On Wednesday, October 2, the Centers for Medicare and Medicaid Services (“CMS”) issued its 2015 consultation guide for states to use when setting reimbursement rates with respect to any Medicaid managed care program subject to actuarial soundness requirements in 42 CFR 438.6 during rating periods starting January 1, 2015. The guide “describes information that CMS expects states to provide when developing the actuarial rate certifications.”
The design of the Medicaid program allows individual states to deliver Medicaid benefits and other services through contractual agreements with managed care organizations. These MCOs agree to accept a set per member per month payment for these services, known as a capitation payment. The goal of Medicaid managed care is to “reduce Medicaid program costs and better manage utilization of health services. Improvement in health plan performance, health care quality, and outcomes.” CMS also cites “improvement in health plan performance, health care quality, and outcomes” as key objectives of Medicaid managed care. You can find more information on Medicaid managed care here.