OHSU study: A handful of corporations now shape how kids in Medicaid get care

Children's mental health form_Getty

New research from Oregon Health & Science University shows that millions of Medicaid-enrolled youth are now covered by managed care organizations owned by one of five national parent firms, and that behavioral health care patterns differ meaningfully depending on which firm a child’s plan belongs to. (Getty Images)

The United States is in the middle of a well-documented adolescent mental health crisis. Because Medicaid provides medical coverage for roughly half of all children in the country, the program has an essential role in responding to that crisis. Increasingly, that response runs through a small number of large corporations.

New research from Oregon Health & Science University shows that millions of Medicaid-enrolled youth are now covered by managed care organizations owned by one of five national parent firms, and that behavioral health care patterns differ meaningfully depending on which firm a child’s plan belongs to.

The study, published in the journal Health Affairs, is one of the first to assess the role of managed care in addressing adolescent mental health needs. 

John McConnell, Ph.D.

“The majority of adolescents on Medicaid are covered by managed care, and among those, most are now in a plan owned by one of these five large, national firms,” said lead author John McConnell, Ph.D., director of the OHSU Center for Health Systems Effectiveness. “As these firms come to dominate Medicaid, their choices about how to structure and deliver care have consequences for millions of children, which is exactly why they deserve a closer look.”

The study examined a database of Medicaid claims data encompassing millions of Medicaid-enrolled youths in 2022, the latest year available.

Ownership of the Medicaid managed care market has consolidated rapidly over the past two decades. In 2006, locally governed plans covered most enrollees; by 2022, five national firms — Centene, Elevance Health (formerly Anthem), UnitedHealth Group, Molina Healthcare, and CVS Health — accounted for about half.

Comparing plans owned by these firms with other managed care organizations, the researchers found several consistent patterns:

• Lower screening rates. Even though Medicaid requires states to provide periodic screening to identify children’s physical and behavioral health needs, screening rates were consistently lower among MCOs managed by large, private insurance companies compared with other organizations. “Screening is the front door to care — it's how you identify a child who needs help,” McConnell said. “Consistently lower screening across these firms is a pattern worth understanding, especially given Medicaid’s screening requirements for kids.”
• Higher reliance on prescribing drugs without accompanying therapy. Youth enrolled in plans owned by four of the five firms were more likely to receive a psychotropic prescription without a recorded psychotherapy visit — a combination that clinical guidelines flag as a concern except in uncomplicated cases. “Some medications, like those for ADHD, can be appropriate on their own,” McConnell said. “But as a routine pattern, it can signal that kids aren’t getting the psychosocial support that should go alongside medication. The concern isn’t overprescribing so much as insufficient access to therapy.”
• Greater reliance on emergency, inpatient, and medication-based care. For most of the firms, enrollees had higher rates of emergency department visits for mental health conditions and a greater likelihood of psychiatric inpatient admission.

Researchers aren’t sure what to make of the higher rates of acute care, but McConnell noted that it could reflect a nationwide lack of available outpatient care. A study from OHSU published a year ago noted that thousands of kids nationwide are “boarded” in hospital emergency rooms for three days or more.  

“In many ways the nation’s response to the adolescent mental health crisis has been delegated to the managed care system and, increasingly, to a small number of for-profit firms,” the authors write. They conclude, “Given the stakes at hand, closer scrutiny of how large managed care organizations balance corporate strategy with Medicaid’s public mission is warranted.”

A wider pattern

The study comes on the heels of a policy report published last month by the same group of OHSU researchers, published by the Milbank Memorial Fund, asking whether managed care is delivering on its promise.

“We conclude that many of the functions MCOs perform … could be carried out more transparently and at potentially lower administrative cost through centralized, standardized processes,” the authors write.

Stephan Lindner, Ph.D.

The studies raise fundamental questions, said co-author Stephan Lindner, Ph.D., an associate professor in the Center for Health Systems Effectiveness.

“Medicaid is a public program run by the government, but a lot of public money is being administered through managed care organizations run by large, for-profit companies,” he said. “We need to ask, Is this a good use of our money?”

The research published in Health Affairs was supported by the National Institute of Mental Health of the National Institutes of Health, award 1R01MH136975, and the Office of Research Infrastructure Programs in the Office of the Director of the NIH, award S10OD034224. The content is solely the responsibility of the authors and does not necessarily represent the official views of the NIH.