Iowa Senate leader warns of change in Medicaid managed care

DES MOINES - House and Senate leaders are in agreement that the Legislature has an oversight role as the management of the state's $4.2 billion Medicaid program is privatized.

They also agreed Thursday the governor has great latitude on adopting a managed care approach to the program that provides assistance to about 560,000 young, poor, disabled and elderly Iowans.

The Senate voted unanimously Wednesday to establish a commission to oversee the transformation to a managed care system that will enlist private health care vendors to coordinate care and manage program spending.

Without specifically endorsing the bill, Speaker Kraig Paulsen, R-Hiawatha, said the Legislature should exercise 'at a bare minimum (the) oversight role that we play with regard to all of state government.”

That followed a warning from Senate President Pam Jochum, D-Dubuque, that Gov. Terry Branstad has abandoned caution by moving unilaterally and too quickly 'to make big changes to the health care of other people.”

'And once again,” she said referring to a similar privatization of mental health services in the 1990s, 'the people affected don't have much political power.”

'We should learn from the past,” she said. 'I remember that process. It was done too quickly and was a very bumpy process. ‘Bumpy' in this case means Iowa families lost essential services and had to fight very hard to get the health care their family members needed.”

The modernization of Iowa's Medicaid system would tie patient outcomes to the provider's payment, Branstad spokesman Jimmy Centers said.

'While new to Iowa, this is not a novel concept around the country,” he said. 'In fact, the majority of Medicaid patients enjoy the increased quality of service and care that comes with modern plans administering Medicaid.”

He characterized Jochum's comment as 'Washington D.C.-style partisan attacks” and Democrats and 'being Iowa's own party of ‘no.'”

Paulsen believes lawmakers see the need and value in the managed care approach.

'I think the general attitude in the General Assembly is that this is an idea that has merit,” he said. 'Most people would say this is the direction we need to move in.”

Although no legislation is required to make the move to managed care, Paulsen said lawmakers want to be a part of the conversation.

'It's not something that we're just going to close our eyes and let happen,” he said.

The changes affect the 'social safety net that all Iowa families depend on,” Jochum said.

Beyond that, she said, the company that gets the managed care contract most likely be for-profit, out-of-state companies that will earn as much as $630 million a year. She expects administrative costs will rise above the current 2 to 3 percent.

'That is an incredible amount of money and this decision is being made at a breakneck speed,” Jochum said.

The 'responsible, cautious, Iowa approach” would be to bring the stakeholders together, an approach she said has worked in other states.

'That's not the approach Gov. Branstad has adopted. Iowa will make bigger changes faster than any other state,” according to Jochum. 'Based on recent history, I have my doubts about the administration's ability to pull this off.”