Xerox Awarded $500 Million Medicaid Deal in NY Despite Texas AG Law Suit and HHSC Contract Cancellation

ACS XeroxXerox Corp at the end of May was awarded a $500 million contract to revamp New York’s Medicaid system despite Texas suing the company and discontinuing their contract as chief Medicaid claims administrator in the state.

The Rochester Democrat and Chronicle published the following:

Xerox Corp. has been awarded a major contract to revamp the state’s massive Medicaid management system, according to the state Department of Health.

The document imaging giant is in line to receive the five-year contract worth an estimated $500 million, Health Department spokesman Bill Schwarz said Tuesday.

The deal is pending a signed, written agreement, Schwarz said. It also will need approval from the state Attorney General’s Office, Comptroller’s Office and the federal Centers for Medicare & Medicaid Services.

Citing that pending status, Xerox declined to comment Tuesday.

The contract calls for Xerox to develop a new system for processing claims under Medicaid, the health care program for the poor. New York’s $52 billion Medicaid program is the largest in the nation.

The New York contract is the latest big win for Xerox’s massive business services arm. Today, such services — which range from insurance claim processing to call center staffing — account for 57 cents of every dollar the erstwhile “Document Company” makes.

Meanwhile, the New York contract comes as Xerox’s Medicaid work saw a high-profile stumble in Texas. That state earlier this month canceled its Medicaid claims processing contract with Xerox and sued the company over what the state said was medically unnecessary Medicaid claims that were paid.

Xerox performs Medicaid work for at least 12 states, the District of Columbia and the U.S. Labor Department, according to Bloomberg.

Xerox to revamp New York’s Medicaid system in $500 million deal.

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