Twenty-three organizations that “serve the interests of Medicaid enrollees,” are concerned over the state’s selection of law firm Manatt, Phelps & Phillips as one of the firms to conduct a “Medicaid Landscape Analysis,” fearing the firm will recommend Connecticut dump its current fee-for-service model of Medicaid and return to a managed care organization (MCO) model because Manatt represents the trade association of Medicaid MCOs.
“We are very concerned that DSS selected a law firm/consulting firm that represents the interests of the Medicaid managed care industry to do what should be an independent, unbiased evaluation of whether there is any possible benefit to gained from jettisoning our successful managed fee for service Medicaid program and contracting with unsuccessful Medicaid managed care organizations once again,” the organizations wrote in their letter to Gov. Ned Lamont, DSS Commissioner Andrea Barton Reeves, and various lawmakers.
Connecticut switched from an MCO model of Medicaid in which the state pays insurance companies a monthly fee per enrollee to a fee-for-service model in which the state pays providers directly in 2012. According to the KFF, MCOs make up most Medicaid programs nationally, with Connecticut essentially bucking the trend.
The advocates in their letter, however, argue Connecticut’s Medicaid system is a success story, saying Connecticut is in the top quarter of states in quality measurements, spends less on administrative costs than other states, and spends less of its state budget on Medicaid than other states.
According to a 2021 DSS presentation which touted the benefits of Connecticut’s fee-for-service model over MCOs, Medicaid as a percentage of Connecticut’s budget has increased from 23.1 percent of the budget in 2015 to 24.8 percent in 2020, lower than all but two other peer states; Connecticut has lower per capita Medicaid costs than peer states; a lower growth rate in Medicaid spending, and that Connecticut’s administrative costs are only 2.8 percent versus the national average of 8.2 percent, based on DSS calculations.
“CT’s taxpayers have literally saved billions of dollars since the shift away from capitated managed care to paying entities that actually manage care,” the organizations wrote, although they recognized that Connecticut’s long-term care costs were higher than other states as a percentage of the Medicaid budget – something they attribute to poor execution of a shift away from nursing homes and toward community-based and in-home long term care services.
Sheldon Toubman, a litigation attorney for Disability Rights Connecticut, says he believes the review was instituted in response to public outcry and skepticism when news broke that Gov. Lamont was considering a switch back to an MCO plan for Medicaid.
“We’re doing so much better than the other states in terms of cost control, quality, access to services, accountability,” Toubman said. “I suspect the review was recommended in response to the pushback.”
The concern outlined in the letter is that the analysis will “include whether there are opportunities to explore managed care options to improve the Medicaid program,” according to a DSS message cited in the letter, and the selection of Manatt, which represents insurance companies that run Medicaid MCOs, and represents Medicaid Health Plans of America, a trade association of MCOs.
“Manett Health, which is going to do most the analysis, is actually a well-known law/consulting firm whose principal clients include not only individual insurance companies which run Medicaid managed care plans but also the association of such MCOs,” the letter states.
“We didn’t make this stuff up, it was really, really easy to research,” Toubman said. “Before choosing Manett, anybody could have seen what Manett does and who they represent and could have seen it would not be possible for them to be objective about whether their clients should continue to be frozen out of Connecticut’s market for Medicaid.”
According to a statement from the Governor’s Office, Lamont “is not proposing any policy changes — whether administratively or legislatively — on this topic.”
“Policymakers have an obligation to the people they represent to regularly conduct reviews that determine whether currently enacted policies are working to their greatest extent and are cost efficient,” the statement said. “This review will provide the administration and the General Assembly with information on whether there are improvements to achieving this goal that we can implement, and we shouldn’t be afraid of receiving that data.”
In Connecticut, the number of people enrolled in Medicaid since 2012 when Connecticut switched models has increased 72 percent, according to DSS numbers, but costs have not risen in tandem thanks, in part, to increasing federal support which covers nearly 65 percent of Medicaid for Connecticut and, according to the 2021 DSS presentation, the fee-for-service model.
In 2014, Connecticut spent $2.9 billion of state revenue on Medicaid, with the federal government contributing $3.8 billion; by 2023, Connecticut spent $3.7 billion of its own revenue on Medicaid – a 27 percent increase — while the federal government paid $6.5 billion, according to the Medicaid and CHIP Payment and Access Commission. Connecticut budgeted $3.4 billion for Medicaid in its last budget but is facing hundreds of millions in cost overruns.
Medicaid and other entitlements are part of Connecticut’s fixed costs which, until recently, had been outpacing revenue growth, leading to a “structural deficit.” According to the Office of Fiscal Analysis, however, that trend has shifted.
An October 2024 report authored by four members of the Medical Assistance Program Oversight Council (MAPOC) who also signed the letter to Lamont, offered recommendations for improvements to Connecticut’s Medicaid system, including improving access to services, improving long-term community and in-home care, greater transparency in data reporting, and investing in “proven upstream preventative solutions.”
One their first recommendations, however, was, “Do not return to a system of capitated managed care through MCOs.”
Accenture was also chosen to conduct the analysis with DSS, but there is little mention of that firm in the letter.
“In sum, it is impossible for Manatt to provide an independent, evidence-based assessment of our current nation-leading, efficient managed fee for service Medicaid program,” the letter concludes. “That report will have no credibility with the community of advocates actively working with legislators and other stakeholders to improve on our successful managed fee for service model. We therefore ask that you abandon this review.”
“Governor Lamont believes state government should be doing everything it can to ensure that Medicaid members are receiving access to high quality, equitable care,” the Governor’s Office said.
**This article was updated with comment from the Governor’s Office**
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ABI Resources aligns with the concerns raised by the coalition of Medicaid advocates regarding the potential conflict of interest in DSS’s selection of Manatt, Phelps & Phillips for the Medicaid Landscape Analysis. The appointment of a law firm deeply enmeshed with Medicaid MCO interests raises questions about the objectivity of the analysis and its recommendations. Connecticut’s shift to a managed fee-for-service model has demonstrated fiscal responsibility, quality in care, and cost efficiency—parameters that clearly prioritize the well-being of enrollees. Reverting to a Managed Care Organization (MCO) model, as endorsed by entities with vested interests, risks undermining the progress Connecticut has achieved under its current Medicaid system.
The Medicaid system in Connecticut stands as a rare example of fiscal prudence and administrative efficiency in a landscape dominated by MCOs nationwide. Advocates emphasize that this model has proven its effectiveness in terms of cost control, transparency, and accountability, setting Connecticut apart from other states. The ongoing review, which the Governor’s Office asserts is a routine practice for assessing policy efficacy, must rigorously avoid any biases that could threaten the program’s integrity.
Further, the systemic efficiency demonstrated by Connecticut’s Medicaid model, with its lower administrative costs and alignment with community-based care, is foundational to maintaining the trust of Medicaid recipients and Connecticut taxpayers alike. ABI Resources thus supports the call for an unbiased, evidence-based review that prioritizes the needs of Medicaid beneficiaries over the profit motives of MCO stakeholders. The call to avoid MCO reintroduction aligns with our commitment to protecting Medicaid integrity, ensuring equitable access, and promoting sustainable healthcare solutions.
Statement from David Medeiros, Founder of ABI Resources
“In our pursuit of justice and compassion, we must always stand firm in the face of decisions that could compromise the wellbeing of the people we serve. Connecticut’s Medicaid system has been a success because it centers on direct service and the dignity of every individual relying on it. The selection of a firm with vested interests in managed care organizations to review our Medicaid model brings a real risk of conflict between profit and people—an imbalance that could jeopardize both transparency and the high standard of care our communities deserve.
I have learned from the wisdom of those who came before us that true leadership requires integrity, empathy, and an unwavering commitment to justice. Changing our Medicaid system to a managed care model, with its history of prioritizing profits over people, would undermine these values. We cannot allow the interests of large organizations to overshadow the needs of our most vulnerable residents. Every dollar in our Medicaid system should be directed toward providing quality care, not to line the pockets of intermediaries.
This is more than a policy review—it’s about the soul of our healthcare system in Connecticut. Our current managed fee-for-service model has proven its effectiveness, lowering administrative costs and ensuring transparency and accountability. I ask our leaders to honor the legacy of those who have stood for equity and justice by ensuring that this review remains unbiased and rooted in the service of the people, not the interests of industry.
ABI Resources stands resolute in advocating for a Medicaid system that remains accountable, transparent, and compassionate. Let this review reflect the principles of honesty, efficiency, and genuine care. Let us always choose to elevate people over profit, to honor truth over expediency, and to walk in the light of those who taught us to serve with dignity and courage. This is our shared responsibility, and I trust that together we will uphold these values in every step we take.”
David Medeiros Founder, ABI Resources