How much is enough? An evidence-based framework for setting Medicaid payment rates

Area of Science:

• Health Services Research
• Health Economics
• Public Health Policy

Background:

• Medicaid rate setting often lacks a direct link to beneficiary access to quality care.
• Existing Medicaid payment strategies may not maximize the return on investment in terms of healthcare access.

Purpose of the Study:

• To propose an evidence-based framework for Medicaid programs to set payment levels for healthcare services.
• To reframe the purpose of payment from the beneficiary's perspective, emphasizing access to quality care.

Main Methods:

• Measuring healthcare access directly.
• Assessing the adequacy of Medicaid payment levels based on access metrics.
• Developing actionable strategies to improve the return on Medicaid's investment in care.

Main Results:

• The proposed framework offers a novel approach to Medicaid payment setting.
• It provides a method for linking payment levels directly to measurable access outcomes.
• Examples of evidence, findings, and actions are presented to illustrate the framework's application.

Conclusions:

• An evidence-based framework can improve Medicaid payment adequacy and enhance beneficiary access to quality healthcare.
• Shifting the focus to beneficiary access optimizes Medicaid's investment in healthcare services.
• This approach offers a practical alternative to traditional Medicaid rate-setting methodologies.