According to an analysis from Kaiser Family Foundation published April 10, states are facing heightened fiscal uncertainty as millions of current Medicaid members may lose coverage.
Medicaid members who stay enrolled may have higher average acuity, leading to higher per-member utilization and costs.
Here are four ways states and plans are managing financial uncertainty, according to Kaiser Family Foundation:
- Thirty-seven states have implemented minimum medical loss ratios for managed care plans. Just four states that use managed care contractors do not require plans to operate with a medical loss ratio of at least 85 percent.
- Twenty-eight states require managed care organizations to pay remittances to the state and federal government if they fail to reach an 85 percent medical loss ratio.
- Eighteen states always use risk corridors in managed care contracts, and 11 states sometimes use these corridors. These agreements allow states and health plans to share profit losses or gains if spending falls above or below specific targets.
- States may use rate amendments if the continuous coverage unwinding differs significantly from predictions used to create initial rates.
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