A Terrace Hill mystery: why doesn’t Governor Terry Branstad have more details to share about his proposed alternative to expanding Medicaid in Iowa?
Answer: Outside consultants are still working up a plan for him. CORRECTION: Branstad rolled out his “Healthy Iowa Plan” on March 4.
Tony Leys reported for the Des Moines Register on March 1 that the Iowa Department of Human Resources hired outside firms to redesign the IowaCare program.
The companies, Milliman Inc. and SVC Inc., will be paid up to $40,118, DHS spokesman Roger Munns said today. Munns wrote in an email that the contractors will “examine health care reform implementation scenarios and ensure reforms pursued in Iowa will work to improve the quality of care, the health of Iowans, and will protect taxpayers.” The consultants charge $250 to $261.80 per hour, he said. […]
DHS often hires contractors to help administer and assess public insurance programs. For example, the state paid Milliman $316,000 to estimate the costs and benefits of expanding Medicaid. That report, released in December, said the expansion would save Iowa tens of millions of dollars for the first few years, then cost the state tens of millions of dollars.
Munns said the consulting companies have started work on their new project, and their proposal should be produced fairly quickly.
I don’t understand why the Branstad administration didn’t hire these consultants immediately after federal officials made clear in December that they will not allow states to expand Medicaid by less than the level foreseen in the 2010 health care reform law. Branstad has been saying since last summer that he doesn’t want to expand Medicaid, while Iowa Senate Democrats and key stakeholders in Iowa’s health care delivery system have repeatedly indicated that Medicaid expansion would be a priority during the 2013 legislative session.
“Funnel week” has arrived at the statehouse, yet the governor is a couple of weeks away from revealing the details on his IowaCare alternative. UPDATE: Branstad announced the plan on March 4.
Unless these outside consultants are miracle workers, their plan is likely to cost more while providing less extensive coverage than low-income Iowans would receive through Medicaid. UPDATE: Branstad acknowledged that the “Healthy Iowa Plan” would provide less extensive coverage to fewer Iowans than expanding Medicaid.
Incidentally, that cost/benefit analysis Milliman Inc. released in December appears to have focused narrowly on the state’s direct costs associated with expanding Medicaid. A ten-page summary of Milliman’s findings by Iowa Medicaid Director Jenifer Vermeer includes this passage on page 3:
Significant fiscal impacts not addressed in this report:
• This report does not address the fiscal impact of continuing IowaCare if the Medicaid Expansion is not enacted. The estimated cost to the General Fund of continuing IowaCare after FY 2013 is estimated to grow substantially.
• This report does not address anticipated savings to counties. If the Medicaid Expansion is enacted, nearly all adults currently covered by counties’ mental health programs would be eligible for Medicaid coverage, and a significant portion of the services costs currently born by counties would be shifted to the Medicaid expansion program. These services would receive the enhanced federal match rates provided under the ACA [Affordable Care Act]. This is anticipated to provide a significant financial savings to counties. This savings has not been addressed by Milliman.
Vermeer and Department of Human Services staff calculated that Iowa counties stand to save tens of millions of dollars per year on mental health services if Iowa expands Medicaid. The Iowa Hopsital Association estimates major savings for the business community, largely because hospitals would provide less uncompensated care.