Equifax Sees a Big Windfall as Medicaid Work Rules Kick In [View all]

Equifax Sees a Big Windfall as Medicaid Work Rules Kick In
Company's pricing power looms as states face bigger income verification bills

When Equifax CEO Mark Begor addressed investors over the summer, he highlighted a "massive" business opportunity: helping states enforce new Medicaid work requirements, a move likely to leave millions without health insurance but poised to boost the company's bottom line. For years, Equifax has dominated the income verification industry, supplying data to banks and landlords, among others. Now, with a Republican-backed law requiring states to verify that tens of millions of Medicaid and food assistance recipients work, volunteer, or study at least 80 hours a month starting in 2027, Equifax's services are in even higher demand, reports the New York Times.

he company already pulls in about $800 million a year selling its "Work Number" database to government agencies, a figure it says could grow to more than $5 billion as the new rules kick in. About half of US states already rely on Equifax, often paying millions annually for quick access to real-time wage data on nearly 100 million workers. Critics say Equifax leverages its near-monopoly to impose steep and frequent price hikes—sometimes doubling or tripling costs within a few years. States report little leverage in negotiations, as alternatives like manually verifying pay stubs are slower and may not satisfy the new law's requirements. Equifax's dominance stems from exclusive data deals with payroll providers and large employers, making it difficult for competitors to gain traction.

The company's income verification business, now responsible for about a third of its revenue, has drawn antitrust scrutiny in the past. Some startups are attempting work-arounds, and the federal government has begun building its own verification tool, but widespread adoption isn't imminent. Equifax, meanwhile, is actively courting new and existing clients, positioning itself as an indispensable partner for agencies under pressure to comply with the law.

https://www.newser.com/story/378088/equifax-sees-a-big-windfall-as-medicaid-work-rules-kick-in.html