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IHA’s Third Way:

A Path Forward for Managing Medicaid in Iowa

Implementation of commercially-managed Medicaid in Iowa has compounded rather than addressed challenges for the Medicaid program and its providers and beneficiaries. Managed care organizations (MCOs) reported more than $300 million in losses in the first year, state savings figures are 80 percent lower than projected, consumer and provider complaints have increased significantly and market volatility led on MCO, AmeriHealth-Caritas, to exit the Iowa market.

Hospitals in particular continue to report issues with inconsistent policy application across MCOs, unexpected financial recoupments, unnecessary claim denials and unpaid or outstanding claims and significant administrative cost increases.

NEW: "Bringing Value to Medicaid"

In this research paper and PowerPoint, a path to value in the Medicaid program is outlined as part of the Third Way. Through the development of a statewide value-based purchasing roadmap, administered by a single Medicaid Administrative Services Organization, Iowa could dramatically reduce duplication and cost, ensure high-quality outcomes and provide a clear pathway to a truly value-driven system of care.

Administrative Services Organization Model

Moving forward, IHA is proposing a managed delivery system supporting access to coordinated, high-quality health care services for Iowa's Medicaid beneficiaries that advances value-based payment. The Administrative Service Organization (ASO) model is a "managed fee-for-service" payment model that shores up the financial viability of providers through incentive payments for care coordination and quality improvement. This model: 

  • Improves data driven care management at the site of care
  • Eliminates administrative redundancy 
  • Promotes transparency
  • Moves the state to value-based payments that reward population health management 

The proposed ASO model provides an alternative path forward that will position Medicaid to more effectively and efficiently meet the needs of Iowa's Medicaid population. 

IHA Member Support

IHA is counting on member hospitals to support this plan by engaging with their elected officials and communicating the positive impact this will have on providers and patients accross the state. 

Watch for more information and opportunities from IHA as this plan develops. Contact Maureen Keehnle at IHA for more information.