1. By Matthew Drew, Sopanha Hour, Eduardo Jimenez, Edward Martel, Paul Munoz Innovation and Inspiration that Ices the Information Competition

2.  Information Systems maintained information on patients and providers  Information Systems were necessary to comply with the Health Insurance Portability and Accountability Act of 1996 (HIPAA). HIPAA was enacted to standardize the management of patient health and records, and most notably, the protection of patient privacy  Maine’s IT staff determined a completely new system would be most cost efficient to implement.

3.  Very tight timeline:  Timeline of October 1, 2002 made the time for vendor selection limited.  Amount of time to meet the requirements given by HIPPA  Project Size:  Large project.  Amount of money to be budgeted towards it.  Number of patients, doctors, hospitals, clinics and nursing homes affected.  Project Structure:  There was not a clear structure given as how to meet the new HIPPA requirements.  The goal was out there, but the means, plan and structure for attaining this goal was vague.

4.  Technology:  CNSI had never before designed a Medicaid claims system, and they lacked experience working with the systems.  CNSI used J2EE, which mismatched the old system legacy code.  Maine’s requirement proposal was unreasonable.  The staff and contractors made improper judgments about Medicaid rules.

5.  The system suspended an usually high number of claims, and also overpaid healthcare providers for their services.  Maine did not have the staff to handle customer service with the unusually high number of claims being suspended.  Doctors were forced to either take out loans or turn away Medicaid patients  The Faulty Medicaid Claims Processing System cost as much, if not more, to fix rather than to build correctly in the first place

6.  Baldly missed deadline to comply with HIPPA requirements  Claims were rejected much more frequently  The suspended files grew quickly, causing millions of dollars in claims to be held back  300,000 claims were frozen within 2 months  Providers were not getting paid, as a result, turned away Medicaid patients or shut down their operations.

7.  Others sought bank loans to keep their practices fluid  Seven thousand other nonprofits and providers had not been compensated properly  State’s finances were threatened  Overpayments were made totaled $9 millions  The disaster cost the state an additional $30 millions  Medicaid was behind on $50 dollars worth of payment

8.  Management  Decided to develop an entire system from scratch using unproven technology  Rejected an option to outsource claims processing systems to a service provider such as EDS  Hired a vendor (CNSI) with no experience in developing Medicaid claims systems because they were the lowest bidder ($15 million dollars)  Not having a Medicaid expert to lead the team  Chose not to follow CSNI’s recommendation to re-enroll all providers as required by the new system

9.  Organization  There was not enough staff to handle customer service  Team members on the project were not properly trained and worked on the same parts of the system  No consultation with Medicaid experts on staff at the Bureau of Medicaid service  The team took shortcuts due to the deadline  End-users were not trained on how to use the new system

10.  Technology  CNSI had no experience working with Medicaid systems  The programming was planned on J2EE, which did not match the legacy code from the old system  No backup or parallel system to support the deployment  The system was not comprehensively tested

11.  Use internal integration tools  Formal planning and control tools for documenting and monitoring project plans  Manager with strong technical and project management background – team members highly experienced  Actualize needed change management  New distributions of power and authority lead to resistance  Run a parallel strategy along with a pilot strategy with a phased approach  Parallel strategy would of avoided claim problems  Pilot strategy would of discover operational problems  Phased approach would of got the IT upgrade moving forward. Damn it Jim, not a Project Manager!

12.  Rework and resubmit RFP  Only two respondents with a large quote gap should have been a sign of something amiss  Explore integration with legacy systems and explore outsourcing claims processing  Add more staff as problems developed  A project this size should of formulated out to a larger staff

13. I would go with a designer that already had created a similar successful system for another state. Appointed a Medicaid expert to work with the designer full-time from the beginning. Invested not only the set aside funds for the project, but appointed the key people who were not only capable, but were also responsible for the project’s success. Allocated the appropriate experts of people to be “on call” when the vendor had questions about how something worked.