The bill amends Section 540.0272 of the Government Code to allow Medicaid managed care organizations to offer nutrition counseling and instruction services as an alternative to certain state Medicaid plan services. Specifically, it permits these organizations to provide medically appropriate, cost-effective, evidence-based mental health or substance use services, as well as nutrition counseling, from a list approved by the state Medicaid managed care advisory committee. The bill specifies that recipients are not required to use these services in lieu of other specified services in the state Medicaid plan.

Additionally, the bill mandates that the commission prepare and submit an annual report to the legislature detailing the usage of these services and consider their costs when setting capitation rates for Medicaid managed care organizations. It also clarifies that the list of nutrition counseling and instruction services cannot include home-delivered meals, food prescriptions, or grocery support. The changes will apply to contracts entered into or renewed on or after the effective date of the Act, which is September 1, 2025.