LINCOLN, Neb.—Nebraska has terminated a $40 million to $50 million contract with an Arizona-based company hired to develop a new computer system to manage Medicaid.
Kerry Winterer of the state Department of Health and Human Services said on Friday that FourThought Group “did not have the capacity to deliver the system they proposed.” FourThought officials could not be reached for comment.
The system that helps determine Medicaid payments must be replaced by 2013 to meet federal requirements. The federal government pays about 90 percent of the cost.
Winterer said FourThought has been paid roughly 15 percent of what it was owed under the contract.
The state Democratic Party has questioned the status of the project.
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