Xerox to revamp NY’s Medicaid system
Jon Campbell and Matthew Daneman, Staff writers
Xerox headquarters in Norwalk, Conn. (Photo: AP file photo, left)
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.
It was not immediately known whether the deal would lead to more jobs in the Rochester area, where Xerox employs 6,300.
Xerox, which was founded in Rochester but is now headquartered in Connecticut, had been competing for the contract with Hewlett-Packard Co., Bloomberg News reported last week, citing unnamed sources. Computer Sciences Corp., which currently runs the state system, did not bid.
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.
“Xerox has been selected as the vendor for the Medicaid Administrative Services (MAS) contract for the New York State Medicaid Program based upon the State Health Department’s evaluation of responses received to the MAS Request for Proposal,” Schwarz wrote in an email.
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.