Medicaid computer system delays again raise hackles

The state Legislative Fiscal Committee wants New Hampshire Attorney General Michael Delaney to be more “proactive” in dealing with repeated delays by Affiliated Computer Systems to implement a new computer information system to handle the massive Medicaid program.ACS is now shooting to implement the system by July 2012, Health and Human Services Commissioner Nick Toumpas told NHBR. The system was originally supposed to be completed by November 2007.Calling the delay “unacceptable,” Sen. Chuck Morse, R-Salem, asked Delaney on Sept. 27 to meet with ACS’s general counsel and report back to the fiscal committee by Oct. 28.”This is going on far too long,” said Morse.Delaney said he would be “happy” to be more “proactive” without getting into the “nitty-gritty aspect” of his office’s involvement.The fiscal committee tabled the ostensible reason for the AG’s testimony, a failed attempt to extend the deadline for an independent review of problems with the $61 million contract, which was awarded at the end of 2005.But the state wasn’t able to get an independent party to conduct the review, and Morse said he would be skeptical of the probe in any case. Morse noted that an IBM study exonerated ACS’s implementation of a Medicaid system in North Dakota, and yet that deadline was pushed back to mid-2013 after ACS vice presidents told lawmakers that it would “not miss another day” past June 2012.ACS (now a division of Xerox) had won a bid to develop and implement a Medicaid Management Information System (MMIS) over EDS (now a division of Hewlett Packard) in 2005. The Executive Council approved the contract in a close vote after a knockdown battle in which EDS charged that ACS was using New Hampshire as a guinea pig to develop an untested system so it could sell it to other states — a charge ACS has denied.The AG’s office — then under now-U.S. Sen. Kelly Ayotte — was asked to get involved back in 2007, when ACS asked for its first delay. There is no evidence that the office got involved. EDS may to have had the last laugh, however, because continued delays meant multimillion-dollar extensions of its contracts — without additional bidding — for the last four years and counting.In a “hold harmless” provision in the contract, ACS has promised to pay for any additional expense caused by the delays, but it says that doesn’t cover the cost of items not included in the original contract. And as the implementation drags on, the federal government, or new technological advances, has led the state to ask for additional features — features that EDS has also had to add to its existing system, often at the last minute. Whether ACS will toss in some of those bells and whistles now for free still has to be hammered out.The latest requirement – which is supposed to be met at the end of the year – is the federal “5010 rule” relating to Medicaid payments to hospitals.The guidelines would automate such payments more efficiently, eliminating a lot of time and paperwork in straightening out errors. Hospitals, which are already in litigation with the state over other Medicaid payment issues – have been gearing up to meet this system.Toumpas said that both EDS and ACS will have to include the 5010 program in their systems.Whether ACS will pay for some of that is not clear.Toumpas stressed that the deal with ACS is a pay-as-you-go contract, and that ACS has only been paid for what it has delivered successfully.He said part of the system – the enrollment of providers – will “go live” by January, and the core system won’t be implemented for six months afterwards. However, Toumpas said that HHS hasn’t settled on an end date for the next EDS contract extension yet, and probably won’t until the end of the year.When asked whether the AG’s involvement would complicate matters, Toumpas said, “I do understand where the Senator (Morse) is coming from. My focus is to continue to hold ACS accountable, but we (HHS and ACS) have a good working relationship.”ACS spokesman Ken Ericson offered the following statement in response to a detailed NHBR voice message.”The state and federal government are continually kept up-to-date on our progress and we are working closely with the Department of Health and Human Services to ensure New Hampshire will have a viable solution to help improve the healthcare of its citizens and lower costs.” — BOB SANDERS/NEW HAMPSHIRE BUSINESS REVIEW

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