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Blog

Medicaid Managed Care Enrollment: Q4 2025 Trends and Early Signals Ahead of New Eligibility Policies

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This week 红领巾瓜报 (红领巾瓜报), draws on its database of monthly Medicaid managed care enrollment to present its latest quarterly analysis, offering a snapshot of enrollment trends across 37 states. 

The analysis comes at a critical time. As states prepare for Medicaid eligibility policy changes that take effect in 2027鈥攊ncluding more frequent eligibility determinations and expanded work and community engagement requirements鈥攃urrent enrollment trends provide an early signal of how policy decisions and administrative practices are already influencing coverage levels. 

The 红领巾瓜报 Information Services (红领巾瓜报IS) analysis shows that Medicaid managed care accounted for 85.6 percent of total Medicaid enrollment in December 2025. This analysis, available to 红领巾瓜报IS subscribers, uses data from nearly 300 health plans in 41 states.鈥疶he report provides by-plan enrollment plus corporate ownership, program inclusion, and for-profit versus not-for-profit status, with breakout tabs for publicly traded plans. 

Key Insights from Q4 2025 Data 

The 37 states included in this review have released monthly Medicaid managed care enrollment data through public websites or in response to a public records request from 红领巾瓜报. The report includes the most recent data obtained and illustrates the effect of state-level choices around eligibility and administration. Key findings include: 

  • As of聽December聽2025,聽Medicaid managed care enrollment across the 37 states declined by聽2.2 million members聽year over year, falling to 62.5 million鈥攁聽3.4 percent decrease.聽
  • Of the 37 states,聽eight鈥擟olorado, Delaware, Mississippi, Missouri, New Jersey, North Carolina, North Dakota, and Oregon鈥攄id聽not聽experience year-over-year聽managed care enrollment聽declines,聽and聽instead showed聽flat enrollment or modest gains.聽With the exception of Mississippi, these聽are聽all聽Medicaid expansion states.聽
  • Arizona聽and Indiana聽experienced聽double-digit聽percentage聽declines. Notably,聽Indiana began requiring聽enrollees聽to actively respond to renewal mailers,聽which aligns with聽enrollment declines that began in March 2025.聽
  • Among the聽expansion states in the analysis,聽enrollment聽declined聽by聽1.7聽million (-3.3%) to聽50.8聽million.聽The聽seven non-expansion states聽experienced聽a聽similar聽decline (-3.6%),聽bringing聽enrollment to聽11.7聽million enrollees.聽

Data Considerations. The data have some important limitations. States report enrollment figures at different points during the month, with some data reflecting beginning of the month totals and others capturing end of the month enrollment. In addition, some state datasets encompass all Medicaid programs offering managed care plans, whereas others reflect only a subset of the managed Medicaid population. As a result, the findings should be viewed as indicative of broader trends rather than a comprehensive state-by-state comparison.鈥�&苍产蝉辫;

Market Share and Plan Dynamics 

Using our data repository for 300 health plans across 41 states, 红领巾瓜报IS analyzes corporate ownership, program participation, and tax status among Medicaid managed care plans. As of December 2025, Centene maintained the largest share of the national Medicaid managed care market at 17.8 percent, followed by Elevance (10.4%), United (8.5%), and Molina (6.0%) (see Figure 1).鈥疶hese figures highlight continued concentration among large national plans, even as overall enrollment declines. 

Figure 1. National Medicaid Managed Care Market Share by Number of Beneficiaries for a Sample of Publicly Traded Plans, December 2025鈥� 

What to Watch鈥� 

Enrollment trends observed in the fourth quarter (Q4) of 2025 and continuing into 2026 indicate increasing state attention to eligibility policy and program integrity. State legislative activity, budget pressures, and federal regulatory developments are prompting many states to assess and strengthen certain aspects of their programs related to eligibility, particularly as they prepare to implement redetermination and work and community engagement requirements. 

Several states are already moving toward implementation. Nebraska is scheduled to launch Medicaid work requirements on May 1,聽2026,聽while Montana plans to begin implementation on July 1, 2026. With聽additional聽federal guidance still聽emerging, most other states are working toward compliance ahead of January 2027 deadlines.聽In聽expansion聽states,聽policymakers聽retain聽authority to tighten administrative processes, alter optional benefits, or adjust provider payment levels鈥攁ctions that聽may聽materially affect enrollment.聽

These developments underscore why Medicaid managed care enrollment trends deserve close attention. Declines in enrollment are often an early indicator of broader system impacts, including rising uncompensated care for providers, shifts in payer mix, and increased financial pressure on safety鈥憂et systems. For managed care organizations, even modest enrollment changes can mask more significant shifts in risk profiles, geographic concentration, or service needs. 

Connect with Us鈥� 

红领巾瓜报 is home to experts who know the Medicaid managed care landscape聽and how it is evolving. 红领巾瓜报IS鈥檚聽Medicaid聽enrollment data, financials,聽procurement聽tracking, and a robust library of public documents鈥痚quips stakeholders with聽timely, actionable intelligence.聽

For more information about the 红领巾瓜报IS subscription, contact鈥�Andrea Maresca鈥痑苍诲鈥�Alona Nenko.鈥�&苍产蝉辫;

Blog

Strategies to Address Fraud, Waste, and Abuse in Non-Emergency Medical Transportation

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Fraud, waste, and abuse (FWA) in Medicaid non-emergency transportation (NEMT) remain a persistent challenge for state Medicaid programs and health plans because of the scale and complexity of the benefit. NEMT is a critical, mandatory benefit intended to ensure eligible Medicaid beneficiaries without reliable transportation can get to necessary medical appointments. Numerous investigations and audits, however, have revealed that some transportation providers bill for trips that never occurred, inflate mileage, fabricate tolls, or even recruit patients with kickbacks to generate fraudulent claims, diverting limited program funding away from legitimate care needs.

The NEMT benefit represents a small share of Medicaid costs鈥攅stimated at around 1 percent of total Medicaid spending. With the codification of NEMT as a required benefit in 2020, market analysts forecast NEMT will grow considerably, nearly doubling in market size from 2021 to 2028.

Comprehensive, nationwide estimates specific to NEMT FWA are limited. Federal and state audits like those in , , and , however, have uncovered millions of dollars in claims that did not comply with federal and state requirements, underscoring systemic vulnerabilities in oversight and documentation. For example, a 2022 federal audit of New York Medicaid NEMT found an estimated $84 million in unallowable federal reimbursements and another ~$112 million that may not have complied with requirements over two years.[1]

Furthermore, individual criminal cases have involved schemes of $1 million to more than $2 million in falsely billed transportation services. Isolated settlements and audits indicate that fraud and abuse can be substantial locally even if we lack a clear, reliable national aggregate estimate.

A 2025 report by 红领巾瓜报 (红领巾瓜报) about NEMT contracting approaches found an opportunity for states and health plans that administer non-emergency transportation to leverage technology and require or incentivize new strategies to improve program integrity and quality in NEMT going forward. Some of the identified strategies to address FWA include:

  • Adopting or requiring digital solutions鈥攕uch as GPS trip verification, electronic visit logs, and real-time data analytics鈥攖o detect irregular billing patterns before claims are paid, replacing outdated paper logs and manual reconciliations that were prone to error and exploitation.
  • Focusing trip verification efforts on standing orders (pre-approved authorizations often for repeated treatments), given that they comprise the largest share of trips and are often vulnerable to fraud.
  • Positioning and educating medical facilities to be critical partners in preventing FWA by confirming appointment attendance, either via phone or signature on the trip log.
  • Automating mileage reimbursement (for enrollees who drive themselves or are driven by family members or friends) through a mobile app, which enabling riders to schedule and track their trips and submit claims quickly while allowing NEMT brokers to verify the mileage using GPS. This system would also allow brokers to better target their anti-fraud efforts, such as requiring additional documentation only for higher reimbursement amounts.

Since the publication of that report, several state Medicaid programs have issued NEMT procurements that maintain a strong emphasis on preventing FWA. For example, the 2025 Wisconsin NEMT RFP included provisions to promote greater collaboration between the Wisconsin Department of Health Services (DHS) Office of Inspector General (OIG) and NEMT broker, including 鈥渜uarterly and ad hoc meetings to discuss open complaint investigations, red flag patterns, and establish safeguards for ongoing or suspected fraud, waste, and abuse鈥� and imposed penalties for fraud incidents that go undetected by the broker.

FWA in Medicaid NEMT may represent a fraction of overall program spending, but the consequences are outsized: Every improper payment diverts resources away from beneficiaries who depend on transportation to access essential care. As states, health plans, and NEMT brokers modernize contract requirements, strengthen oversight, and embed technology-driven verification into their contracts and operations, the focus is shifting from retrospective recovery to proactive prevention, transparency, and accountability in transportation services.

Continued collaboration among Medicaid agencies, brokers, medical providers, and oversight entities will be critical for sustained progress. By pairing smarter contracting with real-time data tools and clear accountability, states and Medicaid health plans can better safeguard public dollars while ensuring that NEMT remains a reliable lifeline for the people it is designed to serve.

Learn more about how 红领巾瓜报 Helps NEMT Stakeholders Overcome Challenges. If your organization is ready to talk about how 红领巾瓜报 can help advance your NEMT goals, please contact one of our experts below.

Related Resources:

[1] US Department of Health and Human Services, Office of Inspector General. New York Claimed $196 Million, Over 72 Percent of the Audited Amount, in Federal Reimbursement for NEMT Payments to New York City Transportation Providers That Did Not Meet or May Not Have Met Medicaid Requirements. September 12, 2022. Available at: .

Blog

CBO鈥檚 New Baseline Signals Shifting Cost and Risk Dynamics in Medicaid and Medicare

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On February 11, 2026, the Congressional Budget Office (CBO) released  report. The publication, which represents the first time CBO has released Medicare and Medicaid spending baseline projections since , reflects the impact of the 2025 Budget Reconciliation Act (P.L. 119-21, OBBBA), recent changes to Medicare reimbursement for skin substitute products, and the latest Medicare Part D and Medicare Advantage bids.

CBO鈥檚 baseline serves many functions, including serving as the official 鈥渟corekeeping鈥� benchmark used for cost estimates of proposed legislation under consideration in Congress.

Changes to CBO鈥檚 Medicaid Baseline

CBO decreased its projections of 2026鈥�2035  by approximately $514 million from its January 2025 baseline update. The main driver of that reduction is the impact of the Medicaid provisions in the 2025 Budget Reconciliation Act, which CBO expects will reduce total Medicaid enrollment by 13.1 million people in 2035. The drop in Medicaid spending from the OBBBA-related enrollment reductions was partially offset by technical changes CBO made to the Medicaid baseline.

Medicaid costs per enrollee grew by 16 percent in 2025, which was more than CBO had anticipated. The agency attributes the cost per enrollee growth to a reported decrease in the average health status of Medicaid enrollees following the end of the COVID-era continuous eligibility policy.

CBO anticipates that payment rates for Medicaid managed care plans will begin to rise in 2026 because of this decrease in the average health status of enrollees, and the agency has updated the Medicaid baseline accordingly (see Figure 1).

Source: 红领巾瓜报 analysis of CBO鈥檚  and F reports.

Changes to CBO鈥檚 Medicare Baseline

Compared with its January 2025 baseline, CBO increased its projections of  by about $1 trillion (roughly $942 billion, by 红领巾瓜报 (红领巾瓜报) calculations). The main driver of that increase came from CBO鈥檚 updates to its Medicare Part D spending projections, which were increased to reflect higher than expected 2026 bids from private insurance plans that administer the Part D benefit. According to their 2026 bids, Part D plans anticipate a 35 percent increase in their annual per enrollee costs in 2026鈥攁 trend that CBO was not expecting and . Part D spending per beneficiary in 2035 is now projected to exceed $4,000, up from less than $3,000 in the January 2025 baseline (See Figure 2).

The agency鈥檚 Medicare Part A fee-for-service (FFS) spending projection increase was the result of larger than expected increases in 2025 enrollment and per enrollee spending. Those trends were also seen in Medicare Part B FFS but were partially offset by the Centers for Medicare & Medicaid Services鈥檚 (CMS) recent reimbursement changes to skin substitute products. Overall, CBO estimates that the skin substitute reform issued in CMS鈥檚  and  final rules will save $245 billion over the 2026鈥�2035 period, including the effects on the Medicare Advantage (MA) program (see Figure 3).

Finally, CBO reduced its spending projections for MA compared to the January 2025 baseline. This change was made to reflect lower-than-expected Medicare Advantage enrollment in 2025, although the spending implications of lower enrollment were partially offset by higher-than-expected bids in 2026 by providers of MA plans (see Figure 4).

Source: 红领巾瓜报 analysis of CBO鈥檚  and  reports.
Source: 红领巾瓜报 analysis of CBO鈥檚  and  reports.
Source: 红领巾瓜报 analysis of CBO鈥檚  and  reports

Contact an 红领巾瓜报 Expert Today

Interested in understanding how CBO鈥檚 latest baseline update affects the federal budgetary implications of certain Medicare or Medicaid policy topics or proposals? Contact our experts, Mark Desmaris and Rachel Matthews, to learn more about 红领巾瓜报鈥檚 鈥淐BO-style鈥� federal budgetary scoring work, which relies on The Moran Company鈥檚 long-standing methodology. [1]

Beyond federal budget scoring, 红领巾瓜报 is working with states, health plans, and providers to assess how changes in enrollee health status are affecting utilization, costs, and payment rates鈥攁nd what those trends may mean for Medicaid and MA organizations and providers. Our teams support states in evaluating managed care rate setting and program design, help Medicaid and MA plans anticipate risk and bid implications, and assist providers in understanding how changes in patient acuity could affect care delivery, contracting, and financial performance.

[1]Specifically, we apply our understanding of CBO precedents to predict how CBO will likely evaluate the budgetary impact of the legislation in question. We use our best judgment to adopt the assumptions CBO would tend to use, with the understanding that any variance in the assumptions CBO ultimately adopts could cause our estimate to differ from theirs.

Brief & Report

Case Study Report: Lessons Learned from HealthySteps Technical Assistance in California

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This report synthesizes insights from multiple efforts to support the financial sustainability of HealthySteps sites in California, including federally qualified health centers (FQHCs), community clinics (non-FQHCs), private practices, and other settings. Led by the HealthySteps National Office and 红领巾瓜报 (红领巾瓜报), the technical assistance (TA) elevated challenges, strategies and best practices to achieve sustainability informed by learning collaboratives, individualized TA sessions, and financial modeling exercises. This report complements additional resources that the HS National Office and 红领巾瓜报 developed which are available via the HealthySteps (HS) Sustainability website.

Brief & Report

Medicaid Changes in the OBBBA and Implications for the Marketplace and Individual Market in 2027

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In recent years, the individual market has undergone significant disruption. The expiration of enhanced premium tax credits (ePTC) at the end of 2025 and sweeping eligibility changes under the 2025 Budget Reconciliation Act (OBBBA) have reshaped鈥攁nd will continue to reshape鈥攖he individual market.

The number of changes facing states and issuers in coming years are significant. As a result, it is unsurprising that discussion and analysis on the individual market impacts of the new Medicaid requirements is limited and expected to result in large numbers of Medicaid beneficiaries being disenrolled. Between community engagement requirements (i.e., work requirements), increases in eligibility checks, and loss of eligibility for certain immigrant population, the expectation is that millions of people will leave Medicaid in 2027.

This brief explores how these coming changes will reshape coverage pathways and costs, and examines implications for consumer affordability and churn, issuer pricing and risk pools, and state administrative burdens鈥攁longside strategies for states, issuers, and policymakers to mitigate adverse effects.

Blog

Tracking Medicaid鈥檚 Growth: FFY 2025 Spending and T-MSIS Data Provide Insights on Managed Care Spending

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This week, our鈥�In Focus鈥痵ection highlights findings from a 红领巾瓜报 Information Services (红领巾瓜报IS) analysis of the Centers for Medicare & Medicaid Services (CMS) preliminary CMS-64 Medicaid expenditure report for federal fiscal year (FFY) 2025. The data show total medical services expenditures reached $971.4 billion across all states and territories, up 6.9 percent from FFY 2024. 

This CMS-64 spending detail provides important context as states prepare for their upcoming legislative sessions and begin implementing changes required under the 2025 budget reconciliation act (P.L. 119-21, OBBBA). Early fiscal and operational pressures will stem from changes to the Supplemental Nutrition Assistance Program (SNAP) and preparations for community engagement requirements for Affordable Care Act (ACA) Medicaid expansion enrollees. In subsequent years, pressures will intensify because of major changes to provider tax financing and new federal limits on state directed payments in 2027 and early 2028. 

In this article, we provide a deeper review of Medicaid spending, including the federal-state financing split. As Medicaid agencies prepare for upcoming spring sessions and anticipate potential program changes under OBBBA, it is notable that  report an at least fifty percent likelihood of a Medicaid budget shortfall in FFY 2026. 

Growth and Drivers in Medicaid Managed Care Spending 

The 红领巾瓜报IS analysis looks at CMS-64 preliminary estimates of Medicaid spending by state for FFY 2025. CMS  state expenditures through the automated Medicaid Budget and Expenditure System/State Children鈥檚 Health Insurance Budget and Expenditure System (MBES/CBES). 

While enrollment decreased for most states following the COVID-19 public health emergency unwinding, states saw an uptick in expenditures due to increased state directed payments, greater utilization and sicker populations, higher drug costs, increased provider rates, and greater use of long-term services and supports and behavioral health. 

Key findings from 红领巾瓜报IS鈥� analysis (see Table 1), include: 

  • Total Medicaid managed care spending (federal and state share聽combined)聽reached聽$550.5聽billion聽in聽FFY 2025,聽up from聽$517.5聽billion聽in聽FFY 2024.聽
  • This聽amount聽represents聽a聽6.4聽percent聽year-over-year increase from聽FFY 2024聽to聽FFY 2025.聽
  • Managed聽care聽accounted for 56.7聽percent聽of total Medicaid spending in聽FFY 2025, down聽0.3聽percentage points聽from the previous聽year.聽
  • The聽$33 billion聽increase from FFY 2024 to FFY 2025 exceeds the聽$9.4 billion聽increase seen the year prior, reflecting renewed growth following the unwinding transition period.聽

These figures include spending on comprehensive risk-based managed care organizations (MCOs), prepaid inpatient health plans (PIHPs), and prepaid ambulatory health plans (PAHPs). PIHPs and PAHPs refer to prepaid health plans that provide a subset of services, such as dental or behavioral health care. This total is exclusive of fee-based programs such as primary care case management models. 

Table 1. Medicaid MCO Expenditures as a Percentage of Total Medicaid Expenditures, FFY 2020鈥�2025 (in millions) 

Annual Medicaid managed care expenditures have grown consistently with total Medicaid expenditures. After slower growth in FFY 2024鈥攚hich aligned with the post-COVID-19 policy unwinding period when many states completed eligibility redeterminations鈥擣FY 2025 again experienced an uptick in managed care growth (see Figure 1). 

Figure 1. Total and MCO Medicaid Expenditures, FFY 2020鈥�2025 ($M)

Federal versus State Share Spending 

The preliminary FFY 2025 expenditure data provides a baseline before OBBBA鈥檚 changes are scheduled for implementation and as states continue to face Medicaid funding challenges. In FFY 2025, federal funding accounted for 64.2 percent of FFY 2025 spending, and non-federal matching funds accounted for 35.8 percent (see Table 2). Particularly later in 2027, 2028, and subsequent years, Medicaid expansion states stand to see disproportionally larger increases in their share of spending. 

Table 2. Federal versus State Share of Medicaid Expenditures, FFY 2020鈥�2025 (in millions)

T-MSIS Data Adds Detail to CMS-64 MCO Spending 

To complement CMS-64 macro-spending trends, 红领巾瓜报 developed a methodology allowing us to use Transformed Medicaid Statistical Information System (T-MSIS) data to approximate managed care spending by service category. Although T-MSIS enables more granular views (e.g., professional services, inpatient/outpatient hospital services, skilled nursing facilities (SNFs), HCBS, clinics, pharmaceuticals), the most recent dataset typically lags one to two years behind CMS-64 totals. 

红领巾瓜报鈥檚 analysis of the T-MSIS data shows that while managed care remains the dominant delivery system model for Medicaid, spending by provider types helps contextualize the CMS-64 report. Notably, the CMS-64 reports FFY25 data and our report below on T-MSIS disaggregation uses 2023 data. Although the T-MSIS and CMS-64 data are for different years, it still highlights the main components of the largest spending component of the CMS-64 with more recent data. 

The 2023 T-MSIS analysis shows the following: 

  • Professional fees are the lead spending category, with聽nearly聽30聽percent聽of spending directed聽toward聽payments to physicians and other practitioners (e.g., physician assistants, nurse practitioners). Given that T-MSIS data are built around billing codes, services that traditionally may be considered part of a bundled rate (i.e.,聽a large portion聽of physician services delivered in hospitals and clinics) are聽essentially unbundled聽and considered professional fees.聽
  • Hospital spending聽(inpatient plus outpatient), SNF聽costs, and professional fees聽together聽account for close to 75聽percent of spending in聽CY 2023.聽

Figure 2. T-MSIS Medicaid Spending by Service Category 2023 (MCO disaggregated plus FFS)

What to Watch 

Because Medicaid is such a big part of state government spending, outlays for Medicaid will always be a focus and challenge for states. Upcoming state legislative sessions and OBBBA driven changes will begin in 2026 with SNAP pressures and major operational preparations for community engagement requirements for expansion states. Preparations for new limits on provider taxes and state directed payments will likely begin immediately, but the true impacts will occur in 2027 and early 2028. States will need to tailor their programs under funding constraints. 

Connect with Us 

红领巾瓜报IS, a subscription-based tool that 红领巾瓜报 offers, provides state-by-state analysis of the CMS-64 data, Medicaid managed care enrollment trends, and state budget reporting. For more information about an 红领巾瓜报IS subscription, contact Andrea Maresca and Alona Nenko. For details on T-MSIS data, contact Matt Powers and Shreyas Ramani. 

Brief & Report

Updated Analysis Compares Consumer Out-of-Pocket Spending of ACA Marketplace Enrollees to other Major Payers Using Claims Data

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红领巾瓜报 and Wakely, an 红领巾瓜报 Company, have released an updated Issue Brief to the comprehensive profile of ACA Marketplace enrollees that was based on claims data from nearly 6 million of the 24 million Marketplace enrollees.

The issue brief discusses these key questions:

  1. Do Marketplace enrollees spend more or less out-of-pocket relative to Medicare, ESI and Medicaid enrollees?
  2. How may the potential expiration of eAPTCs impact out-of-pocket costs?
  3. What are some initial considerations regarding overall healthcare affordability?

Please fill out this form to receive a copy of the update and issue brief.

Contact any of the report authors with further questions, or to discuss potential applications of this work for your organization.

Blog

The Future of Integrated Care Programs for Dually Eligible Individuals in Massachusetts: Key Takeaways from the Fall 2025 MAHP/红领巾瓜报 Policy Forum

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红领巾瓜报 (红领巾瓜报) recently co-hosted a policy forum with the Massachusetts Association of Health Plans (MAHP), entitled Advancing Better Outcomes: How the One Care and SCO Programs Improve Health for Older Adults and People with Disabilities on Medicare and Medicaid. More than 100 key decision makers from MassHealth (Medicaid), health plans, providers, community-based organizations, and advocacy organizations attended the conference, elevating the value of the MassHealth and (SCO) programs to dually eligible individuals. The policy forum also provided an important opportunity for state legislators and their staff to learn about these complex programs.

MassHealth One Care and SCO Programs

Massachusetts鈥� One Care and the SCO programs currently serve more than individuals covered under MassHealth and Medicare, also known as dually eligible individuals. One Care is a population-specific program for dually eligible adults 21-64 years of age. SCO is a population-specific program for dually eligible older adults 65 and older, tailored to the needs of older adults. The One Care and SCO programs serve individuals with complex chronic conditions and disabilities, including mental health and substance use disorder needs, and high home-and-community-based service (HCBS) needs. The One Care and SCO programs advance independent living, recovery, and community living goals. Approximately 99 percent of One Care enrollees, and 95 percent of SCO enrollees, live in the community.

The One Care program is currently authorized as a Financial Alignment Initiative (FAI) demonstration program. The FAI demonstration ends December 31, 2025. MassHealth will continue the One Care program as a model. This transition from the FAI to a FIDE SNP model introduces changes to the program. A FIDE SNP model is a type of .

红领巾瓜报鈥檚 Role: Bringing National and State Expertise

In addition to creating the forum in partnership with MAHP, 红领巾瓜报 shared its national and state policy expertise and local market insights with attendees during a series of presentations. 红领巾瓜报 outlined ways in which the One Care and SCO programs offer more value to dually eligible individuals than the state鈥檚 fee-for-service (FFS) system.

The event focused on three key topics:

  • The national landscape for Medicare-Medicaid integrated care programs.
  • The value of the One Care and SCO programs and the role that health plans play in improving outcomes for adults who are eligible for both Medicare and Medicaid (“dually eligible”), and
  • The upcoming changes to the One Care and SCO programs, as reflected in the with MassHealth.

Key Takeaways from the MAHP-红领巾瓜报 Conference

Key Takeaway #1. Nationwide trends suggest that Medicare-Medicaid integrated care programs will face competition and financial pressures.

Forum attendees were very interested in the national trends. At the national level, D-SNPs have bipartisan support. At the same time, D-SNPs should expect competition from and innovation models developed by the Centers for Medicare and Medicaid Innovation (CMMI). CMMI models such as the Model and Model will compete with D-SNP models in some markets. Finally, presenters and panelists alike raised concerns about the financial risks that D-SNPs will face due to rising pharmacy costs and changes in Medicare payment methodologies.

Key Takeaway #2. The Massachusetts One Care and SCO programs provide significant value to dually eligible individuals in Massachusetts.

The One Care and SCO programs provide significant value to enrollees. As compared to FFS, Medicaid-Medicaid integrated care programs like One Care and SCO provide care coordination, a personal care plan, bundling prescriptions through a single provider, and other services.

Many forum attendees pointed out that the One Care program is one of the most advanced integrated care programs in the nation. One Care鈥檚 success is tied in part to the active and critical role that the plays in shaping program policy. For more than a decade, the One Care Implementation Council and MassHealth have worked in partnership to improve the program. As shared by the : 鈥淭he Commonwealth intends to preserve the Implementation Council鈥檚 role in the next phase of One Care, and to continue engaging the council as an essential partner in policy and program change, monitoring, and oversight.鈥�

Key Takeaway #3. Over the last two decades, SCO and One Care plans have established many innovations.

The forum highlighted many innovations in these programs, from primary and to . It also provided an opportunity to talk about the important role and commitment that the plans have in emergency situations to ensure that members are safe in the face of a community crisis.

Panelists see many opportunities for plans to continue to evolve and improve outcomes and equity. For example, the One Care program has significant opportunities to address the behavioral health needs of dually eligible adults. Dually eligible adults with mental health and/or substance use disorder diagnoses are at higher risk of an emergency department visit and inpatient stay than other enrollees. Health plan per member per month (PMPM) spending on inpatient services for those with a behavioral health condition is much higher as a share of the total PMPM than other populations. The 红领巾瓜报 data pointed to a need for further innovation in the mental health arena to advance better outcomes of quality of life and costs.

Key Takeaway #4. Conference attendees focused on the importance of addressing enrollees鈥� social determinants of health needs.

Throughout the day, the importance of community and addressing the social determinants of health (SDOH) was a common theme. Aging and disability leaders spoke about the importance of community organizations such as , , including peer support since most  One Care and SCO individuals live in the community.

Many One Care and SCO eligible individuals are often just one unmet health related social need away from the risk of hospitalization or institutionalization. Other attendees underscored the risk that enrollee living situations and recovery can become instantly unstable due to the death of an important family member. One aging leader described her role as 鈥渢riaging risk.鈥� Other leaders from the disability community urged plans to use to improve plan and provider attention to identify and address the SDOH needs.

Looking Ahead

As Massachusetts prepares for the 2026 One Care and SCO contract year, the forum underscored the progress made over the past decade and the opportunities ahead to improve care coordination, collect z codes, and invest in outcomes-driven partnerships. Massachusetts is well-positioned to continue leading the nation in designing integrated care programs that improve health and support community living for older adults and people with disabilities.

红领巾瓜报 looks forward to supporting all organizations including state Medicaid programs and health plan and provider associations as they convene stakeholders to improve their integrated care programs. Our expertise includes program planning, strategy and implementation, technical support and evaluation, and state-specific knowledge to make projects successful. Please contact Ellen Breslin, Rob Buchanan, and Julie Faulhaber for more information on how 红领巾瓜报 can help your organization.

Summary Facts About the One Care and SCO Programs
The One Care and SCO programs are population-specific programs, serving more than 125,000 individuals with MassHealth plus Medicare coverage.   MassHealth designed the One Care and SCO programs around the specific needs, preferences and goals of adults and older adults.The One Care program enrolls dually eligible adults with disabilities, ages 21-64 at the time of enrollment, covered under MassHealth Standard or CommonHealth and Medicare (Parts A and B, and eligible for Part D). Enrollees in One Care have multiple chronic conditions and disabilities including significant mental health and substance use disorder needs. The SCO program enrolls dually eligible adults ages 65 and older, covered under MassHealth Standard and Medicare (Parts A and B, and eligible for Part D). SCO enrollees have significant chronic conditions, many of which are associated with aging.
MassHealth launched the SCO program in 2004 and One Care in 2013.   The One Care program currently operates as a Financial Alignment Initiative (FAI) demonstration. The One Care and the SCO programs combine MassHealth & Medicare benefits into a single plan with one card and one care team. One Care covers medical, mental health, and prescription medications, plus support for daily tasks and independent living and recovery. Care coordinators help members stay healthy and get the services they need.
The One Care and SCO Programs Continue to Evolve. The FAI demonstration authority ends in 2025. Massachusetts will shift from the demonstration to a Fully Integrated Dual Eligible Special Needs Plan (FIDE-SNP) structure. The SCO program currently operates as a FIDE SNP model. The state reprocured the One Care and SCO plan network. The state selected five One Care plans and six SCO plans. New contracts for One Care and SCO plans start January 1, 2026.The new contracts create several changes including changes in eligibility for the program and enrollment processes, benefits, and financial payment provisions.
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CMS Clarifies Grandfathering Rules for State Directed Payments

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The Centers for Medicare & Medicaid Services (CMS) last month issued a  to states providing preliminary guidance on  (SDPs), which outlines new federal payment limits, clarifies grandfathering provisions, and signals significant changes ahead for Medicaid financing and policy. The letter is part of CMS鈥檚 implementation of Section 71116 of the Budget Reconciliation Act of 2025 (, P.L. 119-21)鈥攖he portion of the legislation that focuses on curbing SDP spending and reinforcing program integrity.

Though CMS describes the guidance as preliminary, it is the view of 红领巾瓜报 (红领巾瓜报) experts鈥攊ncluding former state officials, actuaries, and policy strategists鈥攖hat it signals directionally new policy for Medicaid agencies, managed care organizations (MCOs), and providers. CMS is working on two proposed SDP-related regulations, which are in the final stages of federal review. The preliminary guidance and forthcoming rules will likely reflect long-standing concerns for several years, even over shifting congressional control and multiple presidential administrations.

This article addresses key clarifications in the letter; the impact of the preliminary guidance on states, MCOs, and providers; and how the directive may influence Medicaid budgets, financing strategies, and future policy reforms.

Guidance Clarifies Timeframes for SDPs

Grandfathering Limited to Specific Rating Periods

CMS will allow states to maintain SDP spending amounts, up to the average commercial rate ceiling, that were in place for state fiscal year (SFY) 2025, calendar year (CY) 2025, and SFY 2026 rating periods. Nonetheless, new or expanded SDPs above Medicare equivalent levels in expansion states and 110 percent of Medicare in non-expansion states鈥攅ven those based on legislation passed in 2025鈥攁re ineligible for grandfathering if they apply to rating periods starting after July 4, 2025. These grandfathered spending amounts will need to phase down with rating periods beginning on or after January 1, 2028.

Preliminary Grandfathering Determinations

CMS has begun notifying states whether a preprint is 鈥渓ikely eligible鈥� for grandfathering. Because these are preliminary determinations, states should prepare for further review and revisions.

Submission Cutoff Date Clarified

In response to confusion around the May 1, 2025, submission deadline, CMS clarified that July 4, 2025, is the cutoff for grandfathering eligibility, provided the state fully completed the preprint. States may have rushed to meet a July 4 submission deadline and may have left questions on the preprint unanswered. In these instances, it is possible鈥攊f not likely鈥攖hat CMS will consider the application incomplete and thus ineligible for grandfathering. Since this is a developing area with limited precedent, states may still seek clarification or reconsideration, though CMS has not yet issued definitive guidance or a formal process for resolving these situations.

No Increases Allowed Until 2028

States are prohibited from increasing the total dollar amount of grandfathered SDPs鈥攖he 鈥渆xpected spend鈥濃�攗ntil January 1, 2028. This restriction limits flexibility for states to expand their programs and may require that they reassess their SDP strategies. For example, using percentage-based calculations tied to average commercial rates, will no longer capture year-to-year growth because of utilization or acuity changes.

10 Percent Phasedown Unaddressed

CMS has yet to provide official guidance on the 10 percent phasedown of SDPs. Stakeholders remain in a holding pattern, awaiting a forthcoming proposed rule that will clarify how reductions will be calculated.

What It Means for States and Healthcare Organizations

SDPs have become a critical tool for states to stabilize provider networks through increased Medicaid reimbursement. This authority will be significantly limited, and states will need to reduce many existing programs. Medicaid enrollment losses resulting from other Medicaid policy changes, such as work requirements and minimum semiannual redetermination, will likely compound the strain on provider payments.

Providers and states need to start planning for these losses in revenue now. Strategic planning for SDP sustainability and close monitoring of upcoming CMS rulemaking is essential.

While the guidance imposes constraints, it also opens the door for policy innovation. For example, some states may use this moment to reform Medicaid financing, streamline supplemental payments, and reconfigure provider incentives to better reflect quality and access, advancing value-based care goals and achieving total cost of care savings through efficiency and aligned incentives.

Connect with Us

红领巾瓜报 is uniquely positioned to support states, MCOs, and providers as they navigate the evolving landscape of Medicaid SDPs. Our team includes former state Medicaid directors, actuaries, and policy strategists with deep expertise in designing sustainable financing arrangements and guiding public engagement processes. We bring robust modeling capabilities to clients seeking to assess the financial impact of CMS鈥檚 new restrictions, including the 10 percent phasedown and interactions with provider tax limitations. Our experts are actively engaged with CMS and understand how to translate federal guidance into actionable strategies that align with state goals and operational realities.

Whether revising preprint submissions, evaluating quality frameworks, or rethinking provider incentives, 红领巾瓜报 delivers the technical and policy insight needed to move forward with confidence.

For questions about the federal guidance and considerations for your organization, contact our experts below.

Helping a Medicare Advantage Plan Identify Gaps in Part D Benefit Quality

Helping a Medicare Advantage Plan Identify Gaps in Part D Benefit Quality

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THE CLIENT

The client for this project is a health plan that provides both traditional Medicare Advantage (MA) plans and those that address chronic conditions and social determinants of health, to reduce healthcare disparities among historically underserved populations in the central and eastern United States. Their plans integrate Medicare Part A and Part B benefits with Part D prescription drug coverage, along with providing robust extra benefits.

BACKGROUND

MA Plans are assuming bigger risk in their Part D benefit spending than in previous years due to recent changes in MA rules. Audits of the program, a requirement to participate in MA, will mean that there are increased compliance and operational risks in how plans go about serving their members with the Part D benefit. As the regulatory environment changes, guarantees in pharmacy benefit manager (PBM) contracts need solidifying, and will require rigorous oversight by the plans to reduce risk. MA plans need to ensure alignment and collaboration across their organizations and with vendors to optimize initiatives in quality and Stars. It is also important to establish alignment and engagement early within the yearly bid cycle. T he client engaged 红领巾瓜报 due to our diverse expertise in Part D plans including operations, PBM and vendor oversight, health plan leadership, Stars and quality programs, financial and actuarial analysis, and compliance.

APPROACH

红领巾瓜报 performed an assessment to analyze and measure the effectiveness of Part D operations, including a comprehensive review of the plan鈥檚 Part D benefit, and identified gaps in Part D policies, procedures and staffing. The effort also documented operational efficiencies, quality improvement recommendations and opportunities for the client to increase their Part D Star ratings. 红领巾瓜报 identified areas of improvement and provided actionable insights to guide future decisions. The assessment utilized a combination of data, documents and interviews to cover various dimensions such as performance, compliance, effective oversight, and collaboration.

RESULTS

The final report recommended a series of organizational changes and quality improvements to enable the client to optimize their Part D operations. Recommendations were made in the following areas:

  • Policies and procedures: Identified gaps in the client鈥檚 internal policies and procedures, and provided recommendations to cure the deficiencies, including the development of desk-level guides.
  • Comprehensive oversight: Identified oversight gaps in vendor management and provided recommendations to improve.
  • Part D strategic leadership & proposed new staffing model: 红领巾瓜报 drafted a best-in-class organization and staffing plan that permits the client to scale up with a delineated staffing structure designed to ensure optimal oversight of Part D quality.
  • Collaboration: Identified gaps in PBM contracts and provided recommendations for negotiating and bolstering account management. The new plan also recommends expanding the Part D team鈥檚 role and involvement with provider engagement teams in order to increase overall CAHPS results to improve Star ratings.
  • Financial/actuarial analysis: Identified changing regulatory reporting (Direct and Indirect Remuneration) and capturing required information related to Manufacturer Discount Program (MDP) and Medicare Prescription Payment Plan (M3P).

HOW 红领巾瓜报 CAN HELP YOUR ORGANIZATION

If your organization wants to undertake a similar review of your Part D organization, we encourage you to engage with your teams to review and prioritize findings and recommendations to build out best practices and best in class plan operations. 红领巾瓜报 can help you develop a plan and guide you through the processes, identify issues that might not otherwise be identified internally, and provide recommendations for ways to optimize your efforts. Our team brings together expertise in Medicare Advantage, Part D, pharmacy, quality and accreditation programs, on the ground leadership experience in health plans, financial and actuarial expertise, with in-depth insider knowledge from our work in states across the country. Contact us to learn more about how 红领巾瓜报 can help.

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红领巾瓜报 Enrollment Update: Medicaid Managed Care Organizations See Drop in Enrollment in 2Q25

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This week, our second In Focus provides insights into Medicaid managed care enrollment in the second quarter of 2025. 红领巾瓜报 Information Services (红领巾瓜报IS) obtained and analyzed monthly Medicaid enrollment data in 30 states,[1] offering a reliable baseline and timely view of the immediate impact of the current policy landscape as new federal policies take effect.

This analysis presents a snapshot of 红领巾瓜报IS鈥檚 comprehensive detailed quarterly Medicaid managed care enrollment report (available by subscription), which includes plan-level information for nearly 300 health plans in 41 states, corporate ownership, for-profit versus not-for-profit status, and similar information regarding publicly traded plans. Table 1 provides a sample of enrollment trends, representing 57 million Medicaid managed care enrollees of a total of 66 million Medicaid managed care enrollees nationwide. Data reporting periods and program coverage vary by state, so figures may not be fully comparable.

Key Insights from 2Q25 Data

The 30 states included in our review have released monthly Medicaid managed care enrollment data鈥攙ia a public website or in response to a public records request from 红领巾瓜报IS鈥攆or April through June of 2025. This report reflects the most recent data posted or obtained from states. 红领巾瓜报 has made the following observations regarding the enrollment data:

  • Year-over-year decline. As of June 2025, in the 30 states reviewed, Medicaid managed care enrollment declined by 1.6 million members year-over-year, a 2.7 percent drop from June 2024.
  • Widespread decreases. Of the 30 states, 27 experienced enrollment declines in June 2025 compared to June 2024. Oregon and the District of Columbia saw modest growth, while California remained flat (Table 1).
  • Sharpest contractions. Arizona and Maryland reported double-digit percentage drops in enrollment in June 2025 (Table 1), underscoring the uneven impact of redeterminations and eligibility policy changes.
  • Difference among expansion and non-expansion states. Among the 24 states included in the analysis that expanded Medicaid, enrollment fell by 1.2 million鈥攁 2.5 percent drop鈥攖o 49.2 million. The six non-expansion states saw a steeper proportional decline of 4.2 percent, to a total of 8 million enrollees.

Table 1. 2Q25 Monthly MCO Enrollment by State, April鈥揓une 2025

Note: 鈥�+/- m/m鈥� refers to the enrollment change from the previous month, and 鈥�% y/y鈥� refers to the percentage change in enrollment from the same month in the previous year.

The data in Table 1 should be viewed as a sampling of enrollment trends across these states rather than as a comprehensive comparison, which cannot be established based solely on publicly available monthly enrollment data. It is also important to note the limitations of the data presented. For example, not all states report data at the same time during the month, resulting in a range of snapshots from the beginning to the end of the month. Second, in some instances, the data cover all Medicaid managed care programs, while in others they reflect only a subset of the broader managed Medicaid population, depending on what data is publicly available.

Market Share and Plan Dynamics

红领巾瓜报IS鈥檚 report includes plan-level details for nearly 300 plans, covering corporate ownership, program participation, and tax status. As of June 2025, Centene continues to lead the national Medicaid managed care market with 17.8 percent share, followed by Elevance (10.4 percent), United (8.6 percent), and Molina (6.2 percent; see Table 2).

Table 2. National Medicaid Managed Care Market Share by Number of Beneficiaries for a Sample of Publicly Traded Plans, June 2025

What to Watch

The OBBBA (P.L. 119-21) calls for significant changes to Medicaid eligibility and enrollment policies, including work requirements and more frequent eligibility redeterminations.  indicate that Medicaid and Children鈥檚 Health Insurance Program enrollment could decline by up to 7.5 million people by 2034. In addition, the Centers for Medicare & Medicaid Services (CMS) has announced that it will not approve or extend waivers for multi-year continuous eligibility for adults or children.

As these policies are implemented, state governments and healthcare organizations should prepare for increased administrative complexity, potential coverage disruptions, and the resulting effect on MCO revenue and value-based care arrangements.

Connect with Us

红领巾瓜报 is home to experts who know the Medicaid managed care landscape at the federal and state levels. As the Medicaid landscape continues to evolve, 红领巾瓜报IS equips stakeholders with timely, actionable intelligence, including enrollment data, quarterly by-plan and by-state enrollment reports, financials, Medicaid demonstration and Rural Health Transformation program tracking, and a robust library of publicly available Medicaid-related documents. 红领巾瓜报IS combines publicly available information with 红领巾瓜报 expert insights on the structure of Medicaid in each state, as well as our comprehensive, proprietary State Medicaid Overviews.

For questions about the 红领巾瓜报IS enrollment report and information about the 红领巾瓜报IS subscription, contact our experts below.

Brief & Report

Finding a Path to Support Aging in Place in California聽

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New 红领巾瓜报 report discusses the unmet needs of older adults in low-income housing, highlighting the challenges of siloed programs and the difficulty in blending services

Research consistently shows that more than 70 percent of Americans want to age in place, remaining in their own homes. Yet the country鈥檚 shifting demographics, rising costs for long-term services and supports, and changing financing landscape make achieving this goal more challenging than ever, especially for low-income older adults. In fact, more than one-quarter million older Californians live in senior affordable housing developments that range in size from a few dozen apartments to over a thousand units in large high rises. Most striking was the finding that while many of these residents are not only low-income and disproportionately burdened with chronic disease and also dually eligible for Medicaid and Medicare鈥攁 group shown in countless studies to represent a considerable proportion of Medicare and Medicaid costs, but that few residents appear to participate in aligned Medicare and Medicaid special needs plans (D-SNPs) or to access Medi-Cal waiver services.

The report gathers direct input from older adults, including Asian populations, in eight languages, addresses critical funding gaps, and identifies policy priorities that if implemented offer innovative recommendations for California to reduce duplication and better serve older adults using current resources.

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