This document discusses using external quality review organizations (EQROs) to improve the quality of preventive and developmental services for children in Medicaid managed care plans. It finds that while states are required to assess quality, most current EQRO reports provide only basic data without interpretation. The document provides guidance to states on developing quality strategies and contracts with EQROs that specifically focus on preventive and developmental services for children, such as measuring developmental screening rates and referral outcomes. States can better utilize EQROs and federal regulations to improve children's healthcare quality by undertaking strategic planning with stakeholder input.