Medicaid managed care program doesn't reduce fees, MA inspector general says

Insurers that contract with the state to manage the care of low-income Medicaid patients are expected to save money, in part by negotiating lower prices with health providers. But a new report by the state inspector general found that the plans pay higher fees to many hospitals and doctors than the traditional Medicaid program pays for the same services. In the 2011 fiscal year, the higher payments cost taxpayers $328 million, the ­report said. Hospitals that dominate their region or have a highly recognizable name and strong reputation were paid the most, up to 2.5 times the standard Medicaid rate, the investigation found.