Judge Rules $400 Million Algorithmic System Illegally Denied Thousands of People’s Medicaid & Disability Benefits

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Thousands of children and adults were automatically terminated from Medicaid and disability benefits programs by a computer system that was supposed to make applying for and receiving health coverage easier.Deloitte has built automatic Medicaid eligibility determination systems for more than 20 states, including Tennessee

Thousands of Tennesseans were illegally denied Medicaid and other benefits due to programming and data errors in an algorithmic system the state uses to determine eligibility for low-income residents and people with disabilities, a U.S. District Court judge ruled this week.

The TennCare Connect system—built by Deloitte and other contractors for more than $400 million—is supposed to analyze income and health information to automatically determine eligibility for benefits program applicants. But in practice, the system often doesn’t load the appropriate data, assigns beneficiaries to the wrong households, and makes incorrect eligibility determinations, according to the decision from Middle District of Tennessee Judge Waverly Crenshaw Jr.

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Judge Rules $400 Million Algorithmic System Illegally Denied Thousands of People’s Medicaid Benefits
Thousands of children and adults were automatically terminated from Medicaid and disability benefits programs by a computer system that was supposed to make applying for and receiving health coverage easier

The TennCare Connect system—built by Deloitte and other contractors for more than $400 million—is supposed to analyze income and health information to automatically determine eligibility for benefits program applicants. But in practice, the system often doesn’t load the appropriate data, assigns beneficiaries to the wrong households, and makes incorrect eligibility determinations, according to the decision from Middle District of Tennessee Judge Waverly Crenshaw Jr.

“When an enrollee is entitled to state-administered Medicaid, it should not require luck, perseverance, and zealous lawyering for him or her to receive that healthcare coverage,” Crenshaw wrote in his opinion.

The decision was a result of a class action lawsuit filed in 2020 on behalf of 35 adults and children who were denied benefits.

“This is a tremendous win for the plaintiffs and all TennCare members who have lost their vital health coverage due to TennCare’s unlawful policies and practices,” said Michele Johnson, executive director of the Tennessee Justice Center

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