Human Services Privatizer Stumbles Again

Accenture – the controversial Bermuda-based company hired by Texas to privatize a portion of the state's social services system – lost another contract with the state of Colorado last week for failing to deliver on millions of dollars worth of promises, according to news reports. It was the second time in less than a month that Colorado officials yanked two separate Accenture contracts.

Despite growing dissatisfaction with Accenture's work around the country – the company has had related performance problems in Florida, Ohio, Wisconsin, and Ontario, Canada – it's still business as usual in Texas, where the Health and Human Services Commission tied the knot with Accenture last summer. The five-year contract will run the state nearly $900 million.

The management consulting and technology company will put its outsourcing skills to work in Texas by setting up and running a handful of remote call centers, which are theoretically supposed to "improve" the way Texans apply for food stamps, Medicaid, children's health insurance, and other services. The privatization endeavor is expected to close about 100 community-based offices and slice nearly 3,000 HHSC jobs.

The Texas State Employees Union, meanwhile, has vowed to continue fighting what it calls a "radical experiment" – eliminating the human touch from social services operations. The union points to Colorado as another glaring example of the company's dismal performance record. In this case, Colorado officials dumped the company after spending $35 million for a computer system on the blink. Before that, the state terminated another contact with Accenture for its poor performance on a computerized voter-registration system.

"Both of the cancelled Colorado contracts were to update and streamline systems, which is what HHSC says is the purpose of its call center scheme," said TSEU vice president Mike Gross, in a statement. "But instead of a new and improved way of delivering services, Colorado got systems that don't work." This, he added, should serve as a major warning to Texas.