The Case for Program Integrity in Medicaid Managed Care

Final Part Twelve: Series Retrospective and Look Ahead

The Benefit/Program Integrity team is pleased to have had the opportunity to bring you the blog post series The Case for Program Integrity (PI) in Medicaid Managed Care and share our insights on PI to combat fraud, waste, and abuse (FWA) within the managed care delivery system. In this closing post, we reflect on the topics we addressed, all driven by very real industry issues that need solutions. We also take note of current/emergent industry issues and provide our thoughts on what lies ahead…for the industry and our firm.

Looking Back: The Series Milestones

FWA are eroding public trust, wasting taxpayer money, compromising outcomes for Medicaid beneficiaries – among the nation’s most fragile populations – and causing improper stewardship of taxpayer dollars and the public good that agencies are entrusted to safeguard.

In our first several posts about PI and FWA within managed care, we raised several critical issues, starting with the headlines around PI and FWA within managed care organizations (MCOs). We looked at how contract language may need enhanced to better support PI and how disincentives against PI activities affect rate setting and may contribute to improper payments. In our special edition post, we shared recommendations from the Office of Inspector General (OIG) for state-led training of their MCOs – based on concerning findings.

We then turned to selected critical dimensions of PI and FWA, including the medical loss ratio and why its structure can have potentially far-reaching effects on capitation rates when FWA is present. We also considered encounter data. In three posts, the team describes how incorrect or incomplete data affects the ability to maintain proper oversight and may impact rate setting. In subsequent posts, we provided recommendations for addressing problematic encounter data, followed by a Case Study from one of our own engagements.

We also discussed the complexity when MCO subcontractors and related entities are involved. Finally, we highlighted the importance of pre-authorization of claims, focusing on why denials are so high and what can be done from a PI perspective.

In the Now: Industry Happenings

Medicaid was front and center in the new Federal Administration’s legislative agenda. House of Representatives Bill H.R.1 (aka The One Big Beautiful Bill Act and The Working Families Tax Cut Act) contained significant changes to the Medicaid program. Among many things, H.R.1 included the Rural Health Transformation Program, Community Engagement requirements, and placed new limits to State Directed Payment and Provider Tax programs. The Medicaid provisions of this legislation will become effective starting in 2026, and our state Medicaid clients will need our help. Beyond H.R.1, managed care organization and pharmacy benefit manager oversight, price transparency, value-based payment programs, and prior authorization provisions remain hot topics of interest. In the year ahead, look for posts on the importance of PI efforts against this backdrop.

The Long View: What Might be on the Road Ahead PI, Oversight, and Compliance

Safeguarding Medicaid and the Children’s Health Insurance Program (CHIP) is central to sustaining the Medicaid and CHIP missions and maintaining public trust. As trusted partners to state agencies, we understand the growing complexity of oversight in an environment shaped by managed care expansion, complex delegated vendor relationships, and evolving provider models. Ensuring effective FWA prevention; validating encounter data; and strengthening provider oversight are not just compliance requirements—they are strategic levers for improving accountability and operational performance. By taking a proactive, data-driven approach, states can mitigate financial and reputational risk, enhance transparency, and ensure Medicaid and CHIP dollars are directed where they matter most—toward high-quality care for the individuals and families they serve.

Hot Button Issues

Fraud Risk in Applied Behavior Analysis (ABA) and Personal Care Services (PCS). ABA/PCS providers warrant more oversight as these services pose higher risks of FWA driven by potential lack of supporting documentation, non-medical services being billed, and difficulty in determining if services were rendered consistent with regulatory requirements. CMS provides resources for states to assist with PCS and ABA provider oversight. Look for posts in 2026 for our recommendations on what states should be doing, at a minimum, regarding these services.

Substance use disorder and medical transport – both emergency and non-emergency – also represent areas of focus for those charged with PI oversight. The lack of a proactive PI approach, a well-honed audit approach, or a disciplined prior authorization review process heightens the risk of mismanagement of agency funds.

In the coming months, the BPI Team will be watching these issues closely and will provide insights along the way to keep you informed and prepared.

Myers and Stauffer

Purpose driven. Exclusive focus. Government Programs.

Established in 1977, Myers and Stauffer is a nationally based consulting and certified public accounting firm. For nearly 50 years, we have worked exclusively with local, state, and federal government health and human-services agencies to help them accomplish their most critical goals for the nation’s most fragile people.

Our Benefit/Program Integrity program area covers a range of services, disciplines, and areas of focus, including data analytics. We are here to answer any questions and help with any health care and human services needs your agency may encounter. Contact a member of our team today.