State Medicaid Managed Care Plans Can Spend Up To 5% Of Premiums On Social Determinants Of Health

State Medicaid plans and Medicaid managed care organizations (MCOs) can spend up to 5% of premiums on non-clinical services considered social determinants of health (SDOH), such as housing, nutrition, or transportation. MCOs that spend at least 1.5% of premiums on these alternative benefits called “in-lieu of services” (ILOS) to substitute for a more costly state-plan service must report how the state determined that the ILOS benefits were cost effective. The reporting requirement goes into effect in 2027.

States and MCOs can use ILOS to strengthen access to care by expanding options for service settings and to . . .