Deloitte\u2019s estimates show that 35 change requests for Georgia\u2019s eligibility system in 2023 would take more than 104,000 hours of work, according to a list of change requests that KFF Health News obtained in response to a public records request. That\u2019s the equivalent of 50 years of work, if someone worked 52 weeks a year at 40 hours a week.<\/p>\n
\u201cSystem changes were made to align with changing federal and state policies, as well as to meet evolving business needs,” said Ellen Brown, a spokesperson for the Georgia Department of Human Services. Brown earlier said changes also were made to \u201cimprove functionality.\u201d<\/p>\n
The federal government \u2014 that is, its taxpayers \u2014 covers 90% of states\u2019 costs to develop and implement state Medicaid eligibility systems and pays 75% of ongoing maintenance and operations expenses, according to federal regulations.<\/p>\n
Eligibility systems for years have posed problems for states because of the dynamic between contractors and government officials, said Matt Salo, CEO of consulting firm Salo Health Strategies. The companies hold the expertise \u201cand, quite frankly, they\u2019re kind of running circles around the state capacity,\u201d said Salo, a former executive director of the National Association of Medicaid Directors.<\/p>\n
\u201cFor decades all I\u2019ve heard from states in this arena is: We know that when we go out to contract it\u2019s going to cost us a lot of money and it is going to run over, it is going to deliver years late, it is going to deliver millions if not hundreds of millions of dollars over budget,\u201d Salo said, and \u201cby the time it\u2019s delivered, our needs have changed and so it\u2019s just this constant process of change orders and going back and fixing.\u201d<\/p>\n
Going to Court in Florida<\/strong><\/p>\n Two advocacy groups last August sued Florida in federal court, alleging tens of thousands of people were losing coverage without proper warning. And Florida\u2019s eligibility system was cutting off Medicaid coverage for some moms after giving birth, William Roberts, a state employee who reviews Medicaid eligibility decisions, testified when the case went to trial in July.<\/p>\n Florida previously gave moms two months of Medicaid coverage after giving birth. Federal regulators in 2022 approved<\/a> Florida\u2019s proposal to grant Medicaid benefits for 12 months. But in April 2023 state officials discovered a \u201cglitch,\u201d Roberts said, and \u201cthe system had reverted back to only giving mothers two months instead of giving them the 12 months that they were entitled to.\u201d<\/p>\n What became clear in the testimony is that the state and Deloitte take different views on what constitutes a \u201cdefect\u201d in a Deloitte-run system. Deloitte said it would fix defects without billing any additional hours for the work. Although Deloitte is not a named defendant in the lawsuit, the company was called to testify about its role in operating Florida\u2019s eligibility system.<\/p>\n Harikumar Kallumkal, a Deloitte managing director who oversees the Florida system, initially testified that, in this case, there was no problem and \u201cthe computer system was providing 12 months\u201d of postpartum coverage.<\/p>\n Then Kallumkal said, \u201cEven in this case, I do not believe it was a defect.\u201d Even so, \u201cwe did fix that.\u201d And for the fix, he said, Deloitte \u201cdid not charge\u201d the state.<\/p>\n Rather, a separate defect may have resulted in coverage losses for mothers after childbirth, Kallumkal testified.<\/p>\n Some historical data \u201crequired to determine postpartum coverage\u201d was not loading into the system, Kallumkal said. \u201cI don\u2019t know how many cases it impacted,\u201d he said, but Deloitte fixed the problem.<\/p>\n The courtroom revelation confirmed what Florida advocates already knew: an eligibility system issue prevented some of the state\u2019s most vulnerable from getting care. Florida denied allegations that it terminated Medicaid coverage without providing adequate notice. The case is ongoing.<\/p>\n When Michigan resumed regular Medicaid eligibility checks following the covid-19 pandemic, advocates saw a concerning trend.<\/p>\n The computer system routinely fails to recognize when certain adults with disabilities should receive Medicaid benefits, said Dawn Calnen, executive director of The Arc of Oakland County, which provides support for those with intellectual and developmental disabilities.<\/p>\n Often a person who qualifies for Medicaid initially for one reason could remain eligible even when life circumstances change. Calnen said there\u2019s no question that the people her group assisted are still eligible, just in a different way than during the pandemic.<\/p>\n The problem is frequent enough that Calnen\u2019s group felt compelled to notify others. \u201cWe kind of shout it from the rooftop for people: Know that this is going to happen.\u201d<\/p>\n When asked about the problem, Chelsea Wuth, a spokesperson for Michigan\u2019s Department of Health and Human Services, said there were \u201cno issues\u201d with the system. Deloitte operates Michigan\u2019s eligibility system. The company said it does not comment on state-specific issues.<\/p>\n Tennessee hired Deloitte in 2016 to build an eligibility system after the state canceled a contract with Northrop Grumman due to chronic delays. Deloitte didn\u2019t create the Tennessee system, known as TEDS, from scratch. It built on components from Georgia\u2019s system, according to a legal declaration<\/a> and a deposition of Kimberly Hagan, Tennessee Medicaid\u2019s director of member services, that were part of a class-action lawsuit that Medicaid beneficiaries filed against the state in 2020.<\/p>\n The lawsuit, which is ongoing and does not name Deloitte as a defendant, seeks to order Tennessee to restore coverage under its Medicaid program, known as TennCare, for those who wrongly lost it. Hagan, in a court filing, said many problems \u201creflect some unforeseen flaws or gaps\u201d with the Tennessee eligibility system and \u201csome design errors.\u201d<\/p>\n A federal judge on Aug. 26 sided with the Medicaid beneficiaries, ruling that Tennessee violated federal law and the U.S. Constitution. \u201cPoor, disabled, and otherwise disadvantaged Tennesseans should not require luck, perseverance, or zealous lawyering to receive healthcare benefits they are entitled to under the law,\u201d wrote U.S. District Court Judge Waverly D. Crenshaw Jr., adding, \u201cTEDS is flawed, and TennCare knows that it is flawed.\u201d<\/p>\n Tennessee Medicaid spokesperson Amy Lawrence said the state is \u201cdetermining what our next steps will be.\u201d<\/p>\n Tennessee\u2019s $823 million contract with Deloitte shows that the budget for changes outside the contract\u2019s original scope increased by hundreds of millions of dollars. Deloitte\u2019s maximum compensation for such change orders rose to $417 million under a 2023 contract amendment, up from $103.6 million four years earlier.<\/p>\n Lawrence said state officials \u201cdo not and would not pay to fix vendor errors.\u201d Lawrence attributed the cost increases to \u201csystem modernization\u201d in \u201can effort to enhance our citizens\u2019 interactions with the state Medicaid program.\u201d Additional funding was also needed to comply with new federal requirements related to the covid-19 pandemic, she said.<\/p>\n Waiting on Fixes<\/strong><\/p>\n States sometimes wait so long for Deloitte\u2019s fixes that the staffers who worked on the problems don\u2019t see the results. Jamie Perkins was responsible for making letters easier for Colorado Medicaid enrollees to understand. The letters are generated by Colorado\u2019s Deloitte-run eligibility system. State audits have found that the notices confuse enrollees and contain errors. Perkins said she left her job in 2021, frustrated that many of her fixes hadn\u2019t been implemented.<\/p>\n \u201cIt feels like a really perverse reward system, frankly, for Deloitte,\u201d Perkins said. \u201cWhen Deloitte is themselves making a problem that did not originate with the department, the department is still paying them to fix those problems.\u201d<\/p>\n The state\u2019s contract with Deloitte now outlines \u201cprotocols to address issues that are the result of the contractor,\u201d said Trish Grodzicki, a spokesperson for Colorado\u2019s Medicaid agency. As of June 30, Colorado \u201chas made substantial improvements\u201d and a \u201cmajority of the letters have been rewritten\u201d and updated in the system, she said.<\/p>\n Deloitte spokesperson Karen Walsh said \u201ca change request can represent a number of different things,\u201d including when states make policy decisions that would warrant system updates. Smith said Deloitte views change requests and system issues, or defects, as different things.<\/p>\n \u201cWe have a responsibility when there\u2019s a system issue to fix that,\u201d Walsh said. \u201cWe don\u2019t get a change request to fix an issue.\u201d<\/p>\n Yet in Kentucky and other places, states have submitted change orders to resolve issues. Government officials and Deloitte sometimes negotiate fixes for months before they\u2019re implemented.<\/p>\n Kentucky resident Beverly Likens lost Medicaid coverage<\/a> in June 2023 partly due to an error with the state\u2019s Deloitte-run system. State health officials told a legal aid group in September 2023<\/a> that a \u201cchange order has been submitted\u201d to fix the glitch, which blocked her new coverage application from getting through online.<\/p>\n Likens, with the help of a lawyer, had her Medicaid benefits quickly reinstated, but that was far from the end of the saga. The problem that caused her benefits to lapse was resolved in April \u2014 10 months later \u2014 when Kentucky implemented the first phase of a change request, Kentucky\u2019s Cabinet for Health and Family Services told KFF Health News.<\/p>\n Agency spokesperson Brice Mitchell said the change request was designed to address a \u201climitation of the system rather than technical issues.\u201d The request, for which a second phase was implemented in July, cost $522,455 and took more than 3,500 hours of work, according to Mitchell and documents obtained in response to a public records request. All such requests \u201care thoroughly vetted, negotiated and approved by several areas within the Cabinet,\u201d Mitchell said in an emailed statement.<\/p>\n \u201cThese are large, complex system implementations,\u201d Walsh, of Deloitte, said. \u201cSo in all of them, you\u2019re going to be able to find a point in time where there was an issue that needed to be fixed. And you can also find millions of people every day who are getting benefits through these systems.\u201d<\/p>\n In February, Georgia officials were discussing a high-priority change request to resolve an ongoing problem: A defect affected potentially tens of thousands of \u201ccases\/claims\u201d for families in the Supplemental Nutrition Assistance Program, known as SNAP, and the Temporary Assistance for Needy Families program that, among other problems, led the state to recoup some residents\u2019 entire benefit, according to state documents KFF Health News obtained from a public records request. The programs provide monthly cash assistance to low-income people for food and housing. Georgia in 2014 inked a contract with Deloitte to build and maintain its eligibility system, known as Georgia Gateway<\/a>.<\/p>\n Federal regulations cap how much money the government can recoup if a SNAP recipient was overpaid at 20% or $20, whichever is higher, according to legal aid attorneys and SNAP experts.<\/p>\n \u201cWe have plenty of clients who, that is their entire grocery budget,\u201d said Adrianne Freeman, deputy director for litigation and advocacy at the Georgia Legal Services Program.<\/p>\n The defect \u2014 which Georgia DHS\u2019 Brown said was identified on April 29, 2022 \u2014 created several problems, including incorrect calculations of how much to recoup and clawbacks not occurring on the correct start dates. \u201cThe Gateway system did not consistently adjust or apply the recoupment amount correctly,\u201d Brown said.<\/p>\n A fix was deployed the weekend of Feb. 17, the documents state, but a formal change request was needed to \u201callow the State Agency (SA) to correctly apply allotment reductions to all SNAP and TANF cases impacted by Defect 21068,\u201d the documents state. The change order would allow state officials to run an automated one-time mass update to fully resolve the problem.<\/p>\n The target date for doing so: March 1. That was nearly two years after officials were provided an \u201coriginal report\u201d noting that more than 25,000 cases may have been affected, the documents state.<\/p>\n Relying on Workarounds<\/strong><\/p>\n States often face constraints on how many changes can be made in a year. In Texas, there is a years-long waitlist for changes, according to advocates, state documents, and the state health agency. \u201cThe system isn’t nimble enough to meet the needs and often relies really heavily on manual workarounds,\u201d said Stacey Pogue, a senior research fellow at Georgetown University\u2019s Center on Health Insurance Reforms with expertise on Medicaid in Texas.<\/p>\n Texas eligibility workers use workarounds to process applications while awaiting permanent fixes. Deloitte said in its $295 million Texas contract that \u201cthere is a real need\u201d for workarounds, which allow operations to continue \u201cwithout affecting client benefits.\u201d<\/p>\n Many of these \u201ctemporary\u201d fixes were implemented years ago and were still in use in 2023, according to records obtained by KFF Health News that found 45 active workarounds in Texas last year. In one instance, a workaround was implemented nearly 14 years ago. Deloitte acknowledged in its Texas contract that reducing workarounds \u201cis one of the top priorities.\u201d<\/p>\n Smith of Deloitte said it doesn\u2019t always take months to fix a problem: \u201cWe have changes that get implemented in a day and changes that get implemented in a month.\u201d<\/p>\n Further, Smith said, Deloitte \u201cis one part of implementing a change,\u201d noting \u201cwe\u2019re often not necessarily the constraint.\u201d<\/p>\n The state considers several factors when assessing which fixes to tackle first, including how many beneficiaries are affected. The more complex the workaround, \u201cthe longer it may take for staff to process eligibility,\u201d said Jennifer Ruffcorn, a spokesperson for Texas Health and Human Services.<\/p>\n In Florida \u2014 in addition to the lapses in coverage for maternal care \u2014 the National Health Law Program and the Florida Health Justice Project alleged in their lawsuit in federal court that notices to Medicaid beneficiaries alerting them their benefits would be terminated did not explain the basis for the decision.<\/p>\n In October, about a month after the lawsuit was filed, the state asked Deloitte to provide an estimate to alter the notices, Kallumkal of Deloitte testified at trial in August.<\/p>\n Deloitte estimated it would need roughly 28,000 hours, he said. That\u2019s more than twice the 12,600 hours the state sets aside each year to pay Deloitte for revisions. The extra hours would require an amended contract in which the state would have to agree to pay more. Florida\u2019s Department of Children and Families did not respond to requests for comment.<\/p>\n For Deloitte, extra hours mean more revenue, Kallumkal acknowledged during his testimony while under cross-examination. Deloitte subsequently provided the state with a new estimate for a narrower scope of work that would take 12,000 hours, he said.<\/p>\n KFF Health News<\/a> is a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF\u2014an independent source of health policy research, polling, and journalism. Learn more about KFF<\/a>.<\/p>\n![](\"http:\/\/aungthiha.me\/wp-content\/uploads\/2024\/09\/Likens_01.jpg\")
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