Branstad to Seek Federal IowaCare Waiver

DES MOINES, Iowa – Gov. Terry Branstad said Tuesday he will move ahead with plans to request a federal waiver to broaden and improve the IowaCare program rather than expand Medicaid coverage to another 150,000 Iowans.

Fresh from what he called a "very positive" meeting with U.S. Secretary of Health and Human Services Kathleen Sebelius, Branstad said he was optimistic Iowa can craft a health-care delivery system for needy Iowans that will meet their needs while containing costs for taxpayers. The program currently serves more than 60,000 low-income Iowans

"We do intend in the near future to submit our proposal for renewing and improving and changing our IowaCare program," the governor told reporters at his weekly news conference.

Branstad said Iowa's Medicaid program would implement accountable care organizations that would provide a set annual fee and potential bonuses based on quality and available funding. He said the effort would include strong incentives for members to focus on prevention and personal responsibility in their health decisions.

"Just expanding Medicaid has not worked to improve health," he said, "in fact the health of the American people has gone consistently downhill. We've become more obese and less healthy."

Branstad said health care reform must increase the quality of care, lower costs and make Iowans healthier. He noted that Iowa Medicaid has grown from 250,000 recipients in 2000 to more than 400,000 Iowa adults now served – an expansion that grew participation by 65 percent and increased costs by 129 percent to more than $3.7 billion projected for fiscal 2014.

"Expanding Medicaid without any attention to the long-term funding of this program – both at the federal and state levels – fails the people that we really intend to help and it fails the hard-working taxpayers of Iowa and the United States that have to pay for it," he said.

Branstad said his administration is seeking flexibility to redesign the IowaCare program to best serve the health of Iowans.

According to Iowa' s proposal, the IowaCare waiver program would cover Iowans below 100 percent of the federal poverty level and would require monthly contributions co-pays and deductibles which could be waived if preventative services are completed. The mechanisms are not intended to create financial savings for the state, but rather to encourage health and cost-conscious behaviors.

Critics of IowaCare -- a state and federally funded plan that provides limited health coverage to low-income adults from ages 19 through 64 who are not otherwise eligible for Medicaid -- say the program costs the state more, covers fewer Iowans, and provides fewer services than Medicaid expansion.

The Senate's Human Resources Committee on Wednesday is slated to consider Senate File 71, bill that proposes to expand Medicaid coverage to another 150,000 Iowa residents. Backers say the measure will aid needy Iowans who have no health insurance or are inadequately served by IowaCare and other options.

Starting Jan. 1, 2014, the new federal law expands Medicaid eligibility to people making up to 138 percent of the federal poverty line, or about $15,400 for an individual. Under the law, the federal government will pay the full cost of the expansion the first three years; thereafter, the federal share gradually phases down to 90 percent.
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