Another Third-of-a-Billion Dollars Goes Toward Dependency

On WPRI, Ted Nesi reports that the State of Rhode Island’s Unified Health Infrastructure Project (UHIP) is now up to projected costs of $364 million:

Early estimates pegged UHIP’s budget at $135 million and then $151 million, before the Chafee administration bumped the forecast up to $209 million in 2014. Another cost increase was disclosed this past March, when the new Raimondo administration put forward an updated projection of $229 million.

In the past four months, however, UHIP’s projected cost has soared by well over $100 million. In July the Executive Office of Health and Human Services filed an application seeking an additional $109 million from the federal government to spend on UHIP, and said if the request is approved, the project’s cost will total $364.1 million through 2020.

The dollar amount is mind-boggling, but I think Nesi understates what the project actually is when he calls it “a sprawling effort to build a new computer system to handle public-assistance programs such as Medicaid and food stamps as well as HealthSource RI.”  This is the state’s attempt to build a first-in-the-country “dependency portal,” as the RI Center for Freedom & Prosperity called it when we first began to look into the project.

The idea isn’t just to streamline some back-end processes, make government more efficient, and save taxpayers money.  It’s to ensure that the government provides benefits to as many people as it can, making it as easy as possible to fall into dependency on government handouts.  The Center has been calling on the state to end this project for years, for budgetary considerations, but it’s the policy implications that are the most terrifying.

In some of the more radical versions of this progressive vision, enrollment in public-assistants programs will happen automatically.  The government will keep careful track of people’s finances and simply send them benefits when they apply.  Maybe on a small scale, this would help the government to stop payments to people who currently receive them and shouldn’t, but the likelihood is that the net effect will be hugely in the other direction.  One need only look at the explosion of Medicaid enrollments as people looking into health insurance through HealthSource RI discover their eligibility to understand how it will work.

Furthermore, it doesn’t take much imagination to understand the effect on people’s decision-making processes.  People receiving checks from the state will swiftly begin to see the effects if they increase their independent income and begin to slide down the welfare cliff.

The cliff is the reduction of total income that happens as workers cease to be eligible for government largess. In Pennsylvania, for example, a single mother who crosses the line above $29,000 in income will lose out until she makes over $69,000.  In Illinois, the necessary jump is from $12 per hour to $38.

On deeper analysis, the radical plans and the cost overruns are not different stories.  Government agents have incentive to make UHIP appear to be a minor upgrade of their computer system, and if they acknowledged up front that it would approach a half-billion dollars in costs, people might begin to ask questions.  As the project moves along, publicly questioning Deloitte, the contractor helping the state with the project, might lead the public to ask more-penetrating questions about what it is they’re doing.

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