'Help us!' State employees blow whistle on errors they say are kicking thousands off Medicaid

The complaint describes system coding errors that placed children in incorrect coverage groups, leading to a failure to claim more than $100 million in federal funds. The letter also says over 5,800 pregnant women had their coverage denied and did not receive full postpartum coverage.

AUSTIN (Nexstar) -- A new whistleblower complaint obtained by Nexstar claims technical glitches and disorganized leadership have caused issues in Texas' administration of Medicaid and erroneously kicked thousands of children and pregnant women off of their health insurance.

"The persistence of numerous and growing system issues remains evident, causing erroneous denials of coverage, particularly impacting newborns and pregnant women—creating a situation that could further agitate our noncompliance with [Centers for Medicare and Medicaid Services] guidelines," anonymous Texas Health and Human Services employees wrote to Texas HHS Commissioner Cecile Young on Monday.

The complaint describes system coding errors that placed children in incorrect coverage groups, leading to a failure to claim more than $100 million in federal funds. The letter also says over 5,800 pregnant women had their coverage denied and did not receive full postpartum coverage.

"Redetermining Medicaid eligibility for approximately 6 million Texans over 12 months is a massive undertaking, and HHSC has planned this unwinding effort for more than a year. We are working closely with Centers for Medicare & Medicaid Services and our partners to ensure that the redetermination process operates as smoothly as possible," HHSC Press Officer Tiffany Young said. "We are aware of some Medicaid cases that were denied improperly, and we've reinstated coverage for those individuals."

Young said out of 95,479 beneficiaries who were erroneously removed from coverage, all but 1,974 have already had their coverage reinstated. She said out of those remaining, 744 will be corrected by Aug. 31.

The latest whistleblower letter comes about three weeks after HHS employees first blew the whistle on administrative challenges that have damaged the state's Medicaid redeterminations.

Essentially, the state has incorrectly designated people as no longer eligible for Medicaid after federal COVID-19 era policies lapsed, requiring states to review their Medicaid rolls.

The latest allegations have spurred calls for immediate federal action from the Texas Democratic Congressional delegation.

"We write to strongly urge swift intervention to ensure State compliance with federal rules
concerning Medicaid redeterminations to prevent the catastrophic loss of coverage occurring in
Texas, which already has the disgraceful distinction of the most uninsured people in the country," the delegation wrote CMS Administrator Chiquita Brooks-LaSure on Tuesday, citing "serious procedural failures and federal rules violations by the State of Texas."

"This happens as a result of just incredible indifference by the State of Texas and the Abbott administration," Austin Congressman Lloyd Doggett told Nexstar. "About one out of five of these were apparently denied this access through nothing they did, but because of errors within the administration, and those would not have come to light but for the courage of some whistleblowers within the agency."

Governor Abbott's office did not respond to a request for comment.

The employees say many of them are now seeking other careers or protection under the Whistleblower Act.

"The environment is toxic, and we are in a constant state of fear," they wrote.