The state Department of Human Services' chief information officer has resigned after months of legislative scrutiny of the department's implementation of a Medicaid enrollment and eligibility-verification system.
Dick Wyatt, director of the Department of Human Services' office of systems and technology, agreed Thursday to step down effective Oct. 30, department officials said.
Department Director John Selig said the resignation came after he spoke Thursday with Wyatt "about the fact that it was probably time to make a change."
"I think it was clear working with the Legislature that they wanted to see new leadership," Selig said. "Periodically, it's just time to make a change and see if there's a different kind of perspective you can get."
Legislators have been asking how the cost of the enrollment system project has more than doubled, to $200 million, since work began in April 2013. The federal government is expected to pay the bulk of the cost, with Arkansas' share totaling about $25 million.
Slow progress in completing the system has been blamed for a backlog of Medicaid applications that have not been processed and a delay in completing federally mandated reviews of Medicaid recipients' eligibility.
But Selig praised Wyatt's work for the department, which he said also included installing systems dealing with juvenile justice and child welfare.
In an email Thursday to staff members, Selig also noted that Wyatt completed initial work on the enrollment system in time to sign up for coverage more than 200,000 Arkansans who became eligible for Medicaid under the state's expansion of the program, which took effect last year.
Most newly eligible adults are covered under the so-called private option, which uses Medicaid funds to buy coverage on the state's health insurance exchange.
"There's a ton of accomplishments that he's made while he was there," Selig said Friday. "It will be a difficult transition."
Wyatt, who is 70, said in an email to staff members that the 12½ years he spent in the job "far exceeded any of my expectations."
Addressing members of the office of systems and technology, he wrote, "You have had my back since day one so I wanted you to be the first to know.
"I also know that many of you would take a bullet for me, which I greatly appreciate, but this is one I must bite myself."
State Rep. Kim Hammer, R-Benton, said the resignation would help the enrollment project "to move on and not be anchored down by the past."
"I think that whenever it is that you are the lead person responsible for a project that involves millions of dollars of waste that people have to be held accountable," Hammer said.
Selig said he told Gov. Asa Hutchinson about the resignation but that it didn't come at Hutchinson's request.
Hutchinson spokesman J.R. Davis said it's common for agency directors to "loop in the governor's office on personnel decisions."
"The governor trusts his directors to make those decisions," Davis said. "That was the case in this situation."
As chief information officer, Wyatt is responsible for planning for the department's technology needs, maintaining the department's computer systems and offering technology guidance to department's divisions. His annual salary is $111,195.97.
In a June 21, 2012, email obtained by the Arkansas Democrat-Gazette under the Arkansas Freedom of Information Act, Wyatt called the Medicaid enrollment and eligibility-verification project "by far the most important and exciting project" he had worked on since joining the department in 2002.
At a meeting on Friday of the Legislative Joint Auditing Committee, Wyatt appeared along with other Human Services Department officials to answer questions about an Arkansas Legislative Audit report that found the department didn't follow state procurement rules in hiring companies for the project.
Fargo, N.D.-based Noridian Healthcare Solutions submitted the winning bid for the project in 2012, but Wyatt and other state officials couldn't agree on the terms of a contract with the company.
Instead of turning to Northrop Grumman, the second-ranked bidder, officials decided to hire workers using an existing contract for technology services available to all state agencies.
Under that contract, the Human Services Department pays companies for workers' time and materials, rather than for meeting specific goals.
For coordinating the contract, Allentown, Pa.-based Computer Aid receives 6.9 percent of the fees paid by the department under the contract. Those fees totaled almost $5 million as of May 31, according to the audit report.
Wyatt has said state procurement officials told him he could not negotiate with Northrop Grumman because the state sent the wrong document notifying Noridian that it had been selected as winning bidder.
Jane Benton, the state's former procurement director, told the Legislature's Joint Performance Review Committee last week that the error wouldn't have prevented the Human Services Department from negotiating with Northrop Grumman.
But officials didn't have time for more negotiations because they faced an Oct. 1, 2013, deadline to begin enrollment using the new system, she said.
Procurement and Human Services Department officials have said using the statewide contract was the only feasible way to meet the deadline.
Mark White, deputy director at the Human Services Department, told the Legislative Audit Committee the department plans to phase out its use of the statewide contract and award contracts that include performance measures.
In response to questions from Rep. Jana Della Rosa, R-Rogers, he acknowledged that the department should have put such contracts in place earlier.
"It was expected that we would be already done with the project now," White said.
He said the project was delayed by flaws with the IBM software being installed, a malfunctioning federal health insurance exchange and changing federal requirements.
Citing poor performance, the department fired EngagePoint of Calverton, Md., as lead vendor on the project, and replaced it in January with eSystems of Princeton, N.J.
Amy Webb, a spokesman for the department, said Wyatt was not involved in another technology project to develop an electronic tool for assessing the needs of disabled people, a project that also has drawn legislative scrutiny.
The cost of that project has grown from just over $2 million to more than $21 million, including $4.8 million that was paid to a company that was later fired after failing to deliver a suitable product.
According to his resume, before starting work at the Human Services Department, Wyatt helped start Lavendar & Wyatt Systems, which provides software for behavioral health care providers, and Disclosure Services, where he operated a service that produced disclosure reports for lobbyists. He also worked for McLarty Leasing and IBM.
Metro on 09/19/2015
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