Medicaid and Managed Care

Medicaid Toolkit

Medicaid benefits have traditionally been a fee-for-service system. However, in the past decade, there has been a move toward managed care in the delivery of Medicaid benefits. 

In a managed-care delivery system, people get most or all of their Medicaid services from an organization under contract with the state. Under this system, the majority of Medicaid services are provided under one contractor. Enrollment in managed care may be voluntary or required. In an effort to be more efficient and provide community inclusion, a growing number of states are using long term services and supports (MLTSS).


Types of entities include:

  • Managed care organizations (MCOs)-like HMOs, these companies agree to provide most Medicaid benefits in exchange for monthly payments from the state
  • Limited benefit plans-companies offering these plans may look like HMOs, but they provide only one or two Medicaid benefits (like mental health or dental services)
  • Primary care case managers-these individual providers (or groups of providers) agree to act as an individual's primary care provider and receive a small monthly payment for helping to coordinate referrals and other medical services

For more information on the types of Medicaid managed care entities, see the Managed Care Overview on the website.


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