(The Center Square) – Officials reviewing bids to modernize Florida's Medicaid database “ignored” the fact Deloitte was being investigated and sued for its role in the state's unemployment debacle when they granted the global conglomerate the project’s $135 million contract, according to complaints filed with the state.
Accenture, headquartered in Ireland, and New York-based IBM, which also bid on the project, filed protests in August. This week, lawyers for both corporations updated complaints with the Division of Administrative Hearings for an eventual hearing.
Administrative hearings focus on procedural issues. While IBM’s complaint exclusively examines alleged technical errors in the procurement process, Accenture’s challenge also raises questions about Deloitte’s performance and how it secured the contract.
The Florida Agency for Health Care Administration (AHCA) announced last month it awarded the seven-year Medicaid Enterprise Data Warehouse project contract to Deloitte, one of five rival bidders.
Deloitte edged out finalist Accenture despite being fined $8 million by the state, sued by unemployed Floridians in a class-action suit and investigated by the state inspector general for its role in building the state’s collapsed unemployment website.
Gov. Ron DeSantis authorized a probe in May into why Florida spent $77 million in 2013 for its CONNECT unemployment website built by Deloitte, which collapsed “right off the bat” in March when the unemployment rate nearly tripled to 12.9 percent and hundreds of thousands of jobless were left waiting weeks for their first checks.
DeSantis wanted to know why Deloitte’s 2011 contract to build the site for $40 million was amended 17 times, was nearly discontinued in 2012 and cost $77 million to launch in 2013.
The state penalized Deloitte $8 million in 2015 for its performance. Florida also paid $2 million to Ernst & Young to test Deloitte’s system.
Florida taxpayers have spent more than $100 million since March to upgrade the system by purchasing 72 servers, reassigning 2,000 state workers, contracting 330 phone center workers and tapping Department of Management Services Secretary Jon Satter to manage it.
None of these factors apparently was considered by AHCA’s project team – which, through March, included the same manager who selected Deloitte for the 2011 CONNECT project – when it awarded Deloitte the contact, Accenture said in its complaint.
The agency “ignored information that, by its nature, would be expected to have a strong bearing on whether the intended awardee is ‘responsible,’ that is, whether it has the capability in all respects to fully perform the contract requirements and the integrity and reliability that will assure good faith performance,” Accenture lawyers said.
Accenture and IBM also were finalists for the 2011 CONNECT contract, which Deloitte received even after being fired from a software installation project by the Miami-Dade school district in 2009.
London-founded and New York-based Deloitte, with 2019 revenues of $46.2 billion and 334,800 employees globally, PricewaterhouseCoopers, Ernst & Young and Klynveld Peat Marwick Goerdeler (KPMG) are among the four biggest international accountant firms.
Deloitte was fined a £15 million ($17.9 million USD) this week by Britain’s Financial Reporting Council for “serious and serial failures” in its 2009-11 audits of software company Autonomy. The Financial Reporting Council said Deloitte failed to “act with integrity and objectivity,” fostering a years’ long scandal in Britain.
Deloitte has considerable lobbying clout in Tallahassee. When it secured the 2011 CONNECT project and survived repeated efforts to void the contract, among Deloitte’s Florida lobbyists was Ballard Partner’s Brian Ballard, co-chairperson of Gov. Rick Scott’s 2010 inaugural finance committee.
Deloitte's Florida lobbyists now include Jennifer Ungru – who served on DeSantis’ election recount team, was a Scott deputy chief of staff and an AHCA chief of staff – and Christopher Moya, who was on DeSantis’ inaugural committee.