Five strategies to improve Medicaid payment accuracy
January 20, 2026 | Erika Johnson & Kaleigh Myers
As health policy continues to shift, every Medicaid dollar has to work harder. Provider tax headwinds, tighter state directed payment rules, semi-annual redeterminations and mounting audit scrutiny are squeezing payers and providers from all sides. Those that successfully navigate this change will be organizations that can prove value—patient by patient, claim by claim—while protecting access and equity.
When Medicaid reimbursement falls and uncompensated care increases, providers often rely on commercial payers to offset losses. For both coverage types, efficiency, value-based payment and accuracy remain crucial.
Five things for payers to think about:
- Track tangible savings for efficiency
Including measures that allow tracking tangible savings can help focus on efficiency. Medicaid managed care organizations (MCOs) may experience decreased revenue due to membership changes, while commercial payers could face provider rate pressures and member expectations of stable premiums. Therefore, it is prudent to select program measures that are outcomes-oriented and linked to actual cost savings. These can be paired with other quality measures reflecting desired care improvements. Ensuring alignment of programs and monitoring savings is important during periods of financial pressure across organizations. Classification tools can help pinpoint inefficiencies and track savings with defensibility and transparency.
- Ensure accuracy in risk-based programs
Accuracy in risk-based programs is essential to avoid overpaying beyond your budget. Implementing a system that emphasizes clinical accuracy through rules and requirements to validate assignments can support the allocation of limited funding or revenue to patients in need of care. Systems designed to support multiple functions can efficiently address various payer priorities. These include incorporating risk adjustment in provider payments, identifying individuals for care management and outreach and gaining a comprehensive understanding of the population’s illness burden.
- Target interventions with equity in mind
Member-first, equity-aware targeting helps direct interventions where they're most needed, especially when resources are tight. Accurate clinical segmentation, considering the person's full experience, can identify chronic conditions to guide care management and provider actions.
Technology can help identify vulnerable populations, including those at risk for poor maternal outcomes, members struggling with their mental health and/or substance abuse, or other chronic conditions to help facilitate these targeted approaches.
- Design flexible payment systems for rural access
Payment systems that enable payers to accurately account for case mix are essential to ensure appropriate compensation and eliminate misaligned incentives. Additionally, such systems should provide the flexibility needed to support targeted policy decisions addressing areas of specific need. Rural hospitals may face significant challenges, which could contribute to ongoing hospital closures and access concerns for members.
Payers should review payment structures for rural providers and aim to ensure that services deemed essential for the community are adequately compensated to a level where they can remain in the community. Maintaining access to care in rural areas requires developing strategies to assess the methods and extent of support for hospitals that provide this level of access for rural members.
Our methodologies, supported by our industry experts, provide valuable guidance to help payers address these complexities.
- Strengthen payment integrity and provider support
Focus on paying accurately using severity-adjusted and clinically-based payment methodologies. These payment mechanisms should be built on clear logic, reproducible results and benchmarking which can withstand regulator and provider scrutiny. These methodologies, when combined with integrated solutions that support providers in complete, accurate, and timely claim submission based on specific payer policies, aim to improve efficiency for both payers and providers.
Payer success in the current healthcare climate means balancing financial stewardship with equitable care delivery. By leveraging technology, payers can navigate regulatory pressures, support providers, and maintain access to care—especially in vulnerable communities.
Erika Johnson is senior manager of consulting services, regulatory and payer services, at Solventum.
Kaleigh Myers is a manager of regulatory and payer solutions at Solventum.
