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Post 'Health Connect,' Is Vermont Ready for its Next Big Tech Project?


Published October 21, 2015 at 10:00 a.m.
Updated October 26, 2015 at 3:51 p.m.

  • Tim Newcomb

If all goes well, by February Vermont officials hope to start installing a computer system that will make it easier to figure out who is eligible for social service programs. The estimated cost: $129 million.

The so-called "integrated eligibility" project has long been in the works to replace an obsolete 32-year-old Agency of Human Services system that no longer meets federal requirements. The new system is expected to save money by simplifying applications and providing a clearer picture of who's getting what from the government.

Nobody is arguing against the need for an upgrade, 90 percent of which would be covered by the federal Affordable Care Act. Still, this project is attracting a whole new level of scrutiny. Two years after the state launched Vermont Health Connect, the glitch-laden, $198 million insurance exchange, some elected officials are in no mood for another big information technology project.

"If your head wasn't in the sand, you know that the administration struggled mightily getting Vermont Health Connect to work," said Senate Finance Committee chair Tim Ashe (D/P-Chittenden). Ashe said he and other lawmakers who are worried about this looming project have "encouraged the administration to take a deep breath" — that is, think and think again before proceeding.

Along those lines, lawmakers this year tightened the purse strings. They're giving the Shumlin administration less than half of the $16 million it requested over two years to pay for the state's share of the system. The state has enough money to get started on the project but will eventually need to go back to the legislature to finish it.

Wary legislators also created a panel of outside advisers to help them find better ways to track such projects and have hired their own expert to address their admitted shortcomings on the technology front. The consultant, Dan Smith, a former information technology manager at the state Agency of Human Services, is slated to start work soon. He has a master's degree in computer science from Rensselaer Polytechnic Institute.

Meanwhile, critics are raising questions about Wipro, the company the state is negotiating with, and whether it's received sufficient scrutiny. "Have Moe, Larry and Curley [sic] — the folks in state government who select technology vendors — done it again?" Randy Brock, a Republican former state auditor and senator who's running for lieutenant governor, asked in an opinion column published October 1 on

Secretary of Human Services Hal Cohen argues that this project will be different. "This procurement process is probably one of the most comprehensive the state has ever seen," he said, describing the state's months-long negotiations regarding the scope and details of the project.

The state has more time to vet the contract, is not trying to invent a new program and has learned some lessons from its past difficulties, Cohen noted. "We're very confident we have the safeguards in place to ensure its success," he said.

As state officials negotiate a contract with Wipro, legislators and critics are trying to figure out how to bird-dog tech projects. They're mindful not just of Vermont Health Connect, but of other projects in recent years that haven't panned out. In 2012, the state abandoned a Department of Motor Vehicles technology upgrade and reclaimed $8 million in a settlement with Hewlett-Packard.

Every time another new project comes along, worries emerge over how much it's actually going to cost and whether it will deliver the promised results, said House Appropriations Committee chair Mitzi Johnson (D-South Hero). "We need a better process to evaluate IT projects," Johnson said. "We need to have a better handle on what the five- or 10-year plans are for the state rather than get hit with, 'This needs an upgrade.'"

That's the way it works with transportation, Johnson pointed out. The state has a good idea of which roads and bridges will need repairs and at what cost.

Johnson conceded the part-time citizen legislature lacks the expertise to scrutinize IT projects. She believes that by hiring their own consultant, lawmakers will have someone to turn to for expertise.

Richard Boes, commissioner of the state's Department of Information and Innovation, contended that the state's oversight of IT projects works. "The tendency is to focus on the bad. There's an awful lot of good happening," he said. As a result of its scrutiny, his department has recommended against signing IT contracts deemed too risky, he argued.

Boes said all states grapple with who should oversee IT projects. Some put departments like his in charge. Others, including Vermont, typically charge the IT department with providing support for individual agencies that host the system.

Senate president pro tempore John Campbell (D-Windsor) and other lawmakers have been critical of Boes and his department. "I think he clearly understands, or is aware of, the skepticism or lack of confidence people had in him last year," Campbell said.

That skepticism led the legislature to create a special three-member citizen committee. Its charge: Recommend by January who should run IT projects, how lawmakers can evaluate them and how the state should fund technology to avoid sticker shock.

Citizen committee chair Michael Schirling, the recently retired Burlington police chief, is now head of the Burlington technology nonprofit BTV Ignite. He said he's no expert, but brings an ability to translate technology into practice. He didn't promise that his panel could provide all the answers by the time its report is due, but planned to identify what's working well and to map some changes.

"I wouldn't describe it as a deep dive," Schirling clarified.

Joining him on the panel are John Burton, president of Network Performance, a South Burlington information technology company; and Tim Kenney, chief technology officer at Winooski-based MyWebGrocer. Schirling said the committee is willing to hear from anyone with ideas.

Last week, the trio gathered in a conference room in Williston. They queried several state leaders on project funding and oversight, and got an idea of how difficult it is to track state IT projects. Sue Zeller, the state's chief performance officer, explained that it took the administration three months of digging through every state agency budget to determine how much money the state spends on information technology. The answer for fiscal year 2012: $77 million. That was three years ago.

Zeller said the analysis indicated the state should be setting aside $20 million to $30 million a year to keep its technology current. "The state has historically had issues coming up with that money," she told Schirling's committee.

The state has long delayed upgrading the Agency of Human Services computer system, but now has the opportunity to do it mostly with federal funding. The goal is to build a system that will more seamlessly track the eligibility of Vermonters applying for social service programs, including Medicaid, Reach Up, childcare subsidies, food stamps and home heating assistance. State workers handling clients in one program have to make a phone call to check whether they are receiving assistance in another. That means, for instance, that a diabetic client might miss out on access to federal food aid that could ultimately lower his or her medical costs.

The new system should reduce the number of state employees administering the program, and their paperwork, Cohen said. But first, he said, his agency is intent on making sure it gets the right company to build the right system.

The agency put out a request for proposals in August, and received five. It selected Wipro as the "preferred vendor," said Stephanie Beck, director of health care operations for AHS, but no final commitments have been made.

Soon after VTDigger reported that, Brock questioned whether Vermont is headed down the same path as with Health Connect. Wipro, he noted, is based in Bangalore, India. The company employs workers in India and relies on visa programs to use lower-paid foreign workers in the United States. Brock also cited a pending lawsuit that a Connecticut bank filed, alleging that Wipro failed to deliver on a software project.

"It would make me very cautious of them," Brock said. He asserted that the state hired CGI to build the Vermont Health Connect system without asking enough questions and eventually had to fire the company.

Cohen said the state is thoroughly vetting Wipro, a multinational technology firm with 160,000 employees working on six continents that earned $7.6 billion in revenue last year. For example, the state is talking to previous Wipro customers and researching its personnel. If the agency decides to seal the deal, Boes' department would hire an audit team to review the contract and further research Wipro before signing anything. A contract would require that all work be done in the United States, Cohen said, but he didn't think the state could ban a vendor from using workers who are in the country on visas.

Brock questioned whether the state should be looking abroad. "We talk constantly about jobs in Vermont, and we would outsource a major contract to a foreign company," Brock said. "The Wipros of the world may be needed in the short term, but we must build IT competence into state government right now, and we must work with and encourage the creation and expansion of Vermont's IT businesses."

The idea that the state could pull off such a large and complex project in-house is far-fetched, Boes said.

Lawrence Miller, the state's health care reform chief, recalled similar suggestions about a local solution for Vermont Health Connect. "This notion that we could pull out a bunch of Vermonters to fix the exchange? ... It's offensive to think that's a reasonable approach." He did say Vermont should simplify the contract process in the future so that smaller, local companies can bid when appropriate.

Miller said the state has learned lessons from Vermont Health Connect that can translate to future IT projects. For example, he told Schirling's committee last week that training non-IT staff to manage a project is crucial. They may not have the IT experience, but they should be trained in managing those who do. That's something the state didn't do at first with Vermont Health Connect, he said, but has since.

"All of these projects are being run by people who, for the most part ... don't have to do this scale a project very often," Miller said. Then he emphasized: "It is worth spending the money training them and developing them in project-management discipline so they understand how their vendor thinks."

The original print version of this article was headlined "Who's IT? Vermont Gets Ready for the Next Big Tech Project"