Medicaid is a government program that provides healthcare along with expanded benefits and services to millions of Americans.
The majority of states contract with managed care organizations (MCOs) to deliver Medicaid benefits. This approach, known as the managed care model, is a public-private partnership that aligns with federal and state requirements to deliver a higher standard of care.
Who Medicaid covers
Medicaid provides coverage for over 81 million people1
Medicaid serves certain people experiencing low incomes, including pregnant women, children (including those in foster care), and seniors. Medicaid also serves people with disabilities.
States may choose to expand eligibility to additional groups. Individuals eligible for Medicaid must meet certain Federal Poverty Level (FPL) eligibility thresholds.
How Medicaid works
A federal and state partnership
States create and run a Medicaid program based on federal requirements to serve people in their state. States may also choose to provide more services or cover more of the population than is required.
The federal government has requirements that all states must follow when running Medicaid programs and provides at least 50% of the funding for these programs.
States may contract with MCOs to deliver coverage.
The vast majority of states that contract with MCOs reported that 75% or more of their Medicaid beneficiaries were enrolled in MCOs2
The managed care difference
Why managed care
The managed care model is the only model with the structure and resources needed to address today’s complex healthcare needs, enabling states to deliver higher quality care and improve health outcomes.
With the cost of healthcare rising, managed care also allows states to better control cost trends and budget with predictability.
In healthcare cost savings since 2009 in Texas3
In healthcare cost savings between 2013 and 2018 in Kansas4
In Nevada, MCOs offer 43 additional services for Medicaid recipients compared to non-managed care models5
- “May 2022 Medicaid & CHIP Enrollment Data Highlights,” Medicaid.gov, 2022. Centers for Medicare & Medicaid Services, 2021.
- “A View from the States: Key Medicaid Policy Changes: Results from a 50-State Medicaid Budget Survey for State Fiscal Years 2019 and 2020,” KFF, 2020. KFF, 2022.
- “Medicaid Managed Care: The Prescription for a Healthier Texas,” TAHP, 2021.
- “KanCare Infosheet,” Kancare, 2018.
- “Managed Care and Dental Health Plan,” DHCFP Nevada, 2022.