Iowa’s Budget Needs to Prioritize Health Care

As our state legislators continue work on 2019 budget targets, it is important for them to resist any further funding cuts to hospitals and Iowa’s Medicaid program. Additionally, it is crucial to restore retroactive Medicaid enrollment for all providers.

Last legislative session, Iowa hospitals and other health care providers suffered large financial losses because of the Legislature’s cost-containment measures and unreimbursed medical care provided to Iowa Medicaid patients. This has resulted in a 20 percent increase in hospital charity care and hospitals experiencing flat-lined and negative profit margins.

These are the kinds of financial difficulties the can lead to financial distress, discontinuation of services and staff layoffs. Nationwide, 80 rural hospitals have closed since 2010 due to similar financial pressures. And hospitals aren’t the only providers being hurt. In fact, smaller health care provider organizations, many of them in rural Iowa, are even more dependent on Medicaid and more vulnerable to these changes. A few have closed their doors because of these financial hardships.

The Legislature eliminated retroactive enrollment for Medicaid patients last year as a cost-containment strategy with unintended consequences. Retroactive enrollment has been a feature of Medicaid for decades, reflecting the program’s emphasis on providing a safety net for poor, disabled and other vulnerable people.

The change in Iowa creates financial hardships for an already vulnerable population as well as health care providers – and both of these groups are already struggling to cope with many difficult changes in the state’s Medicaid program.

Iowa hospitals and other providers are urging legislators – and asking Iowans to join – to resist any further cuts to budget items that support Iowa hospitals or the Medicaid program and to restore retroactive Medicaid enrollment for all providers. Iowa’s budget should not be balanced on the backs of its most vulnerable citizens and those who provide them health care.