State Seeking Tech Firm For Medicaid Overhaul

Jul 10, 2014

Vermont is on the hunt for a technology firm to help with a massive overhaul of the state’s human services system. And state officials are hoping to deliver better living through computer science.

The new request for proposal is for a “Medicaid Management Information System.” It’s part of a broader project called the Health and Human Services Enterprise, which is among the biggest, and most costly system overhauls in the history of the state.

“Part of the vision for transforming how we do our work is to be fully integrated – to fully integrate health and human services,” says Secretary of Human Services Doug Racine.

"Right now we're providing services that help people sort of stay where they are. This is going to help us help Vermonters get ahead, and get to a better place." - Human Services Secretary Doug Racine

Racine says his agency has been hamstrung by an antiquated computer infrastructure that prevents departments from communicating with one another. That means a low-income Vermonter in need of temporary housing, medical care for diabetes and food stamps, for instance, might have to navigate three separate bureaucracies. 

By aligning operations in a way that allows low-income clients to gain access to the full range of services with a visit to a single case manager, Racine says the state is more likely to get people the help they need, when they need it.

“Right now we’re providing services that help people sort of stay where they are,” Racine says. “This is going to help us help Vermonters get ahead, and get to a better place.”

Reform won’t come cheap. The state this week issued a request for proposals for a contractor to create a new payment system for Medicaid patients. The technology will in theory enable the reforms that are at the heart of effort to improve patient outcomes while bending costs.

But this latest contract could carry a price tag of as much as $70 million. And that’s only a small part of a broader IT overhaul expected to take another four or five years to complete.

“We can put an estimate on the whole project of maybe $400 million by the time we’re all done,” Racine says.

That cost, the bulk of which will be paid for with federal money, includes the now infamous health insurance exchange that contractors and state workers are still trying to debug. But Racine says he’s confident the exchange will achieve full functionality. And when all the pieces come together, Racine says his bureaucracy will enjoy game-changing efficiencies.

“And these new systems are going to allow us to pull all those programs together so when somebody walks in the door, we can take care of them for all the programs, all at the same time,” Racine says.

It isn’t only about low-income Vermonters. The new systems will serve as the digital guts needed to support the universal, publicly financed health care system that Gov. Peter Shumlin will try to push through the Legislature next year, according to Stephanie Beck, who is overseeing the Health and Human Services Enterprise.

“The claims processing system, call center, all of that feeds into the single-payer system,” Beck says.

Racine says the agency has thoroughly analyzed the missteps in the deployment of the exchange. And he says officials will apply lessons learned to the next phase of the project.

“My mantra is, we may make some mistakes along the way,” Racine says. “But let’s make sure they’re new mistakes, and not the same ones we made before.”