Iowa Increases PMPM For Medicaid Health Plans, Adjusting For Unexpected Pharmacy Costs

The Iowa Medicaid program recently offered to increase the per member per month (PMPM) capitated rate to its three IA Health Link managed care organizations (MCOs) to account for higher than expected pharmaceutical costs. On October 31, 2016, the  Iowa Department of Human Services (DHS) notified the governor that the capitation rates approved in March 2016 should be updated  to “recognize emerging trends, most notably emerging prescription drug costs.”

DHS recommended increasing the rates for the current 15-month capitation rate period which started April 1, 2016 and run through June 30, 2017. The increase will cost the state $33 . . .