Managed care contracts could be positioned as a valuable tool for state Medicaid programs seeking to promote racial equity. While contracts are far removed from the front lines of care, well-designed agreements between states and plans can begin the process of addressing inequities in the delivery of health care. States can use contractual provisions to encourage or require plans to perform activities that advance health equity goals, including collecting, classifying, and reporting data by race and ethnicity; incorporating input from community-based organizations in program design; and reimbursing for care teams that include community health workers or doulas.
The Center for Health Care Strategies (CHCS), with support from the Commonwealth Fund, has been helping state Medicaid agencies in Louisiana, Mississippi, Oregon, and Washington advance racial health equity by improving how they purchase primary care from managed care plans. Primary care is often patients’ first (and sometimes, only) contact with the health care system; patients often report they trust the advice of their primary care team. Drawing on the experience of these states, we suggest the following promising managed care contracting strategies for advancing health equity.
- Enhance data capacity to inform health equity efforts and improve care. Medicaid data is often rife with incomplete or unreliable information about beneficiaries’ race, ethnicity, or language. This makes it challenging for states to quantify disparities, design interventions to address gaps, and improve care. Many states include managed care contract requirements to ensure plans report quality measures stratified by race, ethnicity, and language, forcing better data collection and quality. In a recent request for proposals, Louisiana asked how plans will stratify, analyze, and act on data related to inequities in primary care measures, like immunizations. Michigan Medicaid went a step further by publicly releasing an annual Medicaid Health Equity report that shares health plan performance data, including primary care measures, stratified by race and ethnicity to show progress toward reducing disparities.
- Ask plans to design interventions to address structural racism. In January 2021, Minnesota Medicaid released a request for proposals asking how managed care organizations (MCOs) are addressing structural racism and their plans to improve systems and processes in becoming antiracist. Specifically, the state focused on primary care access by asking organizations how they plan to respond to disparities in well-child visits. Similarly, Ohio requires its MCOs to promote awareness of implicit biases and their impact on policy and processes through staff training and by hiring a senior-level health equity director at the MCO to inform decision-making. States’ explicit use of language to address bias and racism sends a powerful message about priorities to plans and providers, serving as a critical first step toward identifying strategies to address inequities.
- Partner with patients and communities to advance health equity at the state and local levels. Patients and community members can contribute their critical expertise and perspective to promote health equity in primary care. Through their managed care contracts, Medicaid agencies can support MCOs and primary care providers in developing partnerships with members and community stakeholders. At the state and plan level, Oregon engages patients and community members as key partners in informing Medicaid decision-making. Oregon requires that its coordinated care organization (CCO), the state’s managed care equivalent, operate a community advisory council that includes consumers living in the county. As part of its duties, the council identifies preventive care practices that should be used by the CCO and play a key role in decision-making related to local investments. Many states are exploring opportunities to use Medicaid funds to pay for community health workers to provide care to members and communities. Louisiana is investigating how plans are utilizing community health workers, peer support specialists, and doulas in their Medicaid managed care programs.
- Incentivize the reduction of health and racial disparities. State Medicaid agencies can leverage their managed care contracts to hold plans accountable for how well they serve communities of color and financially reward decreases in disparities. As part of Minnesota’s 2022 MCO contracts, the state is rewarding reductions in health disparities and using MCO quality withholds to penalize worsening health disparities.
As a first step, states must acknowledge the systems that have perpetuated racial inequities and support primary care stakeholders at the MCO, health system, and community level in building capacity and partnerships to address racial inequities. Data collection and reporting requirements at the plan level are essential to help primary care providers understand and identify ways to address disparities faced by their patients and communities. States can consider these strategies to improve equity as part of a broader effort to reduce racial disparities. Medicaid agencies also can embed health equity goals into broader reform efforts, including leveraging Medicaid expansion efforts; encouraging team-based care in primary care; and using primary care transformation programs to advance health equity goals.
