H.R. 6254 would allow states greater flexibility in managing their Medicaid programs by permitting them to hire outside contractors to handle eligibility determinations, re-eligibility checks, and fair hearing appeals—tasks traditionally performed by state staff. The bill affects state Medicaid agencies and the millions of Americans who rely on Medicaid benefits. To prevent conflicts of interest, the legislation prohibits states from using contractors that have financial ties to Medicaid managed care organizations or their affiliated providers. The bill includes a safeguard requiring that contracts cannot include incentives for contractors to delay determinations or wrongly deny benefits to eligible individuals. No specific funding or implementation timeline is included in the legislation; it would take effect upon passage.
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