On Oct.
15, IBM was officially terminated from a
10-year welfare services contract with the state of Indiana—a project intended to improve the
efficiency and quality of working with welfare recipients.
A press
release about the termination came from Gov. Mitch Daniels, who stated that Indiana plans to move ahead with a "hybrid"
strategy that will include more face-to-face contact and "localized team
based case management," said a news release.
The IBM system eliminated face-to-face
meetings and took a task-oriented approach rather than a case-based approach
and was not working well for Indiana residents, said the state. While
there were improvements to the system in terms of eliminating fraud, increasing
state case loads for employees and adding some new jobs to Indiana, fundamental
problems still exist, claimed the state in the news release.
"The fraud appears to have been stopped and
we're still on track to save taxpayers hundreds of millions of dollars, but the
intended service improvements have not been delivered, and that's not
acceptable," said Daniels in a news release. "Those who raised
concerns about service quality were correct and we appreciate their efforts.
We'll now take the best parts of the old and new and move ahead with a hybrid
system in what amounts to a major mid-course correction."
IBM will wind down its part of the
operations in 60 days, and within that timeframe the state is reviewing the 22
subcontractors involved in the project, said an article by local newspaper The
Indianapolis Star. Demand for welfare-related services has been up in the state
as the recession took hold between late 2008 and 2009. The contract was originally
slated to cost $1.16 billion, but changes to the contract had costs ballooning
to $1.34 billion, according to the AP.
Firing IBM was "gutsy," told state
Rep. Peggy Welch, D-Bloomington, to The Indianapolis Star. The changes to the
program are further explained in the IndyStar.com article:
"People seeking food stamps, Medicaid and Temporary Assistance to Needy
Families will be able to go into county offices for a face-to-face meeting,
instead of being pushed to apply only by phone or
computer. Those options, though, will remain for people who prefer them. And,
instead of being routed through two call centers in Grant and Lake counties, calls will be sent
directly to the counties. While those call centers will become 'change centers'
where workers can make basic changes, such as a new address, to people's
information, the actual cases will be managed by caseworkers in each
county."
IBM representative John Buscemi told the AP following
the news of contract termination, "'IBM rejects the state's claims and
believes the state's actions are unjustified." Asked whether the company
was considering suing the state, he said, "IBM will take action as appropriate
to protect its rights under its contract with FSSA."
One of IBM's partners from the contract, Affiliated
Computer Systems, will be the lead technology company on the project now, said
Family and Social Services Administration official Marcus Barlow to the AP.
"The state will continue to shift to paperless
case files, rather than the burdensome paper files that clogged the eligibility
system," said the state news release.
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