Today we had the announcement of CMS to begin their IT Infrastructure upgrade and again this is after 8 years of asleep at the wheel by a prior administration and it’s catch up time and it’s not pretty.  Now the insurers are feeding on states wanting to keep cost down and provide the IT infrastructure to cut costs and take care of claims.  WE ARE TALKING ABOUT THOSE ALGOIRTHIMS ONCE MORE THAT MAKE BIG BUCKS. 

CMS Releases Plan for a Much Needed IT Infrastructure Upgrade With Computers, Data Systems And Those Updated Algorithms

This is a flat out battle of who has the capabilities to hand the IT processes to handle both the claims and the the HMO aspects of managing care.  United is mentioned here and they have been scooping up technology companies all year long, those that need the algorithms or already have their own to run businesses and then there is their subsidiary in China that already has a line of communication with the FDA and who focuses on getting more Chinese drugs and devices in the US and globally, so any guess why they bought this company about 6 months ago.  Perhaps they were using their business intelligence algorithms to project and lead to these decisions, of course they were. 

UnitedHealth subsidiary (Ingenix Subsidiary I3) Acquires ChinaGate – Working to Sell Chinese Products Globally

It gets to be difficult sometimes figuring out where the actual government systems run things and when it’s run by an insurance company.  Back in August this Medicare contractor, a wholly owned subsidiary of WellPoint received a contract to monitor Physician Incentive payments.  If you are a provider, this is the data systems under CMS that will check and see if you are inline with Medicare for your incentive payments and ensure you are eligible, a subsidiary  of WellPoint. The contact information for Governmental affairs is a Wellpoint email address.  Again, without the IT infrastructure, where else would they go as IT infrastructure takes time to set up and again we are suffering from the prior 8 years administration that did not see this as a priority so it could be Obama or anyone else sitting in the White House and this problem would still exist. 

Medicare Contractor Gets Deal to Monitor Physician Incentive Payments–Same Folks Earlier This Week Admonished For Not Doing Enough for Fraud Prevention?

Insurers collect those nice big transaction fees too for all their processes they run processing claims so more money in their pockets.  This is where it gets dicey too with government trying to move in get more of their own IT infrastructure set up, a Senate that doesn’t understand the needs and we go back to the 70s.  (see below how they didn’t fund cloud services) Add on Medcaid contracts won by bidding and we give away a lot more control and stall off the process of states now having their own infrastructure to run Medicaid. 

Senate Cuts Cloud Services From Budget That Would Allow for Data Center and IT Infrastructure Consolidation–Back to the 8 Track Tapes Next?

We tend not to do anything until we are forced into it in the US and here’s a case,  big one that nobody is going to be happy with and corporate American gains an even bigger stronghold.  I’m glad California is not doing this and is doing their own program and administration.  Again you have to remember these are “for profit” companies that are first concerned with dividends who make record profits this year while the jobs continued to vanish and they do no tie a human name to their algorithms and numbers for profit.  States still do have a chance to get this all set up before 2014 if they get the IT expertise in house an do it versus one more outsourced solution.  Social Security is one of the best in house government managed programs, runs cheap and efficient and does basically a pretty good job versus the transaction fees you end up paying with commercial carriers and their algorithmic partners that create more formulas for profit and there’s a bunch of those on Wall Street. 


Health insurers are preparing to capitalize on $40 billion of new opportunities to run privately managed Medicaid plans for the states, which would position insurers to benefit from the health overhaul's expansion of Medicaid in 2014.

Medicaid, the state and federal program for the poor, has become a growth area for big insurers such as UnitedHealth Group Inc. and more specialized plans such as Molina Healthcare Inc. Texas and Georgia will solicit new contracts for their private Medicaid plans early next year, while California, Florida and others are likely to meaningfully expand their programs, companies and states have said.

States want to get vendors lined up now to avoid disruption in 2014, as contracts can run for five or so years at a time. Plans that win bids next year probably will be the ones in place when the big expansion takes place. In preparation, plans are rolling out new programs to address the needs of long-term-care and disabled Medicaid enrollees—populations that some states are adding next year—and are counseling states on how better managing care can save money.

State Medicaid Plans -


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