Branstad defends Medicaid transition timeline

DES MOINES - Gov. Terry Branstad on Monday maintained a fervent defense of his administration's move to shift management of Iowa's Medicaid program from the state to four private health care companies.

Iowa's $4.2 billion Medicaid program serves 560,000 residents.

Branstad's administration said the shift will provide the same - and perhaps better - services at a lower cost.

Providers said at a public hearing this past week that the state is moving too quickly. They expressed concerns with not learning about reimbursement rate structures in a timely manner to be prepared for the transition, which begins Jan. 1.

But Branstad on Monday defended the transition timeline.

'We've been working on this, and they know we've been working on this diligently (since) January,” Branstad said at his weekly news conference. '...

It's being phased in over a period of years, and we started working on this in January, so we're looking at almost a whole year.”

Branstad compared the current situation to 2013 when the state considered expanding Medicaid under the federal health care law.

'The providers were up and arms. They were, ‘It's terrible,' and, ‘We're afraid of this.' And you know what? Today, we have more people insured than we've ever had insured, providers are making more money than they ever have, the charity care in hospitals has gone down significantly. So the hospitals that strongly objected to that have now seen it's really worked effectively,” Branstad said, although state records show the Iowa Hospital Association and other providers in 2013 registered in support of the legislation that created the Iowa Health and Wellness Plan, which was Iowa's version of Medicaid expansion.

'I know there are people that want to protect their funding stream and are afraid of change, but the truth is this has proven to be effective in other states at improving medical outcomes. That's what we want to do,” Branstad said.

In response to the providers' concerns, Democratic state lawmakers on Monday issued a letter to Department of Human Services director Charles Palmer urging him to reconsider a 10 percent penalty on payments to providers who have not signed contracts with the health care companies by Jan. 1.

'Community hospital administrators, mental health providers, in-home nurses and others have contacted me, saying they are being pressured to sign contracts without knowing all the details,” Sen. Amanda Ragan, D-Mason City, wrote in the letter. Ragan is co-chair of legislative committees on health policy oversight and the health and human services budget. 'All these Iowa health care providers want is to be certain they are making good business decisions so they can meet the needs of their clients and continue to operate.”

Some providers questioned the state's ability to authorize this penalty - especially as contracts are missing crucial pieces of information, such as reimbursement rates, said Tim Charles, chief executive officer of Mercy Medical Center in Cedar Rapids.

'Conversations with companies have been more on what I'd say as the sales sides of things - ‘We'll get that figured out, don't worry,'” Charles said.

He added that, while there's no stopping the transition as 'the train is already out of the station,” the state should slow down the process to take time to do it right.

Because Medicaid is jointly funded by the state and federal governments, the administration's plan must be approved by the federal government.

' Gazette reporter Chelsea Keenan contributed to this story.