The State Worker

Chronicling civil-service life for California state workers

August 6, 2013
California IT snapshot: Medi-Cal payment-system overhaul

The Department of Health Care Services, through a contract with Xerox. services more than 8.5 million Medi-Cal recipients. Each day it processes roughly 830,000 health provider claims. Weekly payments run at about $325 million for everything from doctors' exams to prescription refills.

Ronald Reagan was in his first presidential term when the department's current IT system launched. A look at what's coming to replace it and when:

Name: California Medicaid Management Information System
Department: Department of Health Care Services
Estimated total cost: $459 million (majority of cost covered by federal funds)
Budgeted for 2013-14: $193 million ($140 million is funded through federal financial participation, and the remaining $53 million is state General Funds).
Amount spent to date: $108 million
Project complete: 12 percent
Estimated time frame: July 2009 - July 2018 (7.6 years)

What is it? Replaces a 30-year-old system that sends out payments for goods and services rendered under Medi-Cal, the state's version of the federal Medicaid program.

The official line: "This service contract processes payments to health care providers of the Medi-Cal fee-for-service program, including physicians, pharmacies, hospitals and other providers under a new Fiscal Intermediary and includes replacement of the legacy system."

Current red flags reported: None

This is the seventh in a series of daily posts looking at California's 10 most-expensive state computer projects as listed on the Department of Technology's website.

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About The State Worker

Jon Ortiz The Author

Jon Ortiz launched The State Worker blog and a companion column in 2008 to cover state government from the perspective of California government employees. Every day he filters the news through a single question: "What does this mean for state workers?" Join Ortiz for updates and debate on state pay, benefits, pensions, contracts and jobs. Contact him at (916) 321-1043 and at


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