Government & Policy

Combine years of delay, ever-changing rules and requirements, state and federal red tape and a once-mighty company now in deep financial trouble. What do you get? In California’s case, a $179 million computer modernization project that has to be junked. The project, which went to bid in 2007 and still is far from completion, was to process claims for Medi-Cal, the state’s health-payment program for low-income residents. It finally was put to rest this week when the state Department of Health Care Services announced a legal settlement with Xerox Corp., the project contractor, under which Xerox will pay the state approximately $120 million. (The state had paid Xerox $9 million so far, $8.1 of it with federal funds.) That means Medi-Cal’s existing computer system — creaky, patched-together and, decades old — will continue to operate for however long it takes the state to contract out and build a replacement. According to the settlement, Xerox will continue to run the existing system until 2019. The health care services department is putting a bright face on the project’s demise calling it an “opportunity” to reevaluate current needs, it in a press release issued Monday. A fresh start, it went on, will ensure “modern, robust and sustainable system.” The department noted California’s not the only state with such problems: “Many other states … have adjusted their strategies” toward their Medicaid computer systems, the release said. Medi-Cal is California’s version of Medicaid. Indeed, Xerox’s problems with its Medicaid systems in Texas, Alaska and other states have been widely publicized. The DHCS declined to comment beyond the press release. The settlement requires the department and Xerox both approve in advance any public statement for the next 30 days. In its statement, Xerox said the settlement agreement finalizes the announcement it made last fall “that it did not expect to complete implementation of the Health Enterprise Platform in California.” Xerox further said that it is “pleased to work with DHCS to continue processing Medi-Cal claims through September 2019.” The existing computer system, more than 30 years old, handles millions of transactions a day for Medi-Cal, everything from approving medical procedures and paying doctors to determining patient eligibility for the program. Persistent problems came to a head two years ago when a backlog of nearly a million Medi-Cal applications caused untold numbers of patients to put off seeing their doctors until the problems were resolved. California’s drawn-out competition for the replacement project began in 2007. Xerox won the contract in 2010. By 2012, the project was already in trouble. Delays caused the state to impose on Xerox a “corrective action plan. ” Originally scheduled for completion by the end of this year, the project isn’t close to done, the settlement indicates. Its not uncommon for government computer systems to fall behind schedule, in part because of red tape. In this case, the massive Medi-Cal replacement contract with Xerox was inked just five days before President Barack Obama signed the Affordable Care Act into law. As new regulations under the law worked their way through the health care system, requirements for the Medi-Cal project continued to change. Compounding matters, Xerox itself fell into deep trouble. Its stock has lagged far behind the market in general. The company is under pressure from investor activist Carl Icahn. Late last year, Xerox said it would wind down its Medicaid computer systems business in California and Montana, take a $385 million charge against earnings, and “focus on profitable market segments.” That meant the end of the California project. Several companies compete in the Medicaid system market. As of February, Xerox was the number-two provider, covering 11 states. The leader, HP Enterprise Systems, covers 18. Xerox will pay California about $103 million in cash, provide computer hardware and software worth $15 million, and abandon requests for payment worth roughly $5 million more. This story was produced by Kaiser Health News, which publishes California Healthline, a service of the California Health Care Foundation.

DeSalvo, Acting Assitant Secretary for DHHS, talks with Justin Barnes about some of the announcements made at HIMSS16 from the federal government and the agenda going forward.

As part of the Vermont Health Care Innovation Project, the Green Mountain State has tapped Boston-based PatientPing for data exchange among its hospitals.

The new model is expected to work hand in hand with data and technologies to boost care, lower cost, and advance the industry toward becoming a learning health system.

Multi-agency collaboration aim to help app developers stay aware of consumer privacy and safety protections, while still enabling innovation, officials say.

The Government Accountability Office discovered vulnerabilities in three states and said that other state-run health insurance exchanges may be at risk too.

Defense Department is on track to rollout new electronic health records software in the Pacific Northwest later in 2016, and officials are calling the project a new beginning toward interoperable, safe and secure patient records.

Remember ONC Regional Extension Centers? There were 62 of those federally-funded organizations, better known as RECs, created nationwide in 2009 with a mission of helping primary care physicians move from paper to digital systems. In 2009, Morehouse School of Medicine was awarded a $21 million from the Office of the National Coordinator for Health Information Technology to become the only REC in Georgia to provide on-the-ground technical assistance for individual and small medical practices. News out of Atlanta today is that the Georgia center, GA-HITEC, part of the National Center for Primary Care at Morehouse School of Medicine, is closing in on getting the job done. The Georgia REC has reached 100 percent of the eligible primary care providers in the state and 89 percent of its eligible critical access and rural hospitals have achieved Stage 1 meaningful use. [Also: Most RECs plan to stay open for business] Through the program, it has reached more than 4,000 eligible primary care physicians and 56 critical access and rural hospitals by employing a 10-Step Roadmap to meaningful use. Also, it has assisted members in receiving more than $80 million in incentive payments through the federal EHR incentive programs. "Through our quest for Health IT interoperability we have provided the Georgia medical community increased patient engagement and improved quality health care through the use of technology," said Dominic Mack, MD, GA-HITEC's principal investigator and newly named director of the National Center for Primary Care at Morehouse School of Medicine, in a news release. He added that the work of the team would result in both better clinical outcomes and improved population health outcomes. As the national REC program is slated to sunset in late 2016, GA-HITEC continues to develop activities in support of CMS' HIT initiatives, including Stage 2 and Stage 3 meaningful use, health information exchange, clinical practice transformation, along with other value-based reporting efforts. And, GA-HITEC is not alone. Most RECs plan to stay open, according to the 2014 HIMSS Regional Extension Center Survey. Twitter: @Bernie_HITN Email the writer: bernie.monegain@himssmedia.com Like Healthcare IT News on Facebook and LinkedIn

The United States Department of Homeland Security and the Canadian Cyber Incident Response Center issued a joint cyber alert on March 31, in response to the recent surge in ransomware attacks on hospitals and other organizations.

Now the question is whether cyber criminals could someday emulate that approach to access encrypted patient data.