To administer LTSS programs, states can choose to use a fee-for-service (FFS) or managed care model.
Under FFS, states pay providers (including doctors, hospitals, pharmacies, adult daycares, nursing homes, and caregivers) directly for each covered LTSS benefit received by a Medicaid beneficiary. Care coordination under FFS is often very limited and does not account for care needs outside of the scope of the FFS plan.
Under a managed care model, states partner with health plans, through a competitive contracting process, to administer and coordinate LTSS. The state pays the participating health plans a fixed rate, and the health plans are held accountable for delivering care as agreed by the state LTSS program. Managed care models allow far more flexibilty to use funds to better address the holistic healthcare and lifestyle needs of each individual through care coordination.
Managed care is linked to improved health outcomes of Medicaid recipients. MLTSS plans are held to higher standards at both the federal and state level and work closely with their Medicaid partners to achieve quality health outcomes for those they serve.
By rebalancing LTSS spending to faciliate successful transitions out of institutions and instead expand care in home and community-based settings, MLTSS programs can deliver higher quality and more cost-effective care.
MLTSS plans are accountable to state and federal governments for the quality of the care provided and success in meeting the goals and preferences of the individual.