Spending on information technology at the Department of Health and Human Services will skyrocket this year as the agency ramps up technical support for Medicaid.
The heavy investment in the department’s information management system will push its IT budget 45 percent higher than the amount Congress approved for 2015, according to a study by the International Data Corporation.
Shawn McCarthy, research director at IDC Government and author of the report, said such a spike is “unusual.”
While Congress approved a budget of $8.6 billion for 2015, at its current rate of expenditure, the department will spend $12.6 billion by Sept. 30, the end of the fiscal year.
The report projected a slight dip to $11.4 billion in proposed IT spending next year, but McCarthy said this would still put the department well above its 2015 budget.
Although the department will ask Congress for much more next year for IT systems, officials can still call the 2016 budget a cut by comparing it to the 2015 IT spending, McCarthy said.
He said every agency has the ability to frame its budgets this way.
A $5.7 billion expenditure for the Medicaid Management Information System, which handles much of the program’s data, will consume nearly half of the department’s overall IT budget next year. Most of that spending involves transferring funds to state governments for the federal share of their Medicaid systems costs.
Medicaid, which is administered by the department’s Center for Medicare and Medicaid Services, has undergone a massive expansion under Obamacare. The center has often struggled in the recent past with its IT spending.
Center officials selected a Canadian-based contractor with a checkered history to produce the error-ridden Healthcare.gov in 2011, apparently without reviewing a bid from any other companies, the Washington Examiner reported in October 2013.
The firm, CGI, had an uneven history of delivering promised technology products to both the U.S. and Canadian governments, but still somehow won a sole-source bid to create the high-profile Obamacare website.
CMS bungled the project in part because officials there acted as the central coordinators for the entire design program, a role usually reserved for IT contractors with the technical expertise to integrate systems, the Examiner reported.
