The Iowa Department of Human Services outsourced its $4.2 billion Medicaid program this year, hoping to save the state $110 million in taxpayer dollars by the end of fiscal 2016 in June. Insurers have written to state officials to express concern that current reimbursement rates are flawed.
The state up-dated capitation rates in October to better reflect spending trends, particularly drug costs, said Amy McCoy, a state spokeswoman, in a prepared statement.
The insurers say they've lost millions of dollars since Health Link began. The Des Moines Register reported the state offered the companies an extra $127.7 million, but one insurer executive said it “is not acceptable.”
In a prepared statement, a UnitedHealthcare spokesman said, “Sustainability is critical to the long-term health of both Iowa's Health Link program and the many people it serves, and we continue to work with the state to ensure the program is appropriately funded.”
Both Iowa Gov. Terry Branstad, a Republican, and the Iowa Department of Human Services maintain Health Link will save money while improving quality of care and outcomes for the 600,000 residents it serves.