Anchorage, Alaska – Governor Sean Parnell announced Monday that the Department of Health and Social Services (DHSS) filed an administrative claim for breach of contract against Xerox, including a request for an order that Xerox remedy all defects in the Medicaid Management Information System on an expedited basis.

“I am determined that Xerox be held accountable for its continued failure to properly process Medicaid payments,” Governor Parnell said. “Despite repeated promises by Xerox to fix the problem, we still have hundreds of dedicated providers not getting timely or accurate payments. Xerox has had more than enough time, and the issues have yet to be resolved.”

The State attempted mediation with Xerox as required by the contract, but the parties could not come to an agreement. In compliance with the contract, DHSS has filed a contract claim with the Department of Administration.

“We have made multiple attempts to get Xerox to outline a plan of action to correct its errors,” said DHSS Commissioner William Streur. “Since we have not received an adequate plan, the only recourse that remains is to file a claim and move forward with full and speedy enforcement of the contract terms.”

In the contract claim, DHSS asserts that Xerox violated the contract by failing to timely and adequately implement the system and failing to timely and accurately pay Alaska providers who serve Medicaid-covered patients. In addition, on September 19, 2014, the State sent notice to Xerox that it was assessing $46.7 million in liquidated damages against Xerox in accordance with the contract terms.

DHSS expects the contract claim to be referred to the Office of Administrative Hearings.

A copy of the claim is available at:https://gov.alaska.gov/parnell_media/resources_files/09222014_statement_of_claim.pdf

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