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At the start of session, Iowa's 150 legislators were faced with an $80 million shortfall in Medicaid for the current year and a $200 million increase needed for the next year.  This caused some legislators to refer to the Medicaid budget as the "Pac Man" of the state budget, gobbling up all available funds just to keep services at current levels. 

Ultimately, the Legislature cobbled together enough money to address the 2014-2015 shortfall by using unspent funds and appropriating $43 million from the state's ending fund balance.  These one-time funds filled the hole for the fiscal year that ended on June 30, 2015 - but didn't fix the ongoing problem.  For the fiscal year that started July 1, 2015, the Legislature appropriated just under $2 billion for Medicaid, which is about $40 million below the mid-point estimate.  So that probably means the Legislature will be in the same boat next year, needing to come up with another $40 million (or so) to keep up with demands.

The Governor also signed the following into law last week:

  • Funding to implement the ABLE Act.
  • Increase in HCBS Waiver Provider Rates (.5% increase).
  • Increase in supported employment provider rates (10% increase).
  • Gap funding for two MH/DS regions in financial trouble ($2 million).
  • Elimination of the Medicaid offset (repayment of savings due to Medicaid expansion) for MH/DS regions.
  • Extension of the $47.28 equalization formula until 6/30/17.
  • Creation of the Legislative Health Care Policy Committee to watch over Medicaid managed care transition.
  • Requirement that DHS hold monthly input meetings beginning March 2016 to get feedback on managed care.
  • Direction to the long-term care ombudsman to develop plan to create a Health Care Ombudsman Alliance.
  • Transition planning process for the Prevention of Disabilities Council (which will be eliminated next year).

The Governor did not approve (vetoed) the following that prohibited DHS from:

  • Setting a uniform mileage rate ($.575/mile) for HCBS waivers and capping the total allowed at $9.29/one way. 
  • Reducing HCBS waiver slots (levels would not be allowed to go under what was available on 1/1/15).
  • Fast tracking the CDAC transition to agency-based or Consumer Choices Option (which will begin 7/1/15 instead of 7/1/16).

You can read the Governor's veto message for the Health/Human Services Budget here. You can read all of the Governor's veto messages here.