$1 million welfare consultant makes case to lawmakers

Gary Alexander (from left) and Eric Randolph of Rhode Island-based Alexander Group and Maine Department of Health and Human Services Commissioner Mary Mayhew prepare Tuesday to answer questions from the Health and Human Services Committee in Augusta.
Mario Moretto | BDN
Gary Alexander (from left) and Eric Randolph of Rhode Island-based Alexander Group and Maine Department of Health and Human Services Commissioner Mary Mayhew prepare Tuesday to answer questions from the Health and Human Services Committee in Augusta. Buy Photo
By Mario Moretto, BDN Staff
Posted Jan. 14, 2014, at 11:19 a.m.

AUGUSTA, Maine — Lawmakers had their first chance Tuesday to question the controversial author of a report that cautioned against the high cost of Medicaid expansion in Maine.

But the meeting seemed to be a mere formality. Neither side of the debate showed any evidence of being swayed by the report, with those for and against expansion showing how deeply they have dug in their heels.

Gov. Paul LePage’s administration signed a $925,000 contract with the Rhode Island-based Alexander Group in September to study Maine’s welfare system. The first study conducted as part of the contract, made public on Friday, says accepting federal Medicaid dollars to expand coverage to roughly 70,000 Mainers who make less than 138 percent of the federal poverty limit would cost the state $807 million over 10 years.

The meeting went as expected, with majority Democrats on the committee grilling the group’s leader, Gary Alexander, and Department of Health and Human Services Commissioner Mary Mayhew about the findings and methodology of the report, which they suspect of having been created with political motives.

Alexander, a former welfare chief in Rhode Island and Pennsylvania, now works as a roving consultant. He has delivered similar reports in other states, all of which have argued that welfare services are too generous and Medicaid expansion too costly.

Democrats on the committee questioned Alexander about the assumptions used in his proprietary financial model, which include a predicted 31.5 percent increase in the number of Mainers living under the poverty line over the next 10 years. That number matters because the more poverty rolls grow, the more Mainers would be eligible for MaineCare, the state’s Medicaid program.

The state’s most recent Consensus Economic Forecast predicts slow but steady economic growth in the coming years, and groups including Maine Equal Justice Partners and Maine Center for Economic Policy, two left-leaning advocacy groups, have questioned how Alexander got his numbers because the report doesn’t make the root of his assumptions clear.

Democrats and advocates also criticized Alexander for focusing exclusively on the cost of Medicaid expansion while ignoring the health and economic benefits of accepting federal dollars and extending health care services to the poor.

The sternest rebukes came from Reps. Drew Gattine, D-Westbrook, and Peter Stuckey, D-Portland, who said the report was one-sided.

“We’re a human services committee working with the human services department trying to figure out how to provide the best health care for folks, but nothing in your report talks about the health benefits of having insurance, or the economic benefits, the jobs created, the benefits that would come from expansion,” Gattine said.

Said Stuckey: “I sit here distressed, at the absence of any talk about the people of the state of Maine. There are 70,000 people that are part of this discussion, that this report is about, and I wonder, what is the cost to them [of not expanding Medicaid]?”

Eric Randolph, part of the Alexander Group’s team, said the report had to avoid needless complexity. To do that, he said, the group studied what effect expansion would have on MaineCare services as provided today, without considering the ripple effects of expansion.

“When we do a financial projection, we want it to be a clear comparison,” he said. “If you start introducing other kinds of things into the mix, it becomes more complex, and more difficult for you to know, when you’re presented the information, the consequences of what you’re doing.”

Expansion, a keystone of President Barack Obama’s landmark 2010 health care reform law, would be funded 100 percent by the federal government for the first three years before annually winnowing down to 90 percent funding thereafter. The expansion effort was defeated last year by gubernatorial veto, but House Speaker Mark Eves, D-North Berwick, and Senate Majority Leader Troy Jackson, D-Allagash, both have introduced measures to put it back on the table this session.

Aside from the $807 million price tag, Alexander’s report says Medicaid spending is on track to devour the state’s General Fund. Expansion would see MaineCare enrollment grow 66.7 percent over the next 10 years, from the roughly 318,000 enrolled today to 530,200 in fiscal year 2024, the report projects. Without expansion, enrollment would grow 28 percent, to 406,100, the report says.

Republicans on the committee focused their questions on whether the state’s health care industry could accommodate an influx of Medicaid patients, and about whether Maine’s welfare system is in a stable enough position to expand.

Alexander said that until the state achieves greater flexibility from the federal government in running its Medicaid system, expansion would be a heavy burden. As the top welfare executive in Rhode Island, Alexander obtained a “global Medicaid waiver” from the federal government, which allowed the state greater autonomy in administering the program.

“I see the commissioner very hard at work trying to reform the system in Maine,” he said. “She’s headed down the road, pragmatically looking at how to redesign Medicaid so that potentially, in the future, there could be some expansion.”

When pushed to explain why his report didn’t include savings associated with moving some MaineCare services currently paid for by the state, such as mental health services and HIV treatment, into a federal funding pool — as allowed by the expansion plan — Alexander said those benefits could be realized without Medicaid expansion.

“The state could petition Washington to cover those individuals,” he said. “Those are services you could incorporate into your current program if you went to Washington, if you wanted to reform your system. You wouldn’t have to necessarily do a full-blown expansion.”

The Alexander Group’s contract with the state has generated controversy since it was announced in September. Democrats in Pennsylvania have accused Alexander of mismanaging that state’s Department of Public Welfare during his time in charge, leading to 89,000 children losing health coverage and a botched revamp of the state.s home health provider payroll system that cost the state $7 million.

In Maine, opponents have decried Alexander as a LePage “crony,” hand-picked to deliver a report — as he has done in other states — that would bolster the governor’s anti-expansion position. LePage and Mayhew have defended the consultant, saying his firm is one of the best in the country at assessing state welfare programs.

Another Alexander Group report, on the state of Maine’s welfare system generally, was due on Dec. 20. Mayhew confirmed Tuesday that the report has not yet been delivered, and that Alexander was given an extension.

The Health and Human Services Committee will convene Wednesday to take up Eves’ and Jackson’s Medicaid expansion bills.

Follow Mario Moretto on Twitter at @riocarmine.

http://bangordailynews.com/2014/01/14/politics/state-house/lepages-controversial-welfare-consultant-to-present-medicaid-expansion-findings-to-lawmakers/ printed on July 22, 2014