EDS, Unisys protest ACS Medicaid contract

EDS Corp. has fired a verbal broadside at its health services rival Affiliated Computer Services Inc., protesting the award to ACS of a Medicaid replacement system contract in North Carolina.

In an April 23 protest letter filed with the N.C. Department of Health and Human Services, EDS of Plano, Texas, charged that ACS' system does not meet the state's basic standards for the system and would result in implementing a dated solution with a high operating risk.

"We bid a new state-of-the-art Medicaid system that meets or exceeds North Carolina's required technical architecture, while ACS bid a legacy system that has not been modified over the past 25 years," Ricky Pope, EDS' North Carolina MMIS proposal manager, told Washington Technology.

Unisys Corp. of Blue Bell, Pa, which also lost the competition, is protesting the award on technical grounds. Company officials said that the Unisys bid was not evaluated fairly by the state.

North Carolina gave the five-year, $171 million contract to ACS of Dallas April 8.

EDS, Unisys and ACS have large practices that build and operate most of the nation's Medicaid management information systems.

Harvey Braswell, group president and chief executive officer of ACS' state health care solutions, said the company will transport the latest MMIS technology the company has from a large Medicaid project in Georgia.

"We are out there with leading edge technology in Georgia that no one had tried before," Braswell said, adding, "We have the most comprehensive Web front-end system in the world."

As a sign of its commitment to the program, Braswell said the state has assigned 70 employees to work alongside ACS to implement the new system.

"I believe the state is going to have a very successful implementation," Braswell said.

Among EDS' complaints was a charge that ACS' proposed system design doesn't comply with mandatory requirements for both the solicitation and North Carolina's statewide technical architecture.

State evaluators knew that many aspects of ACS' offering were "weak" and did not comply with the request for proposal, EDS said in its letter.

The state has notified ACS that the contract is in effect and that a decision to grant or deny the protests will be made within 30 to 60 days. The N.C. Department of Health and Human Services will hold separate bid protest meetings for EDS and Unisys, said Debbie Crane, a department spokeswoman. No date for those meetings has been set, she said.

Braswell denied that ACS' contract won't meet the state's geographical requirements. He said the company plans to hire between 200 and 250 new employees in the state to support operations. To house the operations, the company plans to expand an existing call center in Henderson, N.C., and to sign leases for new properties in Cary and Raleigh, N.C., next month, he said.

Protests for health care systems go in cycles, Braswell said. Sometimes competitors are in the mood to protest when they lose, other times they aren't. "EDS has been in there 27 years and they hated to lose that business, he said.

Staff Writer William Welsh can be reached at wwelsh@postnewsweektech.com