Criticism mounts of State of Iowa's plan to use private companies to supervise Medicaid in Iowa

In theory at least, the State of Iowa will make a switch in five weeks to Governor Terry Branstad's new system of having four private companies supervise the state's $4.2 billion Medicaid program.  But a coalition of health care providers and Medicaid recipients say they plan to ask the federal government to delay the January 1st launch of the new system.

State Senator Joe Bolkcom was one of two state senators to hold a public forum on the issue in Decorah earlier this month.  He tells decorahnews.com that numerous health care providers have told him the private health management companies are asking the health care providers to sign contracts that don't specify how much money the health care providers will be paid—and then being told if they fail to sign a contract by January 1st they will get paid 10 percent less than other providers will.

Winneshiek Medical Center Chief Financial Officer Lynn Luloff to the hospital's board members earlier this month that WMC plans to sign a contract with one of the four private firms—but only one.  Luloff says the new system "is a pretty heated topic" and said "I'm sure you'll hear more about this."

Bolkcom says the current system used in Iowa is a good one, so people are wondering why the change is being made.  He says people who are on Medicaid don't know which health care providers have signed with which private management firm, so it's hard to know which option is the best.

Governor Branstad has said the new system will save the state $51 million in the first six months of operation, but the private management companies could be paid as much as $500 million a year.  "The cost (of health care) is still the cost," said Winneshiek Medical Center board member Judith Robinson, whose background in the U.S. Army included running a Medical Unit in New Jersey.

560,000 poor or disabled Iowans rely on Medicaid.  Bolkcom says he worries about some of those people falling through the cracks if Iowa switches over to a system of private management.  There are 42,000 Medicaid providers in the state of Iowa.  Governor Branstad claims 12,000 new contracts have been signed.  However, one provider can sign multiple contracts, so it's difficult to say what percent of the 42,000 Medicaid providers have signed a contract.

Bolkcom favors delaying the start of the new system.  He tells decorahnews.com the switchover to the new system "couldn't be a bigger mess."