ATLANTA — Georgia lawmakers will consider a bill that would repay the state’s Medicaid managed care insurers millions of dollars if they don’t meet a certain threshold in health care spending.

This bipartisan billintroduced by the powerful Georgia House Speaker Jan. 26 David RustonAs a Republican, he’s focused on improving the state’s mental health care system.

Hidden in the legislation is a stipulation that Medicaid-administered care companies will refund money to the state if they don’t invest enough money in patient care and quality improvement.

Georgia Health News and KHN September report Georgia is one of the few states that does not mandate a minimum level of health care spending for its Medicaid insurers.

Each year, Georgia pays three insurance companies—CareSource, Peach State Health Plan and Amerigroup—a total of more than $4 billion to run federal state health insurance programs for low-income residents and people with disabilities. In 2019 and 2020, combined annual profits for the two companies averaged $189 million, according to insurer filings reported by the American Association of Insurance Commissioners.

“Hundreds of millions of dollars have gone to Georgia instead of securing an adequate health care network for Georgian children, disabled Georgians and Georgians in care facilities [insurers’] Bottom line,” said Roland Behm, who sits on the Georgia chapter’s board. American Foundation for Suicide Prevention.

Behm, who has advised lawmakers on the bill, said the KHN and Georgia Health News articles helped get the lawmakers who created the bill’s attention.

Georgia is one of more than 40 states that have turned to managed care companies to run their Medicaid programs — and ostensibly rein in costs. Thirty-six of those states and the District of Columbia set a baseline “medical loss rate” for the minimum amount insurers spend on health care, according to an August report by the Office of the Inspector General of the U.S. Department of Health and Human Services. In addition to Georgia, the five states that do not require a managed care spending threshold are Kansas, Rhode Island, Tennessee, Texas and Wisconsin, the report said.

Republican Rep. Todd Jones, a co-sponsor of the new bill, told KHN that Georgia lawmakers should create a strong benchmark for insurers. “We should see what other states are doing,” he said.

Most states with spending requirements set the rate at at least 85 percent of the premium dollars paid by insurers. So when Medicaid insurers spend less than that amount on health care and quality improvement, it must return the money to the government.

The Georgia bill also calls for a threshold of 85 percent. If the bill is approved, Medicaid insurers will face medical spending requirements in 2023.

If the benchmark had been in place in recent years, it could force compensation for the Peach State company, which has the most enrollments in Georgia’s Medicaid program of the three insurers. It failed to hit the 85 percent mark from 2018 to 2020, state documents showed, as KHN previously reported.

Andy SchneiderThe 85 percent score is “a victory for taxpayers, Medicaid providers, and Medicaid beneficiaries,” according to a research professor at Georgetown University’s Center for Children and Families. He also said it’s pretty fair to Medicaid insurers, who keep 15% of the administrative costs and profits the state pays them.

Since Ralston is the main sponsor of the bill in the House, it is expected to pass the House.

But the insurance industry may work to remove the medical spending clause.

Jesse Wessington, an industry official and executive director of the Georgia Quality Healthcare Association trade group, declined to comment on the legislation.

Fiona Roberts, a spokeswoman for the state Department of Community Health, which oversees Medicaid, said the agency needed time to review the measure before commenting on it.

The main provisions of the act require insurance companies to provide mental health care or substance use treatment at the same level as other physical health needs.

The legislation would provide educational loan support for people training in mental health and substance use disorders and seeks to expand behavioral health services for children. It will also promote “assisted outpatient treatment” — when a judge can order a person with a serious mental illness to follow a court-ordered treatment plan in the community.