Medicaid expansion in Iowa
Has Iowa implemented Medicaid expansion?
Iowa’s Medicaid program covers various categories beneficiaries at higher incomes than many other states do, and Iowa expanded Medicaid to low-income adults through the Affordable Care Act (ACA). Initially, the state used a waiver to implement an Iowa-specific version of Medicaid expansion, but that was abandoned in 2015 in favor of straight Medicaid expansion as called for in the ACA, albeit with a managed care approach that utilizes private insurers to provide coverage and care coordination. Medicaid expansion in Iowa is called the Iowa Health and Wellness Program.
Does Iowa have a Medicaid work requirement?
Medicaid work requirements were facing an uphill legal battle by the start of 2020, and have essentially been abandoned amid the COVID-19 pandemic. But even before the pandemic began, Medicaid work requirements in several states have had been blocked or delayed by lawsuits, and it was becoming increasingly likely that Medicaid work requirements would result in states spending money to publicize and/or enforce a program that would ultimately be overturned. But lawmakers in Iowa still considered a Medicaid work requirement during the 2020 legislative session.
of Federal Poverty Level
The legislation followed the same basic approach that numerous other states have taken, with a requirement that Medicaid enrollees work or volunteer at least 20 hours per week in order to maintain their eligibility for coverage.
Various populations would have been exempt, including people under 18 or over 64, mentally or physically unfit for work, enrolled in substance abuse treatment, or pregnant. The bill also exempts caretakers who care for a child with a serious medical condition or disability, as well as a parent caring for a child under the age of one (many other states have extended this exemption to apply to caretakers of older children as well, as it’s fairly well understood that children considerably older than one cannot be left home alone).
According to a fiscal note from Iowa’s Legislative Services Agency, there were an estimated 47,877 people enrolled in Iowa Medicaid who would not be eligible for an exemption and who are not currently working/volunteering at least 20 hours per week. Some or all of these individuals would have been in danger of losing their coverage if the work requirement had been implemented, unless they began working or volunteering or became eligible for an exemption. And as we’ve seen in other states, some people would have lost their coverage despite complying with the work requirement rules, simply because they weren’t aware of the reporting requirements or were unable to understand or fulfill the reporting requirements (ie, if you’re working but the state doesn’t know about it, you would still be in danger of losing your coverage).
If the legislation had been enacted, Iowa would have had to seek federal permission (via an 1115 waiver) to implement the work requirement. The Trump administration has approved work requirements in several states. Two were in effect as of early 2020, in Utah and Michigan, but both have since been discontinued: Utah’s as a result of the COVID-19 pandemic, and Michigan’s because it was overturned by a judge. Quite a few other states have pending waiver proposals. But again, it’s becoming increasingly likely that the court system will not allow Medicaid work requirements to stand.
In addition, the federal government increased funding for Medicaid as a result of the COVID-19 pandemic, but one of the requirements for a state to receive the additional funding is that it cannot terminate Medicaid eligibility for people who are enrolled during the COVID-19 emergency period. That essentially makes work requirements untenable for the time being, since the whole point of the work requirements is to terminate coverage for people who don’t comply with the work and/or reporting requirements. It’s also fairly unworkable to have a work requirement when unemployment is so high as a result of the pandemic. There are no Medicaid work requirements in effect anywhere in the country as of mid-2020.
Am I eligible for Medicaid in Iowa?
The Medicaid eligibility guidelines in Iowa are as follows:
- Children up to age 1 in Iowa are eligible for Medicaid in families with income up to 375 percent of the federal poverty level (FPL)
- Children ages 1 to 18 are covered by Medicaid in Iowa in families with income up to 167 percent of FPL
- Iowa children in families with income too high to qualify for Medicaid are eligible for the Children’s Health Insurance Program (CHIP); Iowa’s program is named hawk-i, and it’s available to kids with family income up to 302 percent of FPL
- Pregnant women are covered by Iowa Medicaid if family income is up to 375 percent of FPL
- Parents and other adults with incomes up to 138 percent of FPL are eligible for Iowa Medicaid
Visit Medicaid.gov to see a chart that shows Medicaid eligibility levels as annual income limits.
Other people, such as low-income elderly, blind or disabled individuals, may qualify for Medicaid in Iowa as well. See who qualifies or call 1-800-972-2017 (Relay Iowa TTY: 1-800-735-2942) or email email@example.com for more information.
How do I apply for Medicaid in Iowa?
To apply for Medicaid:
- Create an account and apply online for Medicaid via the Iowa Department of Human Services (DHS) portal. You can also apply through HealthCare.gov
- Print a Medicaid application in English or Spanish. Mail your completed application to Imaging Center 4; PO Box 2027; Cedar Rapids, Iowa 52406.
- Get help with your Iowa Medicaid application by calling 1-855-889-7985.
Medicaid expansion in Iowa – with a waiver
The federal government laid out very specific parameters for Medicaid expansion under the ACA. But states have the option of seeking a waiver from CMS in order to implement unique approaches to Medicaid expansion, and still receive federal funding to do so.
In December 2013, Iowa received a waiver for its alternative to the ACA’s Medicaid expansion. Under a program called the Iowa Health and Wellness Plan (IHAWP), very low-income residents (household income at or below the poverty level) would be enrolled in a state-run health plan (Iowa Wellness Plan, or IWP) and, in some cases, be required to pay modest premiums. Other residents with slightly higher incomes (101 percent to 138 percent of the federal poverty level) would purchase insurance through the marketplace via a program called the Iowa Marketplace Choice Plan (MPC), with premiums paid by the federal government.
The federal government approved two waiver amendments in December 2014. One allowed Iowa to continue not providing non-emergency transportation. The other allowed Iowa to continue charging a monthly premium for beneficiaries with income under 138 percent FPL. Beneficiaries could reduce or eliminate the premium if they completed a wellness exam and health risk assessment.
The Iowa Health and Wellness Plan launched Jan. 1, 2014, and about 120,000 people were enrolled as of late December 2014 (50 percent more than the 81,000 people the state had projected). But problems began to crop up early on.
Only Coventry and CoOpportunity Health (an ACA-created CO-OP) participated in the privatized Medicaid program (MPC) in Iowa, and CoOpportunity was liquidated by state regulators at the beginning of 2015. Around the same time, Coventry told state regulators that it was experiencing financial hardships as a result of covering MPC members, and was considering dropping out of the program. By June 2015, just 6,937 IHAWP members were enrolled in Coventry plans; the remaining 127,016 were covered by IWP, including more than 33,500 people who would have otherwise been eligible for a private plan under MPC — there were simply no private carriers available to provide coverage.
Medicaid expansion in Iowa— without a waiver, but with managed care
In July 2015, Iowa officials announced that they were abandoning their Medicaid demonstration waiver, and would instead implement Medicaid expansion as called for in the ACA, but with a Medicaid Modernization managed care waiver instead, switching Iowa Medicaid enrollees to a Medicaid managed care system (39 states and DC already had Medicaid managed care programs).
560,000 Iowa Medicaid beneficiaries were scheduled to transition to the Medicaid managed care system (Iowa Health Link) as of January 1, 2016. The Medicaid enrollees were supposed to select a managed care program by mid-December, but many enrollees were having trouble determining which managed care programs included their doctors and hospitals. As a result, the federal government delayed Iowa’s switch to Medicaid managed care until March 1, 2016. The federal government ultimately gave the go-ahead for the switch on February 23, but added an extra month to allow enrollees, MCO carriers, and providers time to make the change. The Medicaid managed care system in Iowa took effect April 1, 2016.
In August 2015, Iowa officials announced that Medicaid managed care contracts would be awarded to four private carriers in 2016: AmeriHealth Caritas, Anthem (Amerigroup), UnitedHealthcare, and WellCare. Seven other carriers bid on the contracts but were not selected. But in December, WellCare lost their contract “due to issues in the bidding process,” and the number of participating managed care providers dropped to three. People who had already enrolled in WellCare’s program were transitioned to one of the other three managed care programs.
In January 2016, questions arose about the business practices of AmeriHealth and UnitedHealthcare in Medicaid managed care programs in other states, including neighboring Kansas. The carriers had allegedly been denying claims for Medicaid patients in an effort to curtail costs, and had to pay tens of thousands of dollars in settlements with the states involved. However, the carriers’ contracts for Iowa’s Medicaid managed care program remained on-track, and AmeriHealth Caritas Iowa, Amerigroup, and UnitedHealthcare were all participating in the MCO program when it launched.
Eligibility for coverage under Iowa’s Medicaid expansion was unchanged; Medicaid coverage continued to be available to Iowa residents with household income up to 138 percent of the poverty level. But enrollees with incomes between 101 percent and 138 percent of the poverty level were no longer enrolled in private exchange plans as of 2016. Instead, they are enrolled in a private Medicaid managed care program, just like the rest of the Medicaid population in Iowa.
Transition in Iowa to Medicaid managed care in 2016, and subsequent shifts in insurer participation
Iowa opted to switch the entire Medicaid program to managed care, intending to make the switch as of January 1, 2016. The federal government determined in December 2015 that Iowa needed additional time to make the transition to Medicaid managed care, and the new system, dubbed Iowa Health Link, took effect April 1, 2016. Patients and providers reported a fairly rocky switch to the privatized Medicaid system.
Democrats in the Iowa Senate tried to halt the switch to managed care, and passed Senate File 2125 in February 2016, which would have terminated the managed care contracts and instructed the existing Medicaid fee-for-service program to focus on improving patient outcomes and access to care, and increasing efficiency (the bill did not advance further, however).
There were initially three insurers offering Medicaid managed care through Iowa Health Link: Amerigroup, AmeriHealth Caritas, and UnitedHealthcare. But Iowa and AmeriHealth Caritas were unable to agree on the terms of a contract renewal in late 2017, and AmeriHealth Caritas withdrew from Iowa Health Link at the end of November, 2017, when their contract ended. And around the same time, Amerigroup informed the state that they did not have the capacity to accept new members.
So 200,000 AmeriHealth Caritas members were transitioned to UnitedHealthcare, which was the only Iowa Health Link insurer accepting new Medicaid enrollees. There were another 10,000 AmeriHealth Caritas members who had selected AmeriGroup as their new Medicaid managed care plan before Amerigroup closed new enrollments, and the state transitioned those individuals temporarily to Medicaid fee for service (ie, not managed care).
The state continued to work with Amerigroup to solve the capacity issue, and by early 2018, Amerigroup had opened up their program to new Iowa Medicaid enrollees once again. The people who had selected Amerigroup in the fall of 2017 and had instead been enrolled in fee for service Medicaid were covered under Amerigroup as of March 1, 2018. And new Iowa Health Link members whose coverage started May 1, 2018 or later were able to select from UnitedHealthcare or Amerigroup.
But UnitedHealthcare exited the program in mid-2019 and was replaced by Iowa Total Care. As of 2020, Iowa Medicaid enrollees can choose a plan from Amerigroup Iowa or Iowa Total Care, although the state withheld funding from Iowa Total Care in early 2020 due to incorrect payments and faulty record-keeping.
More information about the Iowa Medicaid program
Iowa implemented its Medicaid program in July 1967. Iowa Medicaid Enterprise (IME), a division of the Iowa Department of Human Services (DHS), is the name of the entity that administers the state’s Medicaid program.
Total enrollment in Iowa’s Medicaid program was 686,193 as of March 2020. Enrollment has increased by about 39 percent since the first ACA open enrollment period began in the fall of 2013. Iowa Medicaid has served as a safety net during the Covid-19 months, with enrollment increasing 9% from February to July 2020.
Louise Norris is an individual health insurance broker who has been writing about health insurance and health reform since 2006. She has written dozens of opinions and educational pieces about the Affordable Care Act for healthinsurance.org. Her state health exchange updates are regularly cited by media who cover health reform and by other health insurance experts.