Thursday, March 21, 2013

Jindal Administration Kills Medicaid Contract Probed By Grand Jury

The Jindal Administration has killed a $185 Million contract to process Medicaid claims after a Federal Grand Jury probe raised questions regarding ties between State Health & Hospitals Secretary Bruce Greenstein and his former employer, CNSI, which held the contract.

In a written statement, Commissioner of Administration Kristy Nichols said, “Based on consultation with the Attorney General’s Office, today I am terminating the state’s contract with CNSI, effective immediately. The state will work with the current contractor, Molina Medicaid Solutions, to provide services during this transition and until a new RFP (request for proposal), overseen by the Division of Administration, is completed.”
"We have asked the Inspector General to look into this matter and provide assistance," Nichols said. "We have zero tolerance for wrongdoing, and we will continue to cooperate fully with any investigation."

The contract was awarded to CNSI in 2011. Greenstein, who was a Vice President with the company from 2005 to 2006, publicly took himself out of the contract process. However, documents show that Greenstein made changes to the RFP that allowed CNSI to secure the contract.
The state was issued a subpoena to produce documents by January 30th. The information came to light after The Baton Rouge Advocate filed a Public Records Request seeking the subpoena.

According to the Advocate, the subpoena requested that the state produce the following:
-          All documents submitted by the four proposers in response to the state’s solicitation of proposals. In addition to CNSI, the other proposers were ACS State Healthcare, LLC; HP Enterprise Services LLC; and Molina Medicaid Solutions. ACS of Atlanta bid $238 Million; HP of Palo Alto, CA bit $394 Million; while Molina was disqualified due to a poor technical score. 

-          All financial information, including but not limited to financial statements, income statements, balance sheets, and statements of profit and loss, submitted by the firms in connection with or response to the proposal.

-          Documents sufficient to show the date and time at which each response to the proposal was received by the state of Louisiana

It is unclear why the Jindal Administration did not take action between January 30th and now.