Medicaid Changes – Iowa High Quality Healthcare Initiative

Will you be affected by the upcoming Medicaid Changes?

  • Yes; if you, your child or your ward receives Medicaid services (medical, Waiver, and Case Management services, etc.) these changes will impact you.
    Why is this happening?

  • The Department of Human Services, per the Governor, released a formal “Request for Proposals” or RFP.
  • This “Request for Proposals” asks managed care organizations (MCOs) (private businesses) to outline how they would manage the state’s Medicaid program, including long term care supports and services, and waiver-covered servic
  • For more detailed information go to for an explanation and link to the entire RFP document or see attachment for a condensed version.
  • On July 31, 2015, DHS will award contracts to the managed care organizations (MCOs).
  • On January 1, 2016, MCOs will be in charge of most Medicaid services.
    What can you do? 

  • We want to give you some ideas on what you can do now.
  • Now is a good time to talk to your legislators or call/email the Governor and let them know your thoughts.
  • Call, send a letter, or e-mail your legislators with the information listed below in the chart.
  • You can call the Governor at 515.281.5211
  • You can e-mail the Governor at
  • You can go to which will directly link you to the Governor and legislators just by entering your zip code

    NAME Address Phone Number E-mail Address
    Representative Dave Jacoby 2308 Northridge Dr, Coralville 52241 319-430-9793
    Representative Mary Mascher 2012 Sherman Dr, Iowa City, 52240 319-351-2826
    Representative Sally Stutsman 3754 500th St SW, Riverside, 52327 319-679-2347;
    Representative Vicki Lensing 2408 Mayfield Rd, Iowa City, 52245 319-338-6148
    Senator Joe Bolkcom 728 Second Ave, Iowa City 52245 319-337-6280
    Senator Bob Dvorsky 412 Sixth St, Coralville, 52241 319-351-0988


    MEDICAID MANAGED CARE PLAN RELEASED (taken from info NET #3, February 2015)

    Iowa recently released the much-awaited Medicaid Managed Care RFP.  This “Request for Proposals” asks managed care organizations (MCOs) to outline how they would run the state’s Medicaid program, including long term care supports and services, and waiver-covered services.  The state is calling this the “Iowa High Quality Health Care Initiative.”  It is hard to summarize a 300-page document, but we wanted to give you the basics:
    WILL THERE BE CHOICES IN PLANS?  Yes.  The state will award contracts to 2-4 managed care organizations. Right now, there are many that have been present at the Capitol this year (including Magellan, Meridian, Centene, WellPoint, Molina, United, Coventry).  Individuals currently receiving services will be assigned to a plan, and will have 90 days to change plans.  For newly enrolled people, they will be given the choice of plans when they enroll.  People will be given additional options to switch plans, particularly if providers within the network do not offer the services the person needs, their provider drops out of the plan, or the person moves to a new area and does not have the same service options available there.
    WHO WILL BE INCLUDED?   Almost all populations are included – traditional Medicaid, Iowa Health and Wellness Plan, and children’s health insurance (hawk-I).  This includes dual eligibles, users of long-term supports and services in both nursing home and in home and community based (HCBS) settings, and foster care populations.  It includes the children’s mental health waiver and habilitation program.  That is about 550,000 Iowans.  It does not include undocumented immigrants receiving temporary services, voluntary enrollments in the Program of All-Inclusive Care for the Elderly (PACE), and individuals covered by the Health Insurance Premium Payment (HIPP) program.  The state will continue to manage these populations separately.  Native American populations will have the choice to voluntarily enroll in managed care.
    WHAT SERVICES ARE REQUIRED IN THE PLAN?  Managed care organizations would be required to offer all the services currently covered.  A list of those services is outlined in the “Scope of Work” starting on page 32. Managed care organizations must:

  • Develop strategies to integrate the delivery of long term care, physical health, and behavioral health.  They are also required to establish an Integrated Health Home (IHH) network, and if a person is not enrolled in an IHH, show how the person’s care will be delivered in an integrated manner.
  • Establish a person-centered service planning process that is led by the person receiving Medicaid services whenever possible.
  • Develop service models that are consistent with the Olmsted Decision, comply with the federal Mental Health Parity and Addition Equity Act, and are recovery-oriented and “welcome and engage members in their personal recovery efforts.”
    WHAT PROVIDERS WILL BE IN THE NETWORK?  That is not known, since the managed care organizations will negotiate with providers.  Managed care contractors will have to show that they have not only enough providers throughout the state, but also that those providers have the capacity to serve the population assigned to them.  That is important because sometimes a provider will sign up and say they’ll take one or two people.  So on paper it may look like there are a lot of providers, but in reality there are not enough “slots” to serve the people needing services.  Few other things to note:

  • Managed care organizations are required to contract with federally qualified health center and rural health clinics, and make a good faith effort to contract with family planning clinics and maternal child health clinics.  They must also show how they will use the Area Agencies on Aging (which operate the Aging and Disability Resource Centers called “LifeLong Links”).
  • Managed care organizations must contract with both nursing facilities and home and community based service providers, and other providers of long-term care services and supports.  They will also be charged with overseeing the Consumer Choice Options (CCO) and Consumer Directed Attendant Care (CDAC) programs, to ensure proper use of funds.
  • Managed care organizations are required to demonstrate how they plan to develop capacity in community-based residential alternatives, so that a person can find a facility within 60 miles of their home.  Note that this is a goal – they are not expected to have this capacity on day one of the contract.
  • Provider rates will be negotiated by the managed care organization, but some provider rates are set by law (such as federally qualified health center and rural health clinics receiving cost-based reimbursement).  Provider rates for Medicaid are required by law to be “actuarially sound,” which means they do not overpay or underpay significantly (although some providers may argue that the rates are indeed a significant underpayment already).
  • Managed care organizations must guarantee that there is continuity of care in this transition.  In addition, managed care organizations cannot force a person to switch providers, even if they are not in the plan’s network, in the first 90 days of the contract (and they may extend that period to help with a smooth transition).  Managed care organizations cannot move people out of their nursing facility, intermediate care facility for people with intellectual disabilities (ICF/ID), habilitation program, or waiver community-based residential alternative unless 1) the person asks for this transfer; 2) the person agrees to the transfer; or 3) the provider does not contract with the managed care plan.  That last condition is a big one, and you will not know the answer to who is in the networks of each plan until later this summer (but before assignments are made).
  • The RFP states that long term services and supports may not be reduced, modified, or terminated without an updated needs assessment.  In the first year of the plan, managed care organizations are required to allow residential placements to continue for up to one year, even if the provider is not in the network.  They are then to “facilitate a seamless transition to new services and/or providers.”
  • When it comes to long term services and supports, managed care organizations are required to “maximize community placement and participation.”  The RFP states that the managed care organization shall “consider individual member choice and community-based alternatives within available resources.”  The state designates the tools to be used to determine level of need (InterRAI for the AIDS/HIV, elderly, brain injury, health/disability, and physical disability waivers; Supports Intensity Scale for intellectual disability waiver).
  • Waiting lists are allowed for waiver services; the managed care organization is required to notify the person at the time of application that there is a waiting list, and let them know they may choose facility-based services until a slot opens, and the managed care organization is required to provide non-waiver supports and services as needed while on waiting list.
  • The RFP also requires community-based case management, and includes targeted case management.  There are requirements that case management be conflict-free (so the managed care organization that is paying for the service does not also provide the case management service unless it can prove the two functions are “administratively separated”).
    WILL PLANS HAVE TO BE STATEWIDE?  Yes.  Some states have allowed managed care organizations to pick a region or a county, but Iowa did not do this.  Managed care organizations must agree to serve the entire population (they can’t just pick kids, or just pick long-term care), and cover the entire state.

  • The timeline is very aggressive; the state plans to award the contract by July 31 and have federal approval and the plans ready to launch by January 1, 2016.  Most experts say this timeline is not very realistic, given delays at the federal level and the amount of time it will take for a company to get agreements with providers signed, staff hired and trained, and information out to people being served.  Here is the timeline:
    • RFP Released: February 16, 2015
    • Bidder Comments of RFP Due: February 25, 2015
    • Capitation Rate Data Book: March 10, 2015
    • Letter of Intent to Bid Due: March 11, 2015
    • First Round Questions Due: March 11, 2015
    • First Round Answers Posted: March 26, 2015
    • Second Round Questions Due: April 2, 2015
    • Second Round Answers Posted: April 10, 2015
    • Capitation Rates Released: April 13, 2015
    • Proposals Due: May 8, 2015
    • Notice of Intent to Award: July 31, 2015
    • Implementation: January 1, 2016
    HOW MUCH MONEY ARE WE TALKING ABOUT?  The state’s entire Medicaid budget is a little more than $4 billion, but that includes both federal and state dollars.  We do not know how much the state currently spends to administer the program, but we do know that the RFP states that managed care organizations must spend at least 85% of the money given to them on services and supports.  That means no more than 15% can be spent on administration.  The state also plans to keep 2% of those administration funds, and will only give them to the managed care organization if they achieve certain quality outcomes.  Managed care experts say this is a “best practice” that will make sure the focus of the managed care contract is not just about saving money, but also about access and outcomes.  By comparison, Magellan’s current behavioral health managed care contract with the state is limited to 88%, so they can retain 12% for administrative costs.