Types

• Types of reimbursement include fee-for-service, managed care arrangements and a combination of the two. Federal laws do not mandate what type of reimbursement has to be made by the state Medicaid program.
  
  

Fee-for-service

• Fee-for-service payments refer to payments that are made at a set rate to providers based on the services provided. For example, an office visit with a primary care physician may pay $60 to the medical provider, even though the medical provider may charge $80, $100, or $120 for the office visit.
  
  

Managed Care

• Managed care refers to a form of health management where the insured individual must see a set of in-network physicians who are paid a set rate. Out-of-network physicians may be paid at a lesser rate, require that the insured individual pay more for seeing this physician, or entirely refuse payment to out-of-network physicians.
  
  

Claims

• A medical provider typically submits a claim form electronically for services provided to a patient. In some cases, paper forms may be submitted by the medical provider.
  
  

Pharmacy

• Medicaid agrees to pay a set rate for certain prescription drugs and requires the individual to pay a co-payment, typically $3 per prescription. Medicaid typically refuses to pay for expensive drugs, including non-generics, unless a prior authorization form is completed by the prescribing physician.