Iowa is one of six states to expand Medicaid through section 1115 waivers. Iowa's alternative approach to Medicaid expansion, known as the Iowa Health and Wellness Plan, was the result of a bipartisan compromise, motivated by the pending expiration of a preexisting section 1115 waiver that served sixty-five thousand Iowans. The Iowa Health and Wellness Plan emphasizes personal responsibility and private involvement. Key features include beneficiary premiums, incentives for healthy behaviors, and premium assistance for some beneficiaries to purchase insurance in the health insurance marketplace. However, Iowa has struggled to implement its expansion as initially envisioned, due largely to the lack of private insurers willing and able to insure new Medicaid enrollees in the marketplace. In 2016 Iowa will dramatically increase the role of managed care in Medicaid, with the vast majority of beneficiaries receiving almost all Medicaid services through a capitated managed care organization. This article highlights the local factors driving expansion, the interplay of the state and federal political landscape, the challenges of providing consumer choice within Iowa's marketplace, and the future of Iowa's Medicaid program under managed care.