UHIP savings will be $2.4M less than forecast after troubled launch

PROVIDENCE, R.I. (WPRI) – The state’s troubled new computer system for benefits will save taxpayers millions of dollars less than promised because it launched two months late, despite Raimondo administration promises that the full savings could still be realized.

The Unified Health Infrastructure Project (UHIP) launched Sept. 13 and has been in the headlines ever since due to technical problems. The launch had originally been scheduled for July but got pushed back two months after federal regulators expressed alarm about whether the system was ready.

At the time of the delay, administration officials insisted UHIP would still save taxpayers the full amount promised – about $16 million – during the 2016-17 budget year, even though it now wouldn’t be up and running as soon as anticipated. The savings are supposed to come largely from stricter policing of benefit eligibility, along with personnel cuts.

On Tuesday, however, the administration acknowledged the forecast for this budget year’s UHIP savings has been cut to $13.8 million, a decrease of $2.4 million or 15%. The number was officially reduced earlier this month by the Caseload Estimating Conference, the twice-annual meeting of state number-crunchers.

“The $2.4 million decrease is due to the delay of the launch, not system issues,” argued Brenna McCabe, a spokeswoman for the R.I. Department of Administration.

The delay forced the state to wait until October to use UHIP to run its new post-eligibility verification (PEV) process detecting ineligible individuals receiving benefits, McCabe said. “Because of this delay, we were unable to run PEV earlier in the fiscal year, and expected the savings would decrease slightly once we made the decision to conduct further testing,” she said.

The new number is notably lower than what the administration was touting barely a month ago.

As recently as Oct. 20, Department of Administration Director Michael DiBiase told lawmakers UHIP would save about $15 million in 2016-17. And just two weeks before that, DiBiase and Secretary of Health and Human Services Elizabeth Roberts had told reporters they didn’t think the full $16 million in savings were in jeopardy despite the PEV delay.

Last Friday, however, Roberts declined to answer when asked for a new savings estimate.

Meanwhile, the first round of PEV resulted in about 500 people no longer being eligible for the benefits they currently receive, according to Roberts. Roughly 1,400 people were sent notices last month informing them that they might not be eligible, and they were given until Dec. 1 to appeal.

The process “serves as a measure of quality control and ensures the right people are receiving the right benefits,” McCabe said.

State lawmakers held a second oversight hearing Monday to question administration officials over the problems with UHIP. DiBiase testified that he and his colleagues still “firmly believe that the system will ultimately be the right choice,” and said its performance continues to improve.

Ted Nesi (tnesi@wpri.com) covers politics and the economy for WPRI.com. He writes The Saturday Morning Post and hosts Executive Suite. Follow him on Twitter, Facebook and Instagram