DHS software's cost overruns irk lawmakers

$2.14M price now at $13.6M

Lawmakers Monday criticized the state Department of Human Services for allowing years of delays and millions of dollars of cost overruns on a software system that was supposed to improve care for roughly 12,000 Arkansans with disabilities.

During a meeting of the Legislative Joint Auditing Committee in Little Rock, lawmakers also raised doubts about whether the electronic program will even improve health care for clients with disabilities such as cerebral palsy, epilepsy and autism.

Originally expected to cost $2.14 million, the cost has already exceeded $13.6 million.

The tool would move developmental disability assessments to a computerized service administered by nurses and other professionals. The project would determine how much care should cost for each person and track results, but it is now likely to cost about 10 times as much as originally thought.

"A whole lot of people have apparently been deprived of necessary services that were intended for their benefit," said Rep. John Walker, D-Little Rock, at the Legislative Joint Auditing Committee. "I would certainly think that whoever was responsible for reviewing this or putting this contract together must bear some of the responsibility for this and the responsibility has to go to the highest levels to the Department of Human Services, as well."

Officials at DHS acknowledged mistakes were made, but said the electronic tool would help ensure equitable care among patients.

"The goal is to ensure, No. 1, that services are balanced, they're fair and that they are based on an assessed need," said Craig Cloud, director of the Division of Aging and Adult Services at DHS. "The ability to do that [requires] a universal assessment."

So far, the department has employed two companies to develop the electronic assessment.

CH Mack was supposed to provide an electronic tool to evaluate developmental disability clients for $2.14 million by 2012. DHS originally contracted with the company in 2011.

DHS extended the contract and asked for additional services. By 2014, CH Mack had been paid $4.8 million, but had not developed a suitable tool.

CH Mack has since changed its name to AssureCare. The company did not immediately respond to a request for comment.

Tim Lampe, director of the office of quality assurance at DHS, said the contract was handled as a purchase order, limiting what the department can do to claw back the money.

In 2014, the work to develop a usable electronic assessment shifted to CoCENTRIX. The company had been paid $8.8 million so far, and DHS expects to spend about $16.4 million for a five-year contract to use the company's software.

But CoCENTRIX is running several weeks behind in its software development process. DHS is withholding more than $300,000 until the work is completed.

John Malcolm, vice president of government services for the company, said the work will be done and the delay is the result of changing specifications from DHS and the company itself.

Pam Cooney, service coordinator for Pine Bluff Psychological Associates, said she has used programming from CH Mack and CoCENTRIX. During the meeting, she said the CoCENTRIX software was faster, easier to use and the company had asked for her input during the software development process.

Legislators were upset by the cost of the project and the number of years it is behind schedule.

About 12,200 people would be subject to the assessments. Between CH Mack and CoCENTRIX, the project is set to cost more than $21 million -- about $1,700 per person served.

In addition to cost, some legislators questioned the point of moving away from human assessments.

Cloud said he believed the electronic assessments would provide a universal system for determining need.

"I believe that the process as it has begun allows us to do it better, allows us to better effectively manage our resources and our dollars and expenditures to the greatest need and the benefit of those we serve," Cloud said. "It is critical that we be able to do that."

But Rep. Dan Sullivan, R-Jonesboro, questioned the reasoning for abandoning the current system.

"Currently, the assessments are being done locally by a medical professional and under the supervision of a physician or doctor, a plan of care is developed," he said. "Do we think this method is preferable to that? And we're going to save money going through all these steps?"

Politics on 05/19/2015

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