A computer systems company cut off from a lucrative contract with North Carolina's health department filed a lawsuit against the agency seeking more than $40 million.
Affiliated Computer Services was to get a $171 million, five-year deal to build and operate a system for Medicaid claims for the state Department of Health and Human Services. The project didn't go through because of state mismanagement, according to the lawsuit.
The lawsuit, filed Monday in Wake County Superior Court, accused state officials of providing inadequate information and failing to conduct timely reviews of company work. The lawsuit also said the state agency created an oversight organization made up of employees and contractors who were mostly unqualified.
ACS seeks money damages for lost profits, payment delays that resulted in increased costs and other expenses. The lawsuit also asked a judge to prevent the state from using company-owned information.
Health department spokeswoman Debbie Crane declined to comment on the lawsuit when contacted by the News & Observer of Raleigh. Carmen Hooker Odom, department secretary, and the state also were named in the lawsuit.
ACS won the service contract in April 2004, but the company asked for an additional $42 million for the project about two years later. The request was cut to $18 million, but the state said the company wasn't following the agreement and weighed its options.
The state then signed a contract extension with the current operator, Electronic Data Systems Corp., Plano, Texas, worth $91.3 million with a possibility of an extension through 2009.