Mind and Body

Deloitte apologizes, but skirts responsibility for UHIP debacle

Proverb for corporations: If you can get legislators to keep asking the wrong questions, you don’t have to worry about the answers

Photo by Richard Asinof

Kenny Smith, left, and Deborah Sills of Deloitte Consulting testify before the House Committee on Oversight on April 12.

By Richard Asinof
Posted 4/16/18
The first testimony by Deloitte Consulting before the House Committee on Oversight was revealing both in what was said and what was not asked. In the rush to assign blame for political purposes in an election year, the details of the complex story of what happened are often hiding in plain sight, if anyone is willing to look.
Is Rhode Island willing to walk away from the Deloitte system as being unfixable? Would the Republican candidates running for Governor, who plan to use UHIP as a political weapon in the upcoming election, be willing to raise taxes to fix the UHIP system by dumping Deloitte and bringing in a new contractor? Who in the R.I. General Assembly will have the responsibility for tracking the reconciliation of interim payments made to nursing facilities?
At the crux of the design of an integrated technology eligibility system for health and social welfare benefits was the belief that such a system would be able to root out fraud and waste, reduce the number of employees, and save money through greater efficiency. The grand experiment, played out on the state’s most frail, vulnerable residents, did not work. Like the search for the seven cities of gold, it may never be successful.
The other side of the equation would be to look at investing those same kinds of resources in public health and health equity initiatives to improve the quality of life of Rhode Islanders, believing that residents are deserving of benefits to improve the human condition.
In January, when Carl Dvorak, president of Epic, one of the world’s leading health IT systems, gave a talk at the Warren Alpert Medical School, Dr. Elizabeth Toll, a pediatrician and internal medicine specialist at Lifespan, challenged Dvorak’s emphasis on data in medicine. “Medicine is also a human undertaking,” she said, expressing her worries about the over-emphasis on data. Many of the things that help patients, Toll continued, “is the need for human contact, the sense of being with another person and helping them feel better by the simple act of creating a relationship with them.”
That same advice – the recognition that the delivery of benefits is a human undertaking, one where there is a need for human contact, of creating a relationship with the patient where he or she feels heard – needs to be applied to eligibility systems for basic human needs.

PROVIDENCE – For the first time, representatives of Deloitte Consulting testified on April 12 before the R.I. House Committee on Oversight, offering an apology to the people of Rhode Island, saying they were “very sorry,” two years after the botched rollout of the Unified Health Infrastructure Project, or UHIP, on Sept. 13, 2016.

The costs for UHIP implementation have continued to soar, projected to reach $492 million through the 2018-2019 federal fiscal year, with $108 million of that amount to be covered by the state. Deloitte, in turn, has credited nearly $90 million back to the state, and the state of Rhode Island has stopped paying Deloitte since last year.

Two federal class action lawsuits have been filed by the ACLU of Rhode Island, one alleging that Medicaid recipients were not given adequate notice of losing benefits, a second accusing the state of illegal delays in providing SNAP benefits because of glitches in the Deloitte-built system.

A special master appointed by the judge in the second lawsuit, Deming Sherman, paid at the rate of $300 an hour, recently said he is hopeful that a May 19 “fix” by Deloitte will eliminate what he termed “the compliance gap.” In a recent interview, Sherman expressed doubts that the UHIP system would ever work properly.

[ConvergenceRI spoke recently with a SNAP recipient whose benefits of roughly $85 a month had been terminated, for no apparent reason, in January. The woman, living alone, with a part-time job that pays less than $7,500 a year, said she has re-applied twice, to no avail. To put that in perspective, the woman’s loss of SNAP benefits for four months was roughly $340; a sum equal to 67 minutes of Sherman’s fee.]

Another fine mess you’ve gotten us into, Ollie
In some lawmakers’ minds, judging from the questions asked at the hearing, there is healthy skepticism if the Deloitte technology system can ever achieve its aims – successful integration of the eligibility data systems for all of Rhode Island’s health and social service benefits.

Deborah Sills, speaking in a clipped British accent, a leading member of Deloitte’s public sector practice, along with Kenny Smith, who joined the Deloitte team in Rhode Island in November of 2017, attempted to reassure lawmakers that the Deloitte-built system can accomplish those goals, both from an architecture and functionality standpoint.

Beyond the public apology, what seemed equally noteworthy was the decision by the Raimondo administration not to attend the Committee on Oversight hearing. In a statement entered into the record, Eric Beane, secretary of the R.I. Executive Office of Health and Human Services, said: “Although we welcome opportunities to discuss our progress in fixing the RI Bridges [the current newspeak for UHIP] system, we believe it is appropriate that today’s proceeding focus on hearing directly from Deloitte’s leadership.”

Translated, no one from the Raimondo team was present, not even the usual bevy of communications aides [Alisha Pina did made a brief entrance and exit before the hearing began], when Deloitte testified. Can you spell toxicity?

However, Andrew Augustus, press secretary for Cranston Mayor Allan Fung’s 2018 gubernatorial campaign, was in the audience, monitoring what was said at the hearing. And, the state Republican Party was quick to post YouTube testimony from the hearing on its Facebook page.

Beyond the political fallout from the UHIP debacle and the role that it promises to play in the 2018 gubernatorial race, there were some critical details to report on what actually was said – and what was not asked – at the April 12 Committee on Oversight hearing.

1. Contract concerns: At the hearing, Rep. Blake Filippi, in lawyerly fashion, attempted to pin down Sills and Smith about why the Deloitte contract, as part of standard best practices and quality assurance for launching such a complex system, did not contain the provisions to conduct a pilot to test out the system before the live launch, in case “things went south.”

Neither Sill nor Smith could answer why the original contract had such apparent deficiencies, saying that they had come on board to the Deloitte’s UHIP project much later.

The question not asked: Who was responsible for negotiating the original, flawed contract?

Just the facts: The contract was originally negotiated by the R.I. Department of Administration under then Gov. Lincoln Chafee. The agency director at that time was Richard Licht, now a Superior Court Judge. The person responsible for negotiating the original contract with Deloitte was Ken Kirsch, hired by Licht as his deputy director.

The Oversight Committee could call upon Licht and Kirsch to answer questions directly about the reasons for the apparent flaws in the initial contract. [File that in the “do not hold your breath” folder.]

2. Missed warning signs: Rep. Patricia Morgan, House Minority leader and a Republican candidate for governor in 2018, attempted to use the recent report by the R.I. Single Audit Highlights for Fiscal 2017 as the launch point for questions about the deficiencies in Deloitte’s knowledge about potential missed warning signs.

Neither Sills nor Smith had ever seen the Single Audit report [they were handed a copy of the highlights of the audit at the hearing]. As a result, Sills and Smith said that they were unprepared to answer questions about the findings, frustrating Morgan in her attempt to get to answers to those Watergate questions: what did you know and when did you know it?

The Single Audit report had identified that, upon initial implementation of the Deloitte-built UHIP system in October of 2013, “system functional problems resulted in challenges in determining and/or validating Medicaid eligibility for certain individuals, newborn enrollment in existing cases, and other functional and operational issues that resulted in eligibility determinations being suspected.”

The questions not asked: Was there documentation of the problems identified in by the Single Audit report, and when exactly were the problems known?

Just the facts: The details about the initial problems with the Deloitte system and the missed warning signs have been hiding in plain sight for more than three years.

In 2014, HealthSourceRI had encountered numerous problems with the implementation of the Deloitte UHIP system as part of the launch of the state’s health insurance exchange. Christine Ferguson, then director of HealthSourceRI, identified nearly $10 million in costs caused by glitches in the Deloitte system, requiring fixes and manual overrides and additional staff time. This information was reported to the Raimondo administration in early 2015, in an official briefing book compiled by Ferguson, but that information was never acted upon or shared publicly by the Raimondo administration. [See ConvergenceRI story below, “The case of the missing briefing book.”]

As the briefing book enumerated, the problems with the Deloitte system had been documented in many meetings [with Deloitte], to no avail. “Inadvertent dis-enrollments are causing many Rhode Islanders who think they have health coverage and who are up-to-date in paying their premiums to find out that they aren’t covered when they go to the doctor’s office, hospital, or pharmacy,” the briefing book said.

Beginning in March of 2014, the briefing book continued: “We began to divert resources at the HealthSourceRI and the Contact Center to mask these defects and to address the needs of those consumers, carriers, brokers and small businesses facing significant problems.”

“We have been operating under a contingency plan for the past 10 months,” the briefing book said. “Up to 14 staff at HealthSourceRI had been redirected to address UHIP defects, issues and workarounds. Of the 18 members of HealthSourceRI’s small business outreach team, some 6-8 members have been devoted solely to addressing UHIP system issues for small business customers.”

In what seemed to be a precursor of the future glitches that happened with the wider systems launch of the Deloitte-built UHIP system in September of 2016, the briefing book raised questions about UHIP’s system future stability, the inadequacy of testing time, and the ability of the system to operate successfully through open enrollment, and Medicaid recertifications. Does that sound familiar?

In total, the extra costs that were absorbed by HealthSourceRI as a result of UHIP’s glitches and snafus were calculated to be $9.7 million in 2014, according to the briefing book.


The first public sign that the Raimondo administration was perhaps unhappy with the performance and costs of the Deloitte-built system occurred in July of 2015, as part of the Reinvention of Medicaid working group, when Deloitte was “volunteered” to work as the pro bono facilitator of the final public session of the working group.

The House Committee on Oversight, if it wanted to get to the bottom of the origins of what went wrong with the Deloitte-built system, could ask Christine Ferguson to testify about the problems encountered in 2014 as a precursor to the debacle in 2016. [File that in the “swept under the rug” folder.]

It seemed disingenuous, in ConvergenceRI’s opinion, for Sills, in her testimony, to attempt to put the blame on the complexity of the system that Deloitte had been asked to build, calling it: “The only eligibility system that integrates more than 10 state and federal health and human services programs and a state-based health insurance exchange.”

Several committee members attempted to pin Sills and Smith down on what exactly she meant by “complexity,” without much success. In her testimony, Sills said, in retrospect, that a pilot to test the system would have been a good idea. Shouldn’t the first phase of UHIP in building the integrated system for HealthSourceRI, with all of its glitches, be seen as the pilot?

3. A number of Committee on Oversight members asked the Deloitte representatives about the decision-making process leading up to the ill-fated launch of the UHIP system in September of 2016, if Deloitte had been aware of concerns and warnings issued by federal agencies about the readiness of the computer system, seeking a j’accuse political moment.

Sills responded by saying that widespread system issues had not been a concern: “We went through a series of tests and we confirmed, and the state confirmed, the system was working.”

The questions not asked: Had Deloitte ever been made aware of the concerns raised by the long-term care services community, a big customer of the Medicaid eligibility system, about the pending backlog of such cases? Had Deloitte ever been made aware of serious questions about the system’s performance capability raised by state employees?

Just the facts: The problem with Sills’ response saying that the system was working and it had been confirmed by both Deloitte and the state was two-fold: one, vociferous concerns raised by “customers” of the system, in particular, the long-term care services community, were ignored for months leading up to the launch; and two, internal questions and complaints raised by high-level state employees were apparently never addressed, or worse, ignored.

For months preceding the Sept. 13, 2016, launch, the long-term care services community had noticed a growing lag in processing of Medicaid eligibility applications for nursing home patients, creating financial stress for many of the nursing homes. Again and again, they raised warning flags. The response from R.I. Department of Human Services officials was that the launch of the Deloitte-built UHIP technology system, originally scheduled for July 1, then delayed until Sept. 13, with its online portal, would remediate and solve any backlog problem. [See the link below to the ConvergenceRI story, “Waiting for a technological Godot or someone like him.”]

As reported by ConvergenceRI, at the Dec. 20, 2016, joint hearing before the House Oversight and Finance committees, Virginia Burke, president and CEO of the Rhode Island Health Care Association, patiently laid out the back story of the UHIP debacle for legislators. It was the first time that providers, rather than just government officials, had been invited to testify.

Delays in processing applications for Medicaid for long-term care services have always been a problem, Burke explained, since nursing homes provide care without compensation until the application is approved. The problem has waxed and waned over the years, but she testified that the problem escalated dramatically during the year leading up to UHIP's implementation.

In February of 2016, DHS’s response to complaints about the growing “backlog” was to send out a letter to providers, asking them to stop calling about pending applications, Burke testified.

What nursing homes were told to do instead, Burke continued, was “to submit a written request” for information. “You have one chance to do this, on the 15th of every month, and 30 days later, you’ll get an answer to your question,” Burke said, describing the department’s instructions.

In April of 2016, in a meeting with DHS Director Melba Depeña Affigne, Burke said she and her members explained that a crisis was approaching. “We can’t go months and months of uncompensated care,” Burke said, warning the director. Burke said she pointed out that there were vacancies in the long-term care offices at the department that were not being filled.

Depeña Affigne’s response, according to Burke: “I am not going to fill those positions until I know what kind of staffing we need for UHIP.”


From day one of the launch, the online application portal for Medicaid eligibility never worked, helping to precipitate the crisis in delayed eligibility determinations and delayed payments, which in turn precipitated the need to make interim payments beginning in November of 2016 to prevent nursing homes from going bankrupt.

Memos to file
At the same time that the “customers” of the system were complaining, questions had been raised by numerous state employees, who had voiced serious doubts about the Deloitte system capabilities in the months leading up to the launch in September of 2016. But those concerns were allegedly either quashed or disregarded by the top leadership at the R.I. Executive Office of Health and Human Services, according to what several sources told ConvergenceRI.

There were apparently several employees who sent voluminous memos-to-file emails to document the fact that their questions were asked and disregarded by the upper echelons at R.I. EOHHS and, allegedly, Deloitte.

Translated, when complaints from “customers” of the system were ignored, when concerns voiced by state employees were allegedly quashed, it was much easier for the state and Deloitte reach the conclusion that tests had “confirmed” that the system was working before the launch.

The dam of denial finally gave way in January of 2017, when Gov. Raimondo accepted the resignation of Elizabeth Roberts, secretary of R.I. EOHHS, demoted Jennifer Wood, deputy director at R.I. EOHHS, and removed Melba Affigne, the director of the R.I. Department of Human Services, putting a new team in place.

4. Chairwoman Patricia Serpa asked the Deloitte team about the ability to preserve data related to the intervention by the state to make interim payments to nursing homes as a kind of stop-gap measure, given the delays in determining Medicaid eligibility for nursing home patients, which were forcing many long-term care facilities to the brink of bankruptcy.

The interim payments, which began in November of 2016, reached $51 million in March of 2017, according to Beane in previous testimony before the House Committee on Oversight. Interim payments have now reached just north of $100 million for services already rendered by nursing facilities.

The interim payments have been made from the state’s general revenue fund, with the expectation that they can be reconciled with the federal Medicaid program. Rhode Island has two years from the date when the payments were made to reconcile the numbers. The need for reconciliation was in part the result that the interim payments were not specifically tied to an individual patient’s eligibility.

Sills and Smith responding by saying that the Deloitte technology system has not tracked those interim payments. The disliked fact is that Deloitte has no role in tracking the interim payments, which are the responsibility of the state.

[This exchange led to the sensational, misleading story by The Providence Journal, claiming that $100 million in future federal Medicaid reimbursements were at risk.]

Following the hearing, nursing home advocates told ConvergenceRI that the expectation was that most of the $100 million interim payments will be reconciled and the state would be able to draw the federal match. It is just a matter of when that occurs.

The question not asked: Who in the R.I. General Assembly has been tasked with tracking the ongoing reconciliation efforts by R.I. EOHHS?

Just the facts: While the state may well be doing better on processing SNAP applications, that same kind of meaningful progress on the backlog on long-term care eligibility applications has not been evident, according to nursing home advocates.

In addition to issues surrounding the interim payments and the backlog in pending Medicaid eligibility applications, there are also problems around patient co-pays being calculated incorrectly. After 19 months since the botched launch of UHIP, those differences in co-pays are adding up.

The House Committee on Oversight, in addition to looking at the nitty-gritty of the problems with Deloitte-built technology system performance and the state’s lack of capability in managing the UHIP debacle, could also look into the unintended, long-term consequences of the botched eligibility technology system: the destruction of the long-term care infrastructure in Rhode Island, leading to the increasing consolidation of local nursing facilities into larger, for-profit chains, similar to what has happened in the hospital industry.

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