In 2025, despite a tight budget year with limited new Medicaid investments, community providers successfully secured a $3,050,000 increase in state funding, which with federal matching funds will equate to approximately $8,000,000 in total new funding for Employment, Hourly Supported Community Living, Respite, and Day Habilitation Services. This represents the largest FY26 non-facility provider rate increase and one of just five provider rate increases overall. IACP is continuing conversations with the Governor’s Office and Iowa HHS regarding how to maximize the impact of this new state investment.
We also saw success in preventing more significant cuts. Working with our partner organizations, we successfully averted the more than $3 million in behavioral health provider rate cuts proposed as part of the Iowa HHS provider rate adjustments included in the governor’s original HHS budget. We were also successful in restoring $200,000 in the HHS budget to fund the administrative expenses of operating the Iowa ABLE program, which allows individuals with disabilities to save for disability-related expenses without impacting their eligibility for Medicaid or Social Security.
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