K.W. v. Armstrong — Idaho's Secretive Medicaid Budget Formula and a 14-Year Fight Over Disability-Care Cuts

Starting around 2011, Idaho's Department of Health and Welfare (IDHW) used an in-house spreadsheet formula to convert assessment-interview answers into an annual dollar budget for Medicaid home- and community-based waiver services for people with intellectual and developmental disabilities, later tying the formula to scores from the Supports Intensity Scale (SIS), a standardized clinical instrument used in about twenty US states.
Roughly 4,000 to 6,000 Idahoans saw their budgets cut by 20 to 30 percent, with some individual cuts reaching $20,000 a year. IDHW treated the formula itself as a trade secret and refused to disclose it to the people whose budgets it set or to their advocates.
In K.W. v. Armstrong, a federal court first ordered disclosure of the formula and in 2016 ruled it unconstitutional for violating due process; the Ninth Circuit upheld an injunction that restored roughly $30 million a year in assistance. Litigation continued for more than a decade: a 2023 dispute over releasing the SIS-A assessment manual led its developer, AAIDD, to terminate its Idaho contract rather than disclose it, and in 2025 a federal court held the state in contempt over continuing delays in replacing the system.
As of 2025 Idaho still has not fully replaced the disputed system, a caution that once an algorithmic tool in a safety-critical benefits program is deployed without transparency or due process, the resulting legal and administrative fight can drag on for well over a decade.

Read the full analysis: https://www.aclu.org/news/privacy-technology/pitfalls-artificial-intelligence-decisionmaking-highlighted-idaho-aclu-case