Reconciling practice and theory: challenges in monitoring Medicaid managed-care quality

The massive shift to managed care in many State Medicaid programs heightens the importance of identifying effective approaches to promote and oversee quality in plans serving Medicaid enrollees. This article reviews operational issues and lessons from the ongoing evaluation of a three-State demonstration of the Health Care Financing Administration's (HCFA) Quality Assurance Reform Initiative (QARI) for Medicaid managed care. The QARI experience to date shows the potential utility of the system while drawing attention to the challenges involved in translating theory to practice. These challenges include data limitations and staffing constraints, diverse levels of sophistication among States and health plans, and the practical limitations of using quality indicators for a population that is often enrolled only on a discontinuous basis. To overcome these challenges, we suggest using realistically long timeframes for system implementation, with intermediate short-term strategies that could treat States and managed-care plans differently depending on their stage of development.