State Governments Funnel Millions to Tech Giants to Implement Trump’s Medicaid and SNAP Benefit Cuts

Deloitte, Accenture, and Optum are receiving millions to update state systems as the Trump administration implements work requirements and benefit cuts.

By: AXL Media

Published: Mar 31, 2026, 8:37 AM EDT

Source: Information for this report was sourced from KFF Health News.

Consulting Giants Reap Windfall from Policy-Driven System Overhauls

The implementation of President Trump’s landmark tax and spending law has triggered a massive wave of administrative spending as states race to reconfigure their social safety net infrastructure. Major government contractors, including Deloitte, Accenture, and Optum, have secured significant contracts to redesign the computer systems that determine eligibility for Medicaid and the Supplemental Nutrition Assistance Program (SNAP). According to state documents obtained by KFF Health News, five states alone are expected to spend at least $45.6 million combined on these updates. While state officials manage the contracts, the federal government covers approximately 90% of the development costs, essentially using taxpayer funds to build the mechanisms that will remove millions of citizens from benefit rolls.

Work Requirements and the End of a Sixty-Year Mandate

For the first time since the inception of Medicaid in 1965, the federal government is mandating that enrollees prove they are working, volunteering, or studying for at least 80 hours per month to maintain coverage. This historic shift applies to 42 states and the District of Columbia, with the CBO projecting that 18.5 million adults—nearly half of the program's enrollees—will be subject to the new rules. In Vermont, officials estimate that these requirements will impact 55,000 residents, roughly one-third of the state's Medicaid population. The administrative lift to track these hours has forced state departments to divert resources from all other projects, with Optum receiving nearly $1.8 million for initial eligibility adjustments in Vermont alone.

The High Cost of Removing Low-Income Enrollees

While the upfront costs for software modifications are high, internal state estimates suggest the long-term "savings" from benefit terminations are the primary fiscal driver. In Wisconsin, documents prepared by Deloitte estimate that changes to Medicaid and SNAP eligibility will cost approximately $10.2 million. However, state officials anticipate that 63,000 adults could lose coverage once work requirements are fully implemented, potentially "saving" $532.6 million in annual Medicaid spending. This trade-off—spending millions on contractors to save hundreds of millions by reducing care—has drawn sharp criticism from public interest advocates...