How Managed Care Is Reinventing Medicaid and Other Public Health-Care Bureaucracies

The spread of managed care is rapidly transforming the nation's health care system. Less well noted, however, is the way this transformation is also reshaping Medicaid-and other public health-care bureaucracies-across administration, internal operations, and policymaking areas. In this article, we examine how managed care has contributed to "reinventing government" in such bureaucracies, paying particular attention to shifts in organizational mission, competitive contracting, performance measurement, and government regulation. At the same time, we raise questions about the challenges of capacity and accountability that arise as public bureaucracies both participate in and respond to the managed care revolution.