Report to Congressional Requesters

United States General Accounting Office

GAO 

January 2003 MEDICAID AND 

SCHIP 

States Use Varying 

Approaches to 

Monitor Children’s 

Access to Care 

GAO-03-222 
Overall, states imposed more access-related requirements on participating 

providers and more actively monitored children’s use of services in their 

Medicaid managed care programs than in their Medicaid FFS or SCHIP 

programs. 

Medicaid managed care: State requirements for managed care plans ranged 

from very broad provisions that health plans must have “adequate” physician 

networks for serving their enrolled members to very specific standards, such 

as the number and geographic proximity of physicians and maximum time 

frames within which a new beneficiary receives a first appointment. States 

less often verified data that plans submitted to show compliance with these 

requirements or independently monitored physicians’ availability. In one 

instance of verification, a state found that a third of a health plan’s physician 

network was not accepting new Medicaid patients, thus limiting access for 

new beneficiaries. The value of plan-submitted data that states used to 

monitor children’s use of services was often compromised by continuing 

problems with their completeness and reliability. Furthermore, information 

derived from beneficiary satisfaction surveys was not necessarily 

representative of all Medicaid managed care beneficiaries. 

Medicaid FFS: Most states did not set goals for or analyze the availability of 

participating primary care physicians even though a majority of Medicaideligible children in half of the states reviewed are still served in FFS 

programs. In most FFS programs, beneficiaries may seek care from any 

providers participating in the Medicaid program and may change providers 

at any time if they are dissatisfied. However, when FFS payment rates are 

lower than those paid by other purchasers—which was the case in most 

states reviewed—providers can be discouraged from participating in 

Medicaid and thus restrict beneficiaries’ access. States did little to monitor 

the use of services by Medicaid-eligible children in FFS programs despite 

having a ready source of data in their claims payment systems. 

SCHIP: Nine of the 16 states used the same providers, administrative 

systems, and monitoring approaches for their SCHIP programs as they did 

for Medicaid. The remaining 7 states, whose SCHIP programs were distinct 

from Medicaid and used managed care almost exclusively, set few 

requirements for or monitored providers’ availability to SCHIP-eligible 

children. States with distinct SCHIP programs also reported fewer efforts to 

monitor children’s use of services than in their Medicaid programs. 

Comments on our report from the Department of Health and Human 

Services highlighted new federal requirements for state oversight of 

managed care, and design differences between Medicaid and SCHIP that can 

affect monitoring approaches. States we reviewed provided clarifying or 

technical comments regarding their oversight of access, which we 

incorporated in the report as appropriate. 

MEDICAID AND SCHIP 

States Use Varying Approaches to 

Monitor Children's Access to Care 

www.gao.gov/cgi-bin/getrpt?GAO-03-222.

To view the full report, including the scope 

and methodology, click on the link above. 

For more information, contact Kathryn G. 

Allen (202) 512-7118. 

Highlights of GAO-03-222, a report to 

Representatives Sherrod Brown; John 

Conyers, Jr.; Diana DeGette; John D. 

Dingell; Gene Green; William J. Jefferson; 

Sander M. Levin; and Ted Strickland 

January 2003 

Over 25 million children have 

health insurance coverage through 

Medicaid or the State Children’s 

Health Insurance Program 

(SCHIP). Coverage alone, however, 

does not guarantee that services 

will be available or that children 

will receive needed care. GAO was 

asked to evaluate states’ efforts to 

facilitate and monitor access to 

primary and preventive services for 

children in these jointly funded 

federal-state programs. The study 

surveyed 16 states, covering over 

65 percent of the Medicaid and 

SCHIP population. GAO analyzed 

requirements relevant to managed 

care and fee-for-service (FFS) 

delivery systems, including the 

number and location of physicians 

and their availability to see 

beneficiaries, monitoring of health 

plan or physician compliance with 

these requirements, and collection 

and analysis of beneficiary service 

utilization data. 
Page i GAO-03-222 Medicaid and SCHIP Access 

Letter 1

Results in Brief 4

Background 6

In Medicaid Managed Care, States Focused More on Setting Plan 

Network Requirements than on Monitoring Plans or Analyzing 

Service Utilization 14

For Medicaid FFS, State Requirements for Providers and 

Monitoring of Service Utilization Were More Limited 33

Distinct SCHIP Programs Had Fewer Network Requirements and 

Less Monitoring of Service Utilization 40

Agency and State Comments and Our Evaluation 44

Appendix I Medicaid HEDIS Measures Related to Service 

Utilization 50 

Appendix II Managed Care Plan Withdrawals from Medicaid in 

Four States 53 

Massachusetts 53

Ohio 54

Tennessee 55

Texas 56

Appendix III Analysis of Medicaid FFS Payment Rates in 

Selected States 58 

Methodology for Comparison of FFS Payment Rates 59

Appendix IV Comments from the Department of Health and 

Human Services 61 

Appendix V GAO Contact and Staff Acknowledgments 65 

Related GAO Products 66 

Contents 
Page ii GAO-03-222 Medicaid and SCHIP Access 

Tables 

Table 1: SCHIP Design Choices for 16 States, as of March 2002 7

Table 2: Share of Children Enrolled in Medicaid and Separate 

SCHIP Programs, by Service Delivery Method, for 16 

States 10

Table 3: Examples of Specific State Standards for Plan Networks 

and Appointment Waiting Times 17

Table 4: Examples of Medicaid HEDIS Measures Related to Service 

Utilization for Children 25

Table 5: Estimated Percentage of Medicaid Children Excluded 

from HEDIS 27

Table 6: Examples of Beneficiary Satisfaction Questions for 

Children Covered by CAHPS 28

Table 7: Estimated Percentage of Medicaid Children Excluded 

from CAHPS 29

Table 8: Length of Medicaid Enrollment Required for Selected 

HEDIS Measures for Children’s and Adolescents’ Use of 

Services 51

Table 9: Examples of Plan Withdrawal Transition Activities 

Conducted by Four State Medicaid Programs 57

Table 10: Medicaid FFS Payment Rates, Expressed as a Percentage 

of Medicare Payments, in 13 States with Traditional FFS or 

Primary Care Case Manager Delivery Systems That Serve 

Children 59

Table 11: CPT 4 Codes Used in Comparing Medicaid and Medicare 

Fees 60

Figures 

Figure 1: Selected Medicaid Managed Care Plan Network 

Requirements and Standards in 14 States 16

Figure 2: Variation in 14 States’ Monitoring of Medicaid Managed 

Care Plans’ Provider Information 19

Figure 3: Selected Requirements for Medicaid PCCM Providers in 

Seven States 37

Figure 4: Comparison of Seven States’ Requirements and Standards 

for Providers in Medicaid and SCHIP Managed Care 42
Page iii GAO-03-222 Medicaid and SCHIP Access 

Abbreviations 

ACG ambulatory care group 

AHRQ Agency for Healthcare Research and Quality 

CAHPS Consumer Assessment of Health Plans 

CMS Centers for Medicare & Medicaid Services 

CPT 4 Current Procedural Terminology, 4th edition 

EPSDT Early and Periodic Screening, Diagnostic and Treatment 

FFS fee-for-service 

HEDIS Health Plan Employer Data and Information Set 

HHS Department of Health and Human Services 

HRSA Health Resources and Services Administration 

NCQA National Committee on Quality Assurance 

PCCM primary care case manager 

PCP primary care provider 

SCHIP State Children’s Health Insurance Program 
Page 1 GAO-03-222 Medicaid and SCHIP Access 

January 14, 2003 

The Honorable Sherrod Brown 

The Honorable John Conyers, Jr. 

The Honorable Diana DeGette 

The Honorable John D. Dingell 

The Honorable Gene Green 

The Honorable William J. Jefferson 

The Honorable Sander M. Levin 

The Honorable Ted Strickland 

House of Representatives 

Over 25 million children have health care coverage through Medicaid or 

the State Children’s Health Insurance Program (SCHIP), joint federal-state 

programs that finance health insurance for certain low-income adults and 

children. Medicaid and SCHIP provide the financial means for low-income 

children to receive primary, preventive, and specialty care, which are 

important to ensuring a healthy child and adolescent population. Having a 

regular provider, or usual source of care, also can help reduce the use of 

services from high-cost sources such as emergency rooms and inpatient 

hospital care.1

While health insurance coverage can provide the financial means to obtain 

care, it does not by itself guarantee that health services will be available 

and accessible or that beneficiaries will receive needed care. Access to 

primary care services is significantly affected by local factors that vary 

across and within states, such as physician supply, location, and 

willingness to participate in a state’s Medicaid and SCHIP programs. While 

federal law establishes general requirements to ensure that Medicaid and 

SCHIP beneficiaries have access to covered health services, the extent to 

which children actually receive these health care services is influenced by 

how states implement their programs and monitor access at the state and 

local levels. 

The type of service delivery and financing system that states use in their 

Medicaid and SCHIP programs potentially affects beneficiaries’ ability to 

 1

A provider may be a physician, a group of physicians practicing together, or an outpatient 

clinic with physician services. 

United States General Accounting Office

Washington, DC 20548 
Page 2 GAO-03-222 Medicaid and SCHIP Access 

locate and obtain services. Managed care, which often entails states 

making capitation payments to managed care plans to provide or arrange 

for all services for enrolled beneficiaries, encourages participating plans to 

offer and coordinate primary and specialty care for beneficiaries. Managed 

care also may promote efficiency by attempting to ensure that only 

necessary services are provided in the most appropriate setting. 

Appropriate safeguards are important, however, as capitation payments 

can also create an incentive to underserve or even deny beneficiaries 

access to needed care since plans and, in some cases, providers can profit 

from not delivering services for which they have already received 

payment. In contrast, beneficiaries in fee-for-service (FFS) systems, 

including those receiving care in a primary care case manager (PCCM) 

system,2

 may be at risk for the overprovision of services as providers seek 

to increase revenue. However, if FFS payment levels are too low, 

physicians may underserve their patients or be unwilling to participate at 

all. 

Our prior work has shown that access to care in Medicaid has been 

problematic for certain services—such as health screening for children, 

oral health, and mental health—and for particular populations, such as 

children with special needs.3

 Recent reports that some physicians are 

unwilling to take more Medicaid patients and that some managed care 

plans are exiting from the Medicaid program have raised additional 

concerns about adequate access for eligible children. Now that SCHIP is 

beginning its sixth year of implementation, a related concern is the 

experiences of children in accessing care under SCHIP, where states have 

greater flexibility to decide whom to cover, what services to provide, and 

how to pay for services, including required beneficiary cost sharing. 

Accordingly, you asked us to evaluate states’ efforts to routinely monitor 

access to primary and preventive care services in (1) Medicaid managed 

care, including actions selected states took when participating health 

plans withdrew from the program, (2) Medicaid FFS-based delivery 

systems, including PCCM systems, and (3) SCHIP. 

 2

FFS systems include traditional FFS, in which a provider bills the program for services 

provided to an eligible beneficiary, and PCCM systems, in which a physician, physician 

group practice, or similar entity contracts with the state to locate, coordinate, and monitor 

primary health services for Medicaid beneficiaries for a nominal monthly, per capita case 

management fee (usually around $3). 

3

See related GAO products listed at the end of this report. 
Page 3 GAO-03-222 Medicaid and SCHIP Access 

To examine these issues, we analyzed 16 states’ approaches to monitoring 

access to primary and preventive health care services in their Medicaid 

and SCHIP programs. These states were Arkansas, California, Colorado, 

Florida, Illinois, Louisiana, Maryland, Massachusetts, Michigan, Nevada, 

New York, Ohio, Pennsylvania, Tennessee, Texas, and Washington. We 

selected these states to obtain wide representation of geographic regions, 

managed care and FFS systems, and SCHIP program designs.4

 Over 65 

percent of all Medicaid and SCHIP beneficiaries resided in these 16 states. 

To evaluate state approaches to monitoring access to care, we focused our 

analysis of states’ managed care and FFS delivery systems in three key 

areas: 

• specific requirements for participating managed care plans and physicians 

to help ensure sufficient physician capacity and accessibility for eligible 

beneficiaries; 

• actions to independently verify or otherwise monitor provider 

participation; and 

• routine data collection and analysis of information on beneficiaries’ actual 

service utilization, including patient satisfaction surveys. 

For states’ Medicaid and SCHIP managed care programs, these service 

utilization data included encounter data, which are individual-level data on 

service use that plans are required to collect and report to the state; the 

Health Plan Employer Data and Information Set (HEDIS), developed by 

the National Committee for Quality Assurance (NCQA) to help purchasers 

and consumers compare the performance of health plans in providing 

selected services; and the Consumer Assessment of Health Plans 

(CAHPS), which is a standardized patient satisfaction survey developed by 

the federal Agency for Healthcare Research and Quality (AHRQ). We 

conducted site visits in four states where managed care plan withdrawals 

had been reported—Massachusetts, Ohio, Tennessee, and Texas—and 

analyzed information from primary care providers (PCP);5

 representatives 

of advocacy groups; state insurance departments; and managed care plans 

participating in Medicaid, SCHIP, or both. At the federal level, we 

interviewed officials at the Centers for Medicare & Medicaid Services 

 4

States can take three approaches in designing their SCHIP programs: (1) expand Medicaid, 

(2) construct separate child health programs distinct from Medicaid, or (3) use a 

combination of both approaches. 

5

For purposes of this report, PCPs are usually physicians trained in internal medicine, 

pediatrics, family medicine, or obstetrics and gynecology who participate in PCCM or 

managed care programs in Medicaid or SCHIP. 
Page 4 GAO-03-222 Medicaid and SCHIP Access 

(CMS), which oversees states’ Medicaid and SCHIP programs, and the 

Health Resources and Services Administration (HRSA), which has 

responsibility for analyzing issues related to access to care, as well as joint 

responsibility for oversight of SCHIP. We reviewed relevant documents, 

including federal laws, federal regulations, state contracts with managed 

care organizations, and various federal and state reports related to access. 

We conducted our work from June 2001 through December 2002 in 

accordance with generally accepted government auditing standards. 

Each of the states we reviewed with Medicaid managed care programs set 

requirements for participating plans’ provider networks, which include the 

physicians and specialists who have agreed to deliver or arrange for health 

care services to beneficiaries enrolled in a health plan. These state 

requirements ranged from broad provisions that health plans must have 

“adequate” networks for serving their enrolled members, to very specific 

standards that set, for example, a maximum number of beneficiaries per 

primary care physician or maximum time frames within which a provider 

must see a new beneficiary for a first appointment. The states less 

frequently verified data that plans submitted to them or independently 

collected or analyzed data to ascertain compliance with the requirements. 

States that did routinely monitor plans’ compliance with network 

requirements often identified potential access problems and took steps to 

address them. For example, a state review of the physicians listed in a 

plan’s network found that many physicians were not accepting new 

Medicaid patients, resulting in too few physicians accessible to such 

patients. Beyond setting requirements for or monitoring plans’ network 

size and availability, states attempted to assess the extent to which 

beneficiaries were actually receiving services through three key routine 

data sources: encounter data that states require plans to submit on 

individual-level service use, assessments of managed care plans’ 

performance on specified measures, and periodic beneficiary satisfaction 

surveys. However, the value of these data was compromised by continuing 

problems in most states with encounter data’s completeness and 

reliability; additionally, standardized data on plan performance and 

beneficiary satisfaction surveys were not representative of all Medicaid 

managed care beneficiaries. Potential issues of access to care associated 

with managed care plans withdrawing from Medicaid in four states we 

visited affected significantly different shares of eligible beneficiaries, 

ranging from about 1 percent of Medicaid beneficiaries in Texas to almost 

50 percent in Tennessee. While these four states had taken various steps to 

help minimize disruption in access to care for beneficiaries affected by 

plan withdrawals, it was not clear to what extent these efforts had been 

Results in Brief 
Page 5 GAO-03-222 Medicaid and SCHIP Access 

successful in helping beneficiaries transition smoothly to new health plans 

and avoid access-to-care problems. 

States did considerably less in their Medicaid FFS programs—which still 

serve the majority of children in half of the states we reviewed—to 

establish requirements for or monitor provider availability or to assess 

beneficiaries’ utilization of services than in their managed care programs. 

For traditional FFS programs, beneficiaries may seek care from any 

providers participating in the Medicaid program and may change providers 

at any time if they are dissatisfied. However, Medicaid beneficiaries’ ability 

to easily change providers depends on the number, type, and location of 

providers willing to take new Medicaid patients, which in turn is strongly 

influenced by Medicaid payment rates and associated administrative 

processes. We found that FFS payment rates in most states we reviewed 

were significantly lower than those paid by other purchasers for 

comparable services, which can discourage providers from participating in 

the program and thus restrict beneficiaries’ access to a broad supply of 

providers. Officials in several of the states we contacted with Medicaid 

FFS programs said that anecdotal information and complaint data 

suggested that low payment rates, slow payment, and other administrative 

issues deterred physicians in primary care or in some specialties from 

participating in the program. Most of the seven states we reviewed with 

PCCM programs set certain requirements for participating physicians, 

such as limiting the number of beneficiaries that a PCCM could enroll in 

an effort to ensure that physicians had the capacity to serve each 

beneficiary. However, these states did little to monitor the extent to which 

beneficiaries were successful in obtaining appointments as needed. In 

regard to routine data collection and analyses, all but one of these seven 

states analyzed their FFS claims data and provided PCCMs with 

comparative data on service utilization patterns for their own practices 

and for other PCCMs. However, these comparative data often focused on 

higher-cost services, such as inpatient hospitalization or emergency room 

use. 

The majority of the states we reviewed—9 of the 16—designed their 

SCHIP programs to be an expansion of their Medicaid programs or 

modeled them after Medicaid, with the same providers and administrative 

systems. Therefore, in these states, the requirements for, and monitoring 

of, SCHIP provider participation and beneficiary service utilization 

mirrored that of their Medicaid programs. In contrast to these states, 7 

states chose to serve all or most of their SCHIP beneficiaries through 

programs that were distinct from Medicaid. These states did significantly 

less in their distinct SCHIP programs in terms of setting requirements for, 
Page 6 GAO-03-222 Medicaid and SCHIP Access 

or monitoring, participating providers or beneficiary service use than they 

did for their Medicaid programs. 

We received comments on a draft of this report from the Department of 

Health and Human Services (HHS), as well as from 13 of the 16 states that 

were included in our review. In response to our findings, HHS highlighted 

new federal requirements for state oversight of Medicaid managed care 

that are to be fully implemented by August 2003. HHS also pointed out that 

design differences between Medicaid and SCHIP may affect states’ 

approaches to monitoring access to care. State officials provided clarifying 

and technical comments regarding their oversight of access to care, which 

we incorporated as appropriate throughout this report. 

States’ Medicaid and SCHIP programs are governed by various federal 

requirements regarding eligibility, covered services, and access to care. 

Under these requirements, states generally have some discretion in 

determining the amount, duration, and scope of services their programs 

will provide, and the delivery and financing systems through which 

beneficiaries will receive care—that is, FFS, managed care, or both. 

Federal requirements relating to Medicaid beneficiaries’ access to care are 

established in statute; for managed care service delivery systems, detailed 

federal regulations regarding access were recently issued.6

 SCHIP 

requirements are also set out in statute but are less specific than those for 

Medicaid and do not include detailed managed care requirements or 

regulations comparable to those for Medicaid. 

Since 1965, Medicaid has financed health care coverage for certain 

categories of low-income individuals—including over 22 million children 

in 2000. Federal law requires states to extend Medicaid eligibility to 

children aged 5 and under if their family incomes are at or below 133 

percent of the federal poverty level and to children aged 6 through 18 in 

families with incomes at or below the federal poverty level. At their 

discretion, most states have set income eligibility thresholds for families 

with children that expand their Medicaid programs beyond the minimum 

federal statutory levels. 

 6

67 Fed. Reg. 40989 (2002). 

Background 

Populations Covered and 

Program Characteristics 
Page 7 GAO-03-222 Medicaid and SCHIP Access 

In 1997, the Congress established SCHIP, which provides health care 

coverage to low-income, uninsured children living in families whose 

incomes exceed the eligibility limits for Medicaid. SCHIP covered over 4.6 

million children in fiscal year 2001, generally targeting children in families 

with incomes up to 200 percent of the federal poverty level.7

 Compared 

with Medicaid, which has specific minimum federal eligibility and benefit 

requirements, the SCHIP legislation provides states more flexibility in how 

they choose to structure their programs. States have three options in 

designing SCHIP: They may expand their Medicaid programs, develop a 

separate child health program that functions independently of Medicaid, 

or create a combination of the two approaches. (See table 1 for the 

program designs of the 16 states in our sample.) While Medicaid expansion 

programs under SCHIP must use Medicaid’s provider networks and 

delivery systems, SCHIP separate child health programs may depart from 

Medicaid requirements particularly with regard to covered benefits and 

the plans, providers, and delivery systems available to beneficiaries.8

Table 1: SCHIP Design Choices for 16 States, as of March 2002 

Design State 

Medicaid expansion Arkansas,a Louisiana, Ohio, and Tennessee 

Separate program Colorado, Nevada, Pennsylvania, and Washington 

Combination California, Florida, Illinois, Maryland,b

Massachusetts,b

 Michigan, New York, and Texas 

Source: CMS. 

a

In February 2001, Arkansas received approval from CMS to implement a separate SCHIP program; 

however, this program had not been implemented as of February 2002. 

b

The state’s separate SCHIP portion of its combination program provides coverage either through 

(1) a premium assistance program for families with access to private insurance coverage or 

(2) Medicaid providers and services. Premium assistance programs were not included in our study. 

Medicaid and SCHIP differ in terms of the share of their program 

expenditures that come from federal funds. No overall federal budget limit 

exists for the Medicaid program; it is an open-ended entitlement whereby 

 7

The SCHIP statute allows a state to expand eligibility to 200 percent of the poverty level or 

up to 50 percentage points above its Medicaid eligibility standard as of March 31, 1997. As 

of January 2002, states’ upper income eligibility thresholds for SCHIP ranged from 133 to 

350 percent of the federal poverty level. 

8

Throughout this report, SCHIP beneficiaries enrolled in Medicaid expansion programs are 

included in the discussion of Medicaid. 
Page 8 GAO-03-222 Medicaid and SCHIP Access 

state expenditures for services that are provided under a CMS-approved 

state Medicaid plan are matched by the federal government using a 

formula that results in federal shares that currently range from 50 to 76 

percent of expenditures, depending on a state’s per capita income in 

relationship to the national average. The federal share of Medicaid 

expenditures is about 57 percent. In contrast to Medicaid, federal funding 

for SCHIP is limited. The Congress appropriated $40 billion over 10 years 

(from fiscal years 1998 to 2007), with a specified amount allocated 

annually to each of the 50 states, the District of Columbia, Puerto Rico, 

and 4 U.S. territories. State SCHIP expenditures are matched by federal 

payments up to the state’s annual appropriated allotment.9

 The SCHIP 

statute provides for an “enhanced” federal matching rate, with each state’s 

SCHIP rate exceeding its Medicaid rate. The federal share of each state’s 

SCHIP expenditures ranges from 65 to 83 percent; the federal share of 

total SCHIP expenditures is about 72 percent. 

States provide Medicaid and SCHIP services through two distinct service 

delivery and financing systems—managed care and FFS, with the latter 

including PCCM.10 Under a capitated managed care model, states contract 

with a managed care organization and prospectively pay the plans a fixed 

monthly fee per patient to provide or arrange for most health services. 

Plans, in turn, pay providers either retrospectively for each service 

delivered on a FFS basis or through prospective capitation payment 

arrangements. In contrast, in a traditional FFS delivery system, the 

Medicaid program reimburses providers directly and on a retrospective 

basis for each service delivered. The PCCM model is similar to a 

traditional FFS arrangement except that PCCMs are paid a monthly, per 

capita case management fee, usually around $3, to coordinate care for 

beneficiaries, in addition to FFS reimbursement for any health care 

services they provide. PCCMs, which are selected by beneficiaries upon 

enrollment, are responsible for treating and coordinating the care for 

those beneficiaries. Coordination may involve referrals to specialists and 

 9

Annual allotments are made to states for use over a 3-year period. For SCHIP annual 

allotments that remain unspent after 3 years, the Secretary of HHS is required to determine 

an appropriate procedure for redistributing any unused SCHIP funds to states that have 

exhausted their allotments. 

10We included PCCMs as FFS-based arrangements because participating providers are 

predominately paid on a FFS basis. Thus, throughout this report, the term managed care 

only refers to capitated managed care arrangements. 

Delivery Systems 
Page 9 GAO-03-222 Medicaid and SCHIP Access 

other providers. In some cases, receipt of specialty and other services may 

require PCCM approval. 

The 16 states we reviewed often structured their Medicaid and SCHIP 

service delivery systems differently. As shown in table 2, the exclusive use 

of managed care was less prevalent in Medicaid than in separate SCHIP 

programs (3 and 6 states, respectively), with 3 states—Maryland, 

Michigan, and Tennessee—using managed care for virtually all children in 

both Medicaid and SCHIP. The states were more likely to use a 

combination of managed care and FFS approaches for their Medicaid 

programs than for SCHIP (11 and 5 states, respectively). Despite the 

recent growth in states’ use of managed care, FFS is still a major 

component of many states’ programs, especially for Medicaid. 
Page 10 GAO-03-222 Medicaid and SCHIP Access 

Table 2: Share of Children Enrolled in Medicaid and Separate SCHIP Programs, by Service Delivery Method, for 16 States 

Medicaid Separate SCHIP programa

FFS-based FFS-based 

State 

Traditional 

FFS PCCM Managed care 

Traditional 

FFS PCCM Managed care

Arkansas b 100% -- c c --

California 29% b 71% -- -- 100%

Colorado 28% 18% 54% -- -- 100%

Florida d 53% 47% b 2%e98%

Illinois 87% -- 13% 99% -- 1%

Louisiana 88% 12% -- c c --

Maryland d -- 100% -- -- f 

Massachusetts d 63% 37% -- 65% 35%

Michigan d -- 100% -- -- 100%

Nevada 41% -- 59% 13% -- 87%

New York 61% -- 39% b -- 100%

Ohio 67% -- 33% c -- c 

Pennsylvania d 24% 76% -- -- 100%

Tennessee -- -- 100% -- -- c 

Texas 42% 21% 37% -- -- 100%

Washington 34% b 66% 57% b 43%

Number of states using system 9 7 14 3 2 11

Source: State data, as of December 2001, except for New York data, which are as of September 

2001. 

a

Includes the separate child health programs in states with combination or separate SCHIP programs. 

b

Although this delivery system exists in the state, it includes less than 1 percent of children enrolled in 

Medicaid or SCHIP and thus was not included in our study. 

c

Not applicable. State’s SCHIP program is a Medicaid expansion; thus, delivery systems are the same 

as those in the state’s Medicaid program. 

d

Delivery system exists for children with special needs, which is outside the scope of this study. 

Additionally, state enrolls children in FFS until they transition to a managed care or a PCCM delivery 

system. For example, families with eligible children in Florida are allowed 90 days in which to select a 

PCP in managed care or a PCCM; during these 90 days, they are enrolled in Medicaid FFS. 

e

In Florida, delivery systems under SCHIP vary by age. Families with children under age 5 can select 

between managed care and a PCCM, while older children are limited to managed care service 

delivery. 

f

Not applicable; Maryland’s separate SCHIP portion of its combination program was not operational 

when our study began and thus was not included in the study. 
Page 11 GAO-03-222 Medicaid and SCHIP Access 

A state is required by federal statute to ensure that its payment and 

delivery systems will afford beneficiaries’ access to services similar to that 

of its general population;11 further, Medical assistance must be provided 

with reasonable promptness.12 While Medicaid traditional FFS delivery 

systems have no additional access requirements, managed care and PCCM 

delivery systems do. States are required to ensure that beneficiaries’ 

access to care in managed care and PCCM is equal to that available to 

beneficiaries in traditional FFS. On June 14, 2002, CMS published final 

rules to implement new provisions the Balanced Budget Act of 1997 set 

out for states’ Medicaid managed care programs. These new rules address 

the requirements, prohibitions, and procedures for the provision of 

different types of Medicaid managed care and PCCM delivery systems. 

Under these rules, which became effective August 13, 2002, states have 

until August 13, 2003, to bring all aspects of their state managed care 

programs into compliance with the new requirements.13

States that wish to use managed care and PCCMs to deliver Medicaid 

services must have CMS approval to do so. CMS approval is in part 

intended to ensure that adequate protections are in place to safeguard the 

interests of beneficiaries enrolled in managed care who may find their 

freedom to seek the care of any participating provider at any time more 

restricted than in FFS. In managed care, states may “lock in” beneficiaries 

to one managed care plan and its network of providers for up to 1 year in 

order to provide the plan sufficient time and opportunity to manage the 

care of its enrollees most efficiently and appropriately. States request CMS 

approval for their managed care programs through one of two methods: 

(1) as a waiver from certain statutory requirements or (2) as an 

amendment to the state’s Medicaid plan.14 Fifteen of the 16 states we 

reviewed received CMS approval to provide managed care through two 

types of waivers of statutory provisions, program and demonstration 

waivers, while one state—Nevada—received approval through a state plan 

amendment. 

 11See 42 U.S.C. § 1396a(a)(30); 42 C.F.R § 438.2. 

12See 42 U.S.C. §1396a(a)(8). 

13The new Medicaid managed care rules have more detailed requirements for states than in 

the past, such as requiring assurances from participating plans concerning the availability 

of services, adequate capacity and services, coordination and continuity of care, and 

coverage and authorization of services. 

14Implementing managed care service delivery by amending a state’s Medicaid plan has 

been an option for states since passage of the Balanced Budget Act of 1997. 

Federal Requirements for 

Access to Care 
Page 12 GAO-03-222 Medicaid and SCHIP Access 

Of the states we reviewed, 12 had approved “freedom-of-choice” program 

waivers, under section 1915(b) of the Social Security Act, which permitted 

them to direct beneficiaries to enroll in a managed care system.15 In 

reviewing and approving program waivers, CMS requires states that wish 

to limit beneficiaries’ enrollment to managed care to offer a choice of at 

least two managed care plans or allow beneficiaries to choose between 

one managed care plan and a PCCM system. CMS also requires states to 

ensure that (1) managed care plans’ physician networks under the waiver 

include approximately the same number or more physicians than were 

available before the waiver’s implementation and (2) services under 

program waivers are provided within reasonable time frames and are 

furnished within reasonable distances for the beneficiaries to travel. As a 

condition of waiver approval, during the period of our review CMS asked 

states to specify whether they had established access-related requirements 

for participating plans in areas such as provider capacity, or maximum 

times frames for beneficiaries to schedule appointments, travel to 

physicians’ offices, or wait in physicians’ offices to be seen. CMS did not 

require states to establish specific requirements in these areas, but if they 

did, they were asked to describe in their waiver applications how they 

planned to monitor compliance with any established requirements. Initial 

approval of a program waiver is for a 2-year period, at which time the 

waiver can be reviewed and approved for renewal by CMS. Waiver 

renewals can result in changes in specific requirements for states. 

Six of the states we reviewed—Arkansas, California, Maryland, 

Massachusetts, New York, and Tennessee—had approved comprehensive 

research and demonstration waivers, authorized by section 1115 of the 

Social Security Act, to test concepts likely to further program objectives.16

A demonstration waiver provides a state with greater flexibility to design 

its Medicaid programs in areas such as eligibility standards, covered 

benefits, and reimbursement rules. In reviewing and approving 

demonstration waivers, CMS often establishes terms and conditions with 

which states must comply that are more prescriptive than requirements for 

 15The freedom of choice waiver is established by section 1915(b) of the Social Security Act 

and is set forth at 42 U.S.C. §1396n(b). The 12 states that we reviewed with program 

waivers were Arkansas, California, Colorado, Florida, Louisiana, Michigan, New York, 

Ohio, Pennsylvania, Tennessee, Texas, and Washington. 

16The demonstration waiver is set forth at 42 U.S.C. § 1315(a). In addition to comprehensive 

waivers, states can also use section 1115 waivers for specific populations or services, such 

as pharmacy or extending coverage to parents. Four of the 15 states—California, Colorado, 

Florida, and Illinois—have noncomprehensive section 1115 waivers. 
Page 13 GAO-03-222 Medicaid and SCHIP Access 

program waivers. For example, in approving demonstration waivers, CMS 

has required states to (1) specify ratios that set the maximum number of 

enrolled beneficiaries per participating PCP, (2) establish the maximum 

time or distance for beneficiaries to travel to a physician’s office, and 

(3) limit beneficiaries’ waiting times when scheduling appointments for 

urgent, routine, or specialty care. Initial approval of a demonstration 

waiver is for a 5-year period, at which time the waiver can be reviewed and 

approved for renewal by CMS. 

In contrast to Medicaid, in their SCHIP programs states may require 

mandatory beneficiary enrollment in managed care without offering a 

choice among health plans. Federal SCHIP access-related requirements 

are also less extensive than those for Medicaid. The SCHIP statute requires 

that states have methods in place to ensure access to covered services, 

including emergency services, but does not specify precise requirements.17

States must describe their methods to ensure access to covered services, 

including any monitoring procedures, in their SCHIP state plans. In 

addition, the SCHIP statute required each state to submit to the Secretary 

of HHS a one-time program evaluation in March 2000.18 States must also 

submit to the Secretary annual reports that show their progress toward 

reaching their strategic objectives and performance goals, some of which 

may relate to access to care. 

 17See 42 U.S.C. § 1397bb. 

18A state’s SCHIP evaluation was required to address several areas, including (1) the quality 

of health coverage provided, (2) choices of heath benefits coverage, (3) activities to 

coordinate SCHIP with other public and private programs, (4) changes in trends in the 

states that affect the provision of health insurance, and (5) recommendations for improving 

SCHIP. 
Page 14 GAO-03-222 Medicaid and SCHIP Access 

In attempting to ensure access to care in Medicaid managed care, states 

focused more on setting requirements for managed care plans than on 

monitoring compliance with these requirements or on analyzing 

beneficiaries’ use of services. The 14 states we reviewed with Medicaid 

managed care programs reported varying levels of effort (1) to establish 

certain requirements and standards for participating plans’ physician 

networks and to monitor their implementation and (2) to collect and 

analyze data on service utilization, such as encounter data from 

participating plans and beneficiary satisfaction surveys. State 

requirements for plans’ physician networks varied widely in their 

specificity, from broad statements that health plans must have “adequate” 

physician networks serving their enrolled members to very specific 

standards that set, for example, a maximum average number of 

beneficiaries per PCP or a maximum time frame for scheduling a first 

appointment. All but 1 of the 14 states required managed care plans to 

routinely submit lists of physicians participating in their networks, ranging 

from weekly to quarterly reporting. However, fewer states independently 

verified or routinely monitored aspects of the submitted data on managed 

care plans’ provider networks. For example, 8 of the 13 states receiving 

plans’ routine lists of participating physicians periodically verified the 

number of physicians accepting new Medicaid patients, but only 5 states 

analyzed the number of physicians to identify those participating in 

multiple plans, which could overstate overall physician capacity. 

Moreover, only 5 states routinely or independently assessed plans’ 

compliance with maximum waiting times for beneficiaries’ scheduling 

appointments. In some cases, states left it to plans to establish time frames 

for scheduling appointments, rather than setting statewide standards for 

all plans. 

Beyond network-related requirements and any associated monitoring, 

states attempted to assess beneficiaries’ actual use of services through 

various routine data sources and occasional special studies. Routine data 

sources included encounter data, where states require health plans to 

submit data for each service provided to each enrollee, periodic 

assessments of plans’ performance against standardized measures, and 

beneficiary satisfaction surveys. But continuing problems with the 

reliability of encounter data—and the fact that standardized data on plan 

performance and beneficiary satisfaction surveys were not representative 

of all Medicaid managed care enrollees—tended to undermine the utility 

of these data sources in describing the experiences of beneficiaries and 

their service utilization. The four states we visited that had experienced 

the withdrawal of managed care plans from their Medicaid programs had 

taken various steps to help minimize disruption in care for affected 

In Medicaid Managed 

Care, States Focused 

More on Setting Plan 

Network 

Requirements than on 

Monitoring Plans or 

Analyzing Service 

Utilization 
Page 15 GAO-03-222 Medicaid and SCHIP Access 

beneficiaries. However, it is not clear to what extent these states 

monitored service utilization for beneficiaries affected by such changes 

and their experiences in transitioning to new plans and physicians. 

To oversee access to care in their Medicaid managed care programs, the 

states we reviewed established requirements for participating plans that 

most often focused on the size and structure of their physician networks, 

such as the number and geographic location of PCPs and specialists, and 

beneficiaries’ ability to schedule appointments. Some states, such as 

Colorado, Texas, and Washington, had broad requirements that physician 

networks must be adequate to serve beneficiaries, as shown in figure 1. 

Among the 14 states that used managed care in their Medicaid programs, 

broad network requirements were more prevalent for specialists than for 

PCPs. In contrast, 11 of 14 states set specific standards or ratios relating to 

the number of enrolled beneficiaries per PCP, and 13 set standards for 

providers’ geographic proximity to beneficiaries, such as the maximum 

distance or travel time for a beneficiary to reach a provider’s office. More 

variation was evident in states’ requirements for plans in terms of 

appointment scheduling for beneficiaries. All 14 states set maximum time 

frames to schedule routine and urgent appointments, while 6 states also 

set maximum time frames for a newly enrolled beneficiary’s first 

appointment and 8 states set maximum in-office waiting times. 

Most States Set Plan 

Network Requirements but 

Less Frequently Monitored 

Plans’ Compliance 
Page 16 GAO-03-222 Medicaid and SCHIP Access 

Figure 1: Selected Medicaid Managed Care Plan Network Requirements and 

Standards in 14 States 

a

State does not have a specific standard but does require plans to monitor this measure. 

b

State only has a standard for selected populations, such as children with special needs. 

States took varying approaches in setting their requirements for plan 

networks and appointment waiting times, as shown in table 3. For 

example, Florida required physicians to certify that their overall practice 

did not exceed 3,000 patients, whereas other states established specific 

Medicaid beneficiary-to-PCP ratios ranging from 1,000 to 1 in Pennsylvania 

to 2,500 to 1 in Tennessee. With regard to appointment waiting times, 

some states required plans to set their own standards rather than 

establishing a consistent statewide standard. 

Source: GAO analysis of states’ data, as of December 2001. 

State Network size and structure

PCPs Geographic 

distribution

Appointment waiting times

Specialists First visit In-office 

waiting time

Appointment

scheduling

California

Colorado

Florida

Illinois

Maryland

Massachusetts

Michigan

Nevada

New York

Ohio

Pennsylvania

Tennessee

Texas

Washington

Specific Standard

General requirement that health plans’ networks be adequate to serve their members

No standard 

b

a

a

a
Page 17 GAO-03-222 Medicaid and SCHIP Access 

Table 3: Examples of Specific State Standards for Plan Networks and Appointment Waiting Times 

Availability measure Examples of standards used 

Plan network 

PCPs • Florida requires physicians to certify that their overall practice does not exceed 3,000 patients. 

• Maryland requires each health plan to have enrolled beneficiaries-to-PCP ratios that do not exceed 

2,000:1 for adults and PCPs should have no more than 1,500 beneficiaries under age 21. Tennessee 

uses a maximum 2,500:1 beneficiaries-to-PCP ratio. 

• Ohio’s contracts with health plans specify a required number of PCPs based on the number of 

beneficiaries and plans in a county. 

Specialists • New York requires each participating plan to have 30 specialties: 14 with specific ratios of enrolled 

beneficiaries to specialists and 16 specialties for which health plans must have at least two providers. 

• Ohio requires health plans to have a specified number of 6 types of specialists, including dentists, 

allergists, and general surgeons, per county or service area. 

• Pennsylvania requires health plans to provide beneficiaries with a choice of at least 2 appropriate 

specialists within a reasonable geographic distance. 

Geographic distribution • Ohio requires health plans to ensure that 40 percent of beneficiaries reside within 10 miles of a PCP. 

• Texas requires health plans to have a PCP within 30 miles of a beneficiary’s residence and specialty 

care within 75 miles. 

• Washington requires health plans in urban areas to have two PCPs within 10 miles of 90 percent of 

beneficiaries; plans in rural areas must have one PCP within 25 miles of most beneficiaries. 

Appointment waiting times 

First visit • California requires that the first visit of newly enrolled beneficiaries be within 120 days. 

• Michigan requires health plans to set a standard for when new beneficiaries should first visit a PCP. 

• Pennsylvania requires that health assessments, general physical examinations, or first examinations 

be scheduled within 3 weeks of enrollment. 

Appointment scheduling • California requires health plans to provide urgent care within 24 hours and to set a standard for 

routine appointments. 

• Nevada requires appointments for urgent care within 2 days, and that routine care be scheduled 

within 2 weeks of request. 

• New York requires that appointments be scheduled within 24 hours for urgent care, 4 weeks for 

routine and preventive care, and 4 to 6 weeks for specialist care. 

In-office waiting time • Florida requires that explanations be given to beneficiaries if they must wait more than 30 minutes; if 

the wait will exceed an hour, the provider is to reschedule the appointment. 

• Michigan requires health plans to set an in-office waiting time standard. 

• Pennsylvania requires that beneficiaries wait no more than 20 minutes on average or 1 hour 

maximum past their scheduled appointment times. 

Source: GAO analysis of states’ data, as of December 2001. 

Routinely monitoring plan performance, especially with established 

network requirements and standards, is critical because providers can—

and do—change their participation in Medicaid managed care, which in 

turn can affect beneficiaries’ access to care. In some cases, a state may not 

have set a specific network requirement but nonetheless independently 

monitors plan performance. States that monitor the extent to which 

participating plans’ network providers are actually available to 

beneficiaries are better able to systematically identify and respond to 

access problems. For example, see the following. 
Page 18 GAO-03-222 Medicaid and SCHIP Access 

• In 1999, Tennessee reviewed each managed care plan’s contracts with its 

providers and contacted providers directly to independently verify their 

participation with the plan and whether they were open to new Medicaid 

patients. The state found that, for one health plan, only 44 percent of the 

participating PCPs accepted new Medicaid patients; of the remaining 56 

percent of PCPs, 33 percent had Medicaid patients but would not accept 

any new ones, and 23 percent either did not accept any Medicaid patients 

or could not be reached by telephone. Determining that the plan did not 

comply with requirements for PCP availability, the state required the plan 

to add providers who would accept new Medicaid beneficiaries before 

assigning any additional beneficiaries to the plan. State officials also 

reported that they now conduct a regular telephone survey of providers to 

verify the provider data that participating plans submit. 

• Washington has a broad requirement that physician networks be adequate 

to serve enrolled beneficiaries but does not set as many additional specific 

standards as do some other states. The state does, however, require 

participating plans to routinely report which physicians are participating 

in their Medicaid networks and independently verifies plan reports by 

periodically placing test calls to physicians. Washington also compiles the 

physician-level information into a centralized database to review physician 

participation across health plans in order to better ensure that capacity is 

not overstated. 

To monitor plan performance in terms of provider availability to 

beneficiaries, 13 of the 14 states we reviewed routinely obtained periodic 

data from participating plans on the number of physicians in their 

networks, ranging from weekly reports in Maryland to quarterly reports in 

California, Massachusetts, and New York. As a part of this routine data 

collection, 12 states also reviewed the geographic distribution of 

physicians in their networks. Fewer states, however, took additional steps 

to determine, on an ongoing basis, whether the plan-submitted data 

adequately reflected network capacity to serve Medicaid beneficiaries. For 

example, in 9 states the plans’ provider lists identified those physicians 

who were accepting new Medicaid patients, which would help indicate the 

extent to which plan networks were open to new public beneficiaries, and 

7 states independently verified the accuracy of the submitted provider 

lists. Five states analyzed information across the plans’ provider lists to 

help identify the unduplicated number of PCPs available to the Medicaid 

managed care population and to help avoid overstating overall physician 

availability. (See fig. 2.) 
Page 19 GAO-03-222 Medicaid and SCHIP Access 

Figure 2: Variation in 14 States’ Monitoring of Medicaid Managed Care Plans’ 

Provider Information 

a

In some counties in California, plans are required to update their provider lists semiannually. 

b

The state imposed specific standards regarding the number of PCPs in a health plan’s network (such 

as beneficiaries-to-PCP ratios) but did not account for providers that may be enrolled in multiple 

plans. 

c

The state plans to reinstitute requirements for health plans to submit provider information quarterly in 

the next contract period. 

d

The state requires health plans to limit the total number of patients a physician may have across all 

lines of business (for example, private pay, Medicaid, and other types of insurance coverage), but the 

state does not monitor compliance with this limit. 

e

The state does not obtain lists from health plans that indicate the number of providers accepting new 

patients. Instead, it tracks the number of patients each provider is willing to accept through a health 

plan and compares this information to the number of beneficiaries enrolled with a particular physician. 

Based on this comparison, the state identifies which physicians should be accepting new patients. 

Compared to state monitoring of provider network information, even 

fewer states monitored compliance with their requirements for 

appointment waiting times. Five of the 14 states with Medicaid managed 

Yes 

No 

Not applicable

State

California 

Colorado

Florida 

Illinois 

Maryland 

Massachusetts 

Michigan 

Nevada 

New York 

Ohio 

Pennsylvania 

Tennessee 

Texas

Washington

Total

Source: GAO analysis of states’ data, as of December 2001.

How frequently 

do plans 

submit provider 

lists to the 

state? 

Do lists identify 

providers 

accepting new 

Medicaid 

patients?

Does the state

account for 

providers 

enrolled in 

multiple plans?

Does the state 

verify the 

accuracy 

of provider 

lists?

Quarterlya

Monthly

Monthly

Weekly

Quarterly

Bi-weekly

Bi-weekly

Quarterly

Monthly

Monthly

Monthly

Monthly

Monthly

9 7 5

d

d d

d

b

b

b

b

N/A 

N/Ac N/A

N/A

N/A N/A

e
Page 20 GAO-03-222 Medicaid and SCHIP Access 

care—California, Massachusetts, New York, Tennessee, and Washington—

routinely collected data or otherwise independently verified health plans’ 

compliance with specific appointment-related standards such as maximum 

time frames to schedule an initial health assessment (first visit) or routinecare appointment and in-office waiting times. To determine whether 

beneficiaries newly enrolled in a plan received initial health assessments 

within 120 days of enrollment, California regularly reviews health plan 

reports and physician office medical records for a sample of new 

beneficiaries in each plan. To verify physician compliance with 

appointment scheduling standards, New York makes random calls to 

physicians (200 offices per plan service area per year), requesting 

information on the next available appointment for a specified need, such 

as routine care, urgent care, or after-hours care. In contrast, 

Massachusetts directs plans to develop and monitor compliance with their 

own appointment scheduling requirements, and the state annually reviews 

and critiques the methodology and results reported by each plan. 

Absent routine verification or monitoring of plans’ compliance with 

network and availability requirements, states do not have an adequate 

assurance that such requirements are having their intended effect on 

beneficiaries’ access to managed care providers. Officials in one state that 

did not verify requirements indicated that the standards served as a basis 

for legal recourse in the event that beneficiaries raised complaints 

regarding appointment availability. Undertaking additional measures to 

verify plan compliance, as Tennessee did, can identify more 

comprehensive network problems that limit access to care for Medicaid 

beneficiaries and that might otherwise go undetected. 

The new Medicaid managed care regulations, effective August 13, 2002, 

and to be fully implemented by August 13, 2003, will likely require some 

states to alter their approaches to requirements for their participating 

plans and provider networks. In general, the regulations require that states 

ensure—through their contracts with managed care plans—that 

participating plans demonstrate their capacity to serve the needs of their 

enrollees for any specific standards that states set for access to care. 

Among other things, the regulations require states to ensure that 

participating plans 

• maintain and monitor their networks of providers to provide adequate and 

timely access to all services covered under their contracts with the states, 

including monitoring the numbers of network providers who are not 

accepting new Medicaid patients; 

New Regulations May Alter 

States’ Approaches to 

Monitoring Managed Care 
Page 21 GAO-03-222 Medicaid and SCHIP Access 

• ensure that network providers offer hours of operation that are no less 

than the hours offered to commercial enrollees or comparable to those of 

Medicaid FFS; 

• make services included in the contract available 24 hours a day, 7 days a 

week, when medically necessary; and 

• establish mechanisms to ensure compliance by providers with state 

standards for access to care. 

The regulations require states to certify to CMS—at the time the state 

enters into a contract with a plan or when there are significant changes 

that would affect the ability of plans to provide adequate capacity or 

services—that plans have complied with state requirements for the 

availability of services covered by managed care contracts. To the extent 

that states have not made specifications regarding health plan physician 

network capacity or assurances of access to care, states may need to 

revise their contracts with plans to comply with this new requirement. 

States that verify or monitor participating plans’ actual compliance with 

the terms of their contracts will likely have greater direct and routine 

information on whether the access-related requirements they have set out 

for participating plans are achieving their intended benefit for covered 

beneficiaries. 

Determining the extent to which Medicaid beneficiaries are utilizing—and 

are satisfied with—covered program services is an important test of the 

effectiveness of any state requirements for managed care plans’ network 

capacity and accessibility. To assess beneficiaries’ service utilization and 

satisfaction, the states we reviewed generally required participating plans 

to routinely provide data from two key sources: encounter data, which are 

individual-level data on service use, and HEDIS, which provides 

comparative information across participating plans for designated service 

measures. Most states also administered CAHPS, which is a standardized 

beneficiary satisfaction survey. However, for the majority of states we 

reviewed, the utility of these data for routine monitoring was often 

handicapped because of the frequent failure of plans to submit reliable 

encounter data and the exclusion of significant shares of beneficiaries 

from the HEDIS and CAHPS data. CAHPS survey results were further 

limited by poor response rates in most states. A few states reported 

making sufficient progress in their efforts to improve the quality of their 

encounter data that they could use them to routinely analyze service 

utilization in their Medicaid managed care programs. In addition to these 

routine data sources, a few states reported conducting occasional special 

Routine Monitoring of 

Service Utilization Often 

Handicapped by Poor Data 
Page 22 GAO-03-222 Medicaid and SCHIP Access 

studies that enabled them to identify and focus on access issues pertaining 

to beneficiaries’ use of services or satisfaction with services received. 

Encounter data are intended to capture information on beneficiaries’ use 

of primary and preventive care as well as other services, such as 

emergency room visits. These data can help states identify patterns of care 

along several dimensions, such as by type of visit or patient (such as wellchild visits by age), by health condition or disorder (such as asthma or 

diabetes), and by plan. As a condition of their approved federal managed 

care waivers, states must require Medicaid managed care plans to submit 

encounter data. But obtaining reliable and useful encounter data has 

proven to be a difficult undertaking, as we have earlier reported.19

According to CMS and several of the states we reviewed, many states 

continue to struggle with obtaining reliable and complete encounter data. 

One state we contacted found that the lack of standardized provider 

coding and formatting procedures resulted in missing and incomplete 

data. As a result, only 16 percent of the provider identifiers in the 

submitted encounter data could be matched to the state’s Medicaid 

provider master file. Another state noted that its encounter data were of 

limited use because many health plans were unable to obtain complete 

data from their providers. Two of the 14 states we reviewed reported that 

obtaining complete encounter data was more problematic for health plans 

that paid their physicians a monthly capitated payment that is not linked 

to the delivery of specific services. 

For states providing Medicaid services through managed care, encounter 

data often are the basis for states’ responses to federal reporting 

requirements under Medicaid’s Early and Periodic Screening, Diagnostic 

and Treatment (EPSDT) services. EPSDT is designed to provide children 

and adolescents with access to comprehensive, periodic evaluations of 

health, developmental, and nutritional status, as well as hearing, vision, 

and dental services.20 The EPSDT annual reports that states must submit to 

CMS are designed to capture, by age group, information such as the 

 19See U.S. General Accounting Office, Medicaid Managed Care: Challenge of Holding 

Plans Accountable Requires Greater State Effort, GAO/HEHS-97-86 (Washington, D.C.: 

May 16, 1997). 

20Federal law requires that EPSDT include services that are necessary to correct or 

ameliorate defects and physical and mental illnesses and conditions discovered through 

screening, regardless of whether those services are covered by the state’s Medicaid plan. 

Encounter Data
Page 23 GAO-03-222 Medicaid and SCHIP Access 

number of children who (1) received EPSDT health screenings,21 (2) were 

referred for corrective treatment, (3) received dental treatment or 

preventive services, and (4) were enrolled in managed care plans. 

However, we have previously reported that managed care plans, 

particularly those that pay their participating physicians on a capitated 

basis, often had difficulty collecting and reporting complete and accurate 

EPSDT data.22 Thus, EPSDT reports that are based on encounter data are 

often incomplete or inaccurate, compromising the reliability of states’ data 

on use of these services. 

Despite these widespread problems with encounter data, a few states we 

reviewed noted that the reliability and usefulness of their encounter data 

have improved over time. Maryland, New York, and Michigan, for example, 

reported sufficient progress with improving the quality of their encounter 

data that they are now able to use them to analyze service utilization in 

their Medicaid managed care programs, as indicated below. 

• Maryland officials noted that after spending several years developing and 

refining its system for obtaining encounter data, the state is now able to 

use them as the basis to make risk-adjusted payments to plans and to 

routinely assess Medicaid managed care beneficiaries’ utilization of wellchild, ambulatory, and emergency room visits. The state publicly reports 

performance information by health plan, creating a strong incentive for 

health plans to ensure that all encounters are reported. To ensure that the 

reported encounter data accurately portray services delivered, the state 

conducts validation studies on the data submitted by health plans. The 

state also reviews the distribution and frequency of diagnoses reported 

through the encounter data over time to monitor whether the mix of 

diagnoses across the population changes. 

• New York established a data warehouse for Medicaid managed care in 

1997. The warehouse includes encounter data submitted by health plans as 

well as data from other providers’ FFS claims for reimbursement for 

services provided to managed care beneficiaries outside of their health 

 21The components of an EPSDT health screening include a comprehensive health and 

developmental history, a comprehensive unclothed physical exam, appropriate 

immunizations, laboratory tests (including a blood lead-level assessment), and health 

education. 

22See U.S. General Accounting Office, Medicaid: Stronger Efforts Needed to Ensure 

Children’s Access to Health Screening Services, GAO-01-749 (Washington, D.C.: July 13, 

2001). 
Page 24 GAO-03-222 Medicaid and SCHIP Access 

plan. A variety of reports on utilization and access data are generated and 

shared with plans on a restricted access web site. 

• Michigan is developing a data warehouse that will combine managed care 

encounter data with FFS claims and public health data, such as vital 

statistics and immunization records, into a single information system that 

it will use to analyze beneficiaries’ service utilization. The data warehouse 

will also be able to create utilization profiles by managed care plan. The 

state has begun testing the data warehouse that is expected to be 

operational within the next year. 

HEDIS is a set of standardized performance measures that helps 

purchasers and consumers compare the performance of managed health 

care plans.23 HEDIS performance measures are organized into eight 

categories, four of which include measures directly related to beneficiary 

service utilization.24 The Medicaid version of HEDIS includes various 

access-related measures that attempt to capture beneficiaries’ use, often 

by age, of various preventive and other services from specified providers, 

as illustrated in table 4. (See app. I for a more detailed list of Medicaid 

HEDIS measures related to service utilization.) 

 23NCQA, an independent foundation, has managed HEDIS since 1992. Originally designed 

for private employers as purchasers of health care, it has been adapted for public 

purchasers, regulators, and consumers, including Medicaid. 

24The four general HEDIS categories that directly relate to service utilization are 

effectiveness of care, access/availability of care, use of services, and satisfaction with the 

experience of care. The remaining four general categories are health plan stability, cost of 

care, informed health care choices, and health plan descriptive information. 

HEDIS
Page 25 GAO-03-222 Medicaid and SCHIP Access 

Table 4: Examples of Medicaid HEDIS Measures Related to Service Utilization for Children 

General HEDIS 

category Specific HEDIS measure Description 

Childhood immunization 

status 

The percentage of enrolled children who turned 2 years old during the 

measurement year, who were continuously enrolled for 12 months preceding their 

second birthdays and who were identified as having the recommended number of 

specific immunizations by their second birthdays. 

Adolescent immunization 

status 

The percentage of enrolled adolescents who turned 13 during the measurement 

year, who were continuously enrolled for 12 months immediately preceding their 

13th birthdays and who were identified as having had the recommended number of 

specific immunizations by their 13th birthdays. 

Effectiveness of 

care 

Use of appropriate 

medications for people 

with asthma 

Whether members with persistent asthma are being prescribed medications 

acceptable as primary therapy for long-term control of asthma. 

Children’s access to PCPs The percentage of enrolled members age 12 months through 24 months, 25 

months through 6 years, and 7 years through 11 years who had a visit with a 

network PCP. 

Access/ availability 

of care 

Annual dental visit The percentage of enrolled members age 4 through 21 who were continuously 

enrolled during the measurement year and who had at least one dental visit during 

the measurement year (when dental services are a covered benefit under 

Medicaid). 

Well-child visits in years 3, 

4, 5, and 6 of life 

The percentage of members who were 3, 4, 5, or 6 years old during the 

measurement year, who were continuously enrolled during the measurement year, 

and who received one or more well-child visits with a primary care practitioner 

during the measurement year. 

Use of services 

Adolescent well-care visits The percentage of enrolled members who were age 12 through 21 years during the 

measurement year, who were continuously enrolled during the measurement year, 

and who had at least one comprehensive well-care visit with a PCP or an 

obstetrician/gynecologist practitioner during the measurement year. 

Source: NCQA, HEDIS 2000: Technical Specifications (Washington, D.C.: 1999). 

Twelve of the 14 states we reviewed used HEDIS measures to help assess 

Medicaid beneficiaries’ utilization of services. Eleven states required 

participating plans to submit HEDIS performance results, while 1 state—

Ohio—conducted its own HEDIS analysis using encounter data submitted 

by plans.25 Some states used the full set of HEDIS measures, while others 

used selected measures corresponding to areas of interest. 

Despite the potential of HEDIS to provide valuable information regarding 

beneficiaries’ use of managed care services, its narrow focus in identifying 

beneficiaries to be included in the assessments often limits the ability to 

generalize results to all beneficiaries within a plan or within a state. Many 

HEDIS measures require beneficiaries to have 12 months of continuous 

 25Tennessee and Texas did not use HEDIS to assess plan performance. 
Page 26 GAO-03-222 Medicaid and SCHIP Access 

enrollment in a single managed care plan in the assessment year in order 

to be included in the measures.26 As a measurement criterion, the 

continuous enrollment requirement is intended to ensure that 

comparisons of performance across health plans are made on the basis of 

sample populations that have been enrolled for similar periods of time. 

However, because beneficiaries’ average length of time in the Medicaid 

program can be less than 12 months—ranging from 6 to 9 months in three 

states—this 12-month enrollment requirement excluded at least one 

quarter of Medicaid beneficiaries from most of the states we reviewed and 

more than half in four states, as shown in table 5.27 Consequently, HEDIS 

measures may not provide a representative measure of service utilization 

for a significant share of children covered by Medicaid managed care. 

Another limitation of the HEDIS measures is that they are often based on 

encounter data and are thus subject to the reliability concerns previously 

raised. 

 26Although some HEDIS measures have a 12-month continuous enrollment requirement, 

individuals with one gap in enrollment of up to 45 days or less can be included in the 

sample. However, to be included, individuals must remain with the same health plan after a 

break in enrollment. 

27According to one report, at least one state—Iowa—analyzed HEDIS measures for 

individuals that were continuously enrolled in Medicaid for less than 12 months. See 

NCQA, Medicaid HMO and Fee-For-Service Comparison Strategy: Methodological Issues 

(Washington, D.C.: NCQA, n.d.). 

http://www.ncqa.org/Programs/qsg/medicaidcomparison.html (downloaded July 8, 2002). 
Page 27 GAO-03-222 Medicaid and SCHIP Access 

Table 5: Estimated Percentage of Medicaid Children Excluded from HEDIS 

Statea Percentage excluded from HEDISb

Colorado 79

Ohio 75

Washington 52

Florida 51

New York 40

Michigan 33

Maryland 32

Pennsylvania 31

Massachusetts 29

California 26 

Illinois 24

Nevada c 

Tennessee d 

Texas d 

Source: GAO analysis of states’ data, as of December 2001. 

a

States were asked for enrollment information for the most recent year for which data were available, 

which was generally 2001. 

b

Percentages represent the portion of the population excluded from the required sample for some of 

the HEDIS measures because they were enrolled for less than 12 months. 

c

State could not provide exclusion data. 

d

State does not use HEDIS data. 

Several states we reviewed provided examples of how they used the 

HEDIS data they received from participating plans. These included using 

the information to compare each plan’s performance against national 

Medicaid averages for selected measures and developing report cards to 

compare results across plans. Given issues we identified with the 

completeness of the data, however, such uses and comparisons may not 

be reliable indicators of beneficiaries’ use of services and may render a 

false impression of beneficiaries’ actual experience in service utilization. 

State Medicaid managed care programs are required to have an internal 

quality assurance system, which can involve administering beneficiary 

satisfaction surveys.28 Thirteen of the 14 states we reviewed reported using 

CAHPS to assess beneficiaries’ experiences with their Medicaid managed 

 2842 C.F.R. § 434.34. 

CAHPS 
Page 28 GAO-03-222 Medicaid and SCHIP Access 

care plans.29 CAHPS is a standardized survey designed to compare the 

performance of managed care plans on the basis of beneficiaries’ 

perceptions regarding the care they received through their plans.30 The 

CAHPS survey covers a range of topics related to service utilization, 

including appointment scheduling, waiting time in a physician’s office, and 

the use of specialty services, as shown in table 6. 

Table 6: Examples of Beneficiary Satisfaction Questions for Children Covered by CAHPS 

Measure Question 

First visit • Did you get an appointment for your child’s first visit to a doctor or other health care 

provider for a checkup, or for shots or drops, as soon as you wanted? 

Appointment scheduling • In the last 6 months, how often did your child get an appointment for regular or routine 

health care as soon as you wanted? 

• In the last 6 months, when your child needed care right away for an illness or injury, how 

often did your child get care as soon as you wanted? 

Ambulatory care • In the last 6 months (not counting times your child went to an emergency room), how 

many times did your child go to a doctor’s office or clinic? 

In-office waiting time • In the last 6 months, how often did your child wait in the doctor’s office or clinic more than 

15 minutes past the appointment time to see the person your child went to see? 

Referral to specialist • In the last 6 months, how much of a problem, if any, was it to get a referral to a specialist 

that your child needed to see? 

Source: CAHPS 2.0, Child Medicaid Managed Care Questionnaire and Child Supplemental 

Questions, (Rockville, Md.: AHRQ, 1998). 

Like HEDIS, however, information from CAHPS is only gathered from a 

subset of beneficiaries. CAHPS has a 6-month continuous enrollment 

requirement for Medicaid beneficiaries to be included in the survey 

sample. While this is a shorter minimum enrollment period than for 

HEDIS, it still resulted in excluding about one quarter or more of covered 

beneficiaries in five states we reviewed, and nearly half or more in two 

states, as shown in table 7. Moreover, several states using CAHPS reported 

that they had low response rates from the sampled population; in some 

cases, surveys targeted only those beneficiaries with telephones, a 

 29Tennessee opted to use a state-designed beneficiary satisfaction survey rather than 

CAHPS. In most cases, the states we reviewed administered CAHPS directly or through the 

use of an independent contractor. Three states—Colorado, Illinois, and Pennsylvania—

required participating plans to administer CAHPS. 

30CAHPS was developed in 1995 by the federal AHRQ to provide information to help 

beneficiaries compare health plans. 
Page 29 GAO-03-222 Medicaid and SCHIP Access 

practice that has the potential to bias the results for beneficiaries who 

could not be reached by that method.31

Table 7: Estimated Percentage of Medicaid Children Excluded from CAHPS 

Statea Percentage excluded from CAHPSb

Colorado 61

Ohio 49

Texas 31

Florida 30

Washington 24

Michigan 17

Maryland 16

Massachusetts 15

New York 15

Pennsylvania 13

California 11

Illinois 10

Nevada c 

Tennessee d 

Source: GAO analysis of states’ data, as of December 2001. 

a

States were asked for enrollment information for the most recent year for which data were available, 

which was generally 2001. 

b

Percentages represent the portion of the population excluded from CAHPS because this group was 

enrolled for less than 6 months. 

c

State could not provide data. 

d

Tennessee does not use CAHPS, although it does conduct a state-designed survey of a sample of 

all state residents about insurance coverage and satisfaction with services, including access to care. 

Gauging beneficiary satisfaction with services solely through a satisfaction 

survey is an inherently difficult process, especially when a sample is not 

representative or response rates are low. To augment information on 

beneficiary satisfaction, states also had available the results of their 

complaints and grievances processes, which they are required to have as a 

condition of their managed care programs. Nearly all of the states we 

reviewed with Medicaid managed care operated a central hotline or 

complaint number, where beneficiaries could obtain program information 

 31Among the nine states in our sample that reported their response rates, the response rates 

for the CAHPS survey of families with children ranged from 27 percent in Nevada to 85 

percent in Illinois. 
Page 30 GAO-03-222 Medicaid and SCHIP Access 

or request assistance locating providers in addition to filing complaints. 

The states we reviewed generally focused on ensuring that complaints and 

questions raised by beneficiaries’ calls were addressed. For example, five 

states—Ohio, Maryland, Michigan, New York and Washington—had 

information databases that tracked complaints from their inception to 

their resolution. New York, Ohio, and Washington complaint reports were 

also analyzed by managed care plan, which allowed officials to identify 

any trends in beneficiary complaints. 

As a tool to assess overall problems with access to care, records of 

complaints and grievances had several limitations. In some cases, states’ 

hotline or complaint data did not distinguish between requests for 

assistance and complaints about provider services, thus making it difficult 

to assess the extent of any systemic access problems. In addition, a small 

number of complaints could be difficult to interpret at face value; while 

few complaints or grievances could indicate overall satisfaction with care, 

it could also indicate a general lack of knowledge about or ability to file a 

formal complaint or grievance. A small number of complaints also could 

limit the state’s ability to identify any specific trends of systemic problems 

with access to care with a specific plan or within a state’s Medicaid 

managed care program as a whole. 

A few states we contacted reported that they occasionally conducted 

special studies, in addition to any routine monitoring they did, to assess 

service utilization issues for their Medicaid beneficiaries. For example, 

Maryland’s 4-year evaluation of its Medicaid managed care program, 

published in January 2002, concluded that providers and consumers felt 

that PCP networks were “under stress” in certain areas of the state, with a 

notable lack of physicians in rural areas of the state.32 The evaluation also 

identified significant inaccuracies with plan-submitted data on physician 

providers, including duplicate provider entries, incorrect provider 

affiliation status with participating plans, and missing information. As a 

result, the state took steps to develop and implement more rigorous 

methods of monitoring plan-submitted data. In particular, the state now 

monitors plans’ PCP networks, including verification calls to samples of 

physicians, so that PCP shortage areas can be identified and addressed. In 

the future, the state also plans to develop more specific standards for 

 32Maryland Department of Health and Mental Hygiene, HealthChoice Evaluation, Final 

Report and Recommendations (Washington, D.C.: Jan. 15, 2002). 

Special Studies 
Page 31 GAO-03-222 Medicaid and SCHIP Access 

commonly used specialists and monitor plans’ compliance with these 

standards. 

In 2001, Washington conducted a survey of new Medicaid managed care 

beneficiaries in 14 counties as a result of concerns raised by beneficiary 

advocates in light of managed care plans’ withdrawal from program 

participation. The study examined these beneficiaries’ experiences with 

accessing medical care, including emergency room use. The study found 

that 90 percent of new beneficiaries reported having a PCP after 

enrollment in Medicaid, compared to 62 percent having a PCP before 

enrollment in Medicaid managed care. Additionally, there were no 

significant differences between the experiences of managed care and FFS 

beneficiaries who had obtained medical, specialist, or emergency room 

care. However, the study did find that the majority of beneficiaries were 

unfamiliar with several key processes concerning their managed care 

plans, such as how to change PCPs within a health plan, contact their 

health plans when questions or problems arose, and make complaints. 

Based on these findings, the state plans to work with managed care plans 

to improve beneficiaries’ awareness regarding PCP selection and 

communication with their health plans. 

The managed care industry—in the commercial as well as public sectors—

has experienced considerable changes in recent years following periods of 

rapid entry of multiple managed care plans in certain markets and 

subsequent retrenchment based on plans’ willingness or ability to compete 

in those markets. Many communities and states have experienced changes 

in the number of managed care plans as a result of numerous health plan 

mergers, acquisitions, and closures as the managed care industry has 

evolved and matured. State Medicaid programs have often been affected 

by the withdrawal of some managed care plans from their programs; in 

some cases, states have intentionally acted to reduce the number of 

participating plans. The four states we visited—Massachusetts, Ohio, 

Tennessee, and Texas—had experienced such changes to varying degrees. 

These states had taken various measures to help minimize any adverse 

effects on beneficiaries’ access to care due to participating plans leaving 

the Medicaid program. It is not clear, however, to what extent these states’ 

efforts had been successful in helping beneficiaries transition smoothly to 

new health plans and physicians and thus avoid problems with access to 

care. 

States Attempted to 

Minimize Impact of 

Managed Care Plan 

Withdrawals on Access to 

Care, but Effect on 

Beneficiaries Is Uncertain 
Page 32 GAO-03-222 Medicaid and SCHIP Access 

The potential amount of disruption that occurs when a health plan 

withdraws from a state or community can vary considerably, depending on 

a number of circumstances. Health plan mergers can result in minimal 

changes for beneficiaries if they are able to maintain established 

relationships with their providers and can even strengthen the network of 

available providers within a plan. In Massachusetts, for example, a merger 

between two health plans in the early 1990s was considered by state 

officials to have increased physician availability for Medicaid beneficiaries 

enrolled in managed care. Officials in Massachusetts also noted that 

reductions in the number of health plans ensured that participating plans 

have enough enrolled beneficiaries to spread the costs and risks 

associated with capitation payments. In other cases, however, the extent 

of disruption may be more severe, particularly when large numbers of 

beneficiaries are affected and a significant number of plans struggle to 

remain financially viable. 

Each of the four states we visited experienced varying levels of health plan 

withdrawals from their Medicaid managed care programs. Plan 

withdrawals over several years have affected almost 50 percent of 

beneficiaries in Tennessee and over 15 percent in Ohio, raising concerns 

about the accessibility of care to beneficiaries in these states. The 

magnitude of health plan withdrawals in Tennessee necessitated state 

efforts to recruit additional plans, at least one of which was later found by 

the state to have deficiencies related to failure to pay physicians 

accurately and promptly. In Ohio, at least one health plan that withdrew 

from the state program also failed to pay some of its network providers for 

services already rendered. In such cases, delayed reimbursement by 

managed care plans can seriously jeopardize providers’ willingness to 

continue participating in the Medicaid program and provide services to 

eligible beneficiaries. In contrast to Tennessee and Ohio, plan withdrawals 

in Massachusetts and Texas have affected a smaller share of beneficiaries. 

Massachusetts estimated that about 4 percent of its beneficiaries were 

affected by an early period of plan fluctuation as the state was 

implementing its mandatory managed care program; since 2000, however, 

the program has been stable with the same four managed care plans 

participating. In Texas, approximately 1 percent of beneficiaries have been 

affected by withdrawals of participating plans since the state implemented 

managed care in 1996. 

To avoid disruptions in care for beneficiaries when plans ceased their 

participation in the Medicaid program, these states had implemented 

various procedures to help smooth beneficiaries’ transition to other plans 

or providers. For example, in cases where a withdrawing health plan 
Page 33 GAO-03-222 Medicaid and SCHIP Access 

intended to sell its membership to another plan, Ohio first compares the 

provider network of the withdrawing plan with the health plan that is 

purchasing the membership. The state does not approve the sale of 

membership unless most of the providers participating in the withdrawing 

plan also participate in the purchasing plan. In other cases, a state’s 

contract with its managed care plans required certain actions. Ohio’s 

contract, for example, requires a minimum of 75 days advance notice of a 

plan’s intention to terminate its participation in the program and includes 

provisions to collect a monetary assurance from the withdrawing plan or 

to withhold payments until all contractual requirements are completed, 

including required payments to network providers. Ohio and Texas 

provided examples of efforts to inform beneficiaries directly affected by a 

plan’s withdrawal about options available to them to continue care, such 

as information on other participating plans and how to choose another 

plan. These four states indicated that they believed their efforts to respond 

to changes in managed care participation were sufficient to minimize 

disruption to care for Medicaid-eligible beneficiaries. However, the extent 

to which the states’ efforts adequately ensured beneficiaries’ access to 

continuous care was uncertain. Appendix II provides more detail on 

managed care plan withdrawals in these four states. 

For states’ FFS-based Medicaid delivery systems, which continue to serve 

the majority of children in half of the states we reviewed, requirements for 

participating providers and monitoring of provider availability were 

significantly more limited than for managed care. State analysis of service 

utilization data to assess the frequency and patterns of care that 

beneficiaries received was also more limited, despite the ready availability 

of such data through states’ claims payment systems. For traditional FFS 

programs, beneficiaries may seek care from any providers participating in 

the Medicaid program and may change providers at any time if they are 

dissatisfied. However, Medicaid beneficiaries’ ability to easily change 

providers is dependent on the number, type, and location of providers 

willing to take new Medicaid patients, which in turn is strongly influenced 

by Medicaid payment rates and associated administrative processes. We 

found that Medicaid FFS payment rates were significantly lower than rates 

for comparable Medicare services in the majority of states we reviewed, 

which can discourage provider participation and thus restrict 

beneficiaries’ access to a broad supply of providers. States that used 

PCCM programs as part of their FFS service delivery systems were 

somewhat more prone to set certain requirements for participating 

PCCMs, such as a maximum number of assigned beneficiaries and their 

geographic proximity to beneficiaries, than were states with traditional 

For Medicaid FFS, 

State Requirements 

for Providers and 

Monitoring of Service 

Utilization Were More 

Limited 
Page 34 GAO-03-222 Medicaid and SCHIP Access 

FFS systems. States with FFS programs generally did not set requirements 

for specialists or for physicians’ appointments, such as maximum waiting 

times to schedule an appointment, as they did for their managed care 

plans. States were more likely to conduct beneficiary satisfaction surveys 

for their PCCM programs than for their traditional FFS systems; the survey 

results, however, had the same constraints as previously discussed for 

managed care due to the limited share of beneficiaries participating in the 

surveys and low response rates. 

States are required to ensure that their Medicaid service delivery and 

payment systems will afford beneficiaries access to services similar to 

those provided to the state’s general population. To do this, states 

determine which providers may enroll in the Medicaid program to provide 

services, set payment rates for covered services, and pay claims that 

providers submit for the services they provide. In several of the states we 

reviewed with Medicaid FFS programs, program officials said that 

provider survey information and beneficiary complaint data suggested that 

low payment rates, slow payment, and other administrative issues 

deterred physicians in primary care or in some specialties from 

participating in the program. As we reported earlier, if payment rates 

decline to the point that they cause physicians to leave Medicaid or to 

reduce the number of beneficiaries they serve, then beneficiary access 

may be restricted.33

Our analysis of payment rates indicated that Medicaid FFS payments to 

physicians for primary and preventive services for children were often 

significantly lower than what Medicare paid for comparable services in 

many of the states we reviewed. For the 13 states that paid physicians on a 

FFS basis for Medicaid-eligible children, payment rates ranged from 32 

percent to 89 percent of Medicare rates. Nine of these states’ Medicaid 

rates were two-thirds or less of Medicare rates for comparable services. 

(See app. III for more detail.) Officials in many of these states said that 

Medicaid rates were also below those of commercial payers, although they 

generally had not conducted systematic studies to document these 

differences. 

 33See U.S. General Accounting Office, Medicaid and SCHIP: States’ Enrollment and 

Payment Policies Can Affect Children’s Access to Care, GAO-01-883 (Washington, D.C.: 

Sept. 10, 2001). 

Low FFS Payment Rates 

Can Reduce Provider 

Participation and Restrict 

Access to Care 
Page 35 GAO-03-222 Medicaid and SCHIP Access 

Despite the potential for low FFS rates to limit the number of providers 

willing to participate in the program, the nine states we reviewed with 

traditional FFS programs did not set specific goals for the number of 

physicians participating in their Medicaid programs and did not actively 

monitor the number and location of providers.34 While states had lists of 

physicians who were enrolled as Medicaid providers and who submitted 

claims for services provided, in most cases these lists were not frequently 

or comprehensively updated and thus did not provide an accurate count of 

actively participating physicians. Some states’ Medicaid physician 

databases included physicians who had not provided services to Medicaid 

patients for years. In one state, the database doublecounted providers who 

had more than one service location or billing identifier. In addition, 

although states have claims data that serve as the basis for paying 

providers for services rendered, only some analyzed this information to 

identify PCPs, specialists, or other providers who were actively treating 

Medicaid beneficiaries. Even when they did, states often defined “active” 

providers to include those who submitted a single claim during the past 

year. With respect to appointments, such as maximum waiting times to 

schedule a routine or urgent appointment, none of the states we reviewed 

with traditional FFS programs had specific standards comparable to those 

we saw for managed care programs. 

States also did little to monitor service utilization by Medicaid 

beneficiaries participating in traditional FFS care despite having a ready 

source of data in their claims payment systems. Claims data contain the 

type and frequency of services Medicaid beneficiaries have received and 

the type of provider delivering the care, which can be used to analyze 

service utilization. States did report using claims data to develop 

utilization statistics to meet federal requirements for annual reporting on 

EPSDT services for children. However, we have reported earlier that state 

EPSDT reports are often incomplete and unreliable, thus compromising 

their utility in assessing whether children are receiving required services.35

Beyond EPSDT, only one state with a Medicaid traditional FFS system 

reported analyzing claims data to evaluate access to care on primary and 

 34These nine states were California, Colorado, Illinois, Louisiana, Nevada, New York, Ohio, 

Texas, and Washington. The share of Medicaid-eligible children participating in these 

states’ traditional FFS programs ranged from a low of about 30 percent in California and 

Colorado to about 90 percent in Illinois and Louisiana. (See table 2 for more detail by 

state.) 

35GAO-01-749. 

Most Traditional FFS 

Programs Set Few Goals 

Regarding the Number of 

Providers, and Conducted 

Minimal Monitoring of 

Service Utilization 
Page 36 GAO-03-222 Medicaid and SCHIP Access 

preventive services, such as annual well-child and dental visits.36 Rather 

than evaluate access to primary care, at least three states used claims data 

to assess inappropriate utilization of higher-cost services, such as 

emergency room care. For example, Texas collects and analyzes 

information on beneficiaries who potentially overuse care—defined as 

those at or above the 90th percentile of use for particular services, 

including physician, emergency room, and pharmacy services. Patients 

suspected of misusing services may be restricted to using a specific 

physician or pharmacy, with the goal of reducing their use of services to a 

more appropriate level. 

Four of the nine states with traditional FFS systems reported periodically 

using beneficiary satisfaction surveys, such as CAHPS, to help assess 

issues regarding access to care. These states were Colorado, Illinois, Ohio, 

and Washington. As with Medicaid managed care, however, the utility of 

these surveys is diminished when there are low response rates and a lack 

of beneficiary representation in the sample selection. In one state, the 

survey sample was limited to individuals who had received at least one 

service in the prior 6 months, thus excluding individuals who may have 

tried but failed to obtain services. Another state reporting a low 

beneficiary response rate found that while the cooperation rate was high 

among those who were reached, many potential respondents in the survey 

sample could not be contacted because of address or telephone number 

changes. 

States’ PCCM programs are a hybrid of FFS and managed care service 

delivery approaches. They emulate FFS programs in the sense that the 

state has a direct relationship with providers who are enrolled to 

participate in the program and paid retrospectively for services actually 

delivered. PCCM programs share characteristics of managed care in the 

sense that beneficiaries are assigned to a PCCM—a physician, or a 

practice or other entity—that is responsible for coordinating their care as 

a case manager. The seven states we reviewed with PCCM programs had 

more requirements for participating PCCMs than they did for providers in 

traditional FFS programs, but fewer than PCPs in managed care 

 36Since 1995, Ohio has used HEDIS primary care access measures for beneficiaries in its 

traditional FFS program. 

PCCM Programs Had 

Some Requirements for 

Providers, but Monitoring 

of Service Utilization Was 

Limited 
Page 37 GAO-03-222 Medicaid and SCHIP Access 

programs.37 Similar trends were evident in terms of states’ routine 

monitoring of PCCM availability and beneficiaries’ service utilization: 

more than FFS, less than managed care. 

The states we reviewed with Medicaid PCCM programs most often set 

requirements for the maximum number of beneficiaries that a PCCM could 

serve and the geographic proximity of PCCMs to their enrolled 

beneficiaries. None set limits on the number of beneficiaries a specialist 

could serve, and few set specific standards for appointment waiting times 

with their PCCMs; overall, PCCM programs had fewer standards than 

those imposed under managed care, as shown in figure 3. 

Figure 3: Selected Requirements for Medicaid PCCM Providers in Seven States 

a

This type of standard exists in this state’s managed care program but not its PCCM program. 

b

This type of standard exists in the state’s PCCM program, but not its managed care program. 

 37The seven states we reviewed with PCCM programs were Arkansas, Colorado, Florida, 

Louisiana, Massachusetts, Pennsylvania, and Texas. Arkansas and Louisiana do not have 

Medicaid managed care programs other than PCCM, whereas the other five states do. The 

share of Medicaid-eligible children participating in the seven states’ PCCM programs 

ranged from a low of 12 percent in Louisiana to a high of 100 percent in Arkansas. (See 

table 2 for more detail.) 

State 

Arkansas 

Colorado 

Florida 

Louisiana 

Massachusetts 

Pennsylvania

Texas 

Total

Source: GAO analysis of states’ data, as of December 2001.

5 0 52 2 3

a

a

a a

a

a

a a

b

b

a a

d d

a

b

Number and location of providers Appointment waiting times

PCCMs Specialists Geographic 

 distribution 

First 

visit 

Appointment 

scheduling 

In-office 

waiting time

Yes

No
Page 38 GAO-03-222 Medicaid and SCHIP Access 

States’ PCCM capacity requirements were most often based on setting a 

maximum number of beneficiaries that a PCCM or practice could serve, 

ranging from 1,000 beneficiaries per PCCM in Arkansas and Pennsylvania 

to 1,500 in Florida and Massachusetts. Louisiana set a limit of 1,200 

beneficiaries per PCCM, or 4,800 for a group practice, and allowed an 

additional 300 beneficiaries to be enrolled for each nurse practitioner. 

With regard to geographic requirements, all five of the PCCM programs 

that had requirements for this standard specified a basic maximum of 30 

minutes or 30 miles for beneficiaries to reach their PCCMs. Four of these 

states set a higher maximum for rural areas—such as 50 miles in Colorado 

or 60 minutes in Pennsylvania—or allowed general exceptions to the 30-

minute standard for beneficiaries living in some rural areas. 

States typically monitored provider participation in their PCCM programs 

by compiling weekly or monthly lists of participating PCCMs and the 

number of beneficiaries each PCCM was assigned, which could serve as 

the basis for paying the monthly PCCM fee. Monitoring these relative 

numbers also allowed states to ascertain whether PCCMs could be 

assigned additional beneficiaries. States therefore had current information 

on those providers actively participating as PCCMs and the numbers of 

assigned beneficiaries. This information alone, however, would not yield 

insights into how easily beneficiaries could see their PCCMs. 

When states had both managed care and PCCM delivery systems, they less 

frequently set requirements for PCCM appointment waiting times than 

they did for managed care.38 Three states that operated both PCCM and 

managed care programs—Colorado, Florida, and Pennsylvania—did not 

set any appointment waiting time standards for PCCMs as they did for 

managed care. In contrast, Massachusetts required its PCCMs to see new 

patients within a specific time frame in its PCCM program, but not in 

managed care. Of the four states that did set specific requirements for 

appointment waiting times, only Texas reported conducting routine 

monitoring to assess PCCM compliance with those requirements. Texas 

officials reported conducting audits of a random sample of 20 PCCMs per 

quarter per service area to evaluate compliance with respect to 

appointment scheduling and in-office waiting time. 

 38Some states’ contracts with PCCMs may include a general requirement that PCCMs 

provide care on a “timely basis.” 
Page 39 GAO-03-222 Medicaid and SCHIP Access 

To monitor service utilization within their PCCM programs, states most 

often relied on analyses of their FFS claims data. Six of the seven states 

with PCCM programs provided PCCMs that had a certain minimum 

number of assigned beneficiaries with periodic data profiles that compare 

service utilization patterns in their Medicaid practices with those of the 

overall program or other PCCMs.39 These data profiles often focused on 

high-cost services or those at risk of overutilization, such as inpatient 

hospitalization or emergency room use. Three states also included 

information related to primary and preventive services use. For example, 

see the following. 

• Massachusetts provided PCCM practices that had 200 or more enrolled 

beneficiaries with practice-specific and comparative information about the 

percentage of children who received a recommended number of well-child 

visits, by age group. The state further identified, for each practice, 

individual patients who had not received the recommended number of 

well-child visits. State program staff members met with each provider 

twice annually to discuss approaches to address problems identified in 

these data that may indicate limited access. 

• Texas provided participating PCCMs with comparative information on 

selected services per beneficiary, including EPSDT visits, family planning, 

and immunizations. 

In contrast, states typically did not monitor the utilization of services 

provided by specialists, although several state PCCM programs required 

documentation of PCCM referrals to specialists. Officials in several states 

were aware of problems with access to some types of providers and 

specialists in their PCCM programs, including dentists, dermatologists, 

and pediatric neurosurgeons. In an attempt to address such problems, 

Arkansas conducted a survey of dentists and Florida conducted a survey 

of physicians to identify obstacles to their willingness to accept Medicaid 

patients. While such one-time surveys can provide insightful information 

about problems and potential solutions in a specific period, they do not 

take the place of routine or targeted monitoring that can more 

systematically pinpoint problems for particular specialties, geographic 

areas, or beneficiaries. 

 39Targeting such profiles and analyses to PCPs with a certain minimum volume of 

beneficiaries allows more meaningful data comparisons with the program and other PCPs 

than would be possible for PCPs with only a few beneficiaries. 
Page 40 GAO-03-222 Medicaid and SCHIP Access 

Each of the states we reviewed with PCCM programs conducted 

beneficiary satisfaction surveys. In addition, Colorado administers its 

CAHPS survey to individuals participating in all three of the states’ 

Medicaid service delivery systems—managed care, traditional FFS, and 

PCCM—in order to help assess experiences of program beneficiaries 

relative to one another. However, given the shortcomings identified 

earlier—low response rates and exclusions of certain beneficiaries from 

sample selection—states could not with confidence generalize the results 

of these beneficiary surveys to the larger population. 

States have used the flexibility provided by SCHIP to take varying 

approaches for their service delivery systems for eligible children. Of the 

16 states we reviewed, 9 states chose to serve their SCHIP beneficiaries 

through programs that were primarily designed as expansions of Medicaid 

or modeled on their Medicaid programs in terms of benefits and provider 

networks.40 These 9 states used the same health plan contracts for 

Medicaid and SCHIP managed care, and the same provider lists for both 

programs’ FFS-based delivery systems. In these cases, the extent of SCHIP 

monitoring would mirror that of the states’ Medicaid programs. On the 

other hand, 7 states designed at least part of their SCHIP programs to be 

distinct from Medicaid. These programs relied almost exclusively on 

managed care to deliver services. Although most of these states also had 

significant shares of their Medicaid beneficiaries in managed care, they set 

significantly fewer provider network requirements for their distinct SCHIP 

programs than for Medicaid and did less monitoring of providers enrolled 

in their SCHIP programs and of children’s use of services in SCHIP. In 

general, few states with distinct SCHIP programs routinely collected and 

analyzed data to ensure that SCHIP-eligible children were receiving 

covered services. 

 40These states were Arkansas, Illinois, Louisiana, Maryland, Massachusetts, Nevada, Ohio, 

Tennessee, and Washington. 

Distinct SCHIP 

Programs Had Fewer 

Network 

Requirements and 

Less Monitoring of 

Service Utilization 
Page 41 GAO-03-222 Medicaid and SCHIP Access 

The seven states that chose to serve all or most of their SCHIP 

beneficiaries through programs that were distinct from Medicaid used 

managed care delivery systems almost exclusively.41 These states were not 

bound by access-related requirements comparable to those for Medicaid 

PCCM or managed care programs. As such, they set provider network 

requirements and monitored service utilization less often in their distinct 

SCHIP managed care programs than they did in their Medicaid managed 

care programs. As shown in figure 4, only two of these seven states set 

specific beneficiary-to-PCP ratios for SCHIP, compared to five states for 

Medicaid, and no state set specific requirements for specialists, compared 

to three states for Medicaid. Similarly, only one of the seven states with 

distinct SCHIP programs set a maximum waiting time for a first 

appointment with a PCP and none had a requirement for in-office waiting 

times; in contrast six of these states’ Medicaid managed care programs set 

specific requirements for one or both of these access measures. Only four 

of the distinct SCHIP programs in these states set any specific standards 

for appointment scheduling, compared to all seven of the states’ Medicaid 

managed care programs. 

 41These states were California, Colorado, Florida, Michigan, New York, Pennsylvania, and 

Texas. With the exception of Florida, all of the states used managed care delivery systems 

for all of their SCHIP programs; Florida enrolled a small number of SCHIP children into a 

PCCM program. 

States with SCHIP 

Programs Distinct from 

Medicaid Set Few Provider 

Requirements 
Page 42 GAO-03-222 Medicaid and SCHIP Access 

Figure 4: Comparison of Seven States’ Requirements and Standards for Providers 

in Medicaid and SCHIP Managed Care 

Note: Table does not include Medicaid and SCHIP programs that have only a general requirement 

that health plans’ networks be adequate to serve their members. 

a

Although the state did not have a specific standard, it did require plans to monitor this measure. 

b

Florida’s separate SCHIP programs vary by beneficiary age category. The SCHIP column in this 

table refers to the program for older children, as the program for children under age 5 is modeled 

after Medicaid and thus has the same standards as the Medicaid program. 

c

Michigan’s data reflect its arrangement with all participating health plans except for one plan, which 

operates under different requirements. 

The seven states with distinct SCHIP programs also monitored the 

availability of PCPs in plan provider networks less frequently than in 

Medicaid. In contrast to Medicaid managed care where nearly all states 

monitored providers at least quarterly, just three states required plans to 

submit provider lists periodically throughout the year—Colorado, New 

York, and Texas. To confirm provider information submitted by plans 

participating in SCHIP, only New York systematically contacted physicians 

State 

California 

Colorado 

Floridab

Michiganc

New York

Pennsylvania

Texas

Number of states 

with standards for 

Medicaid 

Number of states 

with standards for 

SCHIP

Source: GAO analysis of states’ data, as of December 2001.

5

2

3 7

0 6

5

1

4

0

7

4

a

a

 Network size and structure Appointment waiting times

PCP Specialists Geographic 

 distribution 

First 

visit 

Appointment 

scheduling 

In-office 

waiting time

Medicaid managed care provider availability standard 

SCHIP provider availability standard

No standard for Medicaid or SCHIP
Page 43 GAO-03-222 Medicaid and SCHIP Access 

to verify information about whether network PCPs were accepting new 

SCHIP patients.42 Four states required SCHIP plans to submit physician 

data annually or every several years during state licensure reviews or for 

the contract renewal process. Among these, California’s SCHIP program 

required plans to indicate the number and percentage of PCPs and 

specialists accepting new patients and also to notify the state when there 

was a change in the provider network that resulted in disruption of 25 or 

more beneficiaries. 

The extent of states’ monitoring of participating plans’ SCHIP provider 

networks did not appear to be related to whether SCHIP-eligible 

beneficiaries had access to commercial or noncommercial networks 

within the plans. Some states—such as New York and Texas—did not 

know whether SCHIP-eligible beneficiaries had access to the same 

providers as were participating in plans’ commercial networks. Other 

states—such as Florida, Michigan, and Pennsylvania—stated that most if 

not all of their SCHIP populations did have access to the same providers 

as in the plans’ commercial networks. However, without direct monitoring 

of PCPs enrolled in SCHIP plan networks, states had little or no direct 

knowledge of the extent to which PCPs would see SCHIP beneficiaries, 

including whether enrolled PCPs would accept new SCHIP patients at all 

or limited their practice to only a small number. 

States with SCHIP programs distinct from Medicaid reported fewer efforts 

to monitor children’s utilization of services than in their Medicaid 

managed care programs. This held true for their use of encounter data as 

well as for HEDIS measures and CAHPS beneficiary satisfaction survey 

data. 

CMS does not require states to collect encounter data from managed care 

plans participating in SCHIP, as it does in Medicaid managed care. Of the 

states we reviewed with distinct SCHIP programs, we found that two 

states—Florida and Texas—were attempting to collect as well as analyze 

encounter data for SCHIP-eligible children in order to assess the type and 

frequency of services they received. Florida’s distinct SCHIP program uses 

encounter data to compare the number of ambulatory visits made by 

SCHIP beneficiaries to the number of visits that would be expected for 

 42To achieve this purpose, the state contacted a sample of 50 to 200 providers for each plan 

participating in Medicaid and SCHIP, twice a year. 

Distinct SCHIP Programs 

Monitored Service 

Utilization Less than 

Medicaid 
Page 44 GAO-03-222 Medicaid and SCHIP Access 

those children based on their diagnoses.43 Texas’ distinct SCHIP program, 

which was initiated in 2000, has used encounter data to compare 

immunization rates by plan with rates in commercial plans. 

Four of the seven states—California, Michigan, New York, and 

Pennsylvania—required plans to submit HEDIS data so that the states 

could assess plans’ performance with respect to access to various 

preventive and other services.44 Compared to Medicaid, these HEDIS data 

may be more complete in three of these states—California, Michigan, and 

Pennsylvania—because they had opted to provide SCHIP-eligible children 

with continuous eligibility for a 12-month period, thus increasing the 

likelihood that a more representative share of eligible children and their 

families would be included in the assessments. 

Five of the seven states—California, Florida, Michigan, Pennsylvania, and 

Texas—used CAHPS to assess beneficiaries’ satisfaction with care. 

Compared to Medicaid, the CAHPS data for four of these states’ SCHIP 

programs may be more complete than for their Medicaid programs 

because these states provide continuous eligibility for a 12-month period. 

We provided a draft of our report for comment to HHS, as well as to 

Medicaid and SCHIP officials in the 16 states included in our analysis. We 

received comments from HHS and from 13 states. Three states did not 

respond with comments. 

With regard to states’ Medicaid managed care programs, HHS highlighted 

new requirements included in CMS’s June 2002 regulation implementing 

Medicaid managed care provisions of the Balanced Budget Act of 1997. 

HHS commented that, among other things, the regulation requires states to 

develop a quality strategy setting access standards for network adequacy 

and timeliness of access to care. HHS described this new regulation as 

also making clear the states’ responsibility to continually monitor plans’ 

compliance with these standards. While many states, including 13 of the 14 

 43Florida’s distinct SCHIP program uses the Ambulatory Care Groups (ACG) Case-Mix 

Adjustment System to assign beneficiaries to 1 of 53 ACG categories for the purpose of this 

analysis. 

44Although these four states used HEDIS in both their separate SCHIP and Medicaid 

programs, only New York reported comparing the results across the two programs. 

Agency and State 

Comments and Our 

Evaluation 

HHS Comments 
Page 45 GAO-03-222 Medicaid and SCHIP Access 

states we reviewed with Medicaid managed care delivery systems, were 

already subject to certain access requirements as a condition of receiving 

waivers of federal Medicaid requirements to operate their managed care 

programs, these requirements were not consistent from state to state. This 

new regulation, which must be fully implemented by August 13, 2003, has 

the potential to bring a more systematic approach to access requirements. 

More importantly, its emphasis on state monitoring could better ensure 

that such requirements are achieving their intended purposes. 

For states’ Medicaid FFS delivery systems, HHS acknowledged the 

relationship between reimbursement rates and provider participation, 

noting that states can increase payment rates in geographic areas and 

specialties where access has been demonstrated to be a problem. Beyond 

reimbursement rates, HHS commented that our draft report pointed out a 

lack of data to quantify whether there is an access problem in Medicaid 

FFS. To the contrary, our report indicates that despite a ready source of 

information—claims data—for evaluating access to care in a FFS 

environment, states generally did not do so. 

HHS agreed that our placement of PCCM programs in the FFS category 

was accurate from a reimbursement standpoint, but stated that PCCM 

should be considered a managed care delivery system because PCPs are 

expected to coordinate care. We continue to believe that a PCCM program 

is better described as an FFS-based delivery system because the 

differences between PCCM and managed care reimbursement approaches 

can differentially affect provider incentives in providing covered services. 

Our report does distinguish, however, the degree to which managed care, 

traditional FFS, and PCCM programs employ access standards and 

monitoring. Overall, states with PCCM programs tended to establish more 

standards and conduct somewhat more monitoring than for their 

traditional FFS programs, but less than for their managed care programs. 

With regard to our finding that states with distinct SCHIP programs did 

significantly less to monitor access to care than for their Medicaid 

managed care programs, HHS stated there was a key difference in design 

and intent by the Congress between SCHIP and Medicaid. HHS 

commented that SCHIP allows states to have the flexibility to design 

programs that mirror private insurance and rely on private insurance 

mechanisms to ensure access to and quality of care, rather than laying out 

specific requirements. Acknowledging that states may not have 

comparable requirements for SCHIP and Medicaid monitoring provider 

participation and beneficiary service utilization, HHS said that states are 

monitoring enrollment, health access, and outcomes in their SCHIP 
Page 46 GAO-03-222 Medicaid and SCHIP Access 

programs. However, with regard to access, we found that few states with 

distinct SCHIP programs monitored provider network participation or 

routinely collected and analyzed data to ensure that SCHIP-eligible 

children were receiving covered services. We did not intend to suggest 

that states should use the same processes for their SCHIP and Medicaid 

programs, but rather simply to contrast states’ monitoring of access to 

care for low-income children eligible for these two programs. 

HHS’s comments are reprinted in appendix IV. Additionally, HHS provided 

technical comments, which we incorporated as appropriate. 

Several states provided clarifying comments regarding their oversight of 

access to care in Medicaid and SCHIP. These comments generally 

pertained to additional factors affecting access to care, the relationship 

between monitoring and access, and the extent of monitoring in traditional 

FFS and distinct SCHIP programs. 

Two states identified factors that affect access to care within their 

Medicaid and SCHIP programs but are not easily controlled by the states. 

One state noted that the supply of physicians is severely limited in some 

states and in some regions of states, affecting all payers, including 

commercial payers as well as Medicaid and SCHIP. Another state raised 

the point that the extent to which children receive health care services is 

influenced by how well their parents or guardians understand and comply 

with recommended levels of health care set by providers or by the 

Medicaid program. We agree that provider supply and parental decision 

making are important determinants in children’s access to care and can be 

difficult factors for state programs to address. However, the type of 

monitoring activities addressed in this report can help to identify such 

factors and areas or locations where problems may be more pronounced, 

thus leading to more targeted solutions. 

Four states identified certain activities that they believed facilitated access 

to care, but were not addressed in the report. One state, for example, 

noted that its Medicaid program helped beneficiaries locate a source of 

medical care, and another state described an initiative to send letters to 

parents of beneficiaries reminding them to schedule medical 

appointments. Although we recognize that these activities may help 

promote access to care for the Medicaid and SCHIP populations, this 

report did not address activities that primarily facilitated access, such as 

providing outreach to beneficiaries or offering provider payment 

incentives. Instead, we focused on states’ efforts to (1) establish and 

State Comments 
Page 47 GAO-03-222 Medicaid and SCHIP Access 

monitor requirements for provider availability and (2) gather and analyze 

data on receipt of care. In this regard, one state commented that the report 

had a “narrow perspective” on what constitutes monitoring in managed 

care and cited a range of indicators that it used, including beneficiary 

complaints, grievance reports, state fair-hearing requests, utilization data, 

and immunization rates. While such sources of data and activities hold 

strong potential for providing information concerning access to care, this 

report identified certain shortcomings of some of these indicators as 

programwide measures of access. For example, complaint and grievance 

system data can yield important information about problematic providers 

or services, but are not reliable measures of programwide access. 

Four states cautioned against what they saw as a correlation made in the 

report between the amount of monitoring that a state does and the degree 

of access to care for program beneficiaries. For example, one state said 

that the report suggested that if monitoring is limited, access is also 

limited, and disagreed that this is necessarily the case. We did not intend 

to present such a direct correlation. However, if a state does not monitor 

data related to its access standards and to utilization of services, it may 

not know the extent to which beneficiaries encounter problems locating 

and obtaining services. During the course of our work, we identified 

instances where state data collection and monitoring revealed access 

problems that were then addressed to improve beneficiary access. 

A few states emphasized that they considered HEDIS and CAHPS 

important tools that had helped them monitor health plan performance or 

achieve improvements in quality of care for Medicaid and/or SCHIP 

beneficiaries. One state noted that HEDIS was important in identifying and 

helping to reduce gaps between commercial and Medicaid plan 

performance. Another state questioned whether the continuous 

enrollment requirements for HEDIS (12 months) and CAHPS (6 months) 

would in fact bias the results of any analysis of beneficiaries’ access to 

care because it excludes some beneficiaries. In particular, this state 

believed that the benefits of improvements made by health plans are not 

limited to individuals enrolled for the full 6- or 12-month period. We agree 

that HEDIS and CAHPS are important tools in monitoring and comparing 

performance across plans, which necessitates that the sample population 

be defined by a comparable enrollment period. However, we do not 

believe that states can assume that all beneficiaries have access to care on 

the basis of HEDIS and CAHPS results that exclude a significant portion of 

the program population from their samples. 
Page 48 GAO-03-222 Medicaid and SCHIP Access 

Two states discussed the extent to which they monitored access in 

Medicaid traditional FFS compared with Medicaid managed care delivery 

systems. One state said it analyzes data on key health outcomes for 

children, such as ambulatory-sensitive hospital admissions and trends in 

health care utilization. Both states specifically noted their efforts to 

comply with federally required reporting of EPSDT utilization for their 

FFS programs. Nevertheless, most of the states in our sample had few or 

no goals regarding the number of providers available to FFS beneficiaries 

and, with the exception of federally required EPDST reporting, few 

analyzed data related to access to primary care. 

Similar to HHS’s view, one state noted that the report did not account for 

the fact that distinct SCHIP programs may choose approaches to program 

design and monitoring that differ from Medicaid, including approaches 

used in monitoring states’ commercial managed care plans. For example, 

this state and others reported relying on state insurance department 

licensure of health plans as the means of monitoring provider network 

adequacy, rather than imposing additional SCHIP-specific requirements. 

We acknowledge in our report that states’ SCHIP programs may rely on 

different design and monitoring options than Medicaid. Overall, however, 

states with distinct SCHIP programs reported fewer efforts to monitor 

children’s access and use of services than in their Medicaid managed care 

programs. 

Several states also provided technical comments, which we incorporated 

as appropriate. 

As arranged with your offices, unless you release its contents earlier, we 

plan no further distribution of this report until 30 days after the issue date. 

At that time, we will send copies of this report to the Administrator of the 

Centers for Medicare & Medicaid Services and the Administrator of the 

Health Resources and Services Administration. We also will make copies 

available to others upon request. In addition, the report will be available at 

no charge on the GAO Web site at http://www.gao.gov. 
Page 49 GAO-03-222 Medicaid and SCHIP Access 

If you or members of your staffs have any questions regarding this report, 

please contact me on (202) 512-7118. Other contributors to this report are 

listed in appendix V. 

Kathryn G. Allen 

Director, Health Care—Medicaid 

 and Private Health Insurance Issues 
Appendix I: Medicaid HEDIS Measures 

Related to Service Utilization 

Page 50 GAO-03-222 Medicaid and SCHIP Access 

Four of the eight general categories of the Health Plan Employer Data and 

Information Set (HEDIS) measures for Medicaid managed care plan 

performance relate directly to beneficiary service utilization. These four 

categories include effectiveness of care, access/availability of care, use of 

services, and satisfaction with the experience of care.1

 Many of the 

measures in these categories require beneficiaries to be continuously 

enrolled for some period, often 12 months, in order to be assessed. Table 8 

details selected HEDIS measures that pertain to service utilization for 

children and adolescents enrolled in Medicaid managed care programs and 

the length of continuous enrollment required. 

 1

The remaining four general categories are health plan stability, cost of care, informed 

health care choices, and health plan descriptive information. 

Appendix I: Medicaid HEDIS Measures 

Related to Service Utilization 
Appendix I: Medicaid HEDIS Measures 

Related to Service Utilization 

Page 51 GAO-03-222 Medicaid and SCHIP Access 

Table 8: Length of Medicaid Enrollment Required for Selected HEDIS Measures for Children’s and Adolescents’ Use of 

Services 

Category Measure name 

Length of continuous 

enrollmenta

Childhood immunization status 12 months 

Adolescent immunization status 12 months 

Cervical cancer screening 12 months 

Chlamydia screening 12 months 

Prenatal care in first trimester About 9 months prior to delivery 

Checkups after delivery About 2 months after delivery 

Comprehensive diabetes care 12 months 

Use of appropriate medications for people with asthma 24 months 

Follow-up after mental illness hospitalization 1 month after discharge 

Antidepressant medication management 12 months 

Effectiveness of care 

Advising smokers to quit 6 months 

Children’s access to primary care providers 12 monthsb 

Initiation of prenatal care From 1 to 9 months prior to 

deliveryc

Annual dental visit 12 months 

Access/availability of 

care 

Availability of language interpretation services None 

Frequency of ongoing prenatal care None 

Well-child visits in the first 15 months of life From 1 to 15 months of aged

Well-child visits in the third, fourth, fifth and sixth year of life 12 months 

Adolescent well-care visits 12 months 

Inpatient utilization—general hospital/acute care None 

Ambulatory care None 

Inpatient utilization—nonacute care None 

Discharges and average length of stay—maternity care None 

Cesarean section rate None 

Vaginal birth after cesarean section rate None 

Births and average length of stay, newborns None 

Mental health utilization—inpatient discharges and average length of stay None 

Mental health utilization—percentage of members receiving inpatient, 

day/night care, and ambulatory services 

None 

Chemical dependency utilization—percentage of members receiving 

inpatient, day/night care, and ambulatory services 

None 

Use of services 

Outpatient drug utilization None 

Satisfaction with the 

experience of care Consumer Assessment of Health Plans (adults and children) 6 months 

Source: National Committee for Quality Assurance, HEDIS 2000: Technical Specifications

(Washington, D.C.: 1999). 

a

For measures listed with a continuous enrollment requirement, HEDIS guidelines indicate that the 

managed care entity must assess on a measure-by-measure basis whether the measure may be 

reported in the current measurement year. Partial year reporting for the measures in this table was 

considered acceptable or possible by the HEDIS guidelines. 
Appendix I: Medicaid HEDIS Measures 

Related to Service Utilization 

Page 52 GAO-03-222 Medicaid and SCHIP Access 

b

Older age groups (7 to 11 years) require 24 months enrollment. 

c

Measure requires continuous enrollment of at least 43 days prior to delivery but no more than 279 

days. 

d

Measure requires that child is enrolled from 31 days through 15 months of age. 
Appendix II: Managed Care Plan Withdrawals 

from Medicaid in Four States 

Page 53 GAO-03-222 Medicaid and SCHIP Access 

Four states we visited—Massachusetts, Ohio, Tennessee, and Texas—had 

varying experiences in terms of the number and impact of managed care 

plan withdrawals from their Medicaid managed care programs. In some 

cases, as in Massachusetts, the changes occurred early in the states’ 

implementation of their programs and the number of plans has been stable 

in recent years; in other cases, as in Ohio and Tennessee, the changes in 

participating plans continued over time and presented ongoing challenges 

to the states in managing their programs and ensuring appropriate access 

to care for their beneficiaries. The proportion of Medicaid beneficiaries 

affected by withdrawals of participating managed care plans ranged from 

about 1 percent in Texas to almost 50 percent in Tennessee. Following is a 

brief description of managed care plan withdrawals in each of the four 

states and examples of some of the measures states took to minimize 

disruption to beneficiaries’ care as a result of the changes. 

Health plan participation in Massachusetts’ Medicaid managed care 

program has slowly stabilized, with four plans participating in the program 

since 2000. Earlier fluctuations occurred, however, as the state shaped its 

program to limit the number of participating plans and as some health 

plans decided to consolidate or leave the market. These early changes in 

participating plans affected about 4 percent of the state’s Medicaid 

population. 

Massachusetts began its current Medicaid managed care program in July 

1997 with nine participating health plans.1

 Two of the health plans, created 

by hospital systems that had traditionally provided services to lower 

income individuals, were formed specifically for this program. Of the 

remaining seven plans participating in the state’s Medicaid program, many 

were commercially available. Within the first 2 years of the program, 

however, the number of participating health plans declined to five. This 

reduction was partially a result of the state’s decision to contract with 

fewer health plans and to provide each health plan with a greater volume 

of beneficiaries. As a result of this decision, contracts were not renewed 

with two health plans and approximately 42,000 beneficiaries (about 4 

 1

Prior to 1997, Massachusetts had a managed care program with voluntary enrollment for 

most Medicaid beneficiaries. As many as 13 health plans participated in the state’s 

Medicaid managed care program during the early 1990s. However, since enrollment was 

not mandatory, only a small number of Medicaid beneficiaries joined health plans. These 

low enrollment figures, coupled with health plan consolidations, resulted in some plans 

leaving the Medicaid program. 

Appendix II: Managed Care Plan Withdrawals 

from Medicaid in Four States 

Massachusetts 
Appendix II: Managed Care Plan Withdrawals 

from Medicaid in Four States 

Page 54 GAO-03-222 Medicaid and SCHIP Access 

percent of the state’s Medicaid population) had to select other plans. In 

addition, during this period several health plans merged and at least one 

plan left the Massachusetts health care market altogether. State officials 

reported that some plans lost interest in participating because of 

Medicaid’s administrative and reporting requirements. Additionally, 

commercial plans found that the Medicaid benefit package included 

certain services—such as behavioral health services—that the health plans 

did not provide their other members. This meant that health plans had to 

establish networks specifically for Medicaid beneficiaries; without a 

“critical mass” of Medicaid beneficiaries, however, health plans had 

difficulty remaining financially viable in the program. When participating 

plans withdrew from the state’s Medicaid program, state officials said that 

beneficiaries enrolled in the affected plans were informed that the plans 

would no longer be participating in the program and were provided an 

opportunity to choose other plans or enroll in the state’s primary care case 

manager program. 

Since the inception of its mandatory managed care program in 1996, Ohio 

has faced a large number of health plan withdrawals. As of January 2002, 

10 plans had completely withdrawn from program participation, while 3 

additional plans had withdrawn from specific counties in the state. Over 

224,000 Medicaid beneficiaries—over 15 percent of the state’s Medicaid 

population—were affected by plan withdrawals. As a result of these 

withdrawals and providers’ growing reluctance to participate in managed 

care, Ohio changed from mandatory to voluntary managed care enrollment 

in some counties and fee-for-service (FFS) in others. As of April 2002, 

Ohio had 7 managed care plans serving Medicaid beneficiaries in 15 

counties, with mandatory enrollment in only 4 of the counties. 

Ohio Medicaid officials expected to see some fluctuations in plan 

participation in the early years of its program. They anticipated that some 

plans would withdraw due to the state’s requirement that plans that did 

not have significant enrollment—from 10 to 15 percent of the eligible 

population—within 2 years of the program’s inception would be required 

to leave the program. Several reasons were provided for the number of 

plans that eventually withdrew from the program, including voluntary 

withdrawal and court-ordered liquidations. In many cases, health plans 

sold their Medicaid membership to other plans. State officials 

acknowledged that the relatively large number of plan withdrawals 

affected individuals’ perception of the program and led to changes in the 

state’s managed care enrollment policy, with some counties switching 

from mandatory to voluntary managed care enrollment. Concerns about 

Ohio 
Appendix II: Managed Care Plan Withdrawals 

from Medicaid in Four States 

Page 55 GAO-03-222 Medicaid and SCHIP Access 

the program’s viability and stability were increased when the state 

insurance department liquidated one Medicaid health plan in 1998 and 

some of its network providers did not receive compensation from the plan. 

State officials did not believe that beneficiaries’ access to care was 

affected by these plan withdrawals. In cases where a health plan’s 

membership was sold to another plan, the state attempted to ensure 

continuity of care by requiring that at least 90 percent of the current plan’s 

primary care providers (PCP) were included in the provider network of 

the purchasing plan.2

 In other cases, we were told, beneficiaries were 

notified of their health plan’s impending withdrawal and provided an 

opportunity to select another plan if available. If a beneficiary did not 

select a health plan, or there was no alternative plan available, then the 

beneficiary returned to the state’s FFS program. In areas with mandatory 

managed care enrollment, however, beneficiaries were not allowed to 

remain in FFS indefinitely; they were required to select another plan or be 

automatically assigned to one. 

In establishing its mandatory managed care program in January 1994, 

Tennessee expanded Medicaid eligibility to hundreds of thousands of 

previously uninsured individuals and enrolled them into 1 of 12 capitated 

managed care plans. Four plans left the program or were sold from 1994 

through 1999.3

 Since 2001, plan withdrawals have increasingly been an 

area of concern, with large numbers of Medicaid beneficiaries affected by 

changes to the state’s 2 largest health plans. For example, in 2001, almost 

580,000 beneficiaries, or 41 percent of the state’s Medicaid population, 

were affected when 1 plan withdrew from the western and central 

portions of the state and a second plan’s contract was terminated due to 

solvency issues. In response to the first of these two withdrawals, the state 

took two actions: (1) it recruited two new health plans to join the market 

and (2) it created a self-insured plan to serve as a backup in areas of the 

state where beneficiaries could not be adequately served by other health 

plans. 

 2

Of the beneficiaries affected by plan withdrawals in Ohio from 1996 to January 2002, 

nearly half were involved in withdrawals that were the result of a plan selling its 

membership to another plan. 

3

Plan withdrawals during this period affected approximately 105,000 beneficiaries, about 7 

percent of the state’s Medicaid population. 

Tennessee 
Appendix II: Managed Care Plan Withdrawals 

from Medicaid in Four States 

Page 56 GAO-03-222 Medicaid and SCHIP Access 

As of April 2002, 10 health plans were participating in Tennessee’s 

Medicaid managed care program although 2 plans, covering 21 percent of 

the state’s Medicaid beneficiaries, were considered to be at financial risk. 

The state announced its intention in March 2002 to terminate its contract 

with 1 health plan, which would necessitate the transfer of approximately 

135,000 beneficiaries to other health plans.4

 A second plan, with over 

160,000 beneficiaries, was under rehabilitation by the state’s insurance 

department. 

In view of the instability of the program and participating plans, Tennessee 

has taken several steps to help ensure continuous access to care for 

Medicaid beneficiaries. In order to provide time to plan ahead in the event 

of plan withdrawals, the state’s contract with participating plans requires 6 

months of advance notice of an intended withdrawal and a transition plan 

to assure uninterrupted care to beneficiaries. When plans stopped 

participating in the program, beneficiaries were either provided the option 

to select new health plans or were assigned to health plans. 

Texas began its capitated Medicaid managed care program in1996 in four 

areas of the state. Since 1996, managed care was expanded to three 

additional service areas and now exists in 46 of the state’s 254 counties. 

Since the rollout of managed care began, only three plans have withdrawn 

from participation in Texas’ Medicaid managed care program, affecting 

less than 20,000 beneficiaries, or approximately 1 percent of the state’s 

Medicaid population.5

 Two of these withdrawals were from the same 

service delivery area, leaving three plans participating in that area.6

However, the state contends that prior to the withdrawals there was a 

saturation of health plans in that service delivery area. As of July 2002, 11 

plans were participating in the Medicaid managed care program. 

 4

According to the state, the decision to terminate the contract was based on problems 

including the plan’s financial solvency and failure to pay accurate and timely claims. As of 

May 1, 2002, the state was working with the health plan in an attempt to resolve these 

problems. 

5

Over 50,000 additional beneficiaries were affected when their health plan was acquired by 

another participating health plan. 

6

There are seven service areas, each consisting of multiple counties, in Texas’ Medicaid 

capitated managed care program. Health plans are contracted by service area, with some 

health plans having contracts in multiple service areas. 

Texas 
Appendix II: Managed Care Plan Withdrawals 

from Medicaid in Four States 

Page 57 GAO-03-222 Medicaid and SCHIP Access 

In one instance, a participating plan gave the state less than 3 weeks’ 

notice of its intent to leave the program. Because of the limited notice, 

beneficiaries were automatically assigned to other plans in order to 

minimize disruption in their access to care. Although these assignments 

were initially made without direct input from the affected beneficiaries, 

their prior PCP and specialist utilization patterns were taken into account 

during this assignment process and beneficiaries were later given an 

opportunity to change plans. The state paid particular attention to the 

number of complaints during these transition periods and did not see a 

dramatic change. As such, state officials believe that the transitions went 

smoothly. Texas has a number of other measures in place to facilitate 

beneficiaries’ enrollment in alternative plans when their plans leave the 

program, as illustrated in table 9 along with additional examples from 

other states we visited. 

Table 9: Examples of Plan Withdrawal Transition Activities Conducted by Four State Medicaid Programs 

Type of action Examples of action 

Contractual requirements of managed 

care plans 

• Massachusetts takes responsibility for notifying beneficiaries of the health plan’s 

withdrawal from the program and the process beneficiaries must undergo to continue to 

receive services; however, health plans must continue to provide services until the 

beneficiary is disenrolled and participating in another plan. 

• Ohio’s contract requires the collection of monetary assurance or the withholding of 

payments from withdrawing health plans until all contract requirements are completed. 

• Texas requires health plans to provide the state 90 days notice of their intention to 

terminate participation, Ohio requires 75 days notice, and Tennessee requires 6 

months advanced notice. 

• Tennessee’s contract requires withdrawing health plans to submit transition plans to 

ensure uninterrupted care to beneficiaries. 

Notification of beneficiaries and other 

stakeholders 

• Ohio, Tennessee and Texas send letters to beneficiaries informing them of the health 

plan’s withdrawal. The letters may include a list of the other health plans, important 

telephone numbers, and actions beneficiaries must take. 

• Texas notifies stakeholders, including the enrollment broker and other health plans, of 

the impending withdrawal. Remaining health plans in the area are provided with a list of 

PCPs that are only participating with the exiting plan. Additionally, the state or health 

plan notifies providers of the plan’s intention to withdraw from the program. 

Coordination between plans • In Texas, the withdrawing plan identifies individuals with special needs and a dialogue 

between the current and future case managers begins. In addition, the withdrawing 

health plan provides instructions for providers on seeking authorization for continued 

services from new health plan. 

Source: GAO analysis of states’ data, December 2001. 
Appendix III: Analysis of Medicaid FFS 

Payment Rates in Selected States 

Page 58 GAO-03-222 Medicaid and SCHIP Access 

Nationally, low Medicaid physician fees have been a long-standing area of 

concern because they can affect the degree to which physicians 

participate in Medicaid, and thereby affect beneficiaries’ access to care. 

The relative fees paid by different insurers—Medicare, Medicaid, and 

SCHIP—can also affect providers’ willingness to participate in these 

programs. Since many children in Medicaid remain in fee-for-service 

(FFS)-based programs, we compared Medicaid fees for selected office visit 

and pediatric preventive medical care services to the corresponding 

Medicare fees. While Medicare is a federal health insurance program 

primarily for the elderly and persons with disabilities, some children do 

receive Medicare benefits and thus its fee schedule includes fees for 

pediatric medical services. Among the 13 states we reviewed that used 

FFS-based delivery systems as a key care delivery system for Medicaid 

children,1

 Medicaid fees for primary and preventive care ranged from 32 

percent to 89 percent of what Medicare would pay for similar services. 

(See table 10.) Concerns with the adequacy of Medicaid physician payment 

levels were also identified in studies of Medicaid physician payment in 

California, Washington, and Maryland.2

 1

Tennessee enrolls nearly all beneficiaries in managed care; therefore, we did not collect a 

Medicaid FFS payment schedule that can be compared to Medicare rates. 

2

See PriceWaterhouseCoopers, Comparing CPT Code Payments for Medi-Cal and Other 

California Payers (Oakland, Calif.: June 2001) and University of Washington, State 

Primary Care Provider Study, Health Policy Analysis Program (Seattle, Wash.: February 

2001). A study was also conducted in Maryland because, even though most beneficiaries 

are served through managed care, the state Medicaid program’s FFS payment rates for 

some groups of beneficiaries are considered to affect what managed care plans pay 

physicians. See State of Maryland Department of Health and Mental Hygiene, Report on the 

Maryland Medical Assistance Program and Maryland Children’s Health Program – 

Reimbursement Rates Fairness Act (Baltimore, Md.: September 2001). 

Appendix III: Analysis of Medicaid FFS 

Payment Rates in Selected States 
Appendix III: Analysis of Medicaid FFS 

Payment Rates in Selected States 

Page 59 GAO-03-222 Medicaid and SCHIP Access 

Table 10: Medicaid FFS Payment Rates, Expressed as a Percentage of Medicare 

Payments, in 13 States with Traditional FFS or Primary Care Case Manager Delivery 

Systems That Serve Children 

Statea

Medicaid FFS payments as a percentage 

of Medicare FFS payments (weighted)

Massachusettsb 89

Arkansas 71 

Florida 71 

Texas 71

Nevada 66

Ohio 64

Illinoisb61

Washington 60

Colorado 57

Louisiana 57

New Yorkb54

California 48

Pennsylvania 32

Source: GAO analysis of Medicare data and states’ data, as of December 2001. 

a

Other study states not shown on this table include the following: Tennessee enrolls nearly all 

beneficiaries in capitated managed care, and therefore, we did not collect a Medicaid FFS payment 

schedule that can be compared to Medicare rates. Maryland uses a FFS-based delivery system for 

less than 5 percent of children and includes only those children requiring case management for rare 

and expensive conditions, or who are technology dependent. Michigan uses FFS-based care only for 

children in an eligibility category for special needs. 

b

Illinois, Massachusetts, and New York provide payment enhancements for some services, in addition 

to the regular fee for the service; where appropriate, these enhancements were included in the 

analysis. 

For our comparative analysis of Medicaid and Medicare FFS payments, we 

obtained fee schedules from 13 of the 16 states we reviewed, compiling 

fees for 12 medical services using selected codes from a commonly used 

procedural coding system—the standard Physicians Current Procedural 

Terminology, 4th edition (CPT 4). (See table 11.) For each state, we 

weighted the Medicaid and corresponding lowest Medicare fees3

 for that 

state by the relative utilization of the service among pediatricians, 

identified from a 1999 American Academy of Pediatrics survey.4

 The sum 

 3

States can have more than one Medicare payment rate for a service, varying by locality. 

4

Monique Morris and Suk-fong Tang, Pediatric Service Utilization, Fees and Managed 

Care Arrangements: 2001 Report Based on 1999 Data (Elk Grove Village, Ill.: American 

Academy of Pediatrics, 2001). 

Methodology for 

Comparison of FFS 

Payment Rates 
Appendix III: Analysis of Medicaid FFS 

Payment Rates in Selected States 

Page 60 GAO-03-222 Medicaid and SCHIP Access 

of the weighted Medicaid fees was then expressed as a percentage of the 

sum of the Medicare payments in order to develop a single, weighted 

payment rate. 

Table 11: CPT 4 Codes Used in Comparing Medicaid and Medicare Fees 

CPT 4 code Description 

Office or other outpatient visit

99201 New patient, 10 minute visit 

99202 New patient, 20 minute visit 

99203 New patient, 30 minute visit 

99213 Established patient, 15 minute visit 

99214 Established patient, 25 minute visit 

Preventive medical services 

99381 New patient, under 1 year 

99382 New patient, 1 to 4 years 

99383 New patient, 5 to 11 years 

99391 Established patient, under 1 year 

99392 Established patient, 1 to 4 years 

99393 Established patient, 5 to 11 years 

99394 Established patient, 12 to 17 years 

Source: CPT 4. 
Appendix IV: Comments from the Department 

of Health and Human Services 

Page 61 GAO-03-222 Medicaid and SCHIP Access 

Appendix IV: Comments from the 

Department of Health and Human Services 
Appendix IV: Comments from the Department 

of Health and Human Services 

Page 62 GAO-03-222 Medicaid and SCHIP Access 
Appendix IV: Comments from the Department 

of Health and Human Services 

Page 63 GAO-03-222 Medicaid and SCHIP Access 
Appendix IV: Comments from the Department 

of Health and Human Services 

Page 64 GAO-03-222 Medicaid and SCHIP Access 
Appendix V: GAO Contact and Staff 

Acknowledgments 

Page 65 GAO-03-222 Medicaid and SCHIP Access 

Carolyn L. Yocom, (202) 512-4931 

Catina Bradley, Karen Doran, Laura Sutton Elsberg, Mary Giffin, Michelle 

Rosenberg, and Ann Tynan made key contributions to this report. 

Appendix V: GAO Contact and Staff 

Acknowledgments 

GAO Contact 

Acknowledgments 
Related GAO Products 

Page 66 GAO-03-222 Medicaid and SCHIP Access 

Mental Health Services: Effectiveness of Insurance Coverage and Federal 

Programs for Children Who Have Experienced Trauma Largely 

Unknown. GAO-02-813. Washington, D.C.: August 22, 2002. 

Children’s Health Insurance: Inspector General Reviews Should Be 

Expanded to Further Inform the Congress. GAO-02-512. Washington, D.C.: 

March 29, 2002. 

Medicaid and SCHIP: States’ Enrollment and Payment Policies Can 

Affect Children’s Access to Care. GAO-01-883. Washington, D.C.: 

September 10, 2001. 

Medicaid: Stronger Efforts Needed to Ensure Children’s Access to Health 

Screening Services. GAO-01-749. Washington, D.C.: July 13, 2001. 

Medicaid Managed Care: States’ Safeguards for Children With Special 

Needs Vary Significantly. GAO/HEHS-00-169. Washington, D.C.: 

September 29, 2000. 

Oral Health: Factors Contributing to Low Use of Dental Services by LowIncome Populations. GAO/HEHS-00-149. Washington, D.C.: 

September 11, 2000. 

Medicaid and SCHIP: Comparisons of Outreach, Enrollment Practices, 

and Benefits. GAO/HEHS-00-86. Washington, D.C.: April 14, 2000. 

Oral Health: Dental Disease Is a Chronic Problem Among Low-Income 

Populations. GAO/HEHS-00-72. Washington, D.C.: April 12, 2000. 

Children’s Health Insurance Program: State Implementation Approaches 

Are Evolving. GAO/HEHS-99-65. Washington, D.C.: May 14, 1999. 

Medicaid Managed Care: Challenge of Holding Plans Accountable 

Requires Greater State Effort. GAO/HEHS-97-86. Washington, D.C.: 

May 16, 1997. 

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