September 15, 2011

Texas Medicaid Managed Care Organization Expansion General Contract

On December 12, 2011, Texas received federal approval from the Centers for Medicare and Medicaid Services (CMS) for a new Medicaid waiver that permits the state to expand managed care to new regions of the state. The new 1115 Medicaid waiver replaces the state’s previous 1915(b) and 1915 (b/c) waivers and is effective through September 30, 2016. To prepare for the expansion, in the existing Dallas and Tarrant service areas, the state re-procured contracts with the STAR and STAR+PLUS, and Children’s Health Insurance Program managed care organizations (MCOs) in April 2011. It also selected additional MCOs for the expansion counties. The new contracts, awarded from August to October 2011, put the MCOs at-risk for pharmacy benefits, although the MCOs must still follow the state Medicaid formulary and preferred drug list.