Patients, Health Insurers Challenge Iowa's Effort To Privatize Medicaid
Neal Siegel, who lives with his girlfriend, Beth Wargo, is one of six disabled Iowans suing the state over its privatized Medicaid program.
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Iowa is one of 38 states that radically changed the way it runs Medicaid over the past few years. The state moved about 600,000 people on the government-run health program into care that is managed by for-profit insurance companies.
The idea is that the private companies would save the state money, but it has been a rocky transition in Iowa, especially for people like Neal Siegel.
Siegel is one of six disabled Iowans suing the state, alleging that Medicaid managed care, as it is known, deprives thousands of Iowans with disabilities the right to live safely in their homes.
Medicaid serves people with disabilities, low income people, and people in nursing homes. A combination of federal and state funds pays for it. It covers 74 million people across the country these days, about half of whom are in Medicaid managed care.
Siegel, a former financial consultant, was in a hit-and-run bicycle crash four years ago that left him with a severe brain injury. He uses a wheelchair and can barely speak.
“I would probably put Neal at about 98 percent cognitive of what’s going on around him, but unfortunately not able to articulate it,” says Siegel’s girlfriend, Beth Wargo. “So it’s being trapped inside your own body.”
After the accident, Siegel qualified for Medicaid. He lived in a rehabilitation center for a while, and the lawsuit, filed in U.S. district court in June, says he was the victim of abuse and neglect while living there.
Neal Siegel and Beth Wargo, in a photo taken after Siegel’s accident in a hit-and-run bicycle crash left him with a severe brain injury.
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Eventually he moved home with Wargo, where he’s totally reliant on caregivers to assist him with all activities of daily life.
Then last year, Wargo says, they got a letter in the mail from AmeriHealth Caritas, the company that manages his care. Siegel’s budget for home help had been slashed by 50 percent, Wargo says. Siegel’s face lights up as Wargo talks about the lawsuit, and he manages to say, “Oh yeah,” when she mentions how happy they were that they could be part of it.
Cyndy Miller is the legal director with Disability Rights-Iowa, the advocacy group that spearheaded the lawsuit.
“The system is too stressed right now with the way it’s being managed and it’s not healthy for individuals with chronic or serious disabilities,” says Miller.
According to the lawsuit, the company claimed that spending on Siegel’s case was cut because it had exceeded a limit set in state policy. A spokesman for AmeriHealth Caritas said the company could not comment on ongoing litigation. The state has asked for the lawsuit to be dropped.
In addition to the suit, complaints about Medicaid from hospitals, doctors, and patients have spiked in Iowa.
Iowa’s Department of Human Services Director Jerry Foxhoven defends moving the entire Medicaid population to managed care. He says more taxpayer dollars will be saved under private management.
But he says his agency is willing to make changes, especially for people like Neal with serious disabilities.
“Everything’s always on the table. We’re always looking at everything to say how do we best serve the people we’re trying to serve and be the best stewards of taxpayer dollars,” Foxhoven says.
For their part, the three companies with contracts in Iowa say in statements that the first 18 months have been successful. But they also have said to state officials that reimbursement rates were based on deeply flawed cost estimates provided to them before the project began.
They are now negotiating to get millions of dollars more in state funding.
So where’s the savings? So far, no state has actually done a comprehensive review of whether private companies actually save Medicaid dollars, says Kelly Whitener, an associate professor with Georgetown University who studies managed care.
“You’d really need to be able to see, are you saving money overall or not, and if you are spending less money, are you suppressing services that are needed? Or are you really finding efficiencies and only delivering care that families really need?” says Whitener.
For the moment, those questions don’t have definitive answers.
Meanwhile, Iowa has to balance its books. Republican Governor Kim Reynolds had to tap more than $260 million of the state’s reserve fund this year, and officials expect next year’s budget will be even tougher to negotiate. Medicaid funding will likely be a large part of the discussion.
This story is part of a reporting partnership with NPR, local member stations and Kaiser Health News.
Saturday Sports: Baseball Playoffs
The Major League Baseball Playoffs have started, while in hockey Las Vegas played Dallas after the week’s massacre.
SCOTT SIMON, HOST:
I’m Scott Simon. Just when we need it – time for sports.
(SOUNDBITE OF MUSIC)
SIMON: The Major League playoffs have begun. Who are the defending champion of the world? Oh, I remember. NPR’s Tom Goldman joins us. Tom, thanks so much for being with us.
SIMON: It’s a pleasure.
TOM GOLDMAN, BYLINE: We’ll get to that game last night first. But the AL – the Cleveland Indians have really been handling the New York Yankees so far, haven’t they?
GOLDMAN: You know, Cleveland has that look of magic, doesn’t it?
SIMON: Sure does.
GOLDMAN: The Indians won a thriller yesterday, 9 to to 8 in 13 innings after trailing 8 to 3. They had that 22-game win streak late in the regular season. But Scott, if you’re going to break through and win your first World Series in 69 years, you need luck, too. And Cleveland got that last night in the form of New York manager Joe Girardi making some questionable calls in the Bronx. I’m sure they’re using terms other than questionable.
SIMON: They have another way of saying questionable in the Bronx, yes.
GOLDMAN: Yeah. These calls – in one case, a no call where Girardi didn’t challenge a play on the field – might have helped swing the game Cleveland’s way. You know, in a short series like this, bad decisions mean more. And now the Yanks are one game from elimination.
SIMON: Houston Astros in the AL are two games up on the Boston Red Sox, and a superstar from Venezuela has really broken through, hasn’t he?
GOLDMAN: He has. Houston looked so strong offensively – two wins against Boston, both 8 to 2 thumpings. And that superstar, second baseman Jose Altuve, hit three home runs in the first game. He’s 5′ 6″. He’s the shortest active player in the majors and a huge – sorry – tiny fan favorite…
SIMON: Oh. He’s both.
GOLDMAN: And baseball fans are salivating over what’s looking like a Houston versus Cleveland American League Championship Series in the next round. It could be epic if it happens.
SIMON: Yeah. Nats, Cubs opened last night. And by the way – I hope you’ve seen the video – Representative Steve Scalise threw out the first pitch. It was good to see him. He threw a strike. It was a true pitcher’s duel. Stephen Strasburg of the Nats was untouchable, but stats don’t win ball games, do they?
GOLDMAN: (Laughter) Timely hits helped along by opponents mistakes do, which is what happened when the Cubs finally broke through against Strasburg. You know, for all his greatness, it was Chicago pitcher Kyle Hendricks who ultimately was more effective. He held Washington to two hits. He’s not a guy who throws with blazing speed, but his placement of the ball was nearly flawless. His catcher said Hendricks didn’t miss a spot.
SIMON: Yeah, and not nearly flawless. The opening of the NHL season coincides a terrible crime on the streets of Las Vegas this week. And their first major sports pro team began their history. The Las Vegas Knights had their first game ever against the Dallas Stars in Dallas last night. A sober ceremony on the ice – what a time to step into the story of a city, isn’t it?
GOLDMAN: Very dramatic – and the Golden Knights won 2 to 1 in their first ever game. Winger James Neal scored both goals. He said he hoped he could make the people of Las Vegas smile for one night. You know, the Golden Knight, Scott, were always going to be an interesting story. The first major pro sports franchise in Las Vegas after sports leagues had historically avoided the city because of its connections to gambling, you know, bad optics – but now this hockey team is being embraced by the entire league. There have been tributes surrounding the NHL this season opening week. The home opener for the Golden Knights on Tuesday will be quite a meaningful event for sure.
SIMON: NPR’s Tom Goldman – thanks very much.
GOLDMAN: Thank you.
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