Section 71103 of the recently passed reconciliation bill presents a rare opportunity to improve Medicaid’s efficiency without sacrificing access to care. The provision directs the Centers for Medicare & Medicaid Services (CMS) to build a national database that allows states to detect when someone is enrolled in Medicaid or Children’s Health Insurance Program (CHIP) in more than one state at the same time—a situation that occurs far more often than people realize.
This isn’t a speculative problem. States currently lack a consistent mechanism to detect overlapping enrollments, leading to duplicate payments, administrative confusion, and billions in wasted taxpayer dollars.
Section 71103 offers a smart, targeted fix. It addresses real inefficiencies without reducing benefits, strengthens the technical backbone of Medicaid, and sets the stage for broader improvements to how government delivers services. It is the kind of reform conservatives and state-capacity-minded policymakers should champion.
The Real Problem: Administrative Waste, Not Fraud
When Medicaid enrollees move between states, their previous enrollment often remains active—because there’s no reliable mechanism for states to know they’ve left. Medicaid and CHIP are administered at the state level but funded jointly with the federal government. That means when someone is enrolled in more than one state at the same time, two states (and the federal government) may pay premiums or managed care fees for the same person.
The scale of the problem is significant. A 2024 Wall Street Journal investigation found that insurers were paid $4.3 billion over three years for patients who were enrolled, and paid for, in more than one state. In managed care states, where roughly 70 percent of Medicaid beneficiaries are enrolled, this translates directly into double monthly payments to insurance companies, despite the fact that care is only used in one state.
A 2022 Health and Human Services (HHS) IG report found that 47 states had this problem and called for a solution that involved “CMS provid[ing] States with matched [...] enrollment data that identify Medicaid beneficiaries who were concurrently enrolled in a Medicaid managed care program in two States.” A 2025 “expert perspective” from the Robert Wood Johnson Foundation also notes that “[s]tates are eager to work in partnership with CMS.” That’s what this provision does.
Critically, this is not about fraud by beneficiaries. Most people don’t know they are still enrolled in their old state’s program. Instead, this is an IT and administrative gap, with states relying on returned mail or labor-intensive paperwork to update residency information.
The Congressional Budget Office score projected a $17 billion savings in the 10-year budget window.
A (Partially) Proven Model: Learning from the National Accuracy Clearinghouse
A better way already exists: the National Accuracy Clearinghouse (NAC) for the Supplemental Nutrition Assistance Program (SNAP). Similar to Medicaid, SNAP had a problem catching duplicate SNAP enrollments. NAC was created to address this, reducing improper payments while avoiding new burdens for recipients.
Between 2013 and 2015, the Office of Management and Budget supported a pilot project in five states—Alabama, Florida, Georgia, Louisiana, and Mississippi—which began submitting recipient data daily to NAC to cross-check for overlapping enrollments. That program was evaluated as a success in 2015. This program was incorporated into the 2018 Farm Bill, and in 2022 the Biden administration issued a final rule to implement it. States and the Department of Agriculture (USDA) have until 2027 to comply. Although the extended timeline highlights the challenges of coordinating 50 state-level systems, NAC’s experience proves that secure, privacy-preserving interstate data-sharing can reduce waste while protecting access to critical benefits.
Section 71103 essentially brings NAC’s proven approach to Medicaid. By January 2028, all states will submit identifying Medicaid and CHIP enrollee data at least monthly to a new federal system run by HHS. The database will match records, flag potential duplicates, and prompt states to verify residency and disenroll individuals from the incorrect state program when necessary. Compared to SNAP, CMS already operates a more centralized eligibility infrastructure, which could allow Medicaid’s duplicate enrollment system to be built and deployed faster and more effectively than NAC’s multi-year rollout.
These savings are not abstract: they can fund additional services, support program solvency, or reduce budget pressures on both federal and state governments. And they do so without restricting eligibility or limiting access to health care services.
So all that we have to do is implement a big government IT program, right? But if anyone can do it in government, CMS can.
As Jennifer Pahlka has noted, CMS has been relatively successful in large scale IT implementation under the leadership of Yadira Sánchez. Pahlka describes the IT successes at CMS as “the single biggest source of hope for me in the past ten years.” CMS’s experience with large-scale data systems such as the Transformed Medicaid Statistical Information System (T-MSIS) shows it can manage complex, secure IT projects across all 50 states. For example, since 2015, CMS has increased the number of states fully submitting T-MSIS data from fewer than half to nearly 100 percent today, improving the quality of Medicaid data for audits and program management.
While CMS has faced challenges in the past (notably the early Healthcare.gov rollout), it has also demonstrated the capacity to adapt and build effective systems. This gives reason for cautious optimism that it can implement the Section 71103 database successfully—especially with the modest federal investment of $10 million for development and $20 million for ongoing operations authorized by Congress.
The Key to Success: Engaging States Early and Fully
While building a national Medicaid duplicate enrollment system is technically feasible, the clearest path to real savings and program integrity lies in ensuring every state actively participates—and does so consistently. The experience of NAC shows that even well-designed federal systems can face long delays and hurdles if states are unprepared.
Despite the NAC pilot beginning in 2013, it took nearly a decade for USDA to finalize implementation rules, largely because of states’ varying IT readiness and concerns about administrative burdens on under-resourced counties. Smaller counties, in particular, often lack the staff or technology to keep up with new reporting requirements, which can cause uneven participation and undermine the effectiveness of a nationwide system.
For Section 71103 to succeed, CMS should take a proactive approach:
- Invest early in technical assistance for states and counties, providing onboarding toolkits, training materials, and pre-implementation checklists that help them integrate new reporting processes into existing systems.
- Offer financial support for IT upgrades in jurisdictions with outdated eligibility systems, ensuring all states—regardless of size or resources—can comply with the database’s requirements.
- Set clear federal standards and timelines for timely data submission and resolution of duplicate enrollments, with mechanisms to monitor state compliance and provide targeted support when needed.
- Maintain privacy protections by designing the system to securely flag duplicate enrollments without exposing unnecessary personal data at the federal level, similar to NAC’s privacy-focused architecture.
CMS also has an advantage over USDA: Medicaid’s federal-state funding relationship gives CMS powerful tools to align incentives, since states rely on federal funds to operate their Medicaid programs. By combining technical and financial support with clear expectations and oversight, CMS can help states avoid the pitfalls NAC encountered, accelerating implementation and ensuring the new system reduces improper payments while preserving access to care.
A Model for Smarter Government IT
Section 71103 exemplifies the kind of modernization conservatives should support: it improves efficiency, reduces waste, and does so without adding burdens on beneficiaries or sacrificing benefits. Medicaid enrollees will simply see smoother transitions between states, while taxpayers benefit from significant savings. And it relies on talented government employees with a record of successful implementation.
This approach also reflects a broader trend toward data-driven governance. By updating eligibility systems and integrating modern data-matching practices, government can deliver services more effectively without expanding bureaucracy.
Beyond Medicaid, the new federal database could eventually share technical infrastructure with other programs like SNAP’s NAC or HHS’s Public Assistance Reporting Information System (PARIS), which today suffers from fragmented participation and outdated technology. Integrating or aligning these systems could lower development and maintenance costs, improve accuracy across programs, and reduce administrative overhead.
The potential applications extend beyond social services. The Institute for Responsive Government has highlighted how secure, interstate data-sharing systems such as NAC or the non-profit driven Electronic Registration Information Center can offer models for modernizing both benefits programs and voter registration systems, emphasizing the potential to improve accuracy without creating new burdens.More generally, integrated systems could become a backbone for programs that depend on verifying where people live, from education funding formulas to housing assistance.
Section 71103 represents an opportunity to make Medicaid more efficient and effective, delivering real savings and a better experience for beneficiaries. By learning from NAC and investing in modern, interoperable IT, policymakers can strengthen state capacity and show that government can solve real problems without sacrificing care or adding red tape.
This is the kind of pragmatic, thoughtful reform that conservatives, moderates, and anyone who wants government to work better should support.
