A Guide for Child Health Advocates: Medicaid Managed Care Accountability Through Transparency

Medicaid, Managed Care, and Transparency Medicaid is the nation’s largest health insurer for children—over 35 million at last count—and pays for nearly half of the nation’s births. It offers a comprehensive pediatric benefit—Early and Periodic Screening, Diagnostic, and Treatment (EPSDT) services—for children and comprehensive maternity care for pregnant women. In most states, Medicaid agencies contract with managed care organizations (MCOs) to organize networks of providers to deliver covered services to most, if not all, Medicaid-eligible children and pregnant women. As of July 2021, 40 states and the District of Columbia contracted with a total of 287 MCOs to manage services for Medicaid beneficiaries; in almost all of those states, most eligible children are enrolled in MCOs. Total federal and state Medicaid spending on MCOs this year is projected to be in the neighborhood of $300 billion.

How well those 287 MCOs perform determines how good Medicaid coverage is for the children and pregnant women they enroll. And because children and pregnant women eligible for Medicaid are disproportionately people of color, how well MCOs perform will largely determine how effectively the Medicaid program addresses racial and ethnic health disparities. If an MCO is a high-performing organization, Medicaid coverage can improve their health outcomes. If the MCO is a low-performing organization, Medicaid coverage will have little or no value. So how can we know whether an individual MCO is high- or low-performing? How transparent are state Medicaid agencies and MCOs about their performance for children and pregnant women? And if performance information is publicly available, how can advocates use it to identify low-performing MCOs and hold them accountable?

The purpose of this Guide is to help child and maternal health advocates use transparency to hold MCOs accountable for their performance for children and pregnant women.

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