Thursday, December 27, 2007

On Government Cost Estimates

Heh.

A new computer system to run the state’s Medicaid program will cost $64.2 million, twice as much as originally projected, officials said today.

The increases for the Medicaid Management Information System include $18.7 million in expenses that have not been previously disclosed. The Journal Sentinel reported on the other increases in recent months.

I agree with Elliot.

Wisconsin’s Medicaid computer system…

…is going to cost twice as much as promised, but letting Wisconsin run ALL our healthcare is supposed to save us money.

Uh huh.

(10) Comments
Posted by Owen at 1902 hrs
Politics + Politics - Wisconsin + Technology

  1. Let’s wait for Scott to come in here and wave his arms to make it all better.

    Posted by .(JavaScript must be enabled to view this email address) on December 27, 2007 at 2314 hrs


  2. This state has had one computer related disaster after another.  Each has cost the tax payers many millions of dollars.  Try to imagine how long incompetence or dereliction of duty like this would last out in the real world.  Yet, we sit by and accept one lame excuse after another from the government bureaucrats.

    Posted by .(JavaScript must be enabled to view this email address) on December 28, 2007 at 0759 hrs


  3. And after they spend almost the entire amount, they will deem it behind schedule, too expensive to complete, will terminate the project and outsource it.

    Posted by hsgbdmama on December 28, 2007 at 0802 hrs


  4. Correct me if I’m wrong but everyone of this computer system failures was development by private industry was it not?

    Posted by .(JavaScript must be enabled to view this email address) on December 28, 2007 at 0909 hrs


  5. [hysterics]But we can do better!  It will be cheaper![/hysterics]

    Just getting that out of the way.

    Posted by .(JavaScript must be enabled to view this email address) on December 28, 2007 at 1053 hrs


  6. As someone who has developed many a software package for industry, I must live with my price quote and subsequent purchase order. If I underestimate the effort, I end up eating it. Why is this different? Have they been taking lessons from the DOD?

    Posted by Charlie Hillman on December 28, 2007 at 1345 hrs


  7. That’s how it has always been with me too, Charlie.  I’ve also seen a number of contracts for governments that usually have draconian clauses for deliverables.  I have no idea how all of these vendors are able to keep coming back for more money.

    Posted by Owen on December 28, 2007 at 1402 hrs


  8. Not to completely side with the vendor (the company I work for is a software development consulting/development company), but my guess is that the state has a lion’s share of the blame here.  Sure, there are some seedy vendors out there, but they may be doing what is right.

    In my experience, if the application is being designed by committee, there will be many requirement and/or functionality changes.  I am sure, and would hope, the vendor is billing for these out of scope changes.  As someone on the committee changes his/her mind or adds functionality not part of the original design the vendor is certainly going to add that to the price (along with a little profit).

    My guess is that not one single person knows what the complete system is supposed to do and therefore, you start getting into turf wars and political arguments over functionality - whether the desired functionality is wrong or not.  In the end, the system has to work so we have to pay for the changes.

    Posted by Rich2 on December 28, 2007 at 1703 hrs


  9. Yup—continually changing the specs is expensive.

    Posted by hsgbdmama on December 28, 2007 at 1718 hrs


  10. Rich you are exactly right.  ANd the fact is, with this particular contract, there are always changes to it because there are constantly changes in state and Federal law that dictate changes that could not possibly been included in the original bid because the legislation or regulations had not been adopted.

    Charlie, EDS is going to lose money on this implementation.  I think the state is acknowledging that as well.  But with a contract like this, where the customer (in this case DHS) is making scope changes because of new legislation at the state and federal levels, vendors will put clauses in the contract that ensure they get compensated for changes mandated by the customer beyond the scope of the original contract ... as they should.

    Posted by .(JavaScript must be enabled to view this email address) on December 28, 2007 at 2349 hrs


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