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Health Plan Payment in Medicaid Managed Care: A Hybrid Model of Regulated Competition

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  • Timothy Layton
  • Alice K. Ndikumana
  • Mark Shepard

Abstract

Medicaid, the government program for providing health insurance to low-income and disabled Americans, is the largest health insurer in the United States with more than 73 million enrollees. It is also the sector of the U.S. public health insurance system that relies most heavily on the tools of regulated competition with more than 60% of its enrollees enrolled in a private health plan in 2014. However, regulated competition in Medicaid differs from the typical model, emphasizing the tools of competitive procurement -- such as competitive bidding, the threat of exclusion from the market, and auto-assignment of enrollees to plans -- to attempt to improve efficiency, instead of relying primarily on the forces of consumer demand. In this paper, we discuss how Medicaid combines the tools of competitive procurement with the tools of regulated competition and some potential consequences of this hybrid model.

Suggested Citation

  • Timothy Layton & Alice K. Ndikumana & Mark Shepard, 2017. "Health Plan Payment in Medicaid Managed Care: A Hybrid Model of Regulated Competition," NBER Working Papers 23518, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:23518
    Note: HC HE PE
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    References listed on IDEAS

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    7. Michael Geruso & Timothy J. Layton & Jacob Wallace, 2020. "Are All Managed Care Plans Created Equal? Evidence from Random Plan Assignment in Medicaid," NBER Working Papers 27762, National Bureau of Economic Research, Inc.
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    Cited by:

    1. Keith M. Marzilli Ericson & Kimberley H. Geissler & Benjamin Lubin, 2018. "The Impact of Partial-Year Enrollment on the Accuracy of Risk-Adjustment Systems: A Framework and Evidence," American Journal of Health Economics, MIT Press, vol. 4(4), pages 454-478, Fall.

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    More about this item

    JEL classification:

    • I13 - Health, Education, and Welfare - - Health - - - Health Insurance, Public and Private
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health

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