Iowa governor defends companies selected to manage Medicaid program

Republican Iowa Gov. Terry Branstad is defending the companies selected to manage the state's $4.2 billion Medicaid program, despite reports that all four have been involved in high-priced fraud settlements, according to the Des Moines Register.

Earlier this month, the Register reported that the four companies selected to manage the state's Medicaid program faced serious fraud charges while managing programs in other states:

  • In 2008, Amerigroup paid $225 million to settle claims that it defrauded the Illinois Medicaid program by neglecting to enroll pregnant women and unhealthy patients.
  • In 2009, WellCare paid $80 million to settle claims that it inflated health costs in Florida's Medicaid program.
  • In 2014, UnitedHealthcare was fined $173.6 million by the state of California for failing to make timely payments.
  • In 2011, AmeriHealth paid $2 million to Kentucky for falsely reporting procedures such as Pap smears.

Three of the companies not selected as finalists to manage Iowa's Medicaid program--Aetna, Meridian and Iowa Total Care--have filed requests for consideration with the state's Department of Human Services. Branstad defended the bidding process, adding that the selected companies have learned from past mistakes.

Further complicating matters, the Register also reported that Branstad and other state officials have accepted campaign donations from the four companies selected to oversee Medicaid. Political action committees and lobbyists representing Amerigroup, UnitedHealth, WellCare and AmeriHealth have donated $68,000 to state campaigns, and Branstad received $20,000 of that.

Last year, the Texas Health and Human Services Commission was investigated for its decision to award a $110 no-bid contract to a Medicaid fraud analytics company, 21CT. The investigation and a state audit revealed operational defects prompted the deal, leading two top Office of Inspector General officials to resign and forcing the state to rework its process for awarding state contacts.

For more:
- read the Des Moines Register article regarding fraud settlements and penalties
- here is Gov. Branstad defending the bidding process
- see the Des Moines Register report on campaign contributions

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