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Committee tables bill that would change Medicaid auto-assignment to balance MCO loads
Summary
Members tabled House Bill 589 after extended questioning about current auto-assignment practices and upcoming changes to quality-based assignment. The Health Care Authority explained current auto-assignment favors smaller plans under a 30% rule and will transition to a quality-driven algorithm in 2026.
The House Health & Human Services Committee voted 10–0 to table House Bill 589, a committee substitute that would adjust how the Health Care Authority auto-assigns Medicaid enrollees among managed care organizations (MCOs) when recipients do not choose a plan.
Sponsor Representative (speaker) explained the bill’s objective as preserving member choice while balancing enrollment so that MCOs with fewer members receive preferential auto assignments. "We're asking the health care authority to make those assignments to those MCOs that have the fewer number of people assigned to them because we wanna make sure that people have equal access to health care when they need it," the sponsor said.
The committee heard extensive questioning. Representative Nicole Chavez said the auto-assignment process already favors MCOs with less than 30% of total membership and asked whether HCA currently applied that rule. Dana Flannery, Medicaid director at the Health Care Authority, told the committee that "the auto assignment today, as described, does favor the 2 smaller plans when anyone does not elect a choice," and gave December as an example month with roughly 10,000 by choice and less than 1,000 by auto assignment. Flannery said plans with membership under 30% are favored in the auto-assignment process and that beginning Jan. 1, 2026 the state will start a quality-driven auto-assignment algorithm designed to reward plan performance under the Turquoise Care contract.
Representative Nicole Chavez and other members expressed concern about network adequacy and which providers accept which MCOs. Flannery said HCA maintains geo-access and network adequacy reporting and that single-case agreements can be used when a required provider is outside a member’s plan network.
The sponsor and several members questioned a witness about potential conflicts of interest; an expert consultant said he had national retainer relationships but was not being paid locally for this presentation. Members debated the appropriateness of asking personal-employment questions of witnesses; the chair cautioned decorum but allowed the HCA director to respond.
After discussion, Representative Naya moved to table and Representative Nicole Chavez seconded. The committee recorded a roll-call vote of 10–0 to table the bill.
Committee members repeatedly noted the timing: HCA’s quality-based assignment begins Jan. 1, 2026, and several members questioned whether the bill would be necessary for the six-month interval before the algorithm takes effect.
