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March 2013 Policy Study, Number 13-3


Just Say NO – and Keep Saying NO – to Federal Health Care Exchanges and Medicaid Expansion


Governor Branstad's Proposal



Iowa Governor Terry Branstad has said that he will not accept the federal expansion of Medicaid because of concerns that it “will either collapse, or the burden will be pushed onto the states in a very significant way.”[59] He apparently has read the 2012 Milliman report.


In rejecting the Medicaid expansion Governor Branstad cited a variety of other reasons, including loss of state control, uncertain costs, and regulatory burden.[60]


He has instead proposed a federal waiver, along with a significant re-work of the IowaCare program, and a focus on the Healthiest State Initiative.


Branstad characterized the Medicaid expansion program as being “a ‘60s federal program that’s unaffordable and unsustainable.” He anticipates that the whole Obamacare program will either “collapse” or be financially pushed completely onto state governments.[61]


There is no deadline for agreeing to the Medicaid expansion, and the deadlines established by HHS for various aspects of PPACA are mainly arbitrary and subject to continual pushback and change.


The IowaCare program authorization, as currently configured, expires on December 31, 2013, and the Governor has asked for an extension of that program. It has not yet been granted by HHS.


As part of the Governor’s state reform efforts, the Iowa Medicaid Enterprise (IME) submitted a $1.3 million grant application to the Center for Medicare and Medicaid Services (CMS) to develop an ACO model for Iowa.


This model is supposed to:


1. Implement a multi-payer, value-based purchasing methodology across Iowa’s primary care payers, including both Medicare and Medicaid. This is based on the current system used by Wellmark.


2. Expand on multi-payer ACO methodology to address integration of long-term care services, supports, and behavioral health services. Long-term care comprises half of the current Medicaid costs.


3. Engage Medicaid members in improving their own health.[62]


This effort will attempt to expand the “Blue Zone” and “Healthiest Iowa” approaches to Medicaid recipients, including the 50 percent in long-term care, and to children receiving CHIP services. Currently, irrespective of Medicaid expansion, the ACO model is being proposed by IME for all full-benefit Medicaid and CHIP recipients. Under the CMS grant, the model is to be tested this June.




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