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Audit reveals spotty contract oversight

The state Department of Health and Human Services sought to downplay criticism of its oversight of the Medicaid claims system contract calling it old news,  but a draft state audit provides new details on problems that doubled the cost and led to a nearly two-year delay.

- DHHS assessed the contractor, Computer Sciences Corp., $10 million for delays. But DHHS could not provide documents showing how it reached that number. The contract was changed so neither side can get more money if the estimate is wrong. DHHS secretary Lanier Cansler said the department will write down such things in the future.

-The state did not identify $30 million in changes CSC made to the project on its own. Because state monitoring did not catch the changes, state workers did not know that the system being built was different from the one it approved. The state agreed to pay $15 million for the changes it accepted. Cansler said the state would have been required to make those anyway.

- CSC anticipated it would use about 75 percent of the computer code it had written for New York's Medicaid claims system for North Carolina.

The state Chief Information Officer told auditors in an interview this year that he would have objected to a vendor proposal that had the contractor re-use so much code written for another state because, in his experience, companies making similar estimates were not able to deliver. It turns out that CSC can only re-use 32 percent.


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Dear Editing

Please re-read this.

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