INDIANAPOLIS (December 20, 2006) Â? Following months of scrutiny, three federal agencies within the U.S. Department of Agriculture (USDA) and U.S. Department of Health and Human Services (HHS) each have given formal approval to IndianaÂ?s plan to modernize the stateÂ?s eligibility system. The approvals clear the way for the governor to make a final decision about the proposed agreement.

Daniels announced on November 29 that he had accepted the recommendations of an inter-agency team appointed in May to review the Indiana Family and Social Services Administration (FSSA) contract. The proposed agreement with an IBM-led coalition would utilize Hoosiers in state government and the private sector to provide administrative and technological support for the stateÂ?s eligibility determination process. The agreement would save the state some $500 million in administrative costs alone over the next 10 years, and countless millions more as errors are reduced and federal penalties avoided.

The Centers for Medicare & Medicaid Services (HHS), the Administration for Children and Families (HHS), and the Food & Nutrition Service (USDA) have maintained active dialogue with the state since the beginning of discussions in early 2005 on how to fix IndianaÂ?s ailing welfare system. The agencies have spent the past 60 days reviewing the final proposed contract. In its final response, the USDA said it has approved the request for funding for the project and said it would work collaboratively with FSSA and IBM and its partners to implement and monitor the phase-in process to ensure increased access and fewer errors in the Food Stamp program.

Should the governor sign the contract, the federal sign-off means the state can proceed with the state-negotiated agreement that covers programs such as Food Stamps, Temporary Assistance for Needy Families and Medicaid.

The governor is reviewing final federal documents, as well as testimony given during a public hearing on the proposed agreement on December 8. A decision may be expected by the end of the year