(Radio Iowa) - The companies that manage Iowa's Medicaid program and private companies that offer H-M-Os to Iowans will soon pay a higher state premium tax for nine months -- and it means Iowa qualifies for more federal funding for Medicaid patients.
Senator Mark Costello, a Republican from Imogene, says it's a strategic move that will bring in an additional 355-million dollars in matching federal funds to address a deficit in Iowa's Medicaid program. The plan passed the House last week, it narrowly cleared the Senate Tuesday and Governor Reynolds has indicated she'll sign it into law. The three-and-a-half percent premium tax is temporary -- in effect retroactively on January 1st and on October 1st the tax will return to less than one percent.
Democrats say insurance companies will pass this tax hike along to customers at a time when Iowans are finding it hard to cover their health insurance premiums.