cib09102025
State directed payments (SDPs) permit states to implement contractual Medicaid managed care arrangements that direct a managed care organization (MCO), prepaid ambulatory health plan (PAHP), or prepaid inpatient health plan (PIHP)’s expenditures under 42 CFR § 438.6(c). The use of SDPs has grown substantially since they were first introduced in 2016; in 2024, CMS received more than 330 SDP preprint submissions from 39 states and territories.
Issued by: Centers for Medicare & Medicaid Services (CMS)
Issue Date: September 10, 2025
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