Achieving Transparency, Accountability and Quality in Medicaid Managed Care: A State and Federal Policy Agenda
01.27.2025
At a time when policymakers are looking to address health care efficiency and affordability, policymakers and consumers should have an accurate and transparent accounting of how health care entities spend the tax dollars they receive. Despite $376 billion in Medicaid spending going to managed care organizations, the Centers for Medicare & Medicaid Services (CMS) and states are not using all the levers at their disposal to ensure appropriate oversight of these funds.
Forty-one states (including the District of Columbia) contract with private Medicaid managed care organizations (MCOs) to deliver services to some or all Medicaid beneficiaries in their state, including children, pregnant women, older adults and individuals with disabilities. Reliance on managed care models is growing as states expand their use of MCOs to serve more medically complex beneficiaries, deliver services beyond acute care (for example, long-term services and supports), and cover additional populations, including adults newly eligible for Medicaid under the Affordable Care Act. Today, MCOs provide health coverage to approximately 66 million people — nearly three-quarters of Medicaid beneficiaries nationwide.
This analysis — informed by a comprehensive literature review and a series of roundtable discussions with national policy experts, state advocates and stakeholder organizations — identified substantial gaps across existing state and federal oversight policies and regulations. This policy agenda outlines state- and federal-level policy proposals aimed at improving three key areas necessary for effective MCO oversight: public transparency, accountability and quality of care.