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HF 2518

A bill for an act relating to the department of health and human services and reporting requirements for shelter care, residential treatment, and Medicaid provider reimbursement rates, and establishing provider reimbursement rates for Medicaid home and community-based waiver services.

2025-2026 Regular Session

HHS will annually and biennially review and report on Medicaid provider rates and HCBS waiver costs, using cost data and comparators to inform a new uniform, cost-based reimburseme

Fiscal note.
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Bill Summary · HF 2518

Summary of HF 2518 (2025-2026) – Iowa

This summary describes House File 2518, as amended and considered by the Iowa House, relating to the Department of Health and Human Services (HHS) and reporting requirements for shelter care, residential treatment, and Medicaid provider reimbursement rates, and establishing provider reimbursement rates for Medicaid home and community-based (HCBS) waiver services.

Purpose and Intent

  • Create structured, ongoing oversight of provider reimbursement rates for key Iowa health and human services programs.
  • Establish a system to review and potentially adjust reimbursement rates to reflect costs, market conditions, and actuarial considerations.
  • Improve transparency by requiring regular reporting to the General Assembly and Governor.

Key Provisions

  1. Reporting and Review of Shelter Care and QRTP Rates (biennial)

    • Requires HHS to conduct a biennial review of shelter care and Qualified Residential Treatment Programs (QRTPs) when a uniform provider cost report is implemented.
    • After completing a review, HHS must submit a report to the Governor and General Assembly by October 1 of the immediately following calendar year, detailing results and recommending rate adjustments.

  2. Annual Medicaid Fee-Schedule-Based Rate Reviews (annual)

    • For Medicaid services reimbursed via a statewide fee schedule and not periodically updated or rebased under law, HHS must:
      • Compare each provider rate (except dental) to Medicaid rates in states contiguous to Iowa and, where applicable, to Medicare rates.
      • For dental services, compare Iowa rates to Medicaid dental rates in neighboring states.
    • HHS must submit an annual summary report to the General Assembly by January 15.

  3. Cost Data Submission and Review for HCBS Waivers (annual)

    • HCBS waiver providers must annually submit actual costs of service and supplies to HHS by July 1.
    • Upon request, providers must allow reasonable review of the cost data submitted.

  4. Development of a Uniform, Cost-Based Reimbursement System (ongoing)

    • With input from the public, consumers, providers, and other stakeholders, HHS must develop a proposed cost-based reimbursement system for all services under Medicaid HCBS waivers during the review period.
    • This includes using provider cost data, claims data, consumer needs assessments, and other relevant regional and national data.
    • HHS must create a uniform, streamlined cost reporting mechanism for HCBS waiver services.

  5. Quadrennial Base Period and Rate Model Reporting (every four years)

    • Every four years, HHS shall establish a new base period for calculating proposed rate models and related policy changes.
    • By October 1 of the year a new base period is established, HHS must submit a report to the General Assembly with:
      • Proposed rate models
      • Projected fiscal impact and actuarial soundness documentation
      • Proposed changes to policy and procedures

Affected Programs and Stakeholders

  • Shelter care and QRTP providers (child welfare-related residential services).
  • Medicaid providers reimbursed under a statewide fee schedule (non-dental), including rate comparability to other states and Medicare where applicable.
  • Medicaid HCBS waiver providers (seven waivers: Health and Disability, AIDS/HIV, Elderly, Intellectual Disabilities, Brain Injury, Physical Disability, Children’s Mental Health).
  • Consumers receiving shelter care, QRTP, and HCBS waiver services.
  • General Assembly and Governor (receiving annual and biennial reports).

Procedural and Timeline Aspects

  • Annual reporting deadlines:
    • Medicaid fee-schedule-based rate comparisons: by January 15 each year.
    • HCBS waiver cost data submission: by July 1 each year.
  • Biennial and quadrennial review timelines:
    • Shelter care and QRTP reviews: biennial, with report due by October 1 of the immediately following calendar year.
    • New HCBS base period: established every four years; report due by October 1 of the year the base period is established.
  • House-specific amendments:
    • The bill includes amendments to implement these reporting requirements and to rename the act title accordingly.
  • Fiscal notes provide projected costs:
    • As amended and passed: FY 2027 total cost about $1.3 million (state $650k; federal $650k) for HCBS review components.
    • FY 2027 total cost about $2.3 million (state $1.2 million; federal $1.2 million) for the broader package including Medicaid rate reviews.
    • FY 2028 and beyond reflect reduced ongoing costs, with roughly half the annual state and federal share in the later year estimates.
  • Funding: costs shared equally between state and federal funds.

Practical Implications

  • Higher emphasis on data-driven reimbursement, including uniform cost reporting and actuarial review.
  • Potential adjustments to provider reimbursement rates based on cost data, regional comparators, and Medicare benchmarks.
  • Increased transparency and accountability in how funds are allocated for shelter care, QRTPs, and HCBS waivers.
  • Administrative workload on HHS to collect data, run analyses, and produce regular reports to the Legislature.

Note: The fiscal note and staff analyses indicate costs are contingent on contract amendments and program-specific data collection activities.

Compiled from official sources — confirm details with the bill’s official record.

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