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CHIP Managed Care

Managed Care is a health care delivery system organized to manage cost, utilization, and quality. Children’s Health Insurance Program (CHIP) managed care provides for the delivery of CHIP health benefits through contracted arrangements between state CHIP agencies and managed care plans that accept a set per member per month (capitation) payment for these services.

States with managed care for either all or even a specific segment of their CHIP populations served under the state plan must submit a state plan amendment (SPA) to revise section 3, to be in compliance with the 2016 managed care final rule. View the revised SPA template.

We created a Managed Care CHIP SPA checklist to assist states in the completion of their managed care SPAs.

States may also wish to refer to the Overview of CHIP Template for Managed Care State Plan Amendments.


Final Rule

In May 2016, we published the Medicaid and CHIP final managed care rule. This rule aligns key rules with those of other health insurance coverage programs, modernizes how states purchase managed care for beneficiaries, and strengthens the consumer experience and key consumer protections. This final rule is the first major update to Medicaid and CHIP managed care regulations in more than a decade.

Following the publication of the final rule, we engaged states in a series of webinars and fact sheets to address questions and concerns surrounding the final rule.

Additional final rule materials, including webinars and fact sheets, can be found on the Medicaid and CHIP Managed Care Final Rule page.

State Guide to CMS Criteria for CHIP Managed Care Contract Review and Approval

In July 2018, we developed a guide covering the standards that are used by the Centers for Medicare & Medicaid Services (CMS) staff to review state contracts with CHIP managed care organizations (MCO), prepaid inpatient health plans (PIHP), prepaid ambulatory health plans (PAHP), primary care case managers (PCCM), and primary care case management (PCCM) entities. As a reminder, CMS will be conducting reviews, but not approvals, of CHIP managed care contracts. Additional information regarding the CHIP managed care contract submission and review process will be provided in future guidance. States should contact their CHIP Project Officer if they have questions.

Prospective Payment Systems and Alternative Payment Methodologies for Federally Qualified Health Centers and Rural Health Centers

In April 2016, we published a State Health Official (SHO) Letter to provide guidance to states on the requirements for payment methodologies for Federally Qualified Health Centers  and Rural Health Centers  under managed care. This SHO letter applies to all Medicaid and CHIP managed care arrangements that provide capitated payment for outpatient services, including comprehensive plans offered by MCOs and PAHPs, and with respect to freestanding birth centers, applies to PIHPs.