Iowa will pay more for state’s privatized Medicaid program

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Terry Branstad

DES MOINES, Iowa (AP) — Iowa is increasing the amount of money it pays three private insurance companies to administer the state’s Medicaid program.

The non-partisan Legislative Services Agency says the Iowa Department of Human Services decided recently to pay more in rates distributed for each Medicaid patient. It’s unclear how the extra $33.2 million will affect the state’s cost projections.

LSA analyst Jess Benson says the agency will predict a $20 million to $30 million shortfall for the current budget year when the agency meets soon with state officials. The figure is preliminary, and it’s unclear if the Department of Human Services would absorb such costs or if Gov. Terry Branstad would request extra state funding.

Branstad said Monday he still believes the state will save roughly $110 million this budget year from privatization. Senate Democrats have challenged those savings.

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