LEGISLATIVE SERVICES AGENCY
OFFICE OF FISCAL AND MANAGEMENT ANALYSIS
FISCAL IMPACT STATEMENT
LS 7039 NOTE PREPARED: Jan 3, 2025
BILL NUMBER: SB 493 BILL AMENDED:
SUBJECT: Medicaid Value-Based Contracting.
FIRST AUTHOR: Sen. Crider BILL STATUS: As Introduced
FIRST SPONSOR:
FUNDS AFFECTED:XGENERAL IMPACT: State & Local
DEDICATED
XFEDERAL
Summary of Legislation: The bill allows a managed care organization to enter into a value based contract
with a Medicaid provider to provide services under a risk based managed care program.
Effective Date: July 1, 2025.
Explanation of State Expenditures: Allowing a managed care organization (MCO) and a Medicaid provider
to enter into a value-based contract will have an indeterminate change in the overall costs for the state
Medicaid program. Any change in the cost of MCO reimbursement to the state Medicaid program will be
based on the cost of services under the contract and any changes in the utilization of health care services
through quality improvement. Such impacts are likely to be realized in the long-term.
Additional Information - The Family and Social Services Administration has value-based reimbursement
contracts with the MCOs providing services through the Hoosier Care Connect program. MCOs may be able
to pass through the contract incentives with value-based contracts with Medicaid providers.
Explanation of State Revenues:
Explanation of Local Expenditures:
Explanation of Local Revenues: Locally owned Medicaid providers who enter into value-based contracts
with an MCO may have an indeterminate change in Medicaid reimbursement.
State Agencies Affected: Family and Social Services Administration.
Local Agencies Affected: Locally owned Medicaid providers.
Information Sources: https://www.in.gov/fssa/ompp/quality-and-outcomes-reporting.
Fiscal Analyst: Karen Rossen, 317-234-2106.
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