Colorado Medicaid, SNAP, CHIP, and TANF Wrongful Denials

Problem Statement

In the late 90s, Colorado began a process to replace its multiple legacy benefits systems with one single system, called the Colorado Benefits Management System (CBMS). After a Request for Proposals (RFP) went out, the contract was awarded to Electronic Data Systems (EDS), and in 2004, the system went live—despite clearly not being finished. Because of all the unresolved problems in the system, case backlogs piled up and people were unable to get their benefits. According to one study, “hundreds of people complained that they were denied benefits unfairly, their applications weren‘t processed, or that they received contradictory letters about their eligibility. In addition, some individuals received benefits to which they were not entitled.” After a few months, attorneys from the Colorado Center on Law and Policy sued the state, winning the creation of the Office of CBMS and an emergency call center. However, the system was never truly fixed, and in 2009, Deloitte was contracted to build a web portal that launched in 2010. The web portal also malfunctioned, but the heads of the Office of CBMS claimed the errors were caused by individual caseworkers and were not systematic.

Despite the attention, problems persisted through the 2010s. Most issues were due to technical glitches in the system, relating to poor data quality, coding and logic errors, and lack of accountability for fixing issues that came up. For example, one person got over 70 contradictory automated notices from the system that didn’t have dates on them. These problems may have stemmed from the fact that EDS used code from an Arkansas project, even though the two states were trying to implement different policies and therefore needed different code. Additionally, the Deloitte contract’s fixed budget prevented new elements from being added even when they were deemed necessary during the development process.

More recently, the state decided to try creating another integrated eligibility system. The Governor’s Office of Information Technology spent 2 years working with Deloitte to migrate the old system onto a Salesforce platform, which launched in 2019. Still called CBMS, the system has been far from perfect, and a 2020 audit “identified 67 [of a sample of 100] notices with one or more problems with the accuracy, completeness, and/or understandability of the correspondence.” A similar audit in October 2023 found at least one problem in 90% of the notices sampled, with many of the same problems continuing that were identified in 2016 and 2020. The 2023 audit cites that the “problems persist because the Department has not fully implemented the previously recommended changes to its monitoring functions, work processes, guidance to workers, and system design.”

Status of Issue

The current (post-2019) CBMS is still not perfect. However, Colorado passed legislation (CO Rev Stat § 25.5-4-213 (2017)) in 2017, which requires an audit of state Medicaid correspondence in 2020 and again in 2023. Advocates like the Colorado Cross-Disability Coalition helped in getting this legislation passed. Throughout the past few years, people enrolled in these programs have continued to receive confusing or contradictory notices, as well as information in non-preferred languages.

Links to More Information

(old system) “Colorado Benefits Management System (C): Seven Years of Failure”

(old system) Press release - NCLEJ and Colleagues Achieve Settlements to Secure Colorado’s Timely Processing of Medicaid, SNAP, CHIP, and TANF Applications

Colorado’s new benefits management system has glitches - StateScoop

Colorado is almost done migrating its huge benefits management system - StateScoop

Audit legislation - CO Rev Stat § 25.5-4-213 (2017)

Medicaid Client Correspondence Performance Audit, 2020

Two-thirds of audited state Medicaid notices contained errors - Colorado Newsline

Colorado Audit Finds Inaccuracies, Unclear Information in Medicaid Letters to Members - The Denver Gazette (2023)

Medicaid Correspondence Performance Audit (2023)