A Texas state official has recommended that the state terminate its contract with services firm Accenture to update and manage eligibility for a range of health and human services.
In a letter to several state senators who had asked for a review of the contract, Texas comptroller Carole Keeton Strayhorn said Accenture had underperformed and come in over budget for the program, a five-year contract awarded in June 2005 that at the time was valued at $840m.
Under the contract, Accenture is handling eligibility services for programs such as Medicaid and food stamps for the state Health and Human Services Commission. According to Strayhorn’s report, however, enrollment has dropped under the company’s watch. Since Accenture took over last December, enrollment in the state’s Children’s Health Insurance Program has dropped by 8.5%, while children’s Medicaid enrollment has also dropped by 2.9%.
I recommend that the contract with Accenture should be ended and that the Legislature pass emergency legislation that removes HHSC’s direct management of the project and places responsibility with a turnaround team composed of experts who can effectively manage state resources and stop the drain on tax dollars, Strayhorn wrote.
She added that the contract lacks needed performance incentives for Accenture and will cost the state nearly $100m in additional spending on the program. Strayhorn said the $20m in additional profits Accenture has already pulled in on the contract should be used to fund the transition team.
An Accenture representative was not available to comment on the accusations late on Wednesday.