Firm behind Florida’s faulty unemployment website gets $135 million state contract

The state's 2011 contract with Deloitte Consulting is under investigation. Florida is poised to sign a new one with the firm.
Florida Gov. Ron DeSantis
Florida Gov. Ron DeSantis [ WILFREDO LEE | AP ]
Published Aug. 5, 2020|Updated Aug. 5, 2020

TALLAHASSEE — Gov. Ron DeSantis’ administration is preparing to award a nine-figure state contract to the company responsible for Florida’s disastrous online unemployment claims system.

Deloitte Consulting beat out four other companies for a contract to centralize and manage Florida’s Medicaid data, the state Agency for Health Care Administration announced Monday. The agency is expected to enter negotiations with Deloitte in the coming weeks.

The announcement came after the company has weathered months of scorn for its 2013 overhaul of Florida’s unemployment system. Deloitte was paid more than $40 million to create CONNECT to handle unemployment claims. Amid a crush of coronavirus-related unemployment claims in March, it failed immediately and repeatedly.

DeSantis himself has blasted CONNECT and ordered his inspector general to investigate the state’s 2011 contract with Deloitte, which was signed a few months after Gov. Rick Scott took office.

The most recent contract is worth $135 million, according to Politico. A spokeswoman for the Agency for Health Care Administration did not comment, saying the department is under a 72-hour blackout period following Monday’s announcement.

The losing bidders included other multinational corporations such as IBM and Accenture.

One of the criteria the state used to evaluate the various proposals was a firm’s ability to meet the needs of the state “based on the relative experience in the performance of current or previous contracts...similar in size, scope, and complexity in the past five years.”

When Deloitte was hired by the state in 2011, its task was to update Florida’s antiquated unemployment system. However, when the new system, known as CONNECT, launched in 2013, it was a disaster similar to the one millions of Floridians experienced this year: it crashed constantly and job seekers went weeks and months without receiving benefits.

State officials fined Deloitte more than $8 million for the fiasco, according to the Department of Economic Opportunity, and the company stopped working on the project in 2015.

Between 2015 and 2019, state auditors reported three times that CONNECT was still suffering from serious glitches, but the problems went unaddressed by the Scott and DeSantis administrations.

CONNECT faltered almost immediately when the pandemic triggered a surge in unemployment claims. The state had to create another website to handle the workload, and CONNECT is still taken offline routinely for maintenance.

DeSantis ordered his inspector general, Melinda Miguel, to open an investigation into why Deloitte was awarded the CONNECT contract.

“There’s a lot of money that went in to this,” DeSantis said in May. “I think everything needs to be looked at, 100 percent.”

The governor’s office did not respond to requests for comment about Deloitte’s latest contract.

A spokesperson for Deloitte did not respond to requests for comment.

The contract for which Deloitte was just chosen is part of an ambitious state plan to overhaul the way it manages Florida’s $23 billion Medicaid program.

According to the Kaiser Family Foundation, about one in five Floridians benefit from the federal program in some form or another.

So many people interacting with Medicaid creates a need for Florida’s government to handle, store and, ideally, analyze millions of data points — including private medical information. Deloitte would help the state do that by creating one centralized data source for the wide-ranging program.

“This modernization effort will enable recipients and other stakeholders with an interest in health care to make better use of information, make better decisions, and promote better outcomes,” reads a July 2019 state document which outlined the state’s need for an “enterprise data warehouse.”

According to that document, the state was looking to hire a firm to manage that warehouse on a seven-year contract.

In a letter dated Tuesday, Sen. Darryl Rouson, D-St. Petersburg, wrote to DeSantis expressing his disappointment at the latest contract for Deloitte, which he called “the sole architect for Florida’s broken unemployment website.”

It wasn’t the first time Rouson cautioned the state against hiring Deloitte.

In a letter dated April 29, Rouson pleaded with DeSantis not to pursue any further business with Deloitte. He cited what he characterized as failures by the firm in California, Massachusetts, Arkansas and Rhode Island.

“Deloitte should be barred from receiving any new state contracts until they pay back the taxpayer dollars they received to develop the broken unemployment system, and the existing bid system should be reevaluated,” Rouson wrote then.

On Wednesday, more senate Democrats, including Janet Cruz of Tampa and Democratic Leader Audrey Gibson of Jacksonville, bashed the contract, calling for it to be rescinded.