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04.26.2016 / Press Release

Administration Issues New Medicaid Managed Care Standards

New Rule Caps Profits, Improves Networks Adequacy and Establishes Quality Rating System

Washington, D.C. – The Obama Administration on Monday issued sweeping new standards for insurers operating Medicaid managed care plans for the states. The new rules establish a quality rating system consumers can use to help choose a plan; sets new standards for network adequacy by requiring states to set time and distance standards for certain key service providers; encourages plans to spend 85 percent of their Medicaid dollars on patient care; promotes state delivery system reform efforts by allowing state to require Medicaid plans to participate in performance improvement initiatives, including “value-based” payment for hospitals and doctors, and requires insurers to provide clearer and more standardized plan information for consumers. More than 72 million people enrolled in Medicaid, with three quarters of them served by managed care in 39 states and the District of Columbia. This is the first major update to the rules governing Medicaid managed care in over a decade. Following is the statement of Families USA Executive Director Ron Pollock on the new rules:

“Millions of low-income Americans depend on Medicaid and we congratulate the Administration for setting these new standards that will help guarantee the quality and timeliness of the services they need. These standards were long overdue, but once in place they will set sorely needed quality benchmarks that will guarantee that insurers all play by the same rules.”