2018 Issue #7

Issue 7, 6/6/2018

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Governor Kim Reynolds had until June 4 to sign bills that were sent to her by the Legislature this year. Last week she finished that work, signing all but one bill into law and approving nearly everything in the budget bills.  

The Governor selectively vetoed (called a line-item veto) only one section in the Health/Human Services Budget - language requiring the University of Iowa to give an out-of-state durable medical equipment provider space at their hospital to renovate and resell used equipment. The Governor said the state should not favor one provider over another, and instead encouraged a formal bidding process, giving in-state and out-of-state providers the same opportunity.

In the following pages, we will focus on the issues we know many Iowans with disabilities are talking about, including Medicaid managed care. You can read details about each bill tracked this year in our online BIll Tracker (www.infonetiowa.org/news/bill-tracker/).  

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STATE BUDGETS: 2018 Session Review

The Legislature passed and the Governor approved a $7.5 billion budget for the state's fiscal year that starts on July 1, 2018 (aka "fiscal year 2019" or "FY19" for short).  This is an increase of $225.9 million. Here's how the budget breaks down:

  • Added back the $23.3 million "deappropriation" cuts made in March.
  • Paid back the remaining $113.1 million that was borrowed from the Cash Reserve Fund in 2017.
  • Increased funding for specific programs, services, and government functions by $89.5 million (1.2% increase).
As you can see, most of your tax dollars go to Medicaid, human services, schools, and prisons.
Here are a few highlights from this year's budget:
  • Medicaid funding is increased by $55.1 million (but none of that will go to the rates managed care companies are paid by the state, called capitation payments).  MCOs have said state spending on the Medicaid managed care system is too low and not sustainable without increases; this budget does not address this issue.
  • Medicaid get an extra $1.6 million to pay for stronger oversight of managed care organizations (see the list of new requirements for MCOs under the "Medicaid Managed Care" article).
  • There are a few provider rate increases - home health care providers get an extra $1 million and home- and community-based service (HCBS) providers will see $3 million added to their "tiered rates."  A special work group appointed by DHS will figure out how best to adjust tiered rates using these funds, and will report back to the Legislature if any additional work is needed.  In addition, Medicaid targeted case management will go to a fee schedule, instead of being reimbursed based on cost.
  • There are a couple things to watch over the next year.  First, DHS is going to look at how providers are paid by Medicaid and Medicare, chart the differences in payments, and make recommendations on changes by January 1, 2019.  Medicaid officials have said publicly they would like to pay the same rates as Medicare.  Depending on the service, this could mean a lower reimbursement rate or a different way to get paid.  DHS could not make these changes without legislative approval, so anything recommended would need to be discussed in 2019 Legislative Sesion.   Second, DHS is allowed to adjust non-institutional Medicaid provider rates to meet federal mental health parity laws. That sounds good, but you will want to watch how this is done.  Equalizing can be done in two ways: bringing rates up to the same level, or bringing rates down to the same level.
  • Medicaid members that have copayments for prescription drugs will now pay $1 for all drug categories. Currently members pay $1-3 depending on the prescription.
  • Medicaid is given some infrastructure money to update its Medicaid Information Systems - $8.5 million over the next eight years.  This money comes from taxes generated by the state's casinos and lottery.  Legislators hope this will help provider, MCO, and Medicaid systems communicate better.
  • New complex needs services are funded -  $876,000 to pay for the state Medicaid share of these new services and $56,000 for subacute mental health facility inspections. Check out the "Regional Mental Health & Disability Services" article for more detail.
  • Children's mental health got a boost this year with the Governor's decision (Executive Order #2) to establish a Children's Mental Health System Board.  The budget includes $300,000 to fund this board's work, which includes a strategic plan that will make sure Iowa's children have access to the mental health services they need in or near their hometowns.  
  • Funding for the inherited metabolic disorders program ($153,755) was restored.  This funding, which was eliminated in the March deappropriation, provides grants to cover the cost of necessary special foods and supplements for people with phenylketonuria (PKU) and other inherited metabolic disorders.  
  • Funding for regional autism grants ($384,552), the Epilepsy Foundation ($144,097), and Prevent Blindness Iowa ($96,138) were also restored in this budget. They too had funding eliminated during the March round of budget cuts.
  • Des Moines University will receive $250,000 to jumpstart a joint effort with NAMI Iowa to train primary care doctors to identify and treat patients with mental illness.  
  • The Department on Aging is using the $100,000 restored to its budget from the deappropriation to launch a new "Pre-Medicaid Pilot Project" to deliver long-term care options counseling to help people who are not eligible for Medicaid in returning to their communities following a nursing home stay.  
  • The Office of Long Term Care Ombudsman gets a very small ($10,460) cut due to staffing changes.  The Managed Care Ombudsman is housed in this office.
  • ChildServe gets state help ($500,000) to add 12 beds to its facility for young adults needing intensive medical treatment and 24-hour skilled care.
  • Area Education Agencies (AEAs) are cut by an additional $15 million ($22.5 million total reduction compared to what is in Iowa law).  Among other things, AEAs help school districts in identifying and serving children who need special education services.
  • Rural communities get help in connecting to high speed Internet with $1.3 million in broadband grants.
There was no change in the amount of money going to:
  • Public transit ($1.5 million) and recreational trails ($1 million)
  • Public libraries ($2.5 million)
  • Vocational Rehabilitation ($5.7 million)
  • Entrepreneurs with Disabilities ($138,506)
  • Centers for Independent Living grants ($86,457)
  • Aging and Disability Resource Center ($750,000)
  • Brain Injury Services ($1.1 million)
  • Children's Mental Health Homes ($50,000)
  • ABLE Account Program, IAble ($200,000)
You can read more detail about the programs funded this year in our Bill Tracker at www.infonetiowa.org/news/bill-tracker/.  
The numbers used in this article came from the non-partisan Legislative Fiscal Bureau's end of session analysis (https://www.legis.iowa.gov/docs/publications/EOS/965688.pdf). They also provide excellent detail on each budget bill at www.legis.iowa.gov/publications/information/appropriationBillAnalysis.  Just make sure you look at the version marked "final." 

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MEDICAID MANAGED CARE: 2018 Session Review

Legislators on the Health/Human Services Budget Subcommittee have continued to hear your concerns about Medicaid managed care and spent the entire session investigating these problems.  The House of Representatives passed two bills to address billing errors, poor communications, and expectations when dealing with Medicaid members.  The votes were unanimous (97-0 & 95-0), but the Senate did not bring them up for a vote.  

While legislators talked about this for 118 days, decisions came down to the final hours.  Ultimately, MCO oversight was added to the Health/Human Services Budget (SF 2418).   It is important to note that this is now the law.  While many of the things noted below are included in the MCO contracts, contacts can be changed by DHS and the Governor.  The law can only be changed by legislators, during a legislative session.   

Medicaid MCOs are now required by law to do the following:

  • Pay claims accurately, use the right rates, and give reasons for any full or partial denials. They are to do this in a way that is consistent with national industry best practices.  

  • Correct any errors they find in their systems “within a reasonable timeframe" and reprocess claims affected by the error within 30 days of the correction.  DHS will determine what a "reasonable timeframe" is for corrections.  

  • Give 60-day written notice to affected individuals when there is a program or procedural change.  That would include the persons getting the service as well as the providers of the service.  However, DHS will develop a list of changes that require 60-day notice by July 1, 2018, so not all changes will be subject to this new law.  Changes that may be included in this notificiation period include billing and collection procedures, provider network provisions, member/provider services, and prior authorization requirements.  Watch for updates on this after July 1.
  • Approve and pay for at least three days of court-ordered substance use disorder treatment or mental health services before requiring prior authorization or medical necessity standards be met.  This makes sure hospitals can stabilize a person in crisis without fear that the MCOs will deny coverage or delay approval.
  • Use a standard Medicaid provider enrollment form and a uniform credentialing process developed by DHS.
In order to ensure better member services and make sure MCOs are complying with their contracts and the new laws, DHS is now required to do the following:
  • Convene a Health Home Work Group with integrated health home providers, chronic condition health home providers, and MCOs to review health homes, look at what is required in the state plan amendment, discuss the rationale for any proposed changes, develop a consistent delivery model that clearly defines outcomes and data reporting requirements, and implement a communications plan that keeps stakeholders informed on the operation and administration of the programs.   A report on the group's work is due December 1, 2018, including recommendations and actions taken.
  • Review the effectiveness of MCO prior authorizations.  The Medicaid director has publicly said services that are nearly always approved should not be subject to prior authorization.  Why go to the extra work to get a service authorized if it is approved 99% of the time?
  • Hire a dedicated provider relations staff to help providers to resolve billing conflicts with MCOs (including claims denials, technical omissions, incomplete information). These staff will watch for trends, and report them to DHS for further review.  
  • Maintain and update Medicaid member eligibility files in a timely manner.  MCOs have said some of the errors stem from bad information in DHS eligibility files; legislators hope this will lead to fewer errors and service denials.
  • Hire an independent external quality review consultant to randomly sample decreased level of care determinations to make sure the MCOs are providing appropriate medically necessary services and are following national industry best practices in their decision-making. The consultant is to report on findings, with a plan of corrective action, by December 15, 2018.   
  • Annually review all appeals dismissed, withdrawn, or overturned to watch for any negative patterns or trends.  Members whose appeals are subject to this review will have their services continued while the new assessments are being done, up to 90 days. DHS is to report these findings twice a year (biannually).
  • Contract with an independent review organization to perform small claim (less than $2,500) audits denied or paid to long term care services and supports providers during the first quarter of calendar year 2018 (with report and findings by February 1, 2019).

The focus of most of these changes is on internal processes and administration which legislators feel is the main reason for system problems.  It does not address payments to providers, which many think is the real reason for service disruptions and denials.  Again, we'll be watching this closely and will report back as these groups meet and as these changes are implemented.

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REGIONAL MH/DS SERVICES: 2018 Session Review

Legislators from both parties came together this year to pass a bill to address gaps in services to Iowans with complex mental health, disability, and substance use needs. The legislation was based on the recommendations of a work group, and it makes a lot of changes to the state's regional MH/DS system.  There were a few other changes made to the regional system in other bills, including how new regions are formed. Here's a quick review of the changes made this year in the regional MH/DS system:

MH/DS Region Services:

  • All of the existing crisis services provided by MH/DS regions are moved to the list of "core services." Mobile response, 23-hour crisis observation and holding, crisis residential services, subacute and crisis stabilization community-based services are no longer considered optional services. The existing subacute bed cap is removed, so regions are free to develop these beds based on the needs of their community. Justice system services (jail diversion, crisis intervention training, civil commitment prescreening) and advancements in evidence-based treatment (positive behavior support, peer self-help drop-in centers) are still considered "additional core” services and are still optional.  
  • Regions are expected to build out three new core services and work together to ensure that they are available throughout the state.  These include:
    • Access Centers to provide short-term care for those in crisis, and provide resources needed to get Iowans back home to their families (at least six statewide).

    • Assertive Community Treatment (ACT) teams to provide individualized treatment and support to individuals with mental illness in their homes, 365 days a year (at least 22 teams statewide).
    • Intensive Residential Service Homes will provide individuals with severe and persistent mental illness with the chance to live in smaller community-based settings close to home, while receiving the 24-hour intensive services needed to address their individual needs. There are up to 120 beds available statewide (to be scattered, with facilities preferably serving no more than four individuals at each site, although each site may serve up to 16 individuals).
  • It is important to note that Medicaid is now expected to pay for these new core services if the person is enrolled in or eligible for Medicaid.  Regions will continue to pay for others who are not eligible for Medicaid (to the extent funding is available).  Regions do not yet have a good idea how much it will cost to provide these services, so they cannot say if their current funding is sufficient.  The cost to Medicaid increases substantially next year – legislators will need to find another $5-6 million to cover the expected costs once the services are operational. 
  • Regions are no longer required to fund a 24-hour crisis hotline service.  A single statewide 24-hour crisis hotline will replace the ones managed by each individual MH/DS region, but it will continue to connect people to the local resources they need.

MH/DS Regional Funding: 

  • The Legislative Council has been asked to appoint an interim committee to look at the funding of these regional services, including the new services added this year.  In every redesign, funding has always been the one thing that never quite gets addressed.  If approved, this interim committee will look at levies, budgets, per capita expenditure targets, and fund balances, and make recommendations in time for action in the 2019 session.  Unfortunately, legislative leaders that sit on the Legislative Council do not have to approve every request for an interim study.  This is an important one – so you may want to ask your legislator to lobby their leaders to get this interim committee approved!  We've made it easy to do - just go to our Action Center and send a message now!

  • Regions are still required to spend down excess fund balances before July 1, 2021.  After that time, county levies within the region will be lowered.

  • The Polk County MH/DS Region is allowed to use other funds to pay for regional services if the MH/DS levy is not sufficient.  Polk County already gets $6.3 million in funds/in-kind services from its county hospital (Broadlawns) to cover some of its shortfall, but estimates they are still about $1-2 million short.  They will have to report back on the funds used by September 1, 2019.
  • DHS will review reimbursement rates for ACT teams over the interim and make recommendations by 12/15/18. 

Formation of New MH/DS Regions:

  • New single county regions are no longer allowed. This will not impact the existing single-county region (Polk), but will stop other counties from trying to form their own region.  Similarly, DHS will no longer be able to waive the three-county minimum requirement (so no two-county regions either).

  • New regions must include bordering counties only.  DHS will no longer be able to waive the requirement that counties in a region be contiguous.  

  • DHS is allowed to approve the formation of a new region with counties wanting to leave the 22-county County Social Services RegionNew regions must now meet the following new minimum requirements before being approved by DHS: population must be at least 100,000, must include a city with a population of more than 24,000, must be able to meet all core service requirements by February 1, 2019 and be in full operation by July 1, 2019.  DHS is directed to work with any counties having difficulty joining a new region and allows DHS to assign a county to a region if they have not joined one by February 1, 2019.  The new requirements apply to new regions only; existing regions are not affected.

  • New regions are allowed to reset their per capita expenditure targets (the amount of money the county can levy per resident), but they cannot go over the statewide cap.  Expenditure targets cannot be increased after July 1, 2020.  

The MH/DS Commission and DHS have already started to write the rules on these new laws.  Administrative rules are important here, because they will more fully define these services, set service provider standards, establish reimbursement rates (always key to making services available), access standards, implementation dates, and possibly even location of the services.  While DHS has been asked to get rules noticed in August, it will still need to go through the normal rules process that includes many opportunities for input, including public hearings, public comment period, required responses to comments, and a review by a legislative panel (called the Administrative Rules Review Committee).  During that final legislative review, stakeholders are also able to provide comment, and legislators can stop rules if they feel public comments have not been adequately addressed.  So lots of opportunity for input; we'll make sure you know about these as this gets started!

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MENTAL HEALTH: 2018 Session Recap

The Complex Needs legislation made a lot of changes to the regional services system, but it also addressed several other issues related to mental health and substance use disorder commitments.  These include:

  • Streamlines mental health & substance use commitments to free up beds faster.  Commitment orders will now be immediately terminated when a person no longer meets the criteria for commitment, commitment hearings can now be held via video conference, and hospitals are allowed to immediately release a patient after notifying the court that a person no longer meets the commitment criteria (that is, hospitals do not have to wait for further court action).  
  • Allows disclosure of mental health information to an expanded list of law enforcement officers. DNR officers, county attorneys, probation/parole officers, and jailers were added to the list, but a mental health professional can still only share this information as allowed by their professional ethics, and if the person is an imminent threat to self or others, and has the ability to carry out that threat.  
  • Includes notification of region’s contracted transportation provider when a hospitalized person is being discharged, and requires all contracted transportation providers use secure vehicles and have staff with mental health training. 
  • Changes to definition of Serious Mental Illness (SMI) to include those with a history of non-compliance in taking medications or treatment plans, resulting in hospitalizations.  Oral medication is also added to the list of options for treatment during hospitalizations (currently only allows injectables). 

DHS has a long "to do" list this summer.  Over the next several months, DHS will be required to:

  • Include both adult and child co-occuring subacute beds in the psychiatric bed tracking system.  The current system has only inpatient (acute) hospital beds included.
  • Address the role of hospitals that provide inpatient psychiatric care.  DHS will bring stakeholders together to review the role of tertiary care psychiatric hospitals in the array of mental health services and make further recommendations if necessary (report due November 30, 2018).
  • Further streamline commitment processes.  DHS will bring together another group of stakeholders to review the mental health and substance use disorder commitment processes and make recommendations for improvements (report due December 31, 2018).
  • Set rules for civil commitment prescreening assessments done in MH/DS regions. DHS and the MHDS Commission will work together to develop these rules, which will require prescreening by a mental health professional within 4 hours of emergency detention; coordination of services (inpatient, outpatient, subacute, detox, and community-based); ongoing consultations by mental health professional while person is in ER; and filing of appropriate documentation/reports.  

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ALL THE OTHER STUFF: 2018 Session Review

While complex needs, Medicaid managed care, budgets, and tax cuts took up a lot of energy this session, there were many other things that got done.  Here's a quick review.


  • High school coaches or officials will need to complete training in brain injuries and concussions every two years, focused on prevention, symptoms, evaluation, and risks.  Parents will need to sign a concussion and brain injury information sheet before their child can participate in school sports, and schools are required to provide protective gear needed to prevent concussions and other injuries.  Schools will also have to follow concussion and return to play protocols, which require that student athletes showing signs, symptoms, or behaviors consistent with a concussion or brain injury are to be removed from the activity immediately and not be allowed back until certain precautions are taken. (HF 2442
  • School employees who work directly with students will need to take a one-hour suicide awareness and prevention training annually, beginning July 1, 2019.  The training is to include strategies to identify adverse childhood experiences (ACES) and address toxic stress responses. (SF 2113)
  • Doctors and other health care professionals that prescribe opioids will now have to check the Prescription Monitoring Program (PMP) first before writing a script to make sure their patient is not "doctor shopping" for pain killers. There is a lot in the opioid law that passed this year, but the changes apply mainly to the ways doctors prescribe and pharmacists fill prescriptions.  (HF 2377)
  • The Departments of Aging, Human Services, Inspections & Appeals, and Corrections will get together this summer to take another look at what to do with older Iowans that need nursing home level of care, but are registered sex offenders or are sexually aggressive.  The departments will look at the possibility of using vacant state-owned facilities like Mount Pleasant or Clarinda to care for offenders. A report of their findings is due December 15, 2018.  (SF 2418)

  • DHS will also review dependent adult abuse mandatory reporter training and certification requirements this summer, and convene a work group to make recommendations by December 14, 2018. (SF 2418)


  • Effective immediately (June 1), Medicaid and private health insurance plans will reimburse for services provided by temporarily licensed psychologists, marriage and family therapists, mental health counselors, and social workers, as long as their supervising professional is a Medicaid provider or in the private health insurance network. (SF 2418)
  • Iowans will now be able to buy membership-based primary care services, called "concierge medicine."  Like a health club, you pay a monthly fee to have unlimited access to a primary care doctor.   (HF 2356)
  • After several years of advocacy, behavior analysts and assistant behavior analysts who work with individuals with autism will be licensed by the Board of Behavioral Sciences.  (SF 192
  • A Dyslexia Task Force will be established by the Department of Education to make recommendations on student screening, interventions, teacher prep, continuing education, classroom accommodations, and assistive technology.  The report and recommendations are due November 15, 2019. (SF 2360)


  • People that vote by absentee ballot at their county election office will now need to include their new voter verification number on the application for a ballot.  (HF 2252)
  • State and local election officials will now also accept tribal identification cards or other tribal enrollment documents as proof of identify for voting, if they are issued by a federally recognized Indian tribe or nation, and the card/document  is signed, current, has an expiration date, and includes a photograph.  (HF 2502)

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It was no secret that the Legislature spent weeks behind closed doors working on a tax reform package that would cut taxes and modernize our sales tax system.  It's a complicated bill, but here are the highlights:

  • There will be fewer income tax brackets and the top tax rate is reduced (from 8.53% to 6.5% for individuals, and from 12% to 9.8% for businesses).
  • Federal deductibility is eliminated in tax year 2019 for businesses and tax year 2023 for individuals (that is, the ability to deduct federal taxes from your state taxes).  
  • Iowa's sales tax system is "modernized" to allow for the taxation of online good and services (such as software, games, subscription services such as Netflix) and other services like taxis, Lyft, and Uber.   
  • Requires a review of all tax credits next summer (during the summer/fall of 2019).  Legislators will look at every tax credit and determine whether the state is getting a return on these investments.  There are many tax credits in Iowa law - volunteer firefighters, adoptions, school tuition, historic preservation, child care, beginning farmers, and many, many more.  

You can see a financial summary of the plan prepared by the non-partisan Legislative Services Agency at  www.legis.iowa.gov/docs/publications/FN/965637.pdf

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Over the last three years, we have updated our Guide to the Iowa Legislature more than 29 times (we stopped counting some time ago).  Lots of retirements, committee changes, special elections, and, sadly, deaths made it tough to keep updated.  

And the endless stream of changes hasn't stopped yet.  There have been four significant announcements since session adjourned last month:

  • Rep. Ken Rizer (R-Marion) has a new job as a private jet pilot.  He was not running for office again, but decided to resign from his seat early on May 25.  Since the session is done, they do not need to call a special election for House District 68 (the seat will stay vacant until the November election).  

  • Rep. Peter Cownie (R-West Des Moines) has taken over as Chair of the House Ways & Means Committee.  Rep. Guy Vander Linden (R-Oskaloosa) stepped down from this position recently since he is not running for re-election.  

  • Sen. David Johnson, Iowa's first independent State Senator, has decided not to run for a fifth term.  Two years ago Sen. Johnson renounced his Republican Party membership after Donald Trump made disparaging remarks about a reporter with a disability.  Sen. Johnson has been a committed advocate for Iowans with disabilities.
  • While this isn't a legislative change, it's a significant one.  Governor Kim Reynolds has a new chief of staff - Ryan Koopmans.  Koopmans has been the Governor's chief policy advisor and legal counsel since she assumed the job nearly a year ago.  He takes over for Jake Ketzner, who is leaving to take a job in the private sector.

We've updated the Guide to the Iowa Legislature again, and we will continue to do so as changes happen.  You can always find on the infoNET homepage (www.infonetiowa.org).

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To paraphrase School House Rock, it's a long, long way for a bill to become a law.  Lots of bills get introduced each year, but only a small amount end up becoming law.

  • 1,423 bills were introduced this year.
  • 176 bills were passed by the Legislature.
  • 175 were signed into law (the Governor vetoed one bill).

Only 12% of the bills introduced this year became law.  That means seven out of every eight bills died somewhere along the line.  Not great odds, but pretty consistent over the last twenty years.

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  • You can see the final status of all the bills tracked this year in the infoNET Bill Tracker.  
  • You can see all the bills sent to the Governor this year here
  • You can read the analysis of all budget bills here.
  • You can look at final budget spreadsheets here.
  • Get a head start on the elections by checking out who won the primary election in your area here.
  • Make sure you thank your legislators and the Governor for their work this year. Get started here.
  • Session's over, but there are still town hall meetings and other opportunities for action. Check our calendar often.

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