Pennsylvania Human Services Acting Secretary Meg Snead. | governor.pa.gov
Pennsylvania Human Services Acting Secretary Meg Snead. | governor.pa.gov
Pennsylvania has made a proposal to enter a profit-share agreement with Medical Assistance physical health (PH) managed care organizations (MCOs) where the PH-MCOs will be limited to 3% profits each year so that money can be put in the most beneficial areas.
The announcement of the agreement, made by Gov. Tom Wolf on Oct. 14, will take effect for the 2023 contract year. According to the release by Wolf’s office, the requirements of the agreement are to invest additional profits in projects benefiting the health and well-being of residents across the state.
“At a time of when managed care organizations are seeing incredible returns, it is only right that excess dollars be funneled back into helping the very people those organizations serve,” Wolf said. “This agreement is a responsible use of public money, and will put a cap on annual profits to allow the wealth to be shared among those who need it most.”
The MCOs work with the state's Department of Human Services (DHS) to set monthly rates designed to ensure a profit of 2% to 3%. Over the past three years, DHS has seen an increase in profits of more than 3%. This is expected to continue.
The proposed agreement allows MCOs to have 3% profits each year and anything that exceeds that number will lead to the MCO submitting proposals to retain the profits, which are to be used for improving access to care, food security, employment, housing and other needs.
The news release from the Office of the Governor said that proposals “must include measurable goals that will be approved and tracked by DHS’ Office of Medical Assistance Programs. If the approved programs do not meet these goals, all or part of the profits retained may be recouped by DHS.”
“Managed care organizations are important partners in our work to help Medical Assistance recipients access the care and services necessary to achieve the health and quality of life they deserve,” said acting secretary Meg Snead. “This profit-sharing agreement will allow us to ensure that taxpayer resources for this program can be used to further invest in the program’s mission or be returned to offset program costs.
"I am grateful for our partners’ shared commitment in continuing to build a Medical Assistance program that is innovative and transformative while responsibly utilizing public resources,” she added
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