Iowa privatizing Medicaid resulted in 891% more illegal care denials, report finds

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A report from Rob Sand, Iowa's auditor of state, found that privatizing the state's Medicaid program in 2016 resulted in an 891 percent increase in patients who were allegedly illegally denied care. 

According to the Oct. 20 report, the transition from a Human Services Department-administered program to a managed care system, called IA Health Link, has resulted in a significant shift in Medicaid members appealing a reduction or denial of care.

Comparing pre- and post-privatization appeals, how often a judge approved a reduction or denial of service, rendering the determination legal, decreased by 72 percent after privatization. The number of times a judge overturned a ruling, rendering the determination illegal, increased 891 percent after privatization, according to the report. The report noted a 45 percent drop in overall appeals following privatization.

The report also claimed that two managed care organizations — Amerigroup Iowa and Iowa Total Care — violated portions of their contracts with the state's Human Services Department by allegedly ending care for certain patients while they transitioned to a new provider. This led to alleged instances of patients being left without services such as bathing and wound treatment, the report said.

"We agree with the Department of Human Services statement around the methodology and findings in the auditor of state report and will continue to work closely with them as we are committed to accountability and transparency with Iowa’s Medicaid system," an Amerigroup Iowa spokesperson told Becker's. "We remain focused on our top priority – our Iowa Medicaid members – and will continue to provide them with a simplified healthcare experience that enables them to lead a healthy and productive lifestyle."

An Iowa Total Care spokesperson referred inquiries to the Iowa Medicaid Enterprise.

This story will be updated as more information becomes available.

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