As millions of Americans lose Medicaid coverage due to the unparalleled cuts that President Donald Trump signed into law last year, large private contractors are poised to make a financial killing as states move to implement draconian new work reporting requirements that are already wreaking havoc in several states.
A report published Tuesday by Democrats on the Senate Finance Committee warns that “a small handful of companies—some whose technology has a history of grievous errors—will be in charge of implementing historically harsh Medicaid work reporting requirements that never should have been enacted in the first place.” The report spotlights five firms that hold contracts with states for Medicaid eligibility and enrollment work: Maximus, Gainwell, General Dynamics Information Technology, Conduent, and Deloitte.
“This investigation began by asking contractors a series of questions to determine whether they are up to the task of implementing Medicaid work reporting requirements on behalf of states, and the committee’s interim findings show that we cannot conclude they are,” the report states. “The companies who stand to profit from new Medicaid work reporting requirements evaded hard questions about past performance, current process, and the potential for errors that cause widespread harm.”
The Democrats’ report comes as states are rushing to implement the new Medicaid work reporting requirements ahead of the January 1, 2027 deadline. The mandates require certain Medicaid recipients to document at least 80 hours per month of work or other qualifying activities—or lose coverage.
As KFF Health News reported earlier this year, state governments rely on private firms to “design and operate computer systems that assess whether low-income people qualify for Medicaid.”
“Those state systems have a history of errors that can cut off benefits to eligible people,” the outlet added, pointing to its 2024 investigation of Deloitte, which holds Medicaid-related contracts in at least 25 states.
States are paying Deloitte and other for-profit firms millions of dollars in taxpayer funds to help their governments comply with the new federal Medicaid rules, which could strip coverage from more than 10 million people by 2028.
None of the five vendors that Senate Democrats are investigating agreed to provide data on how many people their systems have reported to state Medicaid offices as potentially ineligible for coverage—though all of them denied having contract provisions that incentivize kicking people off the program. The companies also declined to disclose the compensation of their CEOs.
Nebraska, Montana, and Arkansas are so far the only US states that have begun implementing work requirements included in the Trump-GOP budget law. Preliminary data out of Nebraska indicates that red tape stemming from the work reporting mandates accounts for most of the coverage loss and denials so far.
Across the country, around 4 million people have lost Medicaid and Children’s Health Insurance Program coverage since Trump signed the Republican budget package into law last July.
“The nation is just weeks away from Republicans rolling out the red tape on unsuspecting Americans who have life-or-death healthcare needs. This rushed rollout is going to be a disaster,” Sen. Ron Wyden (D-Ore.), the top Democrat on the Senate Finance Committee, said in a statement on Tuesday. “It is essential to hold these contractors to a higher standard and implement commonsense accountability measures that make fast, simple, and durable enrollment in healthcare coverage the bar for earning taxpayer dollars.”
Sen. Elizabeth Warren (D-Mass.) added that “as President Trump and Republicans gut healthcare for millions of Americans, big corporations are cashing in by running systems that snarl Americans in red tape and strip them of their Medicaid coverage.”
“It’s plain wrong for these companies to boost their profits by kicking people off their healthcare,” the senator added, “and I’ll keep fighting to end this corporate greed.”
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