CNSI is in litigation with several states for their history of extreme cost over runs; asking the States for more money after lowball bids to win the contract. There is no proof they saved taxpayers any money, but what they did in Illinois landed them in the middle of an Investigation with the Grand Jury.
Obama’s new eligibility Medicaid program qualifies “Millions more” for Insurance who didn’t before. With the Oct. deadline looming over the States this expansion of newly qualified people for Medicaid Ins. creates a huge need. How to accommodate the newly created copious influx, of information and technology into every State’s Medicaid Network system? Client Network Systems Inc. (CNSI) has been groomed for this task by a working relationship with the Federal Govt. since 1996, when it won its first Federal contract with the NSA.
1.) Who is CNSI? 2.) Why are they chosen to be data miners of our Medicaid information? 3.) What is their goal and relationship with our information and Obamacare?
*1994 CNSI was founded and Won first contract with Fannie Mae
*1996 Won its 1st Federal Contract w/NSA, Worked on Pres. Clinton’s Inaugural Committee
*1997 Won its 1st contract w/Census Bureau and teams w/IBM to support Amtrak on data mgmt..
*1999 Won its 1st Health Care IT contract. Awarded Nat’l Institute of Health CIO-SP2i contract
*2000 Won its 1st contract w/ FAA
*2002 Won its 1st contract w/ TSA and U.S. Coast Guard
*2008 Won Dept. of Agricultural, Food and Nutrition Contract/ renewal of Dept. of Educ. contract
*2009 Awarded “BLANKET” purchase agreement of Nat’l Inst. Of Health for IT Services
*2011 Expands Fed Health IT market w/2 wins @ centers for Medicaid and Medicare
The newly created group of people called the “working poor” defined by: Income at poverty level, Looked for work 27 wks. out of the past yr., Reduced hours dropped them from employer Ins., Part-time or unemployed…, are now prime targets for Obama Medicaid eligibility. They make up the new uninsured that will gain Ins. through and be covered by Obama Medicaid Expansion. States that opt in are funded 100% for all their expansion costs by the Federal Govt. for (3) Yrs. These new recruits will be fodder for CNSI and others bidding contracts.
CNSI’s President Adnan Ahmed, thinks, “these shared services will help shape the future of Medicaid, to develop the first Medicaid System on Cloud due to: program complexity, behemoth systems with massive amounts of data, changing administrations, new Federal regulations, constraints of annual budgets with outdated technology making public health systems a challenge and needed savings to the people for almost every State.”
In fact, CNSI’s goal is to contract (all the State’s) Medicaid work and then integrate Medicaid into the exchanges making it an easy One-Stop-Ins.-Shop. I believe their explanation was, “The solution is at the core of CNSI’s Health Care vision, a next generation single payer platform. CNSI’s successful platform is now extended to take Medicaid’s program into the New Age of a connected healthcare infrastructure. CNSI working with partnering States is developing a modular solution to manage the Medicaid Incentive Payment Program (MIPP), Medical Health Records (MHR), and Health Ins. Exchanges (HIE) Connectivity.”
Due to Illinois’s history of corruption in procurement it now has a mandatory strict bidding requirement. Governor Quinn has found a loophole, according to, OpenTheBooks.com. “Wrapped inside Obamacare, there is up to $190 Million in no-bid IT contracts to upgrade the Illinois (MMIS) Medicaid Management Info. System.“ Under this Obamacare provision, CNSI gets the contract with no competitive bids.
The $190 Million will not cover all of Illinois Medicaid expansion expenses, so Illinois’ Dept. of Health and Family Services formed a partnership with Michigan’s Dept. of Health and Family Services. Illinois procurement code, the Loophole, allows Family Services to “bypass the bidding process” with an inter-governmental agreement. However, Michigan already has a contract with CNSI so they entered into an inter-governmental contract with Illinois to use CNSI through “contract extensions”, establishing a very expensive 10 person $275,000/month Planning Commission. This allows the continuation of Illinois to use CNSI services through Michigan paid by the taxpayers.
Southeast Michigan’s Health Info Exchange is suing CNSI for contract violations while simultaneously entering into an agreement to sell their services to Illinois. This inter-governmental contract is why the Federal Grand Jury became involved.
Louisiana’s Governor Bobby Jindal cancelled a woefully under bid contract of $185 Million with CNSI, shutting out the competition, for an actual $300 Million job over 10 yrs., once he found out about the CNSI’ Grand Jury Investigation.
Jindal’s Health Secretary Bruce Greenstein, a former Vice Pres. at CNSI, resigned ONE week later, stating he had no role in the evaluation of the proposals. He initially refused to tell legislators the identity of the bid winner, CNSI. Two other companies who lost the bid have protests pending with the Jindal Admin.’s state purchasing agency. State lawmakers are siting Greenstein’s mishandling of new changes he pushed into the bid solicitation which then made CNSI eligible for the Medicaid contract and he met with top officials of CNSI days before he took over the Health Secretary’s job. Source: Bloomberg Businessweek
South Dakota contracted CNSI in 2008.Then ensued two years of disputes between CNSI and the state agency as costs mounted from the original contract amount of $62.7 Mil. to over an estimated $80 Mil. After South Dakota suspended payments, CNSI filed a lawsuit for unpaid services. The State agency claimed it detected 154 defects and 130 problems that could not be solved. Source: The Advocate
Seattle Times reported some providers stopped taking new Medicaid patients and others threatening to do the same because CNSI failed to pay valid claims to Doctors and medical clinics. Maine claims CNSI nearly bankrupt their Medicaid System.
This long standing relationship was fostered by the many Governmental awards, especially all the Health IT contracts. I believe this set up CNSI to feel they were a shoe-in to win “all the states bids” for Obama Medicaid implementation work which led to the alleged criminal activity.
Once the guaranteed Government three year expansion contract is fulfilled, year four is picked up by the State. The State would likely renew CNSI’s contract, and pick up their fees from then on; seeing the efficacy of their program and technology working for the previous three years.
The feeling of being invincible with job security guaranteed, Government’s deep pockets spending program and Whitehouse Whitewash keeping your reputation clean may be too much temptation for any company. We will all see how this plays out with the Federal Grand Jury’s ruling since October and the opening of Obamacare exchanges are just around the corner.