Ind. Panel Approves Ending Welfare Privatization

RICK CALLAHAN

INDIANAPOLIS (AP) — An Indiana House panel endorsed a bill Monday that would end the state's privatization of food stamps, Medicaid and other welfare benefits.

The House Ways and Means Committee voted 14-10 along party lines in favor of the bill after hearing five hours of testimony. The bill, sponsored by state Rep. Gail Riecken, D-Evansville, now heads to the Democratic-controlled Indiana House for consideration.

Monday's vote came hours after the Family and Social Services Administration announced details of its new "hybrid" system for welfare intake. The pilot system, which relies on private contractors, will begin next month in 10 southwestern counties around Evansville.

FSSA Secretary Anne Murphy told the panel she's confident the hybrid system will alleviate problems that developed under the state's recently canceled 10-year, $1.3 billion contract with IBM Corp. to take over Indiana's welfare intake system.

The problems included lost documents, lengthy hold times for its call centers and too many errors in processing of food stamps and Medicaid.

During a testy exchange, state Rep. Ed Delaney, D-Indianapolis, asked Murphy how much money the state had lost when it canceled the IBM contract.

Murphy said Indiana had paid IBM about $418 million before the contract was ended but said it would be hard to calculate how much the state lost when it ended IBM's contract.