Policy & Practice | Fall 2025

limited resources, leading to burnout, high turnover, and decreased produc tivity. The ripple effects are felt by clients as well: application backlogs grow, wait times increase, and the overall quality of service declines. Vacancy rates for eligibility and clerical staff are at crisis levels: n Hawaii’s Department of Human “The majority of Medicaid and CHIP improper payment findings are the result of insufficient or missing documentation and do not necessarily indicate fraud or abuse.” —FISCAL YEAR 2024 IMPROPER PAYMENTS FACT SHEET, CMS and 50 percent vacancy for clerical staff at SNAP processing centers (March 2025). 3 n Colorado faced a 23 percent overall vacancy rate in 2023, with the Department of Human Services short nearly 2,500 workers—about 20 percent of its full-time staff. 4 n Nationally, the average Medicaid agency vacancy rate is 17 percent, with some states as high as 30–40 percent. 5 numbers. These pressures expose and exacerbate underlying inefficiencies in current business processes, many of which rely on manual workarounds and outdated technology. As a result, staff are spending valuable time on repetitive administrative tasks instead of focusing on direct client support The impact of these workforce shortages goes far beyond simple Services reports a 25 percent vacancy for eligibility workers

state-based exchange, 70 percent of MAGI Medicaid determinations were completed in real time, allowing the Medicaid agency to simply enroll those beneficiaries in coverage. The Real Cost of Errors Delays are only part of the problem. The Payment Error Rate Measurement (PERM) program, which tracks improper payments in Medicaid and CHIP, reveals the underlying issues. An eligibility-related error occurs when the Medicaid eligibility rules and requirements are applied incorrectly, including an untimely redetermina tion of eligibility, or when a required element of the eligibility process cannot be verified as being completed. When a PERM auditor reviews a payment for services provided, they also review the eligibility determina tion of the individual who received the service; if the auditor identifies an eligibility-related error, the payment for that service is deemed improper. In 2024, the improper payment rate was 3.31 percent for Medicaid and 4.44 percent for CHIP. While these rates have dropped since the pre pandemic years (when rates soared to 13.68 percent for Medicaid and 22.93 percent for CHIP), nearly half (45%) of improper payments in 2024 were due to insufficient or missing docu mentation in the case file—not fraud, but paperwork problems. 2 Another 18 percent resulted from untimely eligi bility reviews. Federal law requires the govern ment to disallow payment to states for improper payments exceeding 3 percent. These disallowances rarely, if ever, occur because the U.S. Secretary of Health and Human Services is per mitted to waive the reduction when a state is making a good faith effort to comply. With the increased focus on program integrity this could easily change, making proper documenta tion an essential system function. A Workforce Under Siege The stress on human services agencies is growing. Front-line staff are often expected to do more with

Why Are We Still Waiting? Imagine a world where a family in crisis could get the benefits they need in less than an hour, and state agencies were celebrated for their responsiveness. Despite incremental improvements—online applications, electronic verifications, and even robotic process automation—most human services agencies are stuck with the same old manual processes and legacy systems. The consequences are visible: backlogs, long wait times, and high rates or eligibility-related errors that erode public trust. The data are stark. In January 2025 alone, states received 3 million Medicaid and CHIP applications. Nationally, just two-thirds (66%) of MAGI-based (Modified Adjusted Gross Income) eligibility determina tions were made in 7 days or fewer. Seven states processed more than 90 percent of cases within a week, but 34 states lagged behind. In 8 states, fewer than a quarter of applications were processed in one week or less. For too many, the wait dragged on: 6 percent of applications took more than 45 days, and 23 states reported a higher-than-average share of these lengthy delays. 1 This leaves families with limited access to needed health care services and eligibility staff with few options to address the issue. While it may feel like this is the only way human services can function, it is not. When Virginia opened its state based exchange in 2023, they began processing MAGI Medicaid determi nations for people applying through the exchange. At that time, the Medicaid agency reported that only 20 percent of MAGI applications were processed and determined within 24 hours of submission. While at the

Stephanie Bell is a Medicaid Innovation and Policy Strategist at Change & Innovation Agency (C!A), by Vimo®.

Policy & Practice Fall 2025 20