Challenges with Medicaid Eligibility Systems

Marie Noon, residing in Brighton, Michigan, faced a difficult battle with the state’s Medicaid system. Despite being eligible due to a disability, she experienced a denial of coverage in 2025 because of an IT error. It took Marie months of persistence to get the mistake corrected, even though she has a history of working as a bank manager and considers herself technologically savvy.

Marie relies on eight medications daily to manage conditions from adult-onset Still’s disease, an inflammatory arthritis with severe symptoms such as debilitating pain and headaches. Diagnosed over ten years ago, her life has drastically changed, restricting her ability to work for several years due to numerous hospital stays.

In 2025, Michigan suddenly denied her Medicaid application after losing her private insurance. The denial was attributed to an error in the state’s benefits system. An attorney helped her overturn the decision, though the process was fraught with challenges.

“I can’t afford my medical care. I have to have insurance,” Noon mentioned, underlining her reliance on essential health coverage.

Deloitte, a global consulting firm, has provided Michigan’s Medicaid eligibility system since 2006. KFF Health News reviewed $768 million worth of contracts indicating its substantial role. However, similar technological errors have affected Tennessee and Texas, impacting many disabled individuals.

An investigation by KFF Health News involved state official statements, public record emails, and interviews with attorneys and individuals impacted by coverage denial issues. Deloitte’s spokesperson stated no system-wide anomalies were causing routine Medicaid denials. They emphasized states own and dictate these eligibility systems’ functions.

In Marie’s case, the system failed to acknowledge her disability, declaring she earned too much to qualify for Medicaid. Without Medicaid, she paid hundreds for medications out-of-pocket, adding stress due to uncertain drug costs each month. Despite these challenges, Marie continued to advocate for reinstatement, eventually succeeding after months of appeals.

Nationwide, Medicaid covers about 67 million individuals with low incomes or disabilities. Deloitte’s systems, now prevalent in 25 states, face scrutiny as benefits are incorrectly categorized, leaving many without the aid they need. In Michigan, 15.5 million Medicaid enrollees have disabilities, accentuating the necessity for accurate system management.

“When these administrative systems get overloaded, everyone gets impacted,” said Pamela Herd, a University of Michigan professor.

New federal laws are leading to complex changes requiring states to update Medicaid systems. This law shifts Medicaid rules, excluding seniors, children, and disabled individuals from certain restrictions. However, the need for updates disrupts already unstable systems, advocates assert.

In Michigan, Medicaid was part of a program for working disabled adults. Yet, errors in the state’s system, such as misidentification of disabilities, wrongly impacted Noon’s Medicaid status. Attorneys and advocates express concerns about increased errors and burdens as systems struggle to adapt to new federal mandates.

These issues are not isolated to Michigan. Tennessee’s Deloitte-built system faced a class-action suit for unreliable eligibility testing, and Texas similarly encountered errors with misidentification causing lapses in benefits for individuals with disabilities.

Michigan has worked to address enrollment errors, specifically regarding Plan First, a restricted Medicaid program. Mistakes in enrollment led to a drop in comprehensive coverage for disabled individuals. However, recent adjustments have been made to prevent further inaccuracies.

Marie Noon’s persistence paid off. Her Medicaid application was finally approved in January, a moment she described as emotional. The ordeal highlighted significant challenges in the Michigan system and the need for more reliable management of Medicaid eligibility to support those with disabilities effectively.