R.I. extends contract with vendor of problem-plagued UHIP computers

Providence Journal |

--PROVIDENCE, R.I. -- The Raimondo administration has extended until next spring the state's contract with Deloitte Consulting, the company that designed and delivered the $492 million, trouble-plagued, eligibility-verification computer system -- known as UHIP -- for a wide array of public-assistance programs for the poor from food stamps to cash assistance to Medicaid.

In response to Journal inquiries, spokeswoman Ashley O'Shea confirmed that the state on Monday signed paperwork that extended the contract from , when it is set to expire, until .

Asked why the state chose to stick with the company at the center of the so-called UHIP debacle, O'Shea said: "We don't want to pay for work twice which would happen if we shifted to another vendor." She called the extension "an opportunity for Deloitte to bring the project to completion."

Added Health & Human Services Secretary Eric Beane, referring to UHIP by its alternate name within state government circles ("RI Bridges"): "The State continues to hold Deloitte accountable to fixing RI Bridges and is extending its contract with the vendor through .

"Deloitte, at its own expense, has committed to ensuring RI Bridge works and is the best technology it can be for Rhode Island," he said. Meanwhile, "Planning continues for a long term partner to run RI Bridges after ."

While the extension was not unexpected, it comes a week after the General Assembly's Auditor General Dennis Hoyle released a report detailing the many problems the state has faced since launching the Deloitte-designed Unified Health Infrastructure Project, known as UHIP, in to "streamline" eligibility verification for food stamps, Medicaid, subsidized child care and cash assistance.

Underpayments. Overpayments. Long lines at field offices. And application-processing backlogs for food stamps so high that at one point, the ACLU of Rhode Island sued, a court-appointed special master is overseeing the progress.

Last Thursday, representatives of Deloitte Consulting came to the State House to apologize.

"On behalf of Deloitte, we want to apologize to you and to the people of Rhode Island," said Deborah Sills, the national managing principal for the public-sector arm of Deloitte's business, told the House Oversight Committee.

"We are very sorry for the impact that our system issues have had on your constituents, on state workers and on service providers," she told the Oversight Committee. "While the technology is working much better than it was, we still have work to do. We know there are still some people having difficulty accessing benefits, processing cases or receiving timely payments.

"We will not let up until we have made things right," she said. By her estimate, Deloitte has been paid close to $240 million for its work on the two-phase project, credited some of that back and agreed not to bill the state close to $87 million overall.

O'Shea said about $37 million of that credit remains, but the administration's no-pay stance does not apply to the hardware, software or hosting services provided by other companies.

The contract amendment itself was not immediately available for public view, and the administration has not yet made public the letters seeking approval that it sent to the two federal agencies with oversight -- and a huge financial stake -- in the having Deloitte fix the broken computer system. But in response to Journal inquiries, the state made public the letters that arrived over the past two weeks.

One of the two federal agencies -- the Centers for Medicare & Medicaid Services -- effectively approved the contract extension, with the caveat that the state "not expend any further funds on Deloitte" until it has "exhausted" the $37 million or more in credits the company gave the state, while it continues to fix the problems that remain.

In its letter, the CMS acknowledged "the state team's hard work," but it also said: "We continue to have significant concerns about the state's progress toward system completion/stabilization ... operation effectiveness and the precision of the described cost allocations."

The separate Food and Nutrition Service -- which runs the food stamp program (the Supplemental Nutrition Assistance Program, known as SNAP) -- said the proposed contract amendment "seeks to extend the agreement and to provide maintenance and operations services from through . This amendment includes fixed price and fixed capacity services, hourly services, hardware software, hosting and related items at a total cost of $49,601,432."

It is unclear who is paying for what.

-- kgregg@providencejournal.com

(401) 277-7078

On Twitter: @kathyprojo


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