Putting Health First:

What to Know About the McKinsey Report and Medicaid Transformation

In February 2019, McKinsey and Co. released its “Rapid Response Review: Assessment of Missouri
Medicaid Program,” and there is talk of a major effort to “transform” Missouri’s Medicaid program in
2020. Missouri Health Care for All urges leaders to prioritize the health needs of MOHealthNet
participants in approaching the report and potential system reform.

McKinsey Report Content

The Good: Many of the good ideas in the report have been suggested by advocates for years, such as:
 Raising provider reimbursement rates to increase participating providers
 Updating the antiquated and fractured IT infrastructure of Missouri’s Medicaid program
 Improving coordination between departments and systems

The Bad: The overall report is weighted toward for-profit managed care. Current managed care contracts are
failing to meet benchmarks, but the report suggests moving more services (such as pharmacy), roadblocks
(such as prior authorizations) and populations (including the aged, blind, and disabled) into this system. In
doing so, McKinsey ignores substantial evidence that managed care does an inadequate job of insuring
services for people with complex, acute, medical and mental health needs.

The Ugly: The McKinsey report implies that cheap is the highest priority in a system that provides care to
hundreds of thousands of Missourians. It ignores the role of tax cuts in state budget shortfalls and does not
discuss expanding Medicaid, which recent analysis shows would save the state money while expanding care.

Other Concerns
There is very little evidence cited to back up the report’s recommendations and estimated savings, aside
from references to “popular trends” and links to other reports produced by McKinsey & Co. The report
examines a critical public health insurance program through “bottom line” thinking that prioritizes savings
and profits over health. The recommendations also mirror other McKinsey reports, raising questions of
whether Missouri actually got tailored recommendations or cookie cutter solutions.

Finally, McKinsey & Co. itself has a troubling history of advising companies on controversial and ethically
questionable work, including advising the maker of OxyContin to “turbo charge” sales by pressuring doctors
to prescribe higher doses to more patients. As recently as 2018, McKinsey & Co. had a contract with
Centene, one of the largest managed care companies in Missouri, yet there is no disclosure of the company’s
current clients or potential conflicts of interest.

What Should Missouri Do?

Medicaid is a lifesaving program for vulnerable Missourians. Any attempts to radically remake Medicaid
must include the voices of community stakeholders and focus on the impact proposed changes will have on
the Missourians being served. Questions about fiscal sustainability should be addressed through balanced
approaches that maximize income and streamline operations in ways that help, not harm, participants.

Missouri Health Care for All | P.O. Box 190429 | St. Louis, MO 63119 | 877-383-8884 |www.mohealthcareforall.org

Jen Bersdale, Executive Director: 314-651-6568 or jen@mohealthcareforall.org

Shawn D’Abreu, Policy Director: 314-397-4636 or shawn@mohealthcareforall.org