EPIC Joins NHeLP, Upturn in Urging FTC to Investigate Faulty Deloitte Medicaid System

January 31, 2024

In a complaint filed today, EPIC, the National Health Law Program (NHeLP), and Upturn urged the Federal Trade Commission (FTC) to investigate Deloitte for its development and maintenance of a faulty Medicaid eligibility system known as the Texas Integrated Eligibility Redesign System (TIERS).

In Texas and at least 20 other states, Deloitte provides automated Medicaid eligibility software like TIERS. But for the last 10 years, Deloitte’s systems have generated errors while determining Medicaid eligibility, resulting in unfairly lost Medicaid coverage. For example, litigation in Tennessee revealed that, in 2019, a programming error in a Deloitte-built Medicaid system was causing newborn babies to lose Medicaid coverage because the software was failing to properly link them to their mothers. The same problem is now happening in Texas, causing scores of infants to go without essential healthcare—and hundreds of thousands of Texans to lose their benefits—due to over 20 active system issues identified by TIERS workers.

The harms produced by TIERS are even more acute in light of the nationwide Medicaid “unwinding” process, when an unprecedented number of people are undergoing Medicaid eligibility redeterminations following the end of the COVID-19 public health emergency. Even when redeterminations were paused from 2020 to 2023, Deloitte did not address all of the known problems with TIERS.

With this complaint, EPIC, NHeLP, and Upturn call on the FTC to continue its efforts protecting consumers from inaccurate automated technologies and unaccountable government contractors by initiating an investigation into Deloitte’s business practices, pausing the use of TIERS, making public the details about how TIERS was developed and how it operates, and requiring Deloitte to implement a comprehensive AI risk management strategy to protect Texans from unfairly lost Medicaid coverage.

“Deloitte takes taxpayer money to provide Medicaid eligibility software to 20 states, but the software is faulty, and Deloitte has known of numerous failures over the last decade. These flaws lead to people who are eligible for Medicaid losing coverage because of design and programming errors made by Deloitte,” said Sarah Grusin, Senior Attorney with the National Health Law Program. “Unlike Deloitte’s publicly traded clients, the victims of these failures are the children who grew up in foster care, people with disabilities, pregnant and postpartum people, and their newborn babies. Today’s complaint is on behalf of the millions of Medicaid beneficiaries in Texas who have no choice but to wade through Deloitte’s faulty system.”

“Automation in public benefits may seem like a neutral step to help administer important programs, but it can actually worsen the long-standing racial and economic inequities that already prevent people from getting the support they need,” said Emily Paul, Project Director at Upturn. “Badly designed and inadequately tested software can end up incorrectly denying thousands of people in an instant, especially people whose circumstances aren’t considered by the system, whether that’s because they don’t have a permanent address or a traditional family structure, or due to their immigration status.”

“Deloitte has played fast and loose with Medicaid eligibility determinations, leaving hundreds of thousands of Texans in jeopardy,” said Grant Fergusson, Equal Justice Works Fellow at EPIC. “We should all expect better from the automated technologies around us: better testing, better oversight, and better outcomes. With today’s complaint, we urge the FTC to continue its work defending consumers from biased, inaccurate, and otherwise harmful automated technologies.” 

Today’s complaint is the latest in a series of FTC complaints filed by EPIC to address unfair and deceptive data and AI practices, following complaints against companies like Thomson Reuters and Grindr. EPIC has played a leading role in developing the authority of regulators to safeguard the rights of consumers, ensure the protection of personal data, and address AI harms. EPIC has previously called attention to Deloitte’s automated benefits eligibility systems in its investigative AI procurement report, Outsourced & Automated.

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