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Iowa health insurance

The next open enrollment window for individual health plans begins in November 2020, but residents with qualifying events don't have to wait for open enrollment

Health insurance in Iowa

Iowa’s health marketplace

State legislative efforts to preserve or strengthen provisions of the Affordable Care Act

How hard is Iowa fighting to preserve the Affordable Care Act’s provisions? Compare to other states’ efforts.

Iowa operates a partnership exchange with the federal government, which means that residents use to compare and purchase individual coverage, while the state is responsible for plan management, consumer assistance, and Medicaid eligibility determination.

For 2020 coverage, open enrollment has been extended until December 18, 2019 at 3 a.m. Eastern. Enrollments completed by that time will have coverage effective January 1, 2020. Enrollment will still be possible for Iowans with qualifying events.

Read more about Iowa’s health insurance marketplace.

Iowa is permitting Farm Bureau to sell “non-insurance” (ie, not regulated as insurance by the state) health plans that are medically underwritten. Sales began in November 2018, and the plans are available year-round, as eligibility is based on an applicant’s medical history. This is how individual market health insurance worked in most states (including Iowa) prior to 2014.

Iowa enrollment in qualified health plans

49,210 people enrolled in plans through Iowa’s exchange during the open enrollment period for 2019 coverage. See a summary of year-by-year enrollment in Iowa’s exchange here.

Off-exchange enrollment in ACA-compliant plans plummeted in 2018, due to insurer exits from the market and much higher premiums for the remaining Medica plans (an average increase of 57 percent), which can’t be offset by subsidies outside the exchange. As of November 2018, only about 39,000 people had ACA-compliant individual market coverage in Iowa, including on- and off-exchange enrollees. Virtually all of them had on-exchange coverage, as the off-exchange market (where subsidies are not available) has dwindled to almost nothing.

After rates decreased a bit in 2019, effectuated enrollment in the exchange stood at 46,347. Off-exchange enrollment was still very low for ACA-compliant plans.

But far more people — about 68,000 — had individual market coverage under grandmothered and grandfathered plans in 2018. As of 2019, there were still more than 54,000 Iowa residents with grandmothered and grandfathered plans from Wellmark. Iowa is fairly unique in terms of having such a large population on grandmothered and grandfathered plans, relative to their enrollment in ACA-compliant plans.

Read more about Iowa’s health insurance marketplace.

Iowa and Medicaid expansion

Iowa is among the states that have accepted federal Medicaid expansion. The state initially received a waiver from CMS allowing it to take a slightly different approach and still receive federal funding, but that approach was abandoned in 2015 in favor of straight Medicaid expansion as called for in the ACA.

In 2014 and 2015, Iowa’s alternative to ACA Medicaid expansion involved a program called the Iowa Health and Wellness Plan in which residents with household incomes below the federal poverty level were enrolled in a state-run health plan called the Iowa Wellness Plan; some paid modest premiums. Those with incomes of 101 to 138 percent of the federal poverty level purchased marketplace coverage through a program called the Iowa Marketplace Choice Plan and their premiums were paid by the federal government.

In 2015, the state announced that it would switch to regular Medicaid expansion as outlined in the ACA, and also switch to using Medicaid managed care (as most states do). The switch to managed care was slated to happen as of January 2016, but was delayed until April 2016.

The average monthly enrollment for Iowa Medicaid grew by 40 percent from 2013 through August 2019.

More information about Iowa Medicaid is available at the Iowa Department of Human Services.

Read more about Medicaid expansion in Iowa.

Short-term health insurance in Iowa

Iowa agreed to follow federal rules regarding short-term plan durations, so plans can have initial terms of up to 364 days and can last for up to three years if they’re renewable. But as of late 2019, the state has only approved 364-day plans for three insurers, and none of them appear to be actively marketing those plans yet (the state noted that it’s up to each carrier to determine when they want to sell the approved plans). The actively marketed plans all appear to have 90-day term limits as of late 2019.

The state’s insurance division implemented new rules for short-term plans in 2019, with restrictions on benefit caps, out-of-pocket limits, and various coverage mandates. The rules are more lenient than the Division had initially proposed in 2018, but more strict than the rules in many other states.

Read more about short-term health insurance in Iowa.

Iowa health ratings

According to U.S. Census data, only five states and the District of Columbia had lower uninsured rates than Iowa in 2018, and the uninsured rate was just 4.7 percent.

Iowa was ranked 8th place in the Commonwealth Fund’s 2019 Scorecard on State Health System Performance, which evaluates the performance of the 50 states and the District of Columbia on more than 40 health measures.
America’s Health Rankings look at a somewhat different set of measures, and Iowa ranked 20th overall in 2018, but their ranking has trended lower over the last few decades.

Another source for Iowa public health information is the Trust for America’s Health; see Key Health Data About Iowa. Finally, you can zoom in and get county-by-county health rankings for Iowa from the Robert Wood Johnson Foundation and the Population Health Institute at the University of Wisconsin.

Obamacare’s impact in Iowa

Iowa is one of the states that embraced health care reform for the most part, but crucially, the state allowed grandmothered plans to continue to exist in Iowa, and Wellmark didn’t join the exchange until 2017 (and then left at the end of 2017, although they returned as of 2019). In November 2018, the Iowa Insurance Division reported that about 39,000 people had ACA-compliant individual market plans in Iowa, while 68,000 people had coverage under grandmothered and grandfathered plans. This is far different from most states, where enrollment in ACA-compliant plans is far greater than enrollment in pre-ACA plans.

But the state’s pre-ACA uninsured rate was relatively low, with a state-partnership exchange and Medicaid expansion in effect since 2014 open enrollment, its uninsured rate continued to drop through 2016, to a low of just 4.3 percent. The uninsured rate started to rise again in 2017, reaching 4.7 percent, where it remained in 2018 (well below the national average of 8.9 percent).

Premium subsidies in the exchange and Medicaid expansion have made coverage affordable and realistic for many Iowans, but people who purchase their own coverage and aren’t eligible for premium subsidies often find that coverage is entirely unaffordable. Iowa had the dubious distinction of having the nation’s highest average pre-subsidy premiums in 2018: A staggering $988/month per enrollee, versus a national average of $597/month. Iowa’s average premiums have declined in 2019 and 2020, and although they’re still dramatically higher than the national average, West Virginia and Wyoming have higher average premiums as of 2020.

Premium subsidies are correspondingly huge in Iowa, but there’s no relief for people who aren’t eligible for subsidies. That’s a big part of the reason the state has begun to allow Farm Bureau to sell medically underwritten plans that aren’t regulated by the state as insurance and are thus exempt from ACA rules. The idea is to allow people to have access to cheaper plans, but this is only a solution for people who are healthy. Those who aren’t can’t get through the medical underwriting, and are stuck in the ACA-compliant market.

Iowa and the Affordable Care Act

Iowa’s Senators, Chuck Grassley and Joni Ernst, are both Republicans and both are opposed to the ACA. Sen. Both voted yes on all three measures that the Senate considered in 2017 to repeal the ACA (the BCRA, “skinny repeal” and the Obamacare Repeal Reconciliation Act), although all three of those measures failed to pass.

In 2009, Grassley introduced an amendment to the ACA to require members of Congress and their staffs to use the health insurance marketplace – even though the marketplace was intended for individuals and small businesses. The Grassley Amendment was included in the final bill; Congress and their staffers use the DC small business exchange to sign up for health insurance coverage (as opposed to the FEHBP plans that they used to have). Confusion over the amendment led to charges that Congress was exempting itself from Obamacare.

As of 2018, three of Iowa’s four US House representatives were Republican, and one was a Democrat. But that changed significantly after the 2018 election. As of 2019, Iowa’s House delegation includes three Democrats and just one Republican. Dave Loebsack, the incumbent Democrat, won re-election. And Abby Finkenauer (Dubuque) and Cindy Axne (West Des Moines) each defeated incumbent Republicans.

So as of 2019, Iowa’s Congressional delegation is split 50-50, with three Democrats (all in the House) and three Republicans (two in the Senate and one in the House).

Within the Iowa legislature, Republicans control both chambers after taking over control of the Senate in the 2016 election and retaining control of the House. The governor is also a Republican, and this GOP trifecta remained in place after the 2018 elections.

Former Gov. Terry Branstad, a Republican, was not supportive of the Affordable Care Act. In 2011, Branstad signed Iowa onto Florida’s lawsuit challenging the ACA. Branstad stated a preference for a state-based insurance marketplace, but said the federal government had not provided enough information for Iowa to proceed with that option. Iowa currently operates a state partnership marketplace.

Current Gov. Kim Reynolds, elected in 2016, is also a Republican, and supported the Graham-Cassidy bill to repeal the ACA in 2017 (that measure did not pass). Reynolds expressed disappointment when the state was forced to withdraw its 1332 waiver proposal that would have radically changed the ACA within Iowa. Reynolds won re-election in 2018.

Other ACA reform provisions

The ACA’s Consumer Operated and Oriented Plan (CO-OP) Program encourages the creation of nonprofit, consumer-run health insurance issuers. Twenty-four CO-OPs received loans totaling $1.98 billion as of January 2013. CoOportunity Health, which operated in Iowa and Nebraska, received $112.6 million.

But CoOportunity Health stopped selling plans in both states as of late December 2014. It was the first of the nation’s CO-OPs to fail, but almost all of the others failed in 2015 and 2016, leaving just four operational CO-OPs.

Does Iowa have a high-risk pool?

Before the ACA reformed the individual health insurance market, coverage was underwritten in nearly every state, including Iowa. Applicants with pre-existing conditions were often unable to purchase private coverage, or found themselves with very limited options that didn’t cover their pre-existing conditions.

The Iowa Comprehensive Health Association (otherwise known as Health Insurance Plan of Iowa, or HIPIOWA) was established in 1987 to give people an alternative if they weren’t eligible to buy private plans because of their medical history.

Under the ACA, all new health insurance policies became guaranteed issue starting on January 1, 2014. As a result of this reform provision, there is no longer a pressing need for high-risk pools. HIPIOWA is still operational, but membership has steadily declined since 2013.

It’s important to note, however, that Iowa is one of the states that relies on high-risk pool coverage as an option for disabled Medicare beneficiaries under the age of 65 who are not guaranteed access to Medigap plans. Since Iowa does not require Medigap insurers to offer their products to Medicare beneficiaries who aren’t yet 65, it’s important for the high-risk pool to remain operational in order to offer supplemental coverage to these enrollees (Medicare supplement rates through HIPIOWA are available here and here for 2020). But as of 2018, there were only 22 members in HIPIOWA’s Medicare supplement plans.

The program had 3,002 members as of Dec. 2013, and just 280 members as of July 2018. Operating costs for HIPIOWA were $11.9 million in 2016. Of that amount, about 30 percent was covered by members’ premiums, and the rest was covered by an assessment on insurance companies operating in Iowa. Premiums are based on 150 percent of the average premiums charged by the top five insurers in the individual market in the state, although Medica and Wellmark are the only individual market insurer offering plans in Iowa. HIPIOWA premiums for 2020 are available here.

Medicare in the state of Iowa

In 2019, Iowa Medicare enrollment was 627,863, about 20 percent of the state’s total population. 87 percent of the state’s Medicare beneficiaries qualified based on age and 14 percent as a result of disability.

At $8,185 in per-enrollee spending in 2016 (for those enrolled in Original Medicare), annual per-enrollee Medicare spending in Iowa falls well below the nation’s average of $9,533.

Medicare Advantage offers Iowans additional health benefits through private plans instead of Original Medicare. 18 percent of Iowa Medicare recipients chose a Medicare Advantage plan in 2017. Nationwide, that figure was 33 percent.

Iowans can also select stand-alone prescription drug plans called Medicare Part D. 63 percent of the state’s Medicare beneficiaries selected this Medicare prescription drug coverage in 2015, higher than the national average of 45 percent (this makes sense, given the relatively small percentage of people enrolled in Medicare Advantage; Medigap plans are used by people who don’t have Medicare Advantage, which is a larger than average percentage of Iowa’s Medicare population).

Iowa’s state-based reform legislation

Scroll to the bottom of the page to see what’s happening legislatively in Iowa with healthcare reform at the state level

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 Her state health exchange updates are regularly cited by media who cover health reform and by other health insurance experts.