Isaac Buck

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University of Tennessee Legal Studies Research Paper


In a steady but rapid march, managed care has come to Medicaid. Privatization has undoubtedly rebuilt the Medicaid landscape across America over the last three decades. Now, as managed care programs administer health care to three-in-four Medicaid beneficiaries nationwide, whether or not managed care is adequately managing America’s largest public insurance program has become an increasingly important question.

Of particular note have been states’ difficulties in constructing and organizing the bidding and selection processes of the private companies tasked with overseeing the administration of private Medicaid plans. Legal challenges to various states’ bid procurement processes have been well documented. These conflicts, exacerbated by ballooning state budgets and sharply competitive carriers — and coupled with a dose of political tumult and palace intrigue — have raised the temperature of states’ move to privatization. As a result, states’ approaches to, and results from, privatization have not been uniform.

In short, this article summarizes the current landscape of Medicaid managed care. It provides background on the program and catalogs its costs, growth, evolution, and recent relevant regulatory changes. It provides vignettes of various states’ experiences, including those that demonstrate the benefits of managed care, those that are hesitant to move fully towards privatization, and those that have run into legal challenges as they have tried to give the keys of their programs over to private actors. Finally, cost and access challenges are mentioned in an effort to highlight the ongoing dangers threatening privatization’s widespread adoption into the future. Ultimately, this article seeks to highlight the importance of Medicaid managed care during a time of vexing uncertainty in American health care law and policy.

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