Decision pack for the Steering Committee meeting of May 14, 2024. One decision is sought: whether to extend the transitional services agreement by three months and fund it from management reserve. The pack states the recommendation, the two alternatives, what each costs, and what the program will not do regardless of the outcome.
Contents
1. Decision sought
Approve a three-month extension of transitional services covering core administration and IT, funded by a draw on management reserve, moving the exit from the baseline date to the end of December 2024 — inside the eighteen-month contractual maximum with margin remaining.
Two things about this decision are worth separating before the discussion. The first is that the extension is not a schedule adjustment the program could make and report; it consumes margin that was bought at signing, and margin is not float. Float is a by-product of the network and belongs to the schedule; the six months between the exit plan and the contractual maximum were negotiated deliberately as a governance buffer and belong to the Committee. The second is that spending it is the outcome it was purchased for. A buffer that is never spent under a real constraint was either unnecessary or the program failed to recognize when to use it.
2. How the program arrived here
The first full profiling run against the consolidated member estate completed on April 15, 2024. It measured a clerical review band of 26% against a deal-model assumption of 8%. The queue that follows from the measured rate cannot be worked inside the remaining transitional services term at any capacity the program can lawfully or safely deploy.
The assumption was made under a legal constraint. An acquirer may not examine member-level records before close, so the identity estimate was necessarily Class 5 and the measurement necessarily post-close. The exposure has been carried on the risk register as R-01, scored Critical, since February 2024 — ten weeks before it materialized.
The Committee should test one thing in particular: whether the response was designed before the number arrived. A risk scored Critical with a named owner, a sized exposure and an agreed trigger is a different governance artifact from a risk that was noted and then rediscovered as an issue. This one had a mitigation running — a second onshore steward cohort was already approved and recruiting when the profiling completed. The program is not asking for reserve because it was surprised; it is asking because the mitigation it had already started is not sufficient on its own. That distinction is what the register is for and it is fair to interrogate it.
3. Options and their costs
| Option | What it protects | What it spends | Residual exposure |
|---|---|---|---|
| A. Extend transitional services by three months | Data integrity; member-facing continuity | Negotiated TSA margin; management reserve | Cumulative synergy capture falls further behind model; three months of duplicate running cost never recovered |
| B. Exit on the baseline date with the queue open | Cost and the original schedule | Data integrity | Records remain split at exit; continuity screening, claims history and regulatory reporting all inherit an unresolved population with no owner and no end date |
| C. Exit on the baseline date, raise steward throughput | Cost and schedule, on paper | Quality, invisibly | False merges — two members consolidated into one identity, with PHI, claims history and clinical record following. Nothing in normal operations surfaces this error class. |
Option C is the one that will look most attractive in the room, and it is the one the program most strongly opposes. It costs nothing, breaches no date, and produces a clean queue report inside the original term. Its cost is paid later, by members, in a form that is nearly impossible to attribute back to this meeting. A false negative leaves a duplicate record, which is irritating and self-correcting. A false positive merges two people — one member's protected health information under another's identity, claims adjudicating against the wrong history, a clinician reading the wrong chart — and unlike a duplicate, no routine process ever reveals it. The program can accept a schedule cost or a financial cost. It cannot recommend accepting this one.
4. The recommendation and what it spends
Option A. It protects the two constraints the charter ranks highest — the contractual maximum and Day 1 integrity — by spending the two it ranks lowest, cost and schedule margin. That is the constraint order operating as designed rather than being overridden.
The extension carries two funding components: the transitional services themselves, and the program management and workstream leadership required to run for three additional months. Both are presented as separate change requests so that the Committee approves the running cost explicitly rather than discovering it inside the service charge.
The two change requests are concurrent, not additive, in schedule terms. Both cover the same thirteen weeks. Presenting them as separate cost lines but a single schedule impact is deliberate: a reader who sums the weeks would double-count the extension, and a reader who sees one combined figure cannot tell how much of it is service charge and how much is the cost of keeping the program's own leadership in place. Cost is separable and time is not.
5. Scope reduction offered alongside
The program is not asking only for money and time. Two items are offered for deferral to a Year 2 backlog, each with a named owner who accepts the deferral rather than having it imposed.
| Item | Owner accepting deferral | Basis |
|---|---|---|
| Provider network rationalization, phase 2 | J. Kirkendall, VP Network Management | Gated by contract anniversaries falling outside the revised term; deferral costs sequence, not value |
| Care management advanced analytics module | Dr. M. Ellsworth, Chief Medical Officer | Enhancement to a preserved capability; no dependency on the transitional services exit |
Both remain retrievable and both carry a value that stays visible in synergy reporting rather than being removed from the denominator. Neither is canceled.
Scope is the first constraint the charter allows to flex, and it is the one most often left untouched while cost and schedule absorb everything. A program that returns to its Committee asking only for money and time has not tested its own priorities — it has assumed every commitment is equally load-bearing. The reason each deferral carries a named owner who accepts it is that scope which merely disappears from a plan has not been deferred; it has been abandoned quietly and will be rediscovered by whoever expected it.
6. What the Committee is not being asked to approve
- A second extension. This request is for three months. If the revised term proves insufficient, the program will return rather than absorb the difference silently.
- Offshore steward capacity. Raised, examined and rejected — member-level data cannot be worked offshore under the state contract, and the rejection is recorded rather than left as an open possibility to be revisited under pressure.
- Any relaxation of match thresholds. Thresholds were frozen when the rules were issued and are not a lever available to the program, the workstream or this Committee.
- Cancellation of the deferred items. Deferral moves them; it does not remove them.
Related artifacts: 42 — Status Report · 31 — Data Profiling Results · 44 — Change Control Log · 22 — TSA Schedule & Exit Plan