Joe Biden Is on Both Sides of the Debate Over Medicaid Privatization

Photo: Daniel Acker/Bloomberg via Getty Images

At a January campaign stop, former Vice-President Joe Biden had tough words for Iowa’s Republican governor. “In your state, your governor goes ahead and privatizes Medicaid, which is why hospitals aren’t getting paid on time so they’re shutting down,” Biden said. “They’re shutting down emergency services and they’re at risk.”

Biden was partially right, as the Cedar Rapids Gazette reported at the time. Although a number of the state’s rural hospitals are at risk of closure, they’re all still open for now, which undermines part of Biden’s claim. So do the facts of the rural hospital crisis, which are varied and complex. In Iowa, the privatization of Medicaid is the latest entry in a series of threats that include hospital mergers driven by private equity. But the rest of Biden’s observation is largely correct. Iowa’s governor, Kim Reynolds, did continue her Republican predecessor’s approach to privatizing Medicaid, a decision that has benefited certain corporate entities while proving less helpful to medical providers. In January, the Iowa Department of Health Services withheld $44 million in state funds from Iowa Total Care, which provides Medicaid services to low-income people. The company, which recently moved into an office space that includes a food-truck court and heated parking, “had not paid more than 100,000 claims that providers had submitted,” the Des Moines Register reported.

But Iowa Total Care isn’t just a problem for state health officials, or for the hospitals and clinics who rely on timely Medicaid reimbursement to stay open. It may be a problem for the Biden campaign, too. One of his biggest fundraisers is implicated in the very scandal he criticized in front of voters. Iowa Total Care is a subsidiary of Centene, a St. Louis, Missouri–based managed health-care company that has become a major source of donations to the Biden campaign. The official website for the Biden campaign identifies Michael Neidorff, Centene’s president and CEO, as a bundler.

Reached for comment, an aide for the Biden campaign said on background that the candidate “has blasted the Branstad-Reynolds Medicaid privatization disaster for months, and will continue to do so. This approach has consistently led to cuts that hurt people who depend on Medicaid, and that’s absolutely wrong. Joe Biden is running to build on Obamacare and guarantee that every single American has access to quality, affordable health care.” But this would not be the first time that the Centene CEO’s support for Biden seemingly undermined the candidate’s pitch to voters. As the Intercept reported in December, another Centene subsidiary, Centurion, provides health-care services to prisons in 16 states. Biden, meanwhile, introduced a detailed proposal intended to “stop corporations from profiteering off of incarceration.”

Biden is not the only candidate to receive donations from a Centene executive. One executive in particular donated to Pete Buttigieg, Bernie Sanders, and erstwhile contender Kamala Harris in addition to Biden, according to a report from Open Secrets. But as a bundler for Biden, Neidorff is influential. His support may also be a symptom of broader trends. The same Open Secrets report named Biden as the primary field’s top recipient of donations from health-insurance and pharmaceutical executives. Last May, Biden walked past protesting Kaiser Permanente health-care workers in order to attend a fundraiser in the home of Cynthia Telles, who belonged to both the Kaiser Foundation Hospitals and Kaiser Foundation Health Plan’s board of directors. Kaiser clinicians represented by the National Union of Healthcare Workers later walked out on strike in December.

This piece has been updated to clarify that the initial decision to privatize Medicaid was made by Governor Kim Reynolds’ predecessor, Terry Branstad.

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