Watchdog filed IRS complaint against dark money group run by Chris Rants

An advocacy group run by former Iowa House Speaker Chris Rants “is operating with the primary purpose of influencing political campaigns” in violation of federal tax code, according to the watchdog group Citizens for Responsibility and Ethics in Washington.

Last month CREW filed Internal Revenue Service complaints against ten 501(c)(4) groups, which claim non-profit status as “social welfare” organizations but spent a large share of their funds on political activity during the 2014 election cycle. One of them was the Iowa-based Legacy Foundation Action Fund, for which Rants serves as president and secretary. (The fund did not seek to influence any Iowa elections in 2014.) CREW also filed criminal complaints against six of the ten groups for “falsely representing the amount of money they spent on political activity in 2014”; the Legacy Foundation Action Fund was not among them.

Although Rants’s 501(c)(4) does not disclose its donors, CREW was able to determine that most of its 2014 funding came from American Encore, a “secretive” 501(c)(4) group “formerly known as the Center to Protect Patient Rights.” American Encore has been described as “the linchpin” of the Koch brothers dark money network. The Legacy Foundation Action Fund reported $980,000 in “contributions and grants” on its 2014 tax return; $880,000 of that amount came from American Encore.

More details on CREW’s IRS complaint are below. Rants responded via e-mail, “I am confident that Legation Foundation Action Fund is in compliance with the IRS rules. Legal counsel is reviewing the tax returns and we will file any amendment necessary to ensure the tax returns accurately reflected the organizations actives.”

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Throwback Thursday: When state lawmakers chose not to change "infamous crime" to "felony" in the Iowa Constitution

A 2008 amendment to the Iowa Constitution became a matter of debate in Griffin v Pate, the major voting rights case before the Iowa Supreme Court. The amendment changed Article II, Section 5, which as adopted in 1857 read, “No idiot, or insane person, or person convicted of any infamous crime, shall be entitled to the privilege of an elector.” The same section now reads, “A person adjudged mentally incompetent to vote or a person convicted of any infamous crime shall not be entitled to the privilege of an elector.”

Two of the seven Supreme Court justices have previously held that when approving the 2008 constitutional amendment, the legislature “ratified its own existing interpretation of that provision under which infamous crime meant a felony.” In its brief for the Iowa Supreme Court on behalf of defendants in Griffin, the Iowa Attorney General’s Office carried forward that claim: “By failing to alter the Infamous Crime Clause when other portions of Article II, section 5 were amended, the Legislature and the public ratified the definition of infamous crime as all felonies under state and federal law.” During the March 30 Supreme Court hearing on Griffin v. Pate, Solicitor General Jeffrey Thompson likewise argued “the simple answer here” is the 2008 constitutional amendment was “passed twice by the General Assembly, adopted by the people of Iowa, in the context of a legal system and historical cases and practices that said felonies are the line.”

My curiosity piqued, I decided to look into the legislative intent behind the 2008 constitutional amendment. What I found does not support the view that Iowa lawmakers envisioned “infamous crime” as synonymous with “felony” or intended to ratify such an interpretation when voting to remove offensive language from the state constitution.

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WellCare loses battle to maintain Iowa Medicaid contract

One of the four companies the Iowa Department of Human Services initially selected to manage care for Medicaid recipients has given up the fight to keep a contract that would have been worth hundreds of millions of dollars. Follow me after the jump for details on the final stages of WellCare’s unsuccessful effort to overturn state officials’ decision to terminate that contract.

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Well-placed allies couldn't save WellCare's Iowa Medicaid contract

They were so close. Florida-based WellCare played the game almost perfectly to win a contract for its Iowa subsidiary to manage care for Medicaid recipients, which could have been worth hundreds of millions of dollars over the next three years.

The first sign that WellCare’s ambitions might come to nothing attracted little notice, appearing just before the long Thanksgiving weekend. More bad tidings for WellCare arrived yesterday in a late Friday afternoon dump, the classic way for government officials to bury news. Reading Jason Clayworth’s report for the Des Moines Register, it’s easy to see why the Branstad administration sought minimal attention for fixing an embarrassing oversight.

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Feds say Iowa not ready, must delay Medicaid privatization until March 1

For months, Governor Terry Branstad has dismissed warnings from patients, advocates, doctors, hospitals, editorial boards, and lawmakers that the state’s rush to privatize Medicaid would disrupt health care for some 560,000 Iowans. Today the governor finally got the message in a form he can’t ignore. Director Vikki Wachino of the federal government’s Centers for Medicare and Medicaid Services wrote to Iowa Medicaid Director Mikki Stier,

Based on our review last week of Iowa’s progress, as well as the information you have provided, CMS expects that we will ultimately be able to approve Iowa’s managed care waivers. However, we do not believe that Iowa is ready to make this transition Jan. 1. CMS previously outlined the requirements to provide high quality, accessible care to Medicaid beneficiaries, and Iowa has not yet met those requirements, meaning that a transition on January 1 would risk serious disruptions in care for Medicaid beneficiaries. While you have made progress in some areas of readiness, our review also identified significant gaps that need to be addressed before CMS can authorize your waiver requests. For that reason, CMS will work with you toward approval of your request effective March 1, 2016, provided that the state demonstrates progress toward readiness consistent with the actions in the attachment to this letter.

Click through to read the full four-page letter and four-page attachment from Wachino to Stier, which the Des Moines Register posted online. CMS officials found that “significant areas of the state did not have many provider types within a reasonable distance,” and that “Relying too heavily on out-of-network providers is likely to create confusion among beneficiaries and providers, result in access issues for beneficiaries, and disrupt continuity of care for beneficiaries.” Many of the points raised echo concerns three Democratic state senators expressed during meetings with CMS officials in Washington last month.

The CMS readiness review also showed that nearly half of Medicaid recipients who tried to call the state’s call centers earlier this month could not get through. Many Iowans who did reach a staffer on the phone were not able to find out whether any of their current doctors had signed contracts with the four managed care providers approved to run Medicaid. The CMS findings are consistent with what I’ve been hearing from acquaintances: the enrollment packets sent to Medicaid recipients did not include basic details they would need to make an informed choice of managed care provider (such as where their family’s current doctors will be in-network).

I enclose below reaction to today’s news from Branstad, who struck an upbeat tone, and key Democratic lawmakers, who vowed to keep fighting to improve legislative oversight of the Medicaid privatization. The Democratic-controlled Iowa Senate approved such a bill during the 2015 session, but the Republican-controlled Iowa House declined to take it up. Oversight is the very least state lawmakers could do to prevent the transition to managed care from becoming a pretext for denying services to vulnerable Iowans.

David Pitt noted in his report for the Associated Press,

Two legal challenges continue including one from the Iowa Hospital Association, a trade group for the state’s hospitals. It sued the state claiming the privatization plan is illegal because it takes millions of dollars from a dedicated hospital trust fund and gives it to the four managed care companies.

Any relevant comments are welcome in this thread. I am grateful that so many Iowans took the time to contact federal officials about Branstad’s disastrous policy. Bleeding Heartland reader Rhonda Shouse has been one of the superstar organizers in that fight.

UPDATE: Added below reaction from Representative Dave Loebsack (D, IA-02). I expect that during next year’s re-election campaign, Loebsack will highlight his efforts to shield constituents from the negative consequences of shifting Medicaid to managed care. His only declared Republican opponent is State Senator Mark Chelgren, who like his GOP colleagues in the upper chamber has done nothing to slow down the privatization or strengthen legislative oversight of the process.

SECOND UPDATE: Added more news and commentary related to this issue.

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