Governor: Iowa Medicaid transition will be ready March 1

DES MOINES — Barring further legal entanglements, the state will be ready to shift management of its $5 billion Medicaid program to three private managed-care organizations on March 1 — one company shy and two months later than the original plan — Gov. Terry Branstad said Monday.

The state's plans hit two bumps this past week. First, the federal Centers for Medicare and Medicaid Services, which jointly funds Medicaid with states, ordered Iowa to delay implementation by 60 days, citing the state's lack of readiness in some areas.

Second, Janet Phipps, Department of Administrative Services director, sided with a recommendation from Administrative Law Judge Christina Scase that WellCare, one of the four companies chosen by the state to manage its Medicaid program, should lose its contract due to issues in the bidding process.

'We've been working on those things,' Branstad said Monday at his weekly meeting with Iowa reporters. 'Those are well along their way (to) being resolved. We feel very confident that this will be able to take effect March 1.'

Medicaid patients who were enrolled with WellCare Health Plans, the company that lost its state contract in this past week's ruling, will receive information from the state 'over the next couple of weeks,' state Department of Human Services spokeswoman Amy McCoy said. Those patients will be reassigned to one of the remaining three managed-care organizations, McCoy said.

In the meantime, those patients still can to see their doctors, who will continue to be reimbursed by Medicaid at the same rate through March, McCoy said. Medicaid enrollees have until mid-May to choose a new managed-care organization, but must select a company by Feb. 17 for coverage to begin March 1.

Branstad said Monday that he believes three managed-care organizations will be sufficient to meet patients' care needs. He noted the original plan called for 'two to four' organizations.

'We believe that the three managed-care firms that have been approved are an adequate number,' Branstad said.

WellCare lost its state contract because Phipps and Scase said it failed in the bidding process to disclose information such as $137.5 million in fines it has incurred to resolve false claim litigation.

A WellCare official told The Gazette on Friday that the company 'intends to use every avenue available within the legal system to correct this erroneous outcome.'

The federal government ordered its delay citing — among other issues — insufficient communication with patients and providers, time for patients to choose a managed-care organization, and assurances that long-term services and supports case managers will be available.

Despite the setbacks of the past week, Branstad said he is confident the program will be ready March 1, although he repeatedly had said the same about the original Jan. 1 start date.

'We can't prevent people from filing lawsuits or appealing through the courts and whatever. But we intend to go ahead and make this transition as smooth as possible,' Branstad said.