A recent audit on Maine’s faulty Medicaid claims computer, affecting billions of dollars in payments, shows that progress on the system has stalled, communication among contractors is inadequate and the expertise to bring the system up to federal standards is apparently absent. Over the past two years, this expensive exercise in technology has gone from acute failure to chronic underperformance and is a cancer on Maine’s Medicaid system.

First Data Government Solutions completed the audit in November; Maine’s Department of Health and Human Services hoped to present it to the Legislature in January. The audit is both a history and an assessment of the current state of the Maine Claims Management System. “The decision to go live with a partially developed MECMS in January 2005 was very high risk,” the audit states, “as Client Network Services Inc. (CNSI) had never built a Medicaid Management Information System (MMIS) and the state had no fall-back plan or parallel operation strategies.”

Since then, upgrades “continue to be problematic because of insufficient regression testing and vague or undocumented requirements.” First Data Government Solutions faults the state and contractor CSNI and, to an extent, the contractors brought in to fix the errors, and then gives taxpayers more bad news. It concludes CNSI cannot fix the problems without a lot more money, but the federal government, which had been paying 90 percent of the bill, understandably is not now willing to do that.

The MECMS system has cost about $56 million so far, several times what was anticipated, and it still cannot perform required functions such as paying resubmitted claims if the first claim was inaccurately submitted or process claims in which patients receive both Medicare and Medicaid. This isn’t to say the state and CSNI haven’t been trying mightily to fix this mess. They have, counting on phased-in releases of upgrades to allow the computer to meet federal standards. The first release occurred last spring and promptly flopped. There have been none since.

DHHS Commissioner Brenda Harvey is correct when she says the state must quickly determine whether to stay with CNSI, find a new vendor or privatize the entire operation. Before deciding that, however, the audit sensibly suggests creating a clearer line of authority and improving cooperation among the several organizations now working to get the system repaired. That demands changes in the management of the project, combining technical expertise with an understanding of what Medicaid claims require.

Maine and especially its health-care providers have shown more forbearance than the state deserves in this situation; taxpayers may not be so kind if the federal government doesn’t change course on reimbursements. But the audit points the way forward, and that means major changes to the way Maine has tried to solve this problem.