Legislation Proposed to Limit Medicaid MCOs Spending on Administration, Overhead and Marketing Costs

Another bill affecting Medicaid providers of all stripes was introduced yesterday by state Rep. Sergio Muñoz Jr. from District 35 in the Rio Grande Valley.  Rep Muñoz, Jr. is a second term representative who was a member of the Government Efficiency & Reform Committee, the Technology Committee, and the House Administration Committee last legislative session.

MCOs to report annually

HB 2626, entitled an act relating to administrative and other expenditures by Medicaid managed care organizations., if passed, would require Medicaid managed care organizations to report to the legislature and Texas Health and Human Services annually on the percentage of their capitation funds spent on:

1) administrative, overhead, and marketing costs; and

2) reimbursement for clinical services provided to enrollees, activities that improve health care quality for those enrollees, and all other activities related to those enrollees.

Legislature can set limit on expenditures

The legislation would allow the legislature in conjunction with HHS “to set in the General Appropriations Act an upper limit on the percentage or amount of Medicaid capitated or other premium payments that a managed care organization offering a Medicaid managed care plan may spend on administrative, overhead, and marketing costs in each year of the state fiscal biennium.”

The bill and its history can be found online.