The Register's editorial

Correction: The box at the bottom of this editorial has been corrected to add the regional number for CMS: (816) 426-5233.

About 550,000 low-income Iowans rely on Medicaid health insurance. The program, administered by the state, has low administrative costs. It has held down spending by reimbursing providers modestly, reducing fraud and giving seniors alternatives to expensive nursing homes. Medicaid in Iowa spends less per person than the majority of other states, while still providing comprehensive coverage.

Unfortunately, Republicans have never met a government program they didn’t want to privatize. And Gov. Terry Branstad is a Republican.

Several months ago his administration said it intended to hand over administration of Medicaid to a few private managed-care companies. Earlier this month, the Iowa Department of Human Services announced the names of the four “winning bidders” of potential government contracts to operate the program.

While the companies may be celebrating their multi-billion dollar jackpot of public dollars, the people of this state are not. A survey by Public Policy Polling of about 1,200 Iowans this year found the vast majority opposed the governor’s plan; only 22 percent supported the idea. Doctors, hospitals, advocates for the poor and lawmakers have expressed concerns. The four private companies selected have faced serious charges of fraud or mismanagement, some resulting in hundreds of millions of dollars in fines.

The governor chooses to ignore all of this. His staff continues to push the plan forward — insisting privatizing is a good idea because Medicaid spending “has increased 73 percent since 2003.”

Well, here’s a news flash for them: The cost of employer-based health insurance in Iowa, administered by private insurers, has grown about 80 percent during the same time period. A Medicaid recipient here costs an average of about $6,000 annually — about $3,000 less than taxpayers cough up to insure a state lawmaker.

Several studies have shown managed care either saves no money or eventually costs more than traditional Medicaid, according to a 2012 report from the Robert Wood Johnson Foundation. After a push from former Gov. Jeb Bush, Medicaid managed care went statewide in Florida in August 2014. Within a few months, private insurers were lobbying the state for more money. Now they’re asking for a raise of nearly $400 million, which could wipe out all the savings so far if the state agrees. And how much more will they demand going forward?

“You’re assuming there’s going to be more cost savings because the private market is more efficient. Well, the private market is more expensive than Medicaid,” Joan Alker, executive director of the Georgetown University Center for Children and Families, told the Miami Herald last month.

Privatizing Iowa’s Medicaid program will increase administrative costs as much as 300 percent. That is money not spent on actual health care. The state has provided no evidence privatization will improve health care quality and access — likely because it cannot find any. Iowans have no assurances these private companies will be transparent or held accountable for problems.

But the train wreck can be prevented.

Iowa must secure approval from the Centers for Medicare and Medicaid Services to privatize our program. The federal government provides the majority of funding to Medicaid and can choose not to approve the waivers this state is seeking to proceed. Iowans should contact CMS and tell it not to grant Iowa permission to privatize. The health care of a half million people and $4 billion in public money are at stake.

Contact the Obama administration

Iowans with concerns about the governor’s plan to privatize Medicaid can submit comments to the Iowa Department of Human Services. Yet telling the state what you think will likely have no impact. The DHS has been working with the Centers for Medicare & Medicaid and is “confident we will gain approval” for waivers it needs to proceed, said DHS spokesperson Amy McCoy.

Iowans have no choice but to turn to the Obama administration with concerns.

Though CMS prefers correspondence from the public to be submitted through the comments section for waivers on its website, the Register's editorial board is encouraging Iowans to call and email the agency. The general phone number for CMS is (877) 267-2323. Push zero to talk to the operator.

The position of director of the Division of State Demonstrations and Waivers is now vacant, according to the CMS website. The director of State Demonstrations Group is Eliot Fishman. His email is Eliot.Fishman@cms.hhs.gov. The current acting director of CMS is Vikki Wachino. Her email is Victoria.Wachino@cms.hhs.gov. Iowans can also call the regional CMS office in Kansas City at (816) 426-5233.