Alaska has begun to finally put some pressure on Xerox Corp. to live up to its contractual obligations to build an online Medicaid Management System that actually works. The state has said that it’s entering into “mediation” with Xerox over the botched rollout, one that has caused no end of problems for hundreds of medical professionals across the state, some of whom have said they’re on the verge of bankruptcy or shutting down because of the lack of payment from the state since the faulty system went on line.

The total contract was for $146 million, including the costs of continuing to run the system for a certain number of years. The system alone, according to news accounts, was $36 million, of which Xerox has been paid $12 million. Most of that money is being paid from federal funds.

The billing system was supposed to be completed in 2010. Continue reading →