with established provider networks, said State Sen. Liz Mathis, D-Robins, who is on the committee.

“Only one group could, and they said they had approximately 10,000 providers signed up, which is about 30 percent of their goal” Mathis said.

“We keep asking for numbers and they're not revealing them. That means to me they either don't know or they don't want to tell us.”


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Mercy's Charles said managed-care companies have threatened providers with a penalty — a 10 percent cut to reimbursements — if they do not sign contracts by the end of the calendar year.

“There's nothing that authorizes them to do that,” he said, but speculated it is being used as a tool to hurry providers into signing.

Medicaid patients make up 8 to 12 percent of the hospital's overall composition, Charles noted, and he wants the state to take the time to do the transition right.

“Half of the primary-care physicians in Cedar Rapids are employed by Mercy,” he added. “We don't know what the plan is, how (recipients) will be signed up.”

Charles called the shift “incredibly disruptive,” adding it's difficult to “appreciate the full magnitude” of the change just yet.

“Mercy's mission is be available to anyone,” he said. “We will care for these individuals, and if the terms are onerous, we'll make adjustments elsewhere to make up for that,” he said.

Sabra Rosener, vice president of government relations for UnityPoint Health, a health system with more than 480 primary care physicians, 100 clinics and 11 hospitals in Iowa, including St. Luke's Hospital in Cedar Rapids, described the contract review and negotiation as “fast and furious.” She explained there are plenty of instances in which proposed reimbursement rates are equal to what providers already have received while there are other cases in which the reimbursement rate is below expectations.

“This process is moving really quickly,” she said.

'Keep the doors open'

It's also unclear if certain initiatives to manage the Medicaid population — such as a coordinated care effort in Fort Dodge — will continue.


“Or if we'll have to replace them with their services,” Rosener said. “We're trying to not lose the capabilities we have with the Medicaid population and how we manage them.”

Depending on the market or region, Medicaid makes up 18 to 27 percent of UnityPoint's payers, and because of the system's size it is dealing with the transition on numerous fronts — large, urban hospitals, rural critical access hospitals, primary-care physicians, specialty-care physicians, home health, long-term care facilities, hospice care and palliative care.

“We're asking for a lot of modification in the contracts,” Rosener said. “The dialogue is definitely there ... However, we haven't signed anything yet.”

Hospitals aren't the only ones worried about the change.

The Eastern Iowa Health Center, which provides primary care and OB/GYN services, has about 36,000 patient encounters a year, said Joe Lock, its chief executive officer, and about 78 percent of the people it sees are on Medicaid.

The organization hasn't signed any contracts yet, Lock said, but it intends to sign with all four managed-care companies, calling it a “must-do” to continue to care for the population in which it specializes.

“What could be difficult,” he said, “is now that we have four different companies, we could see four different patients and have four different sets of processes to do the same procedure.”

Under the current system, Medicaid reimburses faster than Medicare or private insurers, Lock said. But he doesn't know how speedy these four companies will be, and given the organization's heavy concentration of Medicaid patients, Lock can't take any chances.

“We increased our credit line 500 percent,” he said, “We have to be able to keep the doors open.”


Another unknown — if some area providers decide the added paperwork and complexity of the population is not worth seeing Medicaid patients.

Physicians can struggle with caring for Medicaid patients, he said, because they often have high no-show rates. That's because this group is dealing with pressing matters, struggling to put food on the table or can lack transportation, he said.

If a number of providers choose to not sign contracts, the Eastern Iowa Health Center could see an influx of patients.

“Our demand could only go up,” Lock said.

The provider already is working hard to increase capacity and see as many patients as possible. Lock even has worked to move employees who don't have patient interactions — including himself — off-site since August to covert office space into exam rooms.

“Assuming this goes forward, this will be like the Wild West,” he said.


— November: MCO Enrollment begins
— Nov. 30: MCO readiness assessment finalized
— Early December: State anticipates federal government answer on program approval
— Dec. 17: Last day to make MCO choice
— Dec. 18 to March 18: Medicaid recipient can change MCOs
— Jan. 1: MCO coverage begins

Source: Iowa Department of Human Services, Health Care Policy Legislative Oversight Committee presentation

To listen to Medicaid sessions

CMS has rescheduled the four listening sessions it had postponed due to what it called “logistical issues.” The agency wants to gather additional input about the transition from consumers and providers.

To participate in the calls:

Non-institutional providers
Nov. 16 from 1 to 2:30 p.m.
(800) 837-1935
Conference ID: 82222288


Institutional providers
Nov. 1 from 1 to 2:30 p.m.
(800) 837-1935
Conference ID: 82222291

Other providers
Nov. 18 from 1 to 2:30 p.m.
(800) 837-1935
Conference ID: 82231504

Consumers and advocates
Nov. 19 from 1 to 3 p.m.
(800) 837-1935
Conference ID: 82231506

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