In 1981, the federal government passed a law that gave states permission to change the structure of their Medicaid program. States could now, if they wished, require Medicaid beneficiaries to enroll in a Medicaid “managed care organization” (MCO), as long as Medicaid recipients were offered a choice of several plans. Medicaid recipients would be required to receive their medical care only through their MCOs. The MCOs would receive fixed, regular payments from the state and, in return, would cover the medical expenses of their Medicaid enrollees.
a. Using what you know about Medicaid and managed care, explain several reasons why policy makers might support the requirement that Medicaid beneficiaries enroll in MCOs.
b. Again, applying what you know about Medicaid and managed care, how do you think this requirement would affect the decision of people who are eligible to enroll in Medicaid? Be specific about which Medicaid eligibles are likely to change or not change their decision to enroll.
c. How might this requirement affect overall access to care for Medicaid eligibles?