Seal of the Senate of the State of Texas Welcome to the Official Website for the Texas Senate
Seal of the Senate of the State of Texas
Welcome to the official website for the
Texas Senate
Senator Eddie Lucio, Jr.: District 27
Lucio Masthead Graphic
March 22, 2007
Contact: Doris Sanchez , Press Secretary
(512) 463-0385
Calling for Accountability on Failed Accenture Contract

A program that was supposed to save the state millions of dollars and enhance services to needy Texans did exactly the opposite.

Many reasons and excuses have been offered for the failed performance of Texas Access Alliance, a private consortium led by Accenture, a management consulting firm based in Bermuda. Accenture contracted with the Health and Human Services Commission (HHSC) for $899 million to privatize several social programs for the state, such as the Children's Health Insurance Program (CHIP), Medicaid, Food Stamps and Temporary Assistance to Needy Families (TANF).

The contract was terminated March 13, 2007, because it failed miserably to provide services or save money. However, those responsible for touting its leading-edge capabilities cannot wash their hands of the matter. I joined 30 Senators in signing a letter requesting the Office of Inspector General of HHSC to investigate this transaction.

In 2003, I vehemently opposed House Bill 2292, the legislation that created this fiasco by reorganizing what was then the Texas Department of Health and dividing some of its departments into other agencies. I voted against this bill because I did not feel that the administration of programs like CHIP and Medicaid should be subjected to uncertainty. When it comes to basic human rights like child health, people must come first.

This proposal to exchange face-to-face services with call centers so that Accenture could make a profit at the expense of our needy citizens signaled a red flag from the very beginning. Yet the bill passed.

I don't oppose outsourcing or profit-making, but not on the backs of the poor or hard-working. I generally favor private-public partnerships, because these arrangements often offer more accountability to the taxpayers. I was opposed to the Accenture contract because it meant putting hard-working employees-sometimes employed for 20 or more years-out on the streets. Any money saved would be offset by making productive citizens wards of the state. Displaced workers from the privatization could not have quickly or easily found work, and would have suddenly been deprived not only of a paycheck, but also of health insurance, retirement savings and the dignity to earn a living.

Another grave concern of mine was risking or endangering someone's health or welfare. And unfortunately it did. Accenture mismanaged records and documentation, and was continuously behind schedule in updating records and organizing call centers.

The inefficiency was so severe, that names of children and persons eligible for state social services disappeared from enrollment data. CHIP's operations, assumed by Accenture on Dec. 1, 2005, caused enrollment to plunge by 8.5 percent, or a loss of 27,567 children, through August 2006. Medicaid enrollment dropped 2.9 percent, or 53,937 children, for the same period.

Tragically, Devante Johnson died, a 14-year-old cancer patient who was dropped from Medicaid enrollment. The suffering was widespread throughout the state, but it was more pronounced in high-poverty areas like South Texas and along the Border.

The Accenture contract has cost the state $100 million more than budgeted, while fewer children and families received the needed benefits.

This troubled arrangement with Accenture, since its inception, lost CHIP applications, leaving children unable to visit their doctors, with no one accepting accountability. Ill-trained workers, instead of competent state employees, were making policy decisions they were unable to make. Fortunately, the plan to scrap thousands of state jobs was canceled late last year.

Termination of the contract does not answer the many questions still unanswered nor does it replace the financial and emotional havoc it wreaked. It is time that we ask and receive accountability through an audit. We owe it to the families who have suffered. We owe it to Devante Johnson's family. We also owe it to the state employees who lost or almost lost their jobs. And in good conscience, we owe it to the taxpayers who footed a bill with zero returns on their dollars. I vow to keep an eagle eye on the rebuilding process to ensure that this mistake is never again repeated.

As always, if you have any input or questions regarding these or other matters, please do not hesitate to contact Doris Sanchez, my press secretary, 512-463-0385.