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Gov’s Office Considers Suing Xerox Over Botched System Rollout

By | July 10, 2014

The Governor’s office may sue Xerox Corporation for the bungled rollout of a new system to process Medicaid claims.

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The Enterprise Medicaid Management System was supposed to replace the state’s antiquated 30 year old computer program. It went live on October 1 last year and Commissioner Bill Streur says it had problems right from the start.

“What has happened is this new whiz bang state of the art system doesn’t work,” Streur said. ”So they’re supposed to be fixing it and it simply isn’t going fast enough.”

The state handles millions of Medicaid claims each year.

Streur says the Xerox system is paying only about 60 percent of those claims. He says it should be easily handling over 80 percent of so-called “clean claims” that meet all the criteria to be legally paid.

The problems with the system have been a big burden to many providers, who aren’t receiving payment for their Medicaid claims.

The state has had to hand out $135 million to providers in advanced payments until the system is fixed. And Streur says the glitches with the system have taken a lot of staff time to address.

“Because instead of working with providers and ensuring the services are delivered appropriately and in the right ways, we’ve had to work on making sure claims were getting paid and manually adjudicating those claims, so yes, it’s been a struggle,” Streur said.

The state has paid Xerox $12 million of a $36 million contract. Streur says the state is withholding the rest of the money until the system is working correctly.

A spokesperson from Xerox would not agree to a recorded interview. In a statement she said, “We are working with the state to address its concerns.”

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