Medicaid is a state-federal partnership administered by state agencies and funded by state and federal governments. Each state has considerable flexibility, through the use of waivers, to design its Medicaid plans to meet budget constraints and to deliver care appropriate to the needs of its citizens. In contrast to Medicare, which serves a singular population — the elderly and disabled — Medicaid serves several populations, mostly low-income Americans, but also people with modest incomes who qualify because they are disabled or belong to specific categories such as pregnant women, children, or those with special medical needs. Some population groups may be "dual eligibles," eligible for both Medicare and Medicaid. Sorting out the complexities of multiple eligibilities and complying with extensive federal requirements and restrictions makes Medicaid plans challenging to design and administer.
Medicaid programs are administered by each state, and many states contract with managed care plans to deliver services to enrollees. The complexities of the 50 state Medicaid programs call for specialized knowledge. In addition, states often use their Medicaid programs as a platform for health insurance reform, and health plans need to understand the implications of each reform proposal, as these programs can have a significant effect on plan profitability
How we can help you
PricewaterhouseCoopers has more than twenty years of experience in providing comprehensive actuarial consulting services to state Medicaid programs. We have set rates for Medicaid managed care programs in fifteen states, and served some of the most complex Medicaid programs in the country. We have developed and implemented methodologies for pricing and risk adjusting Medicaid managed care programs, and we regularly assist both public and private clients in analyzing and understanding the implications of legislation and other proposals.
We provide actuarial and advisory services to states' Medicaid programs, including:
- Developing a program from its inception, including all design elements, negotiations with health plans, assistance in developing regulations, and program monitoring activities
- Modeling program design options for federal waivers, including complex economic modeling
- Assisting with waiver cost effectiveness documents and waiver submissions
- Developing capitation rates for Medicaid managed care programs and review of rate setting methods
- Assessing whether the state's care rate setting methodology is actuarially sound and in compliance with federal guidelines
- Assisting in diagnostic risk assessments and risk adjustment methodology for specific populations, plans, and programs
For payers, our actuaries and consultants assist with:
- Reviewing the rate methodology proposed by each state, and assessing rates versus costs for the covered population
- Decision-making regarding program design and rate setting
- Performing diagnostic risk assessment calculations
- Assessing provider contracting arrangements and healthcare reform proposals
- Performing analysis to assess the likely profitability of contracts
- Consulting on provider contracting arrangements and operations improvement to enhance profitability
- Assistance in developing proposals to participate in Medicaid programs
