Maine Cancels Contract with Alexander Group

Jun 13, 2014

From the day it was announced that the state's nearly $1 million contract with the Alexander Group to study Maine's welfare system has been under fire. Six months later, reports of inaccurate projections and allegations of plagiarism increased the volume on Demcrats' calls for terminating the contract. Now Republican Gov. Paul LePage has done just that - but the state is still out more than $400,000 dollars.

Gov. Paul LePage said the state of Maine and the Alexander Group had gone about as far as the two could go in a problematic contract that the governor terminated this afternoon. The $925,000 state Medicaid study had been lambasted by critics for containing major math errors and portions of analysis that were extrapolated from other unattributed sources.

LePage imposed penalties that allows the Department of Health and Human Services to retain $450,400 in funds formerly allocated to the consultant.  Still LePage signed off on an agreement that allows Alexander to keep about $475,000 already paid to him by Maine taxpayers.

"There are two things to look at," LePage said. "The text and teh attributions that they failed to do and then it's the content."

The governor said the state got its money's worth from the Alexander report.

"And frankly when you read it, I agree they didn't give the proper attributions, but I didn't find any errors in the content of the information," LePage says, "and we got what we paid for, basically. Probably more, in some respects."

"I think there's a lot of state money that could have been saved," said state Rep. Drew Gattine.

Gattine is a Westbrook Democrat on the Legislature's Health and Human Services Committee who has been leading the assault on LePage's no-bid contract with the Alexander Group since it was announced in December.

"I don't really see any value that this has brought to any of the important conversations that we need to have in this state about what we're going to do about our public assistance programs," he says.

And, says Gattine, the botched agreement could cost the state even more. Gattine says about $236,000 paid to the Alexander Group came from the state's federal Medicaid funds overseen by CMS, the Centers for Medicare and Medicaid Services.

"Now that there is an admission by the department that this vendor that they went and hired with this no-bid contract didn't provide services and work product that was of quality, I think there is a serious question about whether CMS is going to come back in and try to recoup that money from us," Gattine said.

"I'm not immediately concerned about that," said Rep. Richard Malaby. "I think some of the requested deliverables were in fact delivered and the federal government had enough confidence in the state of Maine to agree originally to fund about $475,000 of this."

Malaby, a Hancock Republican who sits on the Legislature's Health and Human Services Committee, says the administration took the appropriate action in responding to problems with the Alexander report. He also believes that the state received some valuable information from the report, such as the recommendation for a global Medicaid waiver provision that allows federal health care money to be awarded in the form of a block grant.

Malaby says that provision alone is worth it to doctors who are tired of filling out government forms.

"If we can eliminate some of the documentation and get some of that stuff out the way through waivers, OK, while continuing to perform the services, we would enable our medical providers to be probably 30 to 40 percent more efficient," Malaby said.

The global waiver recommendation is part of the study LePage says is worthwhile. And as for the feds, the governor is not all that worried about payback.

"Two-hundred-thousand dollars is peanuts compared to the $13 million we've got to pay back for not having TANF people look for work.  Calls made by MPBN to the Alexander Group were not returned by air time.