Fairfield Ledger

Mt. Pleasant News   Wash Journal
Neighbors Growing Together | Oct 22, 2017

Private Medicaid disaster for Iowa

By Rich Taylor | Apr 13, 2017

The Branstad-Reynolds administration’s decision to privatize Medicaid is not working.

In February, the three private managed care companies told legislators that they’re losing $450 million.

Subsequently, the Branstad-Reynolds administration signed contract amendments with all three companies agreeing (after a certain point) for the state to take on more costs, while the managed care companies continue making a profit. This is completely contrary to the premise of privatizing Medicaid, which is supposed to move the risk to the insurance companies and bring stability to the state budget.

The revised Medicaid privatization plan will allow an additional $235 million in taxpayer money to go to out-of-state, for-profit companies. This is on top of the $130 million they received from the Branstad-Reynolds administration in October.

In one year, Iowa taxpayers have coughed up more than $365 million above what was agreed to, in support of corporations that are not providing promised health care to Iowans.

All of this has been done without consulting the Legislature.

Iowa had one of the best-run Medicaid programs in the country.

Many innovative, cost-effective strategies were just getting off the ground when Branstad-Reynolds unilaterally decided to privatize the program. Legislative Democrats said all along that privatized managed care was wrong for Iowa, especially for people with disabilities and other long-term needs.

The only way to reduce costs and make a profit for private companies is to deny, delay and drastically reduce services, and the amount paid for them.

The real tragedy here is that Iowans are the ones suffering, while picking up the hefty tab. This was an ill-conceived gamble by Branstad-Reynolds, and it has failed.


– Sen. Rich Taylor of Mt. Pleasant represents Iowa Senate District 42, which comprises Henry and Lee counties and portions of Washington and Jefferson counties.

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