🇺🇸United States

Incorrect eligibility determinations causing costly rework and member remediation

2 verified sources

Definition

Low **eligibility determination accuracy** leads to wrong approvals or denials that must later be corrected, increasing rework and member contact costs. Performance frameworks for Medicaid specifically call out rework rates and corrections due to errors as cost drivers in enrollment and eligibility processing.

Key Findings

  • Financial Impact: Hundreds of dollars per corrected case in staff time and member support; scaled to tens or hundreds of thousands of cases per year in large states this yields multi‑million dollar annual avoidable spend.
  • Frequency: Daily
  • Root Cause: Complex eligibility rules, inadequate staff training, and error‑prone manual data handling result in miscalculations and misclassifications that then require formal corrections, appeals handling, or re-determinations.

Why This Matters

This pain point represents a significant opportunity for B2B solutions targeting Public Assistance Programs.

Affected Stakeholders

Eligibility caseworkers and supervisors, Member services/call center staff, Appeals and fair-hearing units, Program integrity and quality assurance teams

Deep Analysis (Premium)

Financial Impact

$1.4B-6.4B in federal improper payment liability; $500K-1M annually in CAP and remediation overhead; state match share $300M-1B+ • $1.4B-6.4B in improper federal payments (from audit data); federal recoupment threats; reputational damage; $500K-1M in CAP development/remediation staff • $1.4B+ annually in federal improper payments for newly eligible cohort alone across 4 major states; per-case rework cost $300-800 in staff time

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Current Workarounds

Budget variance analysis, reallocation of funds from other state programs, legislative requests for supplemental appropriations • Finance team reconciliation spreadsheets, manual audit of improper payment amounts, state legislative budget amendments, fund reallocation • Manual audit samples, spreadsheet tracking of errors, email-based correction workflows, post-hoc policy application reviews

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Methodology & Sources

Data collected via OSINT from regulatory filings, industry audits, and verified case studies.

Evidence Sources:

Related Business Risks

Eligible Medicaid applicants not enrolled due to processing backlogs and pending status

Multi‑million dollar annual loss in federal match and capitation revenue per state with sustained high pending volumes (directionally supported by CMS/KFF data on enrollment swings in the hundreds of thousands of members, each tied to per-member-per-month payments).

High administrative cost from manual Medicaid eligibility rework and intervention

Hundreds of thousands to several million dollars per year per medium‑to‑large state program in avoidable staff time and overhead tied to rework and manual case handling.

Slow application and renewal processing delaying federal match and provider payment flows

Delayed recognition of tens to hundreds of millions of dollars in federal match and plan/provider revenue during high‑volume periods, effectively extending time‑to‑cash across the program.

Eligibility processing bottlenecks reducing throughput and service capacity

Implied losses include increased overtime costs and opportunity cost of staff capacity, often reaching hundreds of thousands of dollars annually per state during heavy backlog periods.

Risk of federal compliance findings for failure to meet Medicaid eligibility timeliness standards

Potential loss or deferral of millions of dollars in federal Medicaid funding for states subject to enforcement actions or required corrective measures, plus internal compliance and remediation costs.

Vulnerabilities to ineligible enrollment and improper payment from weak eligibility controls

Nationally, eligibility-related improper Medicaid payments are in the billions of dollars annually; individual states can face tens to hundreds of millions in questioned costs tied partly to eligibility control weaknesses.

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