Iowa Providers Still Struggling with Medicaid Privatization

medicaid matters
Fewer Services, Rising Costs Cited in New Provider Survey


DES MOINES – A new survey released today finds Iowa Medicaid providers are still struggling under Governor Branstad’s privatization plan, which began earlier this year.  Providers said the privatization plan has led to increased costs, reduced services for clients, and even forced them to borrow money because they are not getting paid on time.


“These survey results confirm what Iowans across the state have been saying to us for months: The Medicaid mess is a major burden for Iowa health care providers. That’s terrible news for thousands of Medicaid recipients because it will lead to reduced access to care and poorer health outcomes,” said Rep. Lisa Heddens of Ames, Ranking Member of the House Human Services Budget Committee.


According the survey, 90% of providers have seen their administrative costs increase and nearly two-thirds of them have received lower reimbursement rates. Nearly eight in ten providers said they are not getting paid on time and 28% of providers have been forced to take out loans to cover their expenses while waiting for payment.


“Ever since Governor Branstad turned over management of Iowa’s Medicaid system to three out-of-state corporations, Iowa physicians and other health care providers have faced more hurdles and headaches as they have attempted to provide quality healthcare. These survey results are more evidence that the Medicaid mess is getting worse, not better,” said Sen. Liz Mathis of Robins, Chair of the Senate Human Resources Committee.


Providers who completed the survey also said services for Iowans on Medicaid will suffer as a result of privatization. Forty-six percent of providers said they have or will be reducing services, while 61% said quality of services is suffering as a result of privatization. Of those surveyed, 38% also said their clients are no longer able to continue seeing specialty providers out-of-network.


“We must continue to listen to Iowans, be vigilant about holding Governor Branstad, the Department of Human Services, Iowa Medicaid Enterprise and the out-of-state corporations accountable for their actions to ensure that vulnerable Iowans get the health care they deserve,” Mathis added.


The survey was completed by over 400 Medicaid providers from around Iowa, including doctors, hospitals, local clinics, and non-profit health care providers.

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