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flag Iowa Senate passes bill raising HMO tax to fund Medicaid expansion.

flag Iowa's Senate passed a bill to increase the tax on HMOs from less than 1% to 3.5% retroactively starting January 1, 2026, in an effort to qualify for $355 million in federal Medicaid funding. flag The measure, which lowers the tax again in October, is expected to be signed by Governor Kim Reynolds. flag Democrats warn the tax will likely raise insurance premiums for consumers, while Republicans argue it helps stabilize Medicaid.

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