DHCS/Xerox Settlement Agreement
April 11, 2016
In 2007, DHCS issued a Request for Proposal, RFP 08-85022 (RFP) for the California Medicaid Management Information Systems (CA-MMIS) – - Fiscal Intermediary (FI) contractor. The project described in the RFP required the FI contractor to take over, operate, and upgrade the then-existing CA- MMIS system (Legacy System) and to design, develop, and implement a replacement Medicaid management information system (Replacement System) for DHCS.
Through a competitive bid process, DHCS selected ACS State Healthcare, LLC (ACS), as the winning bidder. On March 18, 2010, ACS executed the CA-MMIS FI agreement (Contract No. 09-86210). The Legacy System takeover phase was completed on September 30, 2011. In or around the Fall of 2011, the Parties began planning, activities for the design, development, and implementation (DD&I) of a new Replacement System. In December 2014, the first phase of the Replacement System (Release 1.0) was implemented, and design, development, and partial implementation work proceeded on the second phase of the Replacement System (Release 2.0).
However, the Parties now recognize that the pace of technological change for health enterprise data systems has significantly accelerated in the years since DHCS began procurement work in 2007 to replace the Legacy System. Accordingly, many other states as well as the federal Centers for Medicare and Medicaid Services (CMS) have adjusted their strategies on modernizing Medicaid management information systems to embrace a modular approach to procurement, design, and implementation. These changes have created an opportunity for DHCS to reevaluate the nearly decade-old design, development, and implementation strategies of the Replacement System and to reconsider the best course to ensure that California has a modern, robust, and sustainable system.
In light of these technological changes and evolving approaches to enterprise data systems, DHCS and Xerox have agreed to discontinue the remaining Replacement System DD&I, enabling DHCS to pursue a new procurement approach that would benefit from the most up-to-date technology and system design strategies available. Xerox shall continue to operate and maintain the CA-MMIS System, as set forth in Section 8, below.
Xerox shall continue to operate and maintain the CA-MMIS System until 9/30/2019 or an earlier time when DHCS has secured the FI services and support necessary to achieve the goal of implementing a Replacement System that meets both the CMS modular procurement requirements and the Medi-Cal needs of Californians.