Medicaid Patient Shift Squeezes Home Care Providers

The abrupt exodus of thousands of South Texas Medicaid patients from one managed care health plan is putting financial strain on home health providers already struggling to stay in business after the state’s transition to Medicaid managed care.

In July, Molina Healthcare announced it was cutting its reimbursement rates and internal administrative costs by 10 percent. John Molina, chief financial officer of the company, said that after its Medicaid health plan expanded to South Texas, the firm was losing $14 million a month in Texas.

Molina said he realized the rate cuts were painful to providers, but the move was ...

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