Iowa Specialty Hospitals and Clinics has announced it will discontinue accepting certain Medicare Advantage plans, joining a growing number of healthcare systems nationwide pushing back against what they describe as excessive denials and administrative barriers to patient care.
The decision affects the hospital’s campuses in Clarion and Belmond, where administrators cite mounting frustrations with prior authorization requirements and coverage denials that leave patients and families scrambling for alternatives.
The move is the latest sign of problems within the traditional health insurance system with costs rising, and denials a constant and costly headache which have prompted some Americans to look for alternative approaches such as healthshare programs.
“When we have patients on Medicare Advantage plans, many of the plans require pre-authorization for services,” said Beth Carder, the hospital’s Chief Nursing Officer. She described multiple instances where medical staff recommended continued treatment only to have insurers reject the requests based on determinations of medical necessity.
The resulting confusion often falls hardest on elderly patients and their families. “Families are confused and frustrated because their patient isn’t authorized for those services. Some have ended up paying privately, which can get pricey as well,” Carder explained.
Iowa Specialty’s move reflects a broader healthcare industry trend, with at least 27 health systems nationwide dropping Medicare Advantage contracts.
These private insurance plans, which receive approximately $1,000 monthly per enrollee from the federal government, are required to cover the same basic services as traditional Medicare. However, hospital leaders argue the plans frequently impose additional restrictions including narrow provider networks and slow reimbursement processes.
Chief Compliance Officer Reagan Swisher pointed to a fundamental misunderstanding among beneficiaries about the nature of their coverage. “Many families think that when they have Medicare Advantage … it’s Medicare, because of that Medicare Advantage name,” he said, adding, “Health insurance is difficult to understand on a good day.”
The distinction becomes critical when patients need care. While traditional Medicare typically processes claims directly, Medicare Advantage plans operated by private insurers can require pre-approval for services, potentially delaying or denying treatment that doctors deem necessary.
Chief Executive Officer Steve Simonin confirmed the hospital is preparing comprehensive patient notifications about the changes. “We are planning on sending a letter via MyChart to all of our patients discussing which Medicare Advantage plans we don’t accept,” he said. The hospital will continue accepting some Medicare Advantage plans, though specific details about which plans remain in-network were not immediately available.
To assist affected patients in navigating their options, hospital officials are directing residents to SHIIP (Senior Health Insurance Information Program), a free counseling service operated by the Iowa Insurance Division. SHIIP volunteers are available in Wright County locations including Belmond, Clarion, Hampton, and Garner, as well as Hamilton County sites.
Despite potential disruptions for some patients, Simonin emphasized the decision stems from a commitment to ensuring quality care access for the rural Iowa communities the hospital serves. “This isn’t about making life harder on patients,” Simonin stated, framing the move as ultimately protective of patient interests. He stressed the importance of residents understanding their coverage options before enrollment.
“They’re our neighbors,” Simonin said. “In Iowa, we take care of our neighbors.”
With Medicare’s open enrollment period running from September through December, hospital leaders urge seniors to carefully review their coverage options and seek assistance from counseling services when needed to ensure their chosen plans align with their healthcare needs and preferred providers.