On January 1, 2014, the Iowa Medicaid Enterprise (IME) implemented the Iowa Health and Wellness Plan (IWP) for its citizens. The new plan expands coverage to those who would otherwise be ineligible for Medicaid-type insurance. To understand why it is so often compared to Obamacare, it is first important to clarify what this plan is comprised of. We reached out to local officials as well as Dr. James Knight, a dentist working out of Iowa, to get a clear, firsthand account of what the plan is about and how it is impacting Iowa citizens.
The plan expands traditional Medicaid coverage to include all Iowans between the ages of 19 and 65 whose income is below 135% of the Federal Poverty Line (FPL.) Coverage now includes poor, working couples with no children and other groups who had previously been excluded. The new plan can be directly contrasted with the 2012 Medicaid eligibility criteria, which stated, “Medicaid does not provide medical assistance for all poor persons. Even under the broadest provisions of the Federal statute (except for emergency services for certain persons), the Medicaid program does not provide health care services, even for very poor persons, unless they are in one of the designated eligibility groups.”
This plan is separated into two types of coverage. The first group includes citizens who are at or below 100% of the FPL – $11,490 for an individual or $23,550 for family of four – in coverage called the Iowa Wellness Plan. They will be entitled to a “benefit package [that is] equivalent to the state employee health plan, with the addition of Medicaid prescription drug, dental, and habilitation coverage.” The Iowa Medical Society estimates 89,000 enrollees. Each enrollee is assigned a Patient Manager – such as a doctor or nurse practitioner – who is responsible for “coordinating and monitoring necessary medical care, acts as a monitor to assure appropriate utilization of services, and serves as an advocate for the member who might not otherwise seek appropriate medical care.”
The second group includes those who make between 101% and 135% of the FPL – adjusted to be $15,420 for an individual or $31,812 for a family of four – in the Iowa Marketplace Choice Plan. Iowans with access to employer sponsored insurance (ESI) will be provided with premium assistance. For those without access to ESI, Iowa Medicaid will pay the premiums on certain qualified health plans.
While this may sound complicated, Dr. James Knight provided a simple explanation. In a nutshell, traditional Medicaid coverage has just been expanded both to be more comprehensive and to be available to a larger part of the population.
While supporters hoped that the IWP would be an alternative to typical Obamacare Medicaid Expansions, one report by Jonathan Ingram, Director of Research at the Foundation of Government Accountability, argues that that’s all it is, just with a different name.
“It targets the same population of mostly working-age, able-bodied adults with no kids; uses taxpayer dollars to provide essentially the same services as Old Medicaid; is funded from the same pot of ObamaCare Medicaid expansion monies and it similarly ties the hands of policymakers hoping for flexibility from Washington to control costs and improve quality of care,” Ingram states.
The report points out that the program simply “expands Medicaid eligibility to the entire ObamaCare expansion population, most of whom will go into the Old Medicaid program while the remaining are redirected into new programs that still deliver the same Medicaid benefits.” According to the statistics provided by the Iowa Department of Human Services, two-thirds of enrollees are placed into “old Medicaid” while one-third are in ObamaCare Exchange Plans or Employee Sponsored plans.
Insurance News notes that Republicans in Iowa originally opposed Medicaid expansion, but eventually the two parties negotiated a compromise that “expanded Medicaid for some people and provides Medicaid-funded premium subsidies for others.”
"Iowa is leading the country with this whole kind of public and private Medicaid expansion," Cliff Gold, co-founder and chief operating officer of CoOportunity Health, one of two statewide insurance providers in Iowa's marketplace told Insurance News. "A lot of other states are looking at Iowa's model as the one they're considering now."
As of April 30, there are nearly 75,000 residents enrolled in the just Wellness Plan. While some are previous Medicaid carry-overs, many are newly eligible citizens.
On May 1, both types of enrollees began to enjoy the benefits of the Dental Wellness Plan. The new plan is a revision of the previous dental coverage offered by Medicaid which has “deficiencies that, without changes, would not provide sufficient access to dental care to this new population.”
The Dental Wellness Plan “offers coverage for basic services, and allows members to complete specific incentives in order to gain access to other enhanced services.” The core plan covers basic diagnostic, preventive, emergency, and stabilization services. By completing recall exams, participants can earn access to “Enhanced” and “Enhanced Plus” dental coverage, which includes benefits such as root canals, crowns, and tooth replacement. The new comprehensive plan covers all members, many of whom would be otherwise unable to receive dental care. The IME states that studies have shown “a high need for dental care amongst the population, linking oral health to overall health,” which they hope to provide through the new plan
For his part, Dr. James Knight sees both the immediate and long-term effects that the plan will have on members.
“The Iowa wellness program is picking all the people that did not fall into some of these other programs,” he said. “This program is allowing access to dental care for people who did not have access to dental care before. It’s important, especially for minors, to have access to dental care because if a minor loses a tooth or something like that early in life, they’re open for all kinds of health problems later on down the road.”
Dr. Knight also acknowledged the kinks that need to be worked out.
“There are still problems with these programs and most of them have to do with how they reimburse the health care provider for these services,” he explained. “The reimbursement here in Iowa is about 40% of an average fee, which is a problem because most dentists’ overhead is in the neighborhood of 60%, so providing care to these patients is costing dentists money, instead of generating revenue for them.”
On a smaller scale, more businesses have adopted wellness programs. The goal is to cut the costs of health care by encouraging employees to improve their health. Businesses have begun to offer incentives, such as premium credits to employees who do things like control their blood pressure or quit smoking, while others have penalties such as paycheck deductions for neglecting to do so. A survey of nearly 600 large U.S. companies by benefits consultant Towers Watson found that 22 percent of companies that use financial incentives to encourage wellness program participation structured them as penalties. In doing this, businesses are trying to avoid the 40 percent tax on the “expensive benefit plans” that the Affordable Care Act will call for, starting in 2018.