November 20, 2013

Maine hires controversial Medicaid reformist

The state will pay $925,000 to The Alexander Group to help with fraud detection and assess the potential cost of expansion.

By Steve Mistler
Staff Writer

Maine has hired the controversial former welfare chief of Pennsylvania to conduct a $925,000 review of its Medicaid program and the potential effects of expanding it through the federal health care law.

Gary D. Alexander, the former secretary of public welfare for Pennsylvania, has has been hired by Maine to conduct a $925,000 review of Maine’s Medicaid program and the potential effects of expanding it through the federal health care law.

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Related Documents

PDF: The Alexander Group's Contract

The Department of Health and Human Services announced Tuesday that it has contracted with The Alexander Group of Rhode Island to bolster ongoing “program integrity” efforts and assess the cost of expanding Medicaid – known here as MaineCare – under the Affordable Care Act.

The contract is worth $925,200, according to a copy of the document, and will employ the services of Gary D. Alexander, the former welfare chief in Pennsylvania who was criticized for policy initiatives that dramatically cut the state’s Medicaid rolls, eliminating health care coverage for 89,000 children.

DHHS Commissioner Mary Mayhew said in a media statement that Alexander’s firm brings much-needed expertise to evaluating social services that cost Maine $3.4 billion a year.

Democrats viewed the contract with suspicion, saying Alexander’s record shows that his review will not be impartial and will serve only to justify divisive initiatives favored by the LePage administration.

Alexander’s hiring may also spur more partisan fighting over Medicaid expansion. The issue is highly political in Maine and other states because broadening the public health insurance program is a key component of the federal health care law. Republican governors, including Maine Gov. Paul LePage, have resisted Medicaid expansion, while the Obama administration has launched a public push to pressure states to participate.

The hiring of The Alexander Group will likely feed into that debate, which dominated a large part of this year’s legislative session in Maine and is expected to resume when lawmakers reconvene in January.

The firm is led by Alexander, who was welfare chief for Republican Gov. Tom Corbett of Pennsylvania. Alexander left Pennsylvania in February after becoming a lightning rod over proposals that cut public assistance programs in the course of an aggressive anti-fraud initiative.

The Philadelphia Inquirer reported that Alexander’s Medicaid cuts prompted a review by the Obama administration after 130,000 people, including 89,000 children, lost health care coverage.

Alexander’s initiatives drew criticism from Democrats and advocacy groups for the poor. He also came under fire for issues unrelated to welfare reform, including instituting a dress code for female employees that prohibited open-toe shoes and required tights or panty hose.

Alexander, who previously headed the welfare division in Rhode Island, also was criticized for keeping his home in Rhode Island while working in Pennsylvania, billing the state for travel expenses and launching a real estate company while still working for the welfare department.

Earlier this year, Arkansas hired Alexander’s firm for $220,000 to do a four-month review of its welfare system, according to news reports. The extensive report, completed in July, recommended an array of changes, including beefing up fraud detection through all public assistance programs. Other recommendations included:

Identifying and “intensively” managing the top 100 high-cost Medicaid recipients and potentially restricting benefits paid to designated care providers and emergency services.

Reviewing hospitals’ claims for “upcoding” – schemes to overcharge for service.

Scrutinizing state employees’ health benefit plans.

 Reducing “high-end residential placement” for people with developmental disabilities through shared-living programs.

Cutting hospice costs with more aggressive authorization procedures.

Alexander’s recommendations in Arkansas appear to align with the LePage administration’s policy initiatives, particularly for welfare fraud. The administration has beefed up the DHHS fraud unit with a $700,000 annual investment to pay the salaries of new investigators. Democrats and advocacy groups for the poor have questioned whether the investment is politically driven.

The emphasis on fraud has increased the number of prosecution referrals to the state Attorney General’s Office, from 10 cases in 2010 to 45 in 2012. The number of successful prosecutions has increased more gradually, from eight in 2010 to 15 in 2012. The amount of restitution that courts have ordered increased from $92,339 in 2010 to $104,341 in 2012.

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