Ex-official blamed for failures consulting on fix

March 15, 2010 4:54:10 AM PDT
A former state official blamed for much of Texas' biggest privatization failures is now a well-paid consultant helping the state work to eliminate the problems the privatization effort caused, according to a published report. Gregg Phillips, the state's former second-ranking social services official, now heads Austin-based AutoGov Inc., which was hired without soliciting bids from other companies, The Dallas Morning News reported Sunday. The company has received $207,500 since November to help the state's food stamp program eliminate errors in the applicant screening process, according to the newspaper.

Phillips didn't return messages for comment from the paper. Telephone and e-mail messages left for him by The Associated Press were not returned Sunday.

Texas Health and Human Services Commission spokeswoman Stephanie Goodman said executive commissioner Tom Suehs and his predecessor, Albert Hawkins, believed AutoGov software might resolve the problems.

"They both faced the same problem -- high error rates -- and thought it offered a potential solution," she said.

Supporters had touted outsourcing as a way to save the state money while providing more diverse services, but efforts to privatize some social services work were plagued by problems.

A consortium led by Bahamas-based Accenture LLP was hired to help run a new computer system to allow people to apply for food stamps, Medicaid and other benefits over the phone, online or in person. It was implemented in two Texas counties in early 2006, but technical and operational problems forced officials to indefinitely delay its statewide rollout.

Problems also cropped up when the Texas Access Alliance took over processing applications for a state program that provides low-cost health insurance for the children of the working poor.

Mike Gross, vice president of the Texas State Employees Union, criticized the commission's decision to use the company. He said officials appointed by Gov. Rick Perry to fix the problems continue to seek technological solutions to problems caused by the loss of seasoned state workers.

Gross also noted that Hawkins had approved a vendor subcontract with Phillips and AutoGov chief executive Rose Hayden, both former Hawkins aides.

"The whole thing smells very bad. We're now hiring the guy who got us in the mess in the first place. It is absolutely stunning," he said.

Hawkins, former executive commissioner of the Texas Health and Human Resources Commission, said he saw no conflict of interest in hiring a firm led by Phillips and Hayden.

"Both of them had been gone from the agency, what, four or five years?" Hawkins said.

He also said AutoGov had performed similar work for the Texas Youth Commission and social programs in other states.

Hawkins said he chose not to put the work out for competitive bidding because "it was within the scope of a contract that was already in place" with overall contractor Maximus Inc., which took over the program from the Accenture-led consortium on an interim basis.


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