Iowa Gov. Kim Reynolds creates Iowa Medicaid fraud task force as deficit grows

Gov. Kim Reynolds signed an executive order Wednesday creating a new task force geared toward eliminating Medicaid fraud, waste and abuse, joining in the federal government's crackdown on potential misuse of public assistance programs.

Reynolds signed the order establishing the Iowa Medicaid Fraud Elimination Task Force, which the Republican governor's office says will seek to ensure funds are used to support Iowans who qualify for benefits.

"Safeguarding federal programs like Medicaid from bad actors requires accountability at every point in the process, from member eligibility verification to provider enrollment and billing," Reynolds said in a statement. "By identifying and eliminating fraud and abuse from Iowa Medicaid, we will protect taxpayer dollars, strengthen public trust, and ensure these critical benefits remain available to the Iowans who not only qualify for them, but rely on them for their health and well-being."

She tapped Republican Attorney General Brenna Bird to chair the task force.

"Every time someone commits Medicaid fraud, they are taking funds away from programs that help people who desperately need them," Bird said in a statement.

Other members of Iowa's Medicaid fraud panel will include:

Department of Health and Human Services principal Deputy Director Larry Johnson.Iowa Medicaid Director Lee Grossman.Department of Inspections, Appeals, & Licensing Director Aaron Baack (interim).Iowa's Medicaid Fraud Control Unit Director Jeremy Ingrim.Public Safety Commissioner Stephan Bayens.Department of Management Director Kraig Paulsen.A designated representative from the governor's office.One member from each of Iowa's managed-care organizations: Wellpoint Iowa, Iowa Total Care and Molina Healthcare of Iowa.

Federal government pushing to wipe out fraud

Under Republican President Donald Trump, the federal government has undertaken sweeping efforts to expose fraud in federal public assistance programs, including a nationwide six-month pause on some new Medicare enrollments.

The moves are tied to the anti-fraud task force led by Vice President JD Vance, which has ramped up its messaging ahead of a competitive 2026 midterm election cycle.

The Centers for Medicare and Medicaid Services has audited and withheld billions in federal funds from blue states such as Minnesota over claims that funds were used for non-citizens or spent by fraudulent hospice agencies.

CMS Administrator Mehmet Oz previously directed the agency to require all 50 states to submit plans revalidating Medicaid providers to stop abusers from siphoning federal tax dollars, or jeopardize their funding.

In Iowa, Republican lawmakers have passed legislation limiting eligibility for public assistance programs in the wake of federal spending cuts under Republicans' tax and spending law dubbed the "One Big, Beautiful Bill."

Meanwhile, Iowa is grappling with major budget shortfalls in its Medicaid program.

State officials who make up Iowa's Medicaid Forecasting Group estimated in March that Iowa would have a $90.6 million Medicaid deficit in the budget year that ended June 30.

To cover the deficit, Reynolds signed a law temporarily raising a one-time tax on health insurance providers, issuing a $89 million supplemental payment through the state's general fund and tapping reserves through the Taxpayer Relief Fund.

But officials expect those budget problems to persist, projecting that the deficit will rise to $167.6 million in fiscal year 2027.

What will Iowa's Medicaid fraud elimination task force do?

Reynolds directed Iowa's task force to:

Strengthen alignment with CMS and federal Medicaid integrity efforts, and with federal actions to suspend enrollment of new high-risk providers.Promote Medicaid fraud reporting resources and public accountability, including increased public awareness and incentives for fraud reporting available under Iowa law.Use recouped funds to invest in program integrity technology.Support Medicaid managed-care organizations' provider network management.Establish initiatives geared toward high-risk services and electronic visit verification.Improve methods for the public to report suspected Medicaid fraud.

The task force must hold its first meeting by July 17. Its final report with recommendations on a statewide strategy to eliminate Medicaid waste, fraud and abuse is due to the governor in 120 days.