DES MOINES — Saying it’s how his administration always has projected the state’s annual Medicaid costs, Gov. Terry Branstad on Monday defended a $51 million estimate for Medicaid savings next year, even though the state has produced no documents showing how it arrived at that figure.
The state is transitioning to private management of its Medicaid program. Branstad’s administration said the move will save $51 million in the first year, a figure that was calculated into the current state budget.
But the administration has provided no documents showing how it calculated the $51 million in projected savings.
“What we’re telling you is it’s a range, and that range is what’s been used by the Department of Human Services for as long as I can remember,” Branstad said Monday during his weekly news conference.
Branstad and his staff on Monday explained the process for how the savings were calculated but came short of pledging to produce documents.
Branstad’s chief of staff Michael Bousselot said Medicaid projections are formulated by the human services and budget departments along with actuaries and the Legislative Services Agency, the state’s nonpartisan fiscal estimating agency. A range of projected costs is calculated, and the administration uses the midrange figure in the state budget.
But when pressed for documentation of those calculations, neither Bousselot nor Branstad would commit to producing any.
“We just have to use the best estimate we have,” Branstad said. "That’s what we’ve always done. There’s nothing different about this. This is the way it’s always been done."
Rob Hogg, a Democratic state senator from Cedar Rapids and chairman of the Senate Oversight Committee, urged Branstad to be more forthcoming about how the state has determined that shifting to private management of Medicaid will provide savings without reducing services.
“You have said it will save money without hurting services. I doubt it,” Hogg said in a statement. “That’s why, as chair of the Senate Government Oversight Committee, I am formally asking you to release the evidence you used to calculate privatizing Medicaid will save the state of Iowa government $50 million in the first six months of 2016.
“Governor, it is time to open your books and your records. Show Iowans and the federal government how your drive to privatize Medicaid is based on financial reality and is not just a tool to cut services for vulnerable Iowans.”
Statehouse Democrats, in budget negotiations during the 2015 legislative session, originally calculated roughly twice as much Medicaid savings into their budget. Eventually, the parties settled on $51 million based on the administration’s projections.
“This went through a lot of discussion during the legislative session, and that’s ($51 million in savings) the agreement,” Branstad said. “I believe that this year’s process turned out to be better than some we’ve seen in the past where the Legislature’s arbitrarily decided we’re going to consider a higher level of sayings than is realistic.”