In recent years, State Medicaid programs have begun adopting health-ba
sed Payment systems to help ensure quality care for people living with
human immunodeficiency virus (HIV) and acquired immunodeficiency synd
rome (AIDS), and to ensure equity for the managed ca re organizations
(MCOs) in which these people are enrolled. In this article, the author
s discuss reasons why such Payment systems are needed and describe AID
S-specific capitation rates that have been adopted in several State Me
dicaid waiver programs. The authors also examine comprehensive risk-ad
justment systems both within Medicaid and outside the program. Several
research questions needing further work are discussed.