July 2007

State Approaches to Consumer Direction in Medicaid

Forty-nine of the 51 state Medicaid agencies (including the District of Columbia) completed a short survey on consumer-directed health strategies during the late summer or fall of 2006 (response rate of 96%). For each of 17 consumer-directed strategies, respondents were asked whether the approach was part of the current Medicaid program, planned for 2006 or 2007, under consideration for 2008 or later, or not under consideration. The strategy did not have to apply to all Medicaid recipients in the state to count for the study.

Consumer-directed health strategies are increasingly being used to encourage people to make informed, cost-effective health care decisions.1 Health savings accounts are the most notable of these strategies. While these approaches initially took root in the commercial and Medicare markets, state Medicaid agencies are also testing consumer-directed approaches in their programs. This issue brief summarizes findings from a recent survey of Medicaid agencies conducted to identify which of 17 consumer-directed approaches are being implemented and considered by states.