Indiana moves to replace Medicaid consulting firm after $1 billion forecasting error

The state of Indiana is preparing to replace the consulting firm it works with to help prepare its Medicaid forecasts.

That comes after a forecasting miss in 2023 that put Indiana $1 billion off the mark for Medicaid funding.

The state indicated this week it will enter negotiations with Deloitte Consulting for its Medicaid actuarial services, replacing Milliman.

Lawmakers of both parties had focused significant criticism on Milliman after the $1 billion forecasting error.

Sen. Chris Garten (R-Charlestown) was one of those lawmakers. He now says information-sharing restrictions may have been the culprit — restrictions being removed in legislation this session.

“It doesn’t sound like it was as much Milliman’s fault as we originally thought it was,” Garten said. “Now I say all that to say: Change and competition’s good in all these contracts and I trust the executive branch to make a good, firm decision on that.”

READ MORE: Medicaid officials outline forecasting changes, update lawmakers on waitlist progress
 

In a statement, Milliam said it was "naturally disappointed" in the state's decision to move to a different consulting firm. The firm also praised the recent efforts of the Braun administration and legislature to "reestablish regular Medicaid reporting to support strong actuarial forecasting in the future."

"We would like to make clear that the $1 billion discrepancy reported in December 2023 was not in any way attributable to Milliman," the statement said. "Budget forecasts are complex and rely heavily on the quality and completeness of the data provided to the vendor."

Rep. Ed DeLaney (D-Indianapolis) said he’s still not satisfied the underlying problem has been resolved.

“The fact that someone was blamed is great. But is it the right person and why, are the questions that are not being answered to this day,” DeLaney said.

Indiana will get a new Medicaid forecast later this month.
 

This story has been updated with a statement from Milliman.

Brandon is our Statehouse bureau chief. Contact him at bsmith@ipbs.org or follow him on Twitter at @brandonjsmith5.