Xerox Will Not Finish Implementing Medi-Cal Management System
Medi-Cal is California's Medicaid system (AP/Sacramento Bee, 10/13).
In 2010, California awarded a contract to Xerox to develop a $1.7 billion case management computer system, called the California Medicaid Management Information System. The contract was scheduled to expire on June 30, 2016, but it included a five-year extension option.
The new system -- which was set to be rolled out in five phases -- was intended to replace the current, 30-year-old system that processes payments for the Medi-Cal fee-for-service program.
Details of Decision
According to the AP/Bee, Xerox announced that it will not complete the implementation of new Medicaid payment systems in California and Montana, both of which have experienced delays in launching their respective platforms.
Xerox said it will continue to process Medicaid claims in both states via existing legacy systems to avoid service interruptions (AP/Sacramento Bee, 10/13). Meanwhile, the company said it plans to continue providing Medicaid health care services to 35 other state clients.
Xerox said it expects to report a third-quarter loss of between three and five cents per share, resulting in a $385 million pretax charge. Among other things, the charge reflects estimated settlement costs (Minaya, Wall Street Journal, 10/13).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.