Questions and Answers About the Decision to End Contract Early

What does the announcement mean?
It means that HHSC and Accenture have agreed to end their contract. HHSC will be responsible for direct management of some parts of the project that are currently managed by Accenture. The agency will enter short-term contracts with alternate service providers to ensure services continue without disruption.

What led to this action?
During the discussions on rebalancing the contract, HHSC and Accenture could not agree on service levels or costs. Both parties agreed that the state’s objectives could be better achieved by winding up the contract.

Does this mean the state won’t use call centers?
No. HHSC remains committed to expanding the ways Texans can apply for services, and that means the state needs call centers and more modern technology. Call centers provide the infrastructure to take applications by phone, fax, mail and Internet. In addition, consumers will be able to apply for services in hundreds of offices across the state. Call centers have been used for CHIP enrollment since that program’s inception in 2000, and the consumer feedback on the process has been overwhelmingly positive.

How is this arrangement really different if the same subcontractors are still performing the work?
HHSC will assume stronger day-to-day management, and state teams will assume a greater role in daily CHIP operations and TIERS maintenance.

Have you notified federal agencies of the change?
Yes. HHSC notified federal officials with Food and Nutrition Services and the Centers for Medicare & Medicaid Services of the action in a conference call Monday. The state will continue to work with its federal partners in developing next steps for the project.

What does this mean for state employees?
Our state workforce is a highly valued and essential part of the eligibility system. Our statewide network of field offices will be maintained and staffed with state employees. HHSC continues to look for effective ways to manage the increasing workload at our local offices.  We’ve awarded retention bonuses to eligibility staff, increased the pay for our supervisors, and used centralized benefits centers staffed with state employees to help reduce the workload on local offices. Ultimately, the most effective way to provide relief to offices is to continue our efforts to modernize technology and allow consumers to choose how they want to apply for services.

What does this mean for employees of Accenture, Maximus and other companies working on this project?
Delivering services continues to be our top priority. The knowledge and experience of the frontline employees working on this project are important to both the contractors and the state. While management of some components will change, none of the tasks will be going away. These employees are still needed, and we will be providing them with as much information as possible about the transition.

Does this announcement mean the agency is saving the $500+ million in contract costs?
No. The services and support covered by the contract are still necessary, and the state must still cover the costs of performing those functions. For each component, HHSC will evaluate whether to contract for the service or develop state systems for that function. As HHSC goes through the transition planning, the agency will work to ensure that the costs of the various components of the contract stay within the baseline budget for these eligibility services.

How does this action affect payments under the contract?
HHSC continues to negotiate the final financial details with the contractor. The state fully expects to recover any unexpected state costs incurred during the project.

Does this announcement mean that projected savings will never be realized?
No. Integrating the use of call centers and modern business processes and tools in the eligibility system remains a highly cost-effective way to handle the growing workload and achieve high performance standards. The opportunity for significant cost savings will exist once the modern system in fully deployed.

How does this affect the conversion to the news computer system, TIERS?
HHSC will continue to modernize and upgrade technology by moving to the new computer system for eligibility services over the next 18 months. State workers will continue to process all cases, and all state offices will remain open. With each conversion, HHSC will conduct thorough readiness assessments before reaching a final determination to move forward. The state moved Williamson County cases to TIERS in November 2006 and converted foster care cases in February of this year. Both those conversions went very well.