Managed Care Clinical Prior Authorization

MCOs must implement specific clinical prior authorizations for clients enrolled in Medicaid managed care. Usage of all other clinical prior authorizations will vary between MCOs at the discretion of each MCO. MCOs cannot establish a clinical prior authorization for a drug without approval by HHSC, and no prior authorization can be more stringent than what was approved.

The Clinical Prior Authorization Assistance Chart shows the prior authorizations used by each MCO and those used for traditional Medicaid. Pharmacy providers should contact the client's specific MCO for details.

Refer to the Prior Authorization section for more about clinical prior authorization criteria.

Managed Care Complaints

HHSC defines a complaint as any dissatisfaction expressed by telephone or in writing by the pharmacy provider. The definition of complaint does not include a misunderstanding or a problem of misinformation resolved promptly by clearing up the misunderstanding or supplying the appropriate information to the provider's satisfaction.

Pharmacy providers submit pharmacy complaints to the appropriate MCO. Refer to the MCO's website to obtain information regarding complaints and appeals processes and the MCO's procedure manual.

Each MCO must resolve pharmacy provider complaints within 30 days from the date the MCO receives the complaint. The MCOs are also required to resolve pharmacy provider complaints received by HHSC and referred to the MCOs no later than the due date requested by HHSC.

Pharmacy providers must exhaust the complaints or grievance process with the MCO before filing a complaint with HHSC. If a pharmacy provider believes it did not receive the entire due process from the MCO after completing this process, you may file a complaint with HHSC. Pharmacy providers should contact the client's specific MCO for details.

Managed Care Formulary Management

HHSC requires each MCO to adhere to the Medicaid and CHIP formularies and the Medicaid Preferred Drug List. An MCO cannot establish a drug as non-preferred.

Managed Care Pharmacy Participation

Pharmacy providers must enroll in Medicaid through the Provider Enrollment and Management System (PEMS) before participating in any managed care network. Refer to the Enrollment Process section for information about the enrollment process

Each MCO contracts with a pharmacy benefits manager (PBM) to process prescription claims. The PBM contracts with individual pharmacies. The MCO must allow any enrolled pharmacy provider willing to accept the financial terms and conditions of the contract to enroll in the MCO’s network. Each MCO develops its participating pharmacy network for the delivery of services.

Managed Care Programs

HHSC contracts with managed care organizations (MCO) and pays each MCO monthly to coordinate health services for people enrolled in Medicaid or Children’s Health Insurance Program (CHIP) MCOs. HHSC delivers most Medicaid and all CHIP prescription drug benefits through managed care. Each MCO contracts directly with pharmacy benefit managers (PBM) to create pharmacy provider networks people can use to fill prescriptions.

The type of Medicaid coverage a person receives depends on where the person lives and their health. The following are the Medicaid managed care programs in Texas:


STAR is a program for children, newborns, pregnant women, and some families and children. People in STAR get all their services through an MCO.


STAR+PLUS is a program for people who have disabilities or are age 65 or older. People in STAR+PLUS also receive their essential medical services and long-term services through an MCO.

STAR Health

STAR Health is a program for children who receive coverage through the Texas Department of Family and Protective Services. STAR Health also is for young adults who were previously in foster care.


STAR Kids is a program for children and adults 20 and younger who have disabilities.

STAR+PLUS Medicare-Medicaid Plans

HHSC and the federal Centers for Medicare and Medicaid Services (CMS) have set up combined Medicare-Medicaid plans for people in those counties with both Medicare and Medicaid coverage, known as dual eligibles. With one plan, Medicare and Medicaid benefits work together to better meet the client’s healthcare needs by offering essential health care and long-term services.