H.R. 9336: Better Care, Better Cost Act

This bill would change how states assign some Medicaid enrollees to managed care plans or other managed care entities.

What would change

Under current Medicaid rules, states can assign people who do not choose a plan themselves to a managed care entity based on an “equitable” method. This bill would require states to consider performance instead. In practice, that means states would have to look at how well each managed care entity is doing before assigning people to it.

What states would have to do

Each state would need to:

• Set up a system to evaluate the performance of the managed care entities that participate in its Medicaid program.
• Give each managed care entity a performance score.
• Use that score when assigning people who are automatically enrolled into a plan.
• Publish a report every year showing:
  • how default enrollments would differ when performance scores are considered versus when they are not, and
  • an estimate of any reduction in Medicaid spending that results from using those scores.

How performance would be measured

The bill says states could use measures they consider appropriate, but the score would have to be based on cost, health outcomes, and patient satisfaction. Examples listed in the bill include:

• medical assistance spending,
• potentially avoidable hospital readmissions,
• potentially avoidable emergency room visits,
• potentially avoidable hospital admissions, and
• member satisfaction and the rate at which people leave the plan.

The bill also says these measures should be compared with the plan’s risk-adjusted expected performance, meaning the state would be expected to account for differences in the types of patients each plan serves.

When it would take effect

The new rules would apply to Medicaid enrollments on or after January 1, 2028.

Relevant Companies

• UNH — UnitedHealth Group, through its Medicaid managed care business, could be affected by state enrollment decisions based on performance scores.
• CNC — Centene, a large Medicaid managed care provider, could be affected if states steer more default enrollments toward higher-scoring plans.
• HUM — Humana, which participates in government health programs and some Medicaid-related markets, could be affected in states where it operates managed care plans.
• MOH — Molina Healthcare, a major Medicaid managed care company, could be directly affected by performance-based assignment rules.
• ELV — Elevance Health, which has Medicaid managed care operations in some states, could be impacted by how states rank and assign plans.
• CI — Cigna, through managed care and government health businesses, could be affected in markets where it participates in Medicaid managed care.