Contract canceled a year ago, but talks continue
State, Accenture still haggling over money after privatization bid fell apart
Sunday, May 18, 2008
More than a year after Texas canceled a deal with Accenture LLP worth hundreds of millions of dollars to run call centers enrolling people in public assistance, the breakup is still not final.
Yes, and guess who is paying for this screw-up? The clients, and the employees in the field.
"It's a complex contract with lots of moving parts," said Stephanie Goodman, a spokeswoman for the Health and Human Services Commission. "I don't expect anything soon."
Of course not! The wheels of "justice" turn slow, don't they?
Since Executive Commissioner Albert Hawkins announced the end of the Accenture deal in March 2007, the divorcelike process has involved negotiating over money and assets tied to what started as a five-year, $899 million deal. Texas has paid Accenture nearly $243 million, Goodman said.
$243 MILLION TAX PAYER DOLLARS! Insanity!
As Hawkins disentangles his agency from the privatization attempt, he's moving forward with plans to hire a different company to run the call centers when he gets federal approval.
It took months of negotiations before the state agreed in September to pay Accenture $25.8 million for thousands of items from computers and software to office furniture and phones, according to a state report. And nine of the 10 office leases related to the contract have been transferred to the state, Goodman said.
Still under negotiation: money, she said.
Accenture spokesman Peter Soh said there is no particular sticking point.
"We knew this was going to take some time, and we are just working through the unwinding process," Soh said.
Goodman said there's no legal obligation to finish the negotiations by a certain date.
"There are basically two options," she said. "We reach an agreement, or we go to court."
Of course there is no "date". Nevermind, that there is a legal obligation to finish a case by a certain DATE...but hey! What's a "date"? Those due dates never mattered, so why should this?
Goodman said she can't discuss details of the negotiations because they're related to potential litigation. But she said the talks include what to do about $30 million the state has sought from Accenture since December 2006.
Accenture didn't take the contract to pay US any money- they only wanted to be PAID no matter how screwed up it all was. I bet if a client owed the state money, they'd get it.
That's when the contract was scaled back to $543 million, with the state taking over some tasks originally assigned to the contractor.
Yes, the STATE took back the work we had always DONE and did WELL. So with a reduced workforce, we now have all that work BACK. (Yes, the State is hiring, but when you have an office that's 80% NEW and it takes 2-3 months to even get new workers TRAINED, then guess who the burden falls on?)
State officials said Accenture would pay Texas the money to compensate for unexpected costs such as sending state employees to help call center employees with policy
But the state and Accenture never agreed to final terms of the revamped deal, and the contract was soon canceled.
When Hawkins announced on March 13, 2007, that the state and Accenture had agreed to part ways, he said the final transition of services would take place by Nov. 1, 2007.
Although that happened ahead of schedule — enrollment work is now done by state employees and former Accenture subcontractor Maximus Inc. — the legal separation continues.
"They made it sound like it was going to be a quick and neat exercise," said Celia Hagert of the Center for Public Policy Priorities, which advocates for low- and middle-income Texans. "It could drag on so long, we could have forgotten about what happened and who owes who what."
Goodman said it took the state and Accenture nine months to create the contract after Texas received bids for the project.
About 3.7 million Texans receive public assistance.
The state hired the Texas Access Alliance — led by Accenture — to run call centers to enroll Texans in programs such as food stamps and Medicaid. Much of that work had been done by state employees; the ambitious privatization effort was supposed to save the state money and give applicants the option of signing up by phone or online instead of only in person.
But the project hit problems — such as applicants receiving letters asking them to send information they'd already sent and eligible people losing benefits — and the savings never materialized.
And the beauty of that was, in "the old days"- if a WORKER in a local office had done that kind of SHODDY work, and people were losing benefits, I'm pretty sure that worker would have been terminated. But see, when "the contractor" made errors, there was no FACE for the client to go back to and question. They'd call and call and call and call, talking to different people- when had this been a local worker, it could have been resolved much quicker. The State lost control over client services, never hearing of a problem the client was having until it had escalated to a point that it was "serious".
Unraveling a contract of this size is largely uncharted territory for the agency, said state Rep. Bryan Hughes, R-Mineola, co-chairman of the joint House-Senate panel overseeing the health and human services eligibility system.
"I don't know what we really have to compare it to," he said. "We do want to make sure that the state, the taxpayers get everything they're entitled to as the contract is wound down."
Meanwhile, Accenture and Maximus are engaged in arbitration to resolve a dispute over the Texas deal. Maximus, which claims Accenture failed to deliver required technology and made unfounded assertions about Maximus' work on the Children's Health Insurance Program, is seeking more than $100 million from Accenture, according a filing with the Securities and Exchange Commission.
Accenture disputes the claims and is seeking unspecified damages from Maximus.
As Texas officials look toward hiring a new company, their approach draws on lessons learned from the Accenture deal about what work is best to assign to contractors, Goodman said.
Wow. The State is going to try this again. To the tune of how much money THIS time?
Under the new deal, contractors will scan documents, for example, but state workers will decide who is qualified to receive benefits, she said.
Wow. We are paying out all this money- taxpayer money- for someone to SCAN documents? But state workers have been the ones to decide eligibility from DAY ONE. It's FEDERAL POLICY. The state workers are the ones with the policy knowledge to do that.
"We do think this will be different," she said.
We can only hope so.
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