State officials are skeptical of Medicaid managed care company claims that payment rates are falling short this year.
Twenty-five of 41 states surveyed increased Medicaid capitation payments for fiscal 2024 and fiscal 2025 to reflect rising acuity in the aftermath of mass eligibility redeterminations, according to a report the health policy research institution KFF published last week. Michigan, for example, boosted rates in April to address escalating costs. But health insurance companies argue the raises did not do enough to steady their finances.
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"The rates are still inadequate. We take risks. We're health plans; it goes right to our bottom line," said Guy Gauthier, vice president of state markets at Priority Health, a nonprofit insurer owned by Grand Rapids, Michigan-based Corewell Health.
Priority Health, like other Medicaid contractors, is lobbying Michigan to take another look at payments for fiscal 2024, arguing the money has not kept up after a cohort of relatively healthy enrollees lost benefits in 2023 and 2024.