Better Care, Better Cost Act
- Sponsor
- Rep. Goldman, Craig A. [R-TX-12]
- Committees
- Energy and Commerce Committee (primary)
- Last action
- Jun 18, 2026
Bottom line
This bill mandates that states prioritize managed care entities with higher performance scores, based on cost and outcome measures, when assigning Medicaid beneficiaries who do not choose a plan, aiming to improve care and reduce costs.
What it actually does
This bill amends Title XIX of the Social Security Act to mandate that states establish a system to evaluate the performance of Medicaid managed care entities. It requires states to use these performance scores when assigning individuals to managed care entities if the individuals do not actively choose a plan, replacing the previous requirement for equitable distribution. The bill also mandates annual reporting on enrollment differences and estimated expenditure reductions attributable to this performance-based assignment system.
Proponents argue
Proponents would argue that this bill promotes accountability and efficiency within the Medicaid managed care system by incentivizing better performance from managed care organizations (MCOs). By directing default enrollments to higher-performing entities, it aims to improve health outcomes for beneficiaries and reduce overall program expenditures, ensuring taxpayer money is spent more effectively and fostering a more competitive environment among MCOs.
Opponents contend
Opponents might argue that relying solely on performance scores for default assignments could inadvertently create a two-tiered system, potentially disadvantaging certain MCOs or limiting beneficiary choice if the scoring metrics are not comprehensive or fair. There could also be concerns about the significant administrative burden on states to develop and maintain robust performance evaluation systems, and whether the chosen metrics truly capture quality of care or simply incentivize cost-cutting.
The bill is very short and straightforward, allowing for quick comprehension by any interested reader.
Section 2(a)(1)
Mandating Performance-Based Default Enrollment for Medicaid Managed Care
This provision amends Section 1932(a)(4)(D)(ii)(II) of the Social Security Act, changing how states assign Medicaid beneficiaries to managed care entities when an individual does not make an active choice. Instead of distributing individuals equitably among entities, states must now take into account the performance score of such entities, as determined by a new system established by the state. This means beneficiaries who do not choose a plan will be assigned to entities with higher performance scores.
Supporters argue
Supporters argue that this ensures beneficiaries who do not choose a plan are placed with entities that have a proven track record of better outcomes and cost management, leading to improved care and fiscal responsibility. It incentivizes MCEs to continuously improve their services to attract more default enrollees.
Critics contend
Critics might contend that this could create an uneven playing field, potentially penalizing newer or smaller MCEs that haven't yet established extensive performance data, or those serving more complex populations that might inherently have higher costs or different outcome profiles, regardless of care quality. It could also lead to market consolidation.
Tradeoffs
The bill trades off the principle of equitable distribution among MCEs for a system that prioritizes performance, aiming for better outcomes and cost savings but potentially introducing new complexities in plan selection, market dynamics, and the risk of disadvantaging certain types of MCEs.
Section 2(a)(2)
Establishment of State Performance Evaluation System and Annual Reporting
This provision requires states to establish a system for annually evaluating the performance of managed care entities based on cost, outcome, and individual satisfaction measures, as determined appropriate by the state. It specifies potential measures such as expenditures, avoidable hospital readmissions, emergency department visits, hospital admissions, and satisfaction scores. Additionally, states must publish annual reports quantifying the differences in default enrollments and estimated expenditure reductions attributable to using these performance scores.