Iowa Medicaid changes leave members worried about future coverage

'We're in limbo'

Delaine Petersen lifts her daughter Leslie from her wheelchair to lay her on her bed in their home in northeast Cedar Ra
Delaine Petersen lifts her daughter Leslie from her wheelchair to lay her on her bed in their home in northeast Cedar Rapids, Iowa, on Thursday, April 4, 2019. Delaine and her husband Duane are caregivers to their daughter who is dependent on her parents to move, eat and bathe. (Jim Slosiarek/The Gazette)

Iowa’s Medicaid program, and the people involved in it, were thrown through a loop this past week.

While many details still are to be determined, state officials have reassured Iowans the departure of a managed-care organization from the state’s privatized program will be a seamless process.

State officials made the announcement March 29 that UnitedHealthcare of the River Valley will withdraw from Iowa’s program in the coming months.

A managed-care organization — or a private insurance company contracted by the state to administer Medicaid coverage — UnitedHealthcare has more than 427,000 members. That’s more than two-thirds of the total number of Iowans on Medicaid.

Managed-care members will received notices they will be reassigned to one of the two other insurers, and then will have 90 days to switch if they wish to change to a different managed-care organization.

Because of the sudden nature of the announcement, state officials said many details of the change — such as the transition of UnitedHealthcare members to other insurers — still is being finalized.

And despite reassurances from state officials that the transition will be a smooth one, many Iowans say they feel frustrated with the lack of consistency in the managed-care program since it privatized three years ago.


“I feel like we’re in limbo,” said Delaine Petersen, Cedar Rapids woman and caretaker of her disabled daughter on Medicaid. “Do you turn right or do you turn left? Are you making a mistake in either of those choices?

“This is not the way to take care of Iowans.”


According to state officials, UnitedHealthcare is withdrawing from the Medicaid program because the state would not give into “unreasonable and unsustainable” demands from the insurer during recent contract negotiations.

UnitedHealthcare, however, maintains the state of Iowa has underfunded the program, causing the insurance company to lose hundreds of millions of dollars since it joined in April 2016.

UnitedHealthcare stated in a letter to the state that it plans to withdraw from the state on June 30 — the day before new managed-care organization Iowa Total Care is set to join Iowa’s program.

Petersen said she not concerned with whatever the reason is. Her worry is for her daughter.

Leslie Petersen, 46, is a UnitedHealthcare member and a non-verbal quadriplegic who lives with her parents — Delaine and Duane — and is reliant on others to help her eat, use the bathroom and otherwise function or move on her own.

Delaine said she and her husband have a list of questions. Among them: Will Leslie have to go without addressing her mobility issues, if another managed-care organization denies services? Is going from UnitedHealthcare to another insurer “jumping from the pan and into the fire?”

“Families have spent tons of time getting prior authorizations and special medicine,” Petersen said. “Are they going to have to go through that again? Are they going to get providers the right information so that they can set up their systems to support people?”

Craig Harwood, 62, of Cedar Rapids, is the father and caretaker, along with his wife, of their son, Dan, 38, a UnitedHealthcare member who has been diagnosed with Down syndrome. Craig said the managed-care system can feel like it’s “constantly being changed.”


“It is what it is,” he said. “It has not been horrible for him, but he’s also got the two of us who advocate for him at every stage. There’s people out there that don’t have their own voices and need someone else to advocate for them.”

However, Craig said he is fearful of what the switch could mean for providers and the services they offer. Dan has been with Options of Linn County for about 17 years, and goes every weekday for day habilitation services.

“We’re not worried about him specifically because we’re both going to be in there fighting for him,” Harwood said. “What we’re worried about in this transition is what it does to service programs like Options ... . If Options closed, that would be devastating to Dan. That’s the reason why he gets up and leaves the house every morning.”


For many members and health care providers within Iowa’s Medicaid system, UnitedHealthcare’s announcement felt all too familiar.

“The effect on Options will probably be Déjà vu all over again,” said Jim Fox, director of Options of Linn County.

Managed-care organization AmeriHealth Caritas announced in October 2017 it planned to pull out of the state’s program by the end of that year. The majority of AmeriHealth members was assigned to UnitedHealthcare.

“The rates are set, but history shows that with a new (managed-care organization) receiving a sudden influx of new members, billing is a nightmare for six to nine months while they sort their systems,” Fox said.

“For small agencies and providers that rely on accurate monthly income for cash flow and meeting payroll, it can be devastating.”

For one small Eastern Iowa provider, the billing took longer than a few months to sort out.

Ann Brownsberger, co-founder of the Village Community day habilitation facility in West Branch, said her organization was paid accurately and on-time in December for the first time in 33 months.


The Village Community offers services to 15 disabled individuals who are on UnitedHealthcare or the state-run fee-for-service program.

“Are we going to start this again?” Brownsberger said. “We hope things worked out with Amerigroup (Iowa), and we hope that won’t be a concern with Iowa Total Care. But if history tells us anything, that’s probably not going to be the case.

“It feels like we’re starting all over again,” she said.

Smooth Transition

Iowa Department of Human Service officials and UnitedHealthcare executives say they have committed to working together to ensure a smooth transition for Medicaid members moving to other plans in the coming months.

“We’re focused on making sure that we’re ready to go, that the transition is smooth,” Gov. Kim Reynolds told reporters this past Wednesday.

Reynolds said the two remaining managed-care organizations are still “committed to Iowa.”

“Amerigroup Iowa remains committed and focused on ensuring access to quality care for the Iowans we serve in Iowa Health Link,” Amerigroup Iowa officials said in a statement. “We will continue to work closely with Gov. Reynolds and the Department of Human Services to help ensure sustainability of the program and improved access to care for Iowans.”

Iowa Total Care officials say it is “prepared and ready to go live July 1.” It is owned by Centene, based in St. Louis.

“Iowa Total Care is committed to being a responsible steward and partner to the state,” according to a spokesperson. “We are honored and appreciative of the opportunity the state of Iowa has given us to provide services to its citizens.


“We have found the state of Iowa to be a good and fair partner. We know every day we must prove ourselves and earn the trust of the citizens of Iowa, and develop partnerships with providers and the community. We have high hopes for a successful program that advances high quality health care for all Iowans.”

Gazette Des Moines Bureau reporter Rod Boshart contributed to this article.

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An Iowa managed-care timeline

January 2015 — Gov. Terry Branstad announces a plan to shift Iowa’s state-run Medicaid system to a full managed-care program.

August 2015 — Iowa accepts the bids of four insurance companies vying to be managed-care organizations within the state’s Medicaid program. One company eventually was dropped from the program, and three would go on to administer health care for members — AmeriHealth Caritas Iowa, Amerigroup Iowa and UnitedHealthcare Plan of the River Valley.

December 2015 — The federal Centers for Medicare and Medicaid Services, or CMS — the agency that must approve the managed care implementation — cites concerns of an inadequate provider network. Officials tell Iowa that it must wait until March 1 to transition to a managed care program.

February 2016 — Federal officials approve Branstad’s Medicaid plan. The implementation date is set for April 1, 2016.

April 1, 2016 — Iowa moves to a managed-care program and the majority of members are moved under the MCOs.

October 2017 — AmeriHealth Caritas, one of the MCOs in Iowa’s Medicaid program, announces it will withdraw from the state. AmeriHealth members are to be moved to the remaining two insurers.

November 2017 — Amerigroup Iowa, one of the two remaining MCOs after AmeriHealth’s departure, says it does not have capacity to take any new members from AmeriHealth.


December 2017 — AmeriHealth exits Iowa’s Medicaid program. The majority of members will end up with UnitedHealthcare.

Mike Randol starts as director of Iowa’s Medicaid Enterprises. He leaves Kansas, where he held a similar position, as that state seeks insurers to manage a new version of its program for 2018.

May 2018 — Following a request-for-proposal process, Iowa Total Care — owned by St. Louis-based Centene — is selected to join Iowa’s program as an MCO. State officials announce the insurer will join the program and begin accepting members on July 1, 2019.

March 29, 2019 — UnitedHealthcare announces it will withdraw from the state’s now $5 billion Medicaid program. The 425,000 members under UnitedHealthcare will be moved to Amerigroup or Iowa Total Care, officials say.

June 30 — UnitedHealthcare is expected to leave Iowa’s Medicaid managed-care program.

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