Iowa bill would raise taxes on Medicaid insurers to close budget gap
By Isabella Warren
Published on March 18, 2026.
A bill in Iowa would temporarily raise taxes on insurance premiums for health maintenance organizations by 278 percent to help close a $91 million shortfall in the state's Medicaid program this year and a $168 million deficit next year. The tax increase on the three companies managing Iowa’s Medicaid program would generate approximately $123 million, a significant one-time source of funding for the Medicaid program. Concerns were raised from residents and insurance companies over the bill. The bill advanced out of subcommittee and is set to be debated by the House.
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