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Branstad: State "Needs to Learn" from Medicaid Fraud

Joyce Russell/IPR
Iowa Governor Terry Branstad at weekly statehouse news conference.

Governor Branstad is minimizing complaints about the private firms selected to manage Iowa’s more than four billion dollar Medicaid program that provides health care for Iowa’s poor and disabled.  

A Des Moines Register investigation shows fraud and mismanagement by the firms in other states.       

The state is scheduled to turn over management of the giant program to the four companies starting in January.    But three firms that didn’t win the contracts are requesting a review of the bidding process, which they call haphazard.  

At his weekly news conference Governor Branstad suggests that’s sour grapes.

“Obviously when there's this much money at stake and you're not one of the four successful ones,” Branstad says, “you're going to be disappointed, but I think the process is fair."

The winning bidders were fined hundreds of millions of dollars in other states for inflating expenses, excluding patients, or getting  reimbursed for health care that wasn’t provided.  

Branstad says all four are substantial companies with significant experience. 

“And I guess I'd challenge you to find any Medicaid provider of any magnitude that hasn't had some issues in the past,” Branstad adds.

The complaint over the bidding process could end up in court.  Branstad says he hopes that doesn’t delay privatizing Iowa’s Medicaid program, which critics say is happening too fast.     

The Branstad administration projects Iowa will save as much as $50 million in efficiencies by hiring out the huge program to the private sector.