Future of Medicaid managed care still uncertain

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If the GOP's American Health Care Act had passed, the federal match for $550 billion of Medicaid would have ended by moving to per-beneficiary spending limits. That would have eventually curbed around $880 billion in Medicaid reimbursements, according to the Congressional Budget Office, a number that caused stress for long-term care providers reliant on the government funding.

Even with Friday's death of the GOP-sponsored plan, the majority of Medicaid beneficiaries are still in a managed care plan, which is meant to reduce costs for the state and federal government, noted Bloomberg BNA. The GOP plan made Medicaid providers and plan managers themselves nervous, with Medicaid Health Plans of America registering their disapproval March 22.

The bill meant “such a large reduction in federal funding that it has a potential of disrupting the Medicaid program and putting our plans at risk [as well as the ability to provide] care to America's most disadvantaged, the ones we're contracted to provide care to,” Jeff Myers, president and CEO of Medicaid Health Plans of America, told Bloomberg BNA.

As state and federal lawmakers continue to debate the future of Medicaid in the aftermath of the death of the GOP plan, several Republican-leaning states, including Kansas, are evaluating expanding Medicaid.

Those states looking for more efficiency through Medicaid moving to private managed care companies, however, also are keeping a close eye on Iowa. In April 2016, Iowa shifted to having three for-profit companies run its Medicaid program. Those companies complained about “catastrophic losses,” the Des Moines Register reported, and asked for government help in recouping $450 million. The state said Friday an agreement to help the companies would eventually cost the state roughly $10 million.

Iowa had pledged to help cover losses under “risk-corridor agreements” included in February amendments to the companies' contracts with Iowa's Medicaid program, the newspaper reported.