March 01, 2005
Accenture to get HHSC call center

Following up on this post regarding the new call center system in Texas' Health and Human Services Commission (HHSC), we see that they have made a tentative award of a contract to Accenture.

Notice of Tentative Award

HHSC announces the tentative award of a contract under request for proposals (RFP) #529-04-334 for Integrated Eligibility and Enrollment Services to Accenture LLP for all components prescribed by the RFP.

The tentative award is contingent upon, among other things, a final determination that a contract for call center services is cost-effective, the successful negotiation of a contract for the services, and obtaining federal agency approval for the portion of the contract that is subject to such approval. If negotiations with the selected vendor are unsuccessful, the tentative award will be withdrawn and HHSC may initiate negotiations with the next highest rated respondent or respondents. A tentative contract award becomes final upon successful execution of a contract.

As Pink Dome notes, that means that Accenture must have their "principal place of business" in Texas. I'm curious how that squares with this:

The General Accounting Office has concluded that four of the 100 largest federal contractors are incorporated offshore in tax haven countries as a way of lowering their corporate taxes.

One of the four, Accenture Ltd. of Hamilton, Bermuda, is ranked No. 24 on Washington Technology’s 2002 list of Top 100 federal IT prime contractors. The company had $279 million in federal contracts in fiscal 2001, according to the GAO report. Overall, the four companies pulled in $2.7 billion in government contracts during 2001.


Besides Accenture, the other three companies identified as incorporating in tax havens were McDermott International Inc. of Panama, with almost $1.9 billion in federal contracts in fiscal 2001; Foster Wheeler Ltd. of Bermuda, with $286.3 million; and Tyco International Ltd., Bermuda, worth $206.4 million.

The report said that McDermott, Foster Wheeler and Tyco had conducted “corporate inversions,” the term given to companies that were incorporated in the United States and then re-incorporated in a tax haven.

Accenture spokeswoman Roxanne Taylor said the GAO report vindicates the company’s position that it was never a U.S. corporation.

“Our contention has always been that we were not a U.S. company,” Taylor said. “They have communicated very clearly the fact in their own report that Accenture is not an inversion.”

Accenture was part of Andersen Worldwide, which is based in Chicago. When it split from its parent, it operated as a series of related partnerhips, according to the GAO report. In April 2001, it conducted an initial public offering and incorporated in Bermuda.

Emphasis mine. I'm sure someone smarter than me can square that particular circle. In the meantime. State Rep. Dawnna Dukes (D, Austin) may have a spanner in the works for Accenture:

Rep. Dawnna Dukes, D-Austin, filed a bill Monday that would require the state to put the brakes on call centers until it has fully tested an electronic system that would be the centerpiece of the new program for determining how people are eligible for government benefits.

House Bill 1674 calls on the state to stop negotiations related to opening the centers — hubs where people would call to apply for or renew food stamps, cash assistance and other government programs.

Dukes’ bill states that if the Health and Human Services Commission enters into a contract with a company before the bill takes effect, it will not be able to renew that contract until it proves that the electronic system that will support call centers works.

On Friday, the commission chose Accenture as the company to which it would give a tentative contract for the centers. However, a spokeswoman said the state must still weigh the company’s proposal for running the centers against its own to see which is better.

I doubt that bill will go anywhere, but I'm sure it will cause a few concerns in the Capitol.

Father John has a different concern about the call center system (TIERS), once again looking to Colorado for an inkling of what's to come:

More Colorado mothers are getting little or no prenatal care, and it's beginning to show with more unhealthy babies, a hospital manager says.

"We're seeing more women show up in labor having no prenatal care," said Barbara Hughes, director of the Exempla St. Joseph Medical Center's midwife program.

Hughes blames a change in state policy last year that no longer allows counties or doctors to "presume eligibility" for Medicaid for a pregnant woman who seems to have very little money.

She also blames the state's new $200 million Colorado Benefits Management System, which is supposed to determine eligibility for welfare payments, but has been beset by problems.

If a pregnant woman applies for Medicaid, but then has to wait three or four months to be approved, she loses out on most of the crucial prenatal care, say health officials who want presumptive eligibility restored.

Medicaid covers about $1,000 worth of prenatal care for women of very low income who don't have any other insurance.

That $1,000 worth of care can mean the difference between life or death, a healthy baby or one that will cost the health-care system millions of dollars, Hughes said.

She cited the example of one pregnant mother who applied for Medicaid last August, just before the change in presumptive eligibility.

"She decided to wait for her Medicaid application to go through," Hughes said. "It took five months. She missed all her prenatal visits over that time."

She finally showed up at St. Joseph, about 10 days before her baby's due date. "The baby was already dead," Hughes said. "It's so tragic."

Father John tells me via email that presumptive eligibility is still in place in Texas and that there's no current plan to change that (though I must confess that given the re-enrollment shenanigans that came along with HB2292 last session, I'm not 100% confident that it is unassailable), but he fears that the new system, which will essentially be beta tested on live users, will cause the kind of delays that may have contributed to the tragedy described above. We should all be concerned about that.

Thanks to a nameless-by-request reader for the tip on this. A communication from HHSC to its employees about the upcoming changes (read: massive layoffs) is beneath the fold.

February 25, 2005 Communications from HHSC:


As most of you know, HHSC has been evaluating
private proposals to operate call centers as part
of our effort to modernize our eligibility
system. We still have not made a final
determination on whether call centers will be
operated with state employees or through a
private contract. However, we are taking a
significant step in that process today by issuing
a tentative award to Accenture, one of the
companies that submitted a proposal to operate
the call centers.

We will not be able to make a final decision on
whether a private proposal or the state's plan
for call centers represents the best value for
taxpayers without more discussions with the
vendor. Once that decision is made, changes to
staffing levels will still be months away.

Regardless of the decision on call centers, state
employees will continue to determine eligibility
and staff field offices across the state.

After a decision is reached on how to staff call
centers, HHSC will be able to develop a more
detailed transition plan and timeline for
employees. That means we'll be able to tell
employees how many state jobs there will be in
the new system, where the jobs will be located,
and what criteria will be used to determine who
gets those positions. Our goal is to provide
employees with this information several months
before any changes take place.

We recognize that this a stressful time. We will
continue our efforts to use temporary workers,
paid overtime and other innovative ideas to help
deal with workload issues as we transition to the
new eligibility system. HHSC also remains
committed to giving displaced eligibility
employees priority consideration for other jobs
within the health and human services system.

We appreciate the continued dedication of our
eligibility workers. Change is rarely easy, but
our efforts will result in an eligibility system
that is more convenient for Texans and makes
better use of limited tax dollars. We will
continue to provide employees with open and
honest communication about the changes taking
place in a timely manner so that you can make the
best decision for you and your family.

Posted by Charles Kuffner on March 01, 2005 to Budget ballyhoo | TrackBack