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Iowa Medicaid companies say program is underfunded

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DES MOINES, Iowa (AP) — The companies running Iowa’s newly privatized Medicaid system are complaining of drastic underfunding of the program in documents obtained by The Des Moines Register.

Gov. Terry Branstad ordered the shift to private Medicaid management last year, and it went into effect April 1.

Amerigroup, AmeriHealth Caritas and UnitedHealthcare told state officials their reimbursement rates were based on deeply flawed cost estimates provided to them before the program began, the Des Moines Register reports.

According to reports filed last month with regulators, the companies have lost hundreds of dollars on the program.

Branstad says he remains confident the state will save over $110 million with private Medicaid management. Branstad announced in October that the state would pay the companies an additional $33.2 million this fiscal year for unexpected cost increases.