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Nebraska dumps 2 major system upgrades, costing state $12M

December 13, 2018 GMT

LINCOLN, Neb. (AP) — The state of Nebraska has abandoned two major computer system upgrades for different agencies after spending more than $12 million combined on them.

Officials acknowledged Wednesday that the Nebraska Department of Health and Human Services has pulled the plug on an $84 million contract with tech company Wipro to create a new Medicaid eligibility and enrollment system, the Omaha World-Herald reported .


Medicaid Director Matthew Van Patton said the contract was suspended in September — after the state had already spent $6 million on it — because state officials and a consulting firm raised concerns about the pace of work. The federal government had spent nearly $60 million on it. The project was undertaken to meet requirements for a modernized system under the federal Affordable Care Act.

State officials say ending the contract forces the state to start over. Van Patton said no decisions have been made about what to do next but said state officials are talking with the federal officials about the best way forward.

The state will continue using its N-FOCUS system to enroll Medicaid participants, including those made eligible last month by a voter-approved initiative to expand Medicaid, Van Patton said.

“This action will in no way, shape, form or fashion affect the timeline on expansion,” he said.

The second project — a $12 million endeavor to consolidate five personnel and budget systems at the Department of Administrative Services — was cut short after running into snags. The state had also spent $6 million on that project before calling it off.

Ed Toner, Nebraska’s chief information officer and the interim department director, said he opted to instead upgrade the state’s existing payroll and invoicing system. The upgrade could be done for less than $900,000, would be supported through 2030, and would not require new training or recoding, he said.


Information from: Omaha World-Herald,