Wednesday, March 23, 2005

HHSC leader defends how contract was handled

Note: My comments are those of a private citizen, and do not represent the Texas Health and Human Services Commission in any way.

In todays Chronicle, there is an update on the brewing scandal over how Accenture got it's tentative contract with Texas HHSC: HHSC leader defends how contract was handled:
Health agency faces IBM lawsuit and inquiries by the Legislature about welfare deal
By R.G. RATCLIFFE


Here are some excerpts:

Hawkins released a letter Tuesday that he sent to Democratic state Reps. Sylvester Turner of Houston and Dawnna Dukes of Austin.... Hawkins told the lawmakers he doesn't believe his agency mishandled the bidding and that accusations of conflicts of interests among agency personnel involved in the contract appear to be wrong or unfounded. But he also said he has asked his inspector general to investigate. "We believe that we have taken reasonable and effective measures to protect the taxpayers' interests in a fair outcome," Hawkins said....

IBM sued the Texas Health and Human Services Commission last week, claiming conflicts of interest and bias resulted in a tentative award of the contract being given to Accenture LLP. Turner and Dukes also wrote Hawkins with questions about the same issues. The contract, the final details of which are being negotiated, is worth $1 billion over five years.

Earlier this year, the Houston Chronicle raised questions about whether former Deputy Human Services Commissioner Gregg Phillips had potential conflicts of interest involving Accenture and Deloitte Consulting while drafting the proposed rules for bidding the eligibility and enrollment project.

A consultant who wrote the legislation for former state Rep. Arlene Wohlgemuth, R-Burleson, calling for the privatization project went to work for Accenture after the bill passed in 2003....

The main allegations of conflicts raised by IBM and the legislators are:

•That HHSC hired as chief information officer Gary Gumbert, a former employee of Maximus Inc., the partner firm with Accenture on the bid.
IBM claimed HHSC officials said Gumbert was receiving retirement pay from Maximus and then said he was not.

IBM said Gumbert also showed favoritism toward Accenture in the bidding.

The lawsuit said IBM raised questions about Gumbert's "apparent conflict of interest" and was told he would be only peripherally involved in the contract award.

But the company claims documents show he was heavily involved.

Hawkins said Gumbert severed all financial ties to Maximus before he was hired in January 2004. He said Gumbert was involved in the bidding process but had no role in evaluating the bids.

•That Hazel Baylor, a former deputy commissioner of the Texas Department of Human Services, helped develop the bidding procedure for the contract before leaving the agency in September 2004 to go to work for Accenture. Hawkins said Baylor had no role in developing the contract proposal. He said Accenture also has assured the state that Baylor did not advise the company on how to write its bid. He said Baylor also received an opinion from the Texas Ethics Commission that her employment with Accenture would not violate state revolving door laws.

•That Baylor's roommate was Anne Sapp, an agency executive who had attended confidential vendor presentations on the contract. Hawkins said the two had shared housing several years ago and no longer do. He said their mere friendship does not constitute a conflict of interest.