Sellers Dorsey provides a comprehensive state-by-state analysis of enacted FY2026 budgets, detailing Medicaid spending allocations and programmatic changes across all states. This resource helps managed care organizations and state Medicaid officials understand funding priorities, anticipated program modifications, and how different states are addressing their specific Medicaid challenges in the upcoming fiscal year. The overview serves as a critical planning tool for MCOs operating in multiple states or seeking to understand the broader fiscal landscape affecting Medicaid managed care.

A former Louisiana state disability services executive argues that the decades-old case management systems used for intellectual and developmental disabilities services are fundamentally broken, creating barriers to care coordination, data access, and communication between caseworkers, providers, and participants. The piece calls for integrated platforms that serve as single points of entry for all IDD services and records, which would directly impact how Medicaid MCOs and states manage LTSS and IDD waiver programs that account for billions in annual spending.

Independent pharmacies are struggling with financial viability driven in part by declining reimbursement rates across government payers including Medicaid, alongside Medicare and commercial plans. The analysis examines how pharmacy closures are creating access deserts that disproportionately affect vulnerable populations, with pharmacies adapting through expanded services like home delivery and vaccination programs. For Medicaid MCOs, pharmacy network adequacy and access remain critical compliance considerations as independent pharmacies face consolidation pressure.

Twenty-nine states and DC have enacted laws regulating AI use in healthcare as of August 2025, with prior authorization restrictions being a primary focus that spans Medicaid, Medicare Advantage, and commercial plans. These laws often prohibit AI from serving as the sole basis for coverage denials or require licensed physicians to make final adverse determinations, directly affecting how managed care organizations structure their utilization management programs. The regulatory landscape continues to evolve with at least 10 states considering additional AI-related healthcare legislation.

Reported plans to dismiss all USPSTF members raise concerns about politicization of preventive care recommendations that underpin coverage requirements under the ACA and Medicaid. Medical societies warn that disrupting the Task Force's evidence-based process could destabilize access to screenings and preventive services including cancer detection, HIV prevention, and maternal mental health interventions. Since USPSTF recommendations trigger mandatory coverage requirements for Medicaid managed care plans, changes to the Task Force's composition and methodology could reshape preventive care obligations and plan benefits.

The One Big Beautiful Bill Act established a $50 billion Rural Health Transformation Program to offset anticipated Medicaid cuts and address rural hospital closures. States must submit applications to CMS detailing plans to improve rural access, health outcomes, and provider partnerships, with half the funding distributed evenly and half awarded competitively based on need. The program is particularly relevant to Medicaid managed care operations given the law's estimated $1 trillion in Medicaid reductions over ten years and new requirements around community engagement and enrollment.

Congress has passed budget reconciliation legislation containing sweeping Medicaid policy changes that will reshape state financing mechanisms, managed care payment structures, and eligibility rules. The bill includes reforms to provider tax arrangements, modifications to state directed payment authority, and new community engagement mandates—all of which will require significant operational and compliance adjustments by state Medicaid agencies and managed care organizations. Sellers Dorsey is tracking the provisions with regular updates on effective dates and implementation funding to help stakeholders prepare for the changes.

This benchmarking report examines enrollment dynamics in Medicaid and individual marketplace insurance since 2020, finding that subsidized marketplace growth was concentrated among near-poverty populations while Medicaid changes varied significantly by state. With enhanced premium subsidies set to expire and new federal rules on income verification, premium subsidy repayment, and potential Medicaid work requirements taking effect, the analysis projects substantial enrollment volatility in 2026—including an estimated 3.5 million losing individual market coverage. For Medicaid MCOs and state programs, this signals potential membership shifts, redeterminations challenges, and the need to prepare operational systems for new eligibility verification and work requirement administration.

This issue brief chronicles Medicaid's transformation in maternal health coverage, from its origins without explicit pregnancy benefits to current coverage of nearly half of all rural births. The analysis examines key policy milestones including extended postpartum coverage periods, state innovations in contraception access and breastfeeding support, and the integration of culturally competent care models. It also addresses emerging federal policy changes that may affect access for vulnerable maternal populations, providing MCOs and state programs context for navigating maternal health benefit design and delivery.

The One Big Beautiful Bill Act signed in July 2025 makes substantial changes to Medicaid and ACA Marketplace programs, with CBO projecting over $1 trillion in federal Medicaid spending reductions by 2034 and 15 million people losing coverage when combined with expiring ACA subsidies. The legislation also expands orphan drug exemptions from Medicare drug price negotiation and affects 340B covered entity status, creating implications for how life sciences companies engage with state Medicaid programs. Manatt's analysis emphasizes that impacts will vary significantly by state based on their individual Medicaid policies and current coverage distribution.

Seventeen states enacted 27 laws in 2025 regulating artificial intelligence use in healthcare, with multiple states prohibiting health plans from relying solely on AI for prior authorization and coverage denials without physician review. The legislation directly affects how Medicaid managed care organizations can deploy AI tools for utilization management, requiring human clinician oversight of AI-generated decisions. While the tracker covers broader healthcare AI policy, the payor-focused provisions have immediate compliance implications for MCO operations.

The administration's reported plan to dismiss all USPSTF members and reconstitute the panel could fundamentally alter preventive care coverage mandates that apply to Medicaid managed care organizations. Because ACA requirements tie no-cost preventive service coverage to USPSTF 'A' and 'B' grade recommendations, changes to the Task Force's composition and methodology could affect MCO benefit design, coverage obligations, and access to services like cancer screenings and PrEP. The move mirrors recent changes to ACIP that have already influenced vaccine policy across public programs.

A new executive order directs federal agencies to defund states and jurisdictions that support harm reduction programs and housing-first policies, while incentivizing involuntary institutionalization of homeless individuals with mental illness or substance use disorders. The policy shift has direct implications for Medicaid managed care organizations that serve behavioral health populations, particularly regarding coverage for institutional versus community-based services and compliance with evolving federal funding priorities. MCOs may face pressure to realign programs away from harm reduction and housing-first models that have been Medicaid reimbursable approaches to addressing homelessness and behavioral health comorbidities.

A state Medicaid program designed to reimburse indirect medical education costs has channeled over $1 billion in new federal funding to teaching hospitals over five years, enabling expansion of residency slots and physician supply. The enhanced reimbursement structure aims to increase teaching hospitals' participation in Medicaid by offsetting the higher costs of training environments, which directly affects access to care for Medicaid enrollees. The program spans public and private hospitals across urban and rural settings, demonstrating how states can use Medicaid financing mechanisms to address workforce shortages while supporting safety-net providers.

Guidehouse outlines how the reconciliation bill's Medicaid work requirements, narrowed eligibility, and limits on provider taxes will reshape provider operations and payer mix. The analysis focuses on coverage transitions for newly uninsured populations, financial planning for reduced Medicaid funding, and strategic responses including M&A activity and AI deployment. Rural providers face particular pressure despite a new $50 billion transformation fund that may not offset Medicaid cuts.

Manatt identifies best practices from high-performing states on increasing competitive integrated employment access for individuals with intellectual and developmental disabilities served through Medicaid HCBS programs. The brief covers strategies including early career planning, robust employment support services, cross-agency coordination, and rate structures that incentivize employment outcomes—all areas where Medicaid MCOs and state agencies play direct operational and policy roles. With fewer than 25% of people with I/DD currently in competitive integrated employment despite HCBS settings rule requirements, the strategies offer actionable guidance for state Medicaid programs and their managed LTSS contractors.

This retrospective examines the Early and Periodic Screening, Diagnostic, and Treatment benefit's comprehensive care standards for Medicaid enrollees under 21, including how it guarantees preventive and medically necessary services beyond typical adult coverage. The analysis addresses current operational challenges for managed care plans, including eligibility disruptions, provider network adequacy for pediatric specialty care, and MCO performance measurement around EPSDT compliance. It positions EPSDT's expansive benefit design as a foundational compliance requirement for Medicaid MCOs serving children and CHIP populations.

The One Big Beautiful Bill Act (OBBBA) introduces new restrictions on state provider taxes, a critical financing mechanism used by all states except Alaska to draw down federal Medicaid matching funds. The changes will force states to restructure how they fund Medicaid programs, with direct consequences for MCO rate-setting, provider reimbursement levels, and benefit coverage. Medicaid managed care organizations should prepare for potential state budget pressures that could impact capitation rates and contract terms as states scramble to replace lost federal matching dollars.

HHS has revised its interpretation of the 1996 welfare reform law to broaden what constitutes a "federal public benefit," immediately making non-citizens who don't meet qualified alien status ineligible for a wider array of HHS programs. For Medicaid managed care organizations, this policy shift will likely affect enrollment, eligibility verification processes, and member populations, particularly in states with significant immigrant communities. MCOs and state Medicaid agencies will need to understand which programs are newly restricted and prepare operational changes before the August 13 comment period closes.

Avalere's updated 50-state survey documents how biosimilar substitution statutes vary across jurisdictions in authorization requirements, notification protocols, and dispensing conditions. For Medicaid managed care plans operating across multiple states, these statutory differences create compliance complexity in pharmacy benefit management, formulary design, and provider education. The report provides a reference tool for MCO pharmacy teams navigating interchangeable biosimilar policies that directly affect prior authorization workflows and member access.