One of the two managed care companies left to handle Iowa's Medicaid program has told the state it doesn't have the capacity to handle any new members from AmeriHealth Caritas, the company that is withdrawing from the state at the end of the month, according to a notice from the state Department of Human Services that was circulated among lawmakers Tuesday.
The decision means that hundreds of thousands of Iowans will be left with just one choice to oversee their health insurance, UnitedHealthCare.
Amerigroup notified DHS that "they do not currently have capacity to take any new members, including those who have actively chosen Amerigroup Iowa as their MCO after AmeriHealth Caritas' withdrawal," DHS said in the announcement.
The 215,000 members of AmeriHealth were tentatively being assigned to United HealthCare. But the state had also informed AmeriHealth members they could switch to Amerigroup if they wanted.
While many health care providers in the state have contracts with more than one managed care company, some do not. And that could put some of Iowa's Medicaid population in a difficult position as they seek medical care or other services. Only a week ago, UntyPoint Health announced it may not renew its contract with Amerigroup.
In its notice, DHS said that it had been in communication with the federal government and received approval to suspend a provision giving patients choices for who their managed care company would be. The DHS notice did say that Amerigroup will continue to provide services to members who were enrolled with it prior to AmeriHealth's announcement.
Asked about the notice Tuesday, Matt Highland, a spokesman for DHS, said in an email, "the Department is continuing to work with the MCOs on this transition. We will notify members, providers and stakeholders as soon as we have finalized information."
Critics said this latest development is evidence the change isn't working."We need to fix it. We can’t continue to put individuals in turmoil time and time again," state Rep. Cindy Winckler, D-Davenport, said.
Amerigroup said Tuesday its “top priority is to coordinate high quality health care for our members," according to a statement to The Gazette in Cedar Rapids. “We are focused on ensuring appropriate and effective access to quality care to reasonably and responsibly support both current and potential future members. In addition, we continue to collaborate with state and federal officials to help identify solutions to strengthen Iowa’s Medicaid program."
UnitedHealthcare said it “welcomes the opportunity to serve more than 200,000 additional IA Health Link members," The Gazette reported.
Tuesday's development is the latest in the controversial shift to managed care for the state's Medicaid program, which includes more than 600,000 Iowans.
Proponents said it would improve care and save money. But the managed care companies have complained about financial losses. Meanwhile, providers and clients have said the transition has been a logistical headache, and many providers say they have bills that have gone unpaid.
The state recently signed extensions with Amerigroup and UnitedHealthcare. In its notice, DHS said "in the future" members would again have choice. But it didn't say when that would be.
Previously, DHS has said that another managed care company wouldn't be brought on until 2019.