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Health Care Reform:

Health Insurance & Affordable Care Act

By Randy Dotinga

Reviewed by Lisa Zamosky

WebMD Health News

Iowa Waiting for Approval of Medicaid Alternative

July 31, 2013 -- Iowa is ready to expand eligibility for Medicaid so more poor residents can get coverage as of Jan. 1, 2014. But it's waiting for the federal government to approve a unique approach under the Affordable Care Act.

The state wants to use federal funds to let residents buy insurance through its new Marketplace, instead of being required to get insurance through Medicaid itself, says Tom Alger, a spokesman for the Iowa Insurance Division.

For now, the state is expecting a waiver that will allow it to pursue this approach. "We don't have it yet, and we're waiting," Alger says. "Enrollment starts on Oct. 1, so it would be helpful to know in advance of that time."

Jennifer Vermeer, Iowa’s Medicaid director, told The Des Moines Register last month that she was optimistic about the state's waiver request. She noted that a similar program in Arkansas was moving smoothly toward approval.

The Supreme Court last year ruled that the federal government must allow states to accept or reject Medicaid expansion under the Affordable Care Act. Most states have already decided whether or not to approve expansion, which covers adults under age 65 who aren’t pregnant, aren’t already eligible, and have incomes less than 138% of the federal poverty level. (That’s currently $32,499 for a family of four in Iowa.)

Iowa, however, is one of the last states to act. Gov. Terry Branstad signed the expansion into law on June 20.The Des Moines Register estimates that tens of thousands of Iowans will be affected by it.

The federal government says people in states that don’t expand Medicaid who would have qualified under the expansion will be exempt from the mandate to have insurance or pay a tax penalty.

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