AUGUSTA — Democratic lawmakers said Monday that they’re submitting a bill that would nullify a $925,000 contract that the LePage administration entered into with a consultant to examine Maine’s welfare system.

Gary Alexander, a former health and human services chief for Pennsylvania and Rhode Island, has been the subject of controversy since the administration announced in November that it had hired his firm, the Alexander Group. The contract, offered and awarded without competitive bidding, was signed Sept. 30.

Additional Photos

Gary Alexander, founder of the Alexander Group, gives his analysis recently of a report his group developed regarding the cost of expanding MaineCare at the Department of Health and Human Services. Gregory Rec / Staff Photographer

The criticism has increased since January, when Alexander delivered an analysis of the feasibility of expanding Maine’s Medicaid program. One national analyst said the report contained a $575 million calculation error. Others noted that the report doesn’t show any cost savings from expanding Medicaid.

Democrats have said the contract is designed to validate the administration’s proposed welfare reforms and isn’t an independent analysis.

In a news release Monday, the Democratic Party said the state cannot afford a skewed study when it faces an estimated $70 million budget shortfall for the fiscal year that ends June 30.

“This is just one more in a tragic series of management errors from (Gov. Paul LePage) that is costing Maine taxpayers lots of money with little positive outcome,” said Rep. Richard Farnsworth of Portland, House chairman of the Legislature’s Health and Human Services Committee.

Democrats contended that the administration used $185,000 in federal money designated for cash welfare benefits, known as Temporary Assistance for Needy Families, to pay Alexander. The entire study is funded with a mix of state general fund dollars and federal money.

So far, the state has paid Alexander $185,040.

“The Alexander Report fiasco is yet another example of Gov. LePage’s pattern of mismanagement,” said Sen. Margaret Craven of Lewiston, the Senate chairwoman of the Health and Human Services Committee.

It’s not clear what legal or legislative mechanism lawmakers might use to kill the contract. Democrats said details of the bill will be made available in coming weeks.

If the bill passes and is vetoed by LePage, it won’t take effect without Republican votes for a veto override.

DHHS CHIEF: CONTRACT HAS VALUE

Adrienne Bennett, the governor’s spokeswoman, said the administration does not comment on bills until it sees their details. She referred media inquiries to the Department of Health and Human Services, which manages the Medicaid program.

DHHS Commissioner Mary Mayhew said in a prepared statement that the bill is “a blatant attempt by partisan lawmakers to discredit a thorough and accurate report from a national Medicaid expert that does not support their political position on Medicaid expansion. To portray this bill as an attempt to save the Maine taxpayer money is disingenuous and misrepresentative.”

Mayhew said Alexander will provide the state with a valuable analysis, especially when he submits his proposals for gaining flexibility from the federal government in the use of Medicaid funding.

“The Alexander Group’s track record in these areas of reform is unsurpassed, especially in helping states gain flexibility within Medicaid in order to use resources to address the unmet needs of those who are elderly, disabled and the state’s most vulnerable,” she said.

The DHHS also disputed Democrats’ assertion that Alexander was paid with $185,000 designated for Temporary Assistance for Needy Families, saying the amount is actually $91,964.

House Republican leader Kenneth Fredette of Newport said in a prepared statement that the bill is an example of Democrats, who have the majority in the Legislature, using the current session as a soapbox to campaign against LePage.

“Instead of scoring political points, Democrats should help us find solutions to the countless fiscal and economic problems caused by their decades of one-party rule,” Fredette said.

MEDICAID EXPERT: REPORT FLAWED

The Alexander report was touted initially by Republican lawmakers as a reason to oppose Medicaid expansion, a key policy battle in this session. However, Republican support for the report has been muted since its findings were questioned by outside analysts.

In January, Kathy Gifford, a Medicaid analyst for Indianapolis-based Health Management Associates, said the report has several shortcomings, including a miscalculation that could significantly overstate the cost of expansion. Gifford reviewed the study for AARP, which favors Medicaid expansion.

Gifford said the Alexander Group apparently used a lower federal reimbursement rate for its calculations than it cited in the text of the report, effectively inflating Maine’s share of the cost by $575 million.

Gifford also noted that, unlike independent analyses of Medicaid expansion in other states, Alexander’s report omitted any savings that might come from expanding the program. Savings are generated largely by migration out of programs in which the state pays most of the cost, and into Medicaid, in which various federal reimbursement rates are higher.

Other states have used such analyses to determine whether they want to expand their Medicaid programs.

REPORTS LATER THAN EXPECTED

Under the contract, the Alexander Group was given several target dates to deliver specific elements of its analysis. The group missed its Dec. 1 target date for the Medicaid expansion study.

The report was delivered Dec. 16, and the LePage administration didn’t release it until Jan. 10, even though the contract notes that all documents in the state’s possession are subject to the state Freedom of Access Act.

In January, Attorney General Janet Mills, a Democrat, told LePage to release the report in response to multiple media requests, including from the Portland Press Herald. LePage responded that if Mills wanted him to release the report, she should sue him.

The Alexander Group was also scheduled to deliver a “data-driven analysis” of the state’s welfare system, as well as a plan to redesign the Medicaid system, on Dec. 20. A spokesman for the DHHS said Jan. 14 that the department was giving Alexander more time to complete the reports and had not set a deadline.

The spokesman, John Martins, said 40 percent of the payment to the Alexander Group would be withheld until the required work has been completed.

Steve Mistler can be contacted at 791-6345 or at:

smistler@pressherald.com

Twitter: @stevemistler

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