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How Healthcare Technology is Transforming Medicaid

Updated: Jan 31

healthcare worker typing on a cellphone, medicaid technology

What is Medicaid and Medicaid technology?

As of March 2022, over 80 million Americans were enrolled in Medicaid coverage. Established in 1965, Medicaid is a public health insurance program serving low income individuals. From adults, children, and the elderly to pregnant women to people with disabilities, the government program offers free/low cost coverage to those that are eligible. It was created as a joint effort between the federal and state governments, meaning that each state has the freedom to decide how they would like to administer Medicaid as long as they follow federal requirements. Likewise, both the state and federal governments contribute to program funds.

As Medicaid continues to expand its coverage, healthcare technology has also seen an expansion of its own. Blossoming from the technological transformation of modern society, healthcare tech refers to the use of any digital program/tool within healthcare organizations. For instance, electronic medical records (EMR) have allowed easier access to shared patient data among medical providers; remote patient monitoring utilizes video technology to enable doctors to perform check-ups and assessments on patients without either party having to travel; discussions of artificial intelligence are even seeming to become more and more realistic.

Why has Medicaid not adopted new technology sooner?

However, up until a few years ago, Medicaid and healthcare tech seemed unwilling to cross paths, despite both’s growing influence. One reason for this could be the perception among developers that Medicaid holds low profit margins. According to an article by The Commonwealth Fund, the innovation of healthcare technology has been concentrated among middle and upper classes as “innovating for the poor doesn’t seem to make financial sense.” The same article also mentions that public programs come with issues of budget scrutiny whereas those with private plans are “perceived as more technologically savvy.”

The skewed and biased perceptions of low income individuals held by tech companies aren’t the only reasons behind Medicaid’s lack of innovation, however. In an article by Deloitte, the authors state that “the types of technology platforms still used by most state Medicaid programs” could be another reason for the lagging upgrades. Medicaid Management Information Systems (MMIS) are large and inflexible, and the cost of making even a small change can be expensive and time consuming. Thus, the barriers for technological transformations in Medicaid are viewed as daunting and difficult to overcome.

How is the government playing a role in Medicaid’s technological advancements?

Barriers are slowly being broken down by federal and state governments, however, as they begin to realize the potential and importance of adopting modern information systems into Medicaid. With 1 in 5 American relying on Medicaid for coverage and with more and more states expanding the program, the opportunity – as well as necessity – for improving accessibility is large. The Centers for Medicare & Medicaid Services (CMS), which is the federal agency that administers Medicaid, announced in 2016 that they are encouraging greater investment into the Medicaid Information Technology space.

Not only did the federal agency extend a “90 percent federal match for investments [in] Medicaid systems,” but they also created a resource for tech companies that links “to states’ Medicaid procurement websites and to any open state Medicaid IT Requests for Proposals,” which will allow easier detection of business entrance opportunities ( CMS has also implemented regulations that require states to “evolve their legacy Medicaid IT systems to leverage reusable solutions, and to practice industry-proven IT methods” in order to encourage the “adoption of advanced technology solutions,” ( Overall, the federal government has spurred the connection between Medicaid and healthcare technology by paving the way for state governments and tech companies to begin innovation.

How is Medicaid technology being implemented?

Although many worried that new technology would never take hold over the field of Medicaid due to being inaccessible to people with low incomes or unprofitable for investors, the last decade has witnessed how technology innovation empowers Medicaid. The adoption of Electronic Health Records (EHRs), the primary technological infrastructure, by the Health Information Technology for Economic and Clinical Health (HITECH) in 2009 set the first step of tech transformation. Nine years later, 99% of Federally Qualified Health Centers used EHRs. The combination of EHRs and targeted care management tools greatly benefits patient care as it renders clinical decision-making more efficient; for instance, prescription drug monitoring programs that build on EHRs can give providers real-time insights into prescribing patients at high risk of opioid-abuse.

Additionally, care coordination technology - which is based upon a data-exchange system - has developed quickly. Almost 9 in 10 acute care hospitals can now send patient information to sources outside their health system. This benefits patients, providers and their care teams. For instance, a primary care physician has access to details about a patient's mental health, allowing the providers to jointly manage medication; when a patient's blood pressure climbs, a blood pressure monitor can immediately alert a team of primary care physicians and social workers, enabling the team to plan the best course of action.

Another feature is the surging use of telehealth services after the pandemic outbreak. Telehealth visits increased by over 2,600% between February and April 2020, compared with the same period one year before. And this has brought a positive impact on patients. A survey has found that over 70% of the interviewed Californians with low incomes were more or just as satisfied with their video visits as they were with their off-line visits. Overall, technology adoption in Medicaid has greatly impacted use of electronic health records, care coordination and telehealth over the past decade.

How will Medicaid technology be further utilized in the future?

The world changes rapidly, and the boom of tech accelerates it. The future undoubtedly will continue to bring tremendous change to Medicaid and Medicaid technology. While Medicaid’s primary mission may still be to provide health care services to low-income people, how it will achieve this might change. A group of subject matter specialists at Deloitte recently gave an informed judgment about what could happen in Medicaid and what big changes would impact Medicaid by 2040. Here is a brief summary of their arguments.

All Medicaid beneficiaries will have their own smart medical devices that empower them to manage their own wellness; for example, beneficiaries will manage health conditions via sensors, telehealth, and remote patient monitoring, and smart health communities will be established. The issue of being unable to afford or not knowing how to use smart devices may not exist. By 2040, people across all ages will be familiar with tech devices and, for those Medicaid eligible groups, there will be more apps and services that specifically tailor to them; states might also provide smart medical devices to beneficiaries as a covered benefit.

Care coordination will continue to advance. A nationwide database of healthcare and related data will exist, visible to all healthcare stakeholders, as the data system advances. The data will be interoperable among all health care stakeholders — such primary care providers, labs, pharmacies, public health agencies, and long-term care providers, among others — and fully accessible to patients themselves. This database will greatly improve the quality of care through providing a more comprehensive view of patients, connecting various social determinants of health together for predictive analysis, as well as reducing administrative burdens.

In the future, individualized financiers that create specific financial products to meet the needs of individuals may replace larger health insurance companies. This may lead to changes in “who services Medicaid beneficiaries''; while over ⅔ of today’s beneficiaries receive service from Managed-Care organizations (those that are part of health insurance companies), wellness organizations (WO) may emerge. WOs aim to ensure that Medicaid beneficiaries receive the social services that affect the drivers of health (such as food, transportation, and housing); coordinate care with doctors and hospitals (both in-person and virtual); distribute smart medical devices; and ensure that patients understand how to use these devices. Apart from the above changes, precision engagement will drive preventive care, and localized health hubs may shift focus from health care to health in general. Thus, as the healthcare industry transforms rapidly, Medicaid would look radically different by 2040.

Despite Medicaid’s history of slow technological advancements, the federal and state governments have now begun to spur development. The future of the program lies within a sphere of advanced tech capabilities, and it will be compelling to see how Medicaid will grow to better serve its beneficiaries. Here at Sedna, we are at the forefront of healthcare transformation. With over 15 years of experience in Medicaid and Health Information Systems, we are experts in innovating for a more accessible future and are confident that we can serve your business and staffing needs. Contact us at with any questions and explore our website at to further discover our services.



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