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War of words over Medicaid purge

Wednesday, Dec 18, 2013

* From a press release…

The Illinois Department of Healthcare and Family Services (HFS) and the Illinois Department of Human Services (IDHS) [yesterday] announced that an Arbitrator has issued a supplemental order impacting the State’s largest public employee union that will allow for a contract with an outside vendor that handles Medicaid eligibility screening to be amended instead of abruptly cancelled.

The arbitrator’s supplemental order allows the state to maintain the improved screening process put in place this year to verify that Medicaid clients remain eligible for benefits when they re-apply annually to remain in the program. The state was faced with the abrupt termination of the eligibility screening contract with Maximus, Inc., at the end of this year, under an arbitrator’s initial ruling - issued this summer- in response to a grievance by the American Federation of State, County and Municipal Employees (AFSCME) Council 31.

Under the supplemental order, the Maximus contract will be amended and the state will retain the ability to use Maximus to make preliminary electronic determinations through the end of June. In addition, the agencies will be able to retain the use of Maximus’s call center and mail room operations through June 30, 2015. The screening program, known as the Illinois Medicaid Redetermination Project, was authorized by the General Assembly as part of the “Save Medicaid Access and Resources Together Act” (SMART Act) of 2012. The amended contract will comply with State and federal law and the collective bargaining agreement.

* But that’s not entirely true. The arbitrator’s “supplemental order” came after some negotiations

In order to bring down costs, the administration of Gov. Pat Quinn agreed to hire Maximus, a company with experience verifying eligibility for Medicaid in other states. But the AFSCME union objected, saying the job should be done by government employees.

An arbitrator agreed, and the Quinn administration, warned by its lawyers that an appeal might not succeed, cut a deal with the union.

* Two Republican legislators called the new agreement a “backroom deal” and defended Maximus

But lawmakers say the private company, Maximus, was “a stunning success” and should have never been fired.

“As of the latest update, 216,000 people who were receiving Medicaid benefits were taken off the program because the third-party contractor was involved,” said state Sen. Dale Righter, R-Mattoon, adding that Maximus only looked at about a half million Medicaid files.

State Rep. Patti Bellock, R-Hinsdale, said before Maximus took over the review, state workers did a terrible job of checking incomes and addresses.

“These people were not even living in Illinois,” Bellock said. “They were (in) Wisconsin, Indiana, Michigan.”

* AFSCME disagrees that Maximus was so great

The union, however, points to the same report to contend that Maximus has a roughly 30 percent error rate among those 127,000 cases. Union leaders also say Maximus was duplicating work being done by state employees and argue that the company “found favor with a small vocal minority of legislators and conservative lobbyists.”

“It’s time to end this failed experiment with outsourcing a critical public watchdog role to a private, for-profit corporation,” said Henry Bayer, executive director of AFSCME Council 31. “This order will bring oversight back to state government where it is directly accountable, and save money in the process.”

Actually, Maximus has some Democratic and regular Republican lobsters.

* Quinn defended the new arrangement

Quinn denied any “backroom deal.”

“That isn’t the case,” Quinn told reporters in Chicago. “The fact of the matter is that I respect everyone. But I don’t want to spend the rest of my life in court.”

Mike Claffey, a spokesman for HFS, said there was “nothing secret” about the deal, noting that legislators were told about the “two-track strategy” in September and it was in the department’s quarterly report.

* Look, the problem before wasn’t with the state employees, it was with management. If competent management is determined to cleanse the Medicaid rolls, then the job will get done. The question is whether state management is competent enough to do that and has the will to go forward.

- Posted by Rich Miller        


36 Comments
  1. - RNUG - Wednesday, Dec 18, 13 @ 8:51 am:

    Another problem was, at the time, the State didn’t want to hire the extra workers required to do the work. The expanded headcount would not have played well with some of the austerity stories about the budget and limited State resources.

    Now the State is going to hire the needed workers … 520 of them according to the SJ-R.

    And Rich’s point about competent management is also valid. It’s hard to keep and motivate good management people in the MC ranks when you don’t give out raises, undermine authority, and just generally stab (non-political) middle management in the back every chance you get.


  2. - Cassandra - Wednesday, Dec 18, 13 @ 8:58 am:

    Under the ACA, all citizens will be eligible for some form of health insurance-Medicaid, expanded Medicaid, or subsidized private insurance, up to a certain income level starting Jan 1. Many will shift around in those categories depending on employment status. Still, 520 workers seems like a lot. What are they going to be doing. As to those found ineligible by Maximus, all will be eligible for something in less than a month. So how much money did Illinois taxpayers save, really, when you consider the administrative expense of putting them back on one of the insurance programs. Which I hope they all realize they can do.


  3. - RNUG - Wednesday, Dec 18, 13 @ 8:59 am:

    Quinn’s “I don’t want to spend the rest of my life in court.” line reeks of irony. He’s going to be there enough over the pension bill …


  4. - PhoenixRising - Wednesday, Dec 18, 13 @ 9:01 am:

    Would have, could have, should have…20/20 clarity now


  5. - Anon - Wednesday, Dec 18, 13 @ 9:10 am:

    = whether state management is competent enough to do that and has the will to go forward =

    The understatement of the century.


  6. - wordslinger - Wednesday, Dec 18, 13 @ 9:15 am:

    –“As of the latest update, 216,000 people who were receiving Medicaid benefits were taken off the program because the third-party contractor was involved,” said state Sen. Dale Righter, R-Mattoon, adding that Maximus only looked at about a half million Medicaid files.–

    That’s overstating it a bit, isn’t it? They were still on the books as Medicaid eligible, they weren’t necessarily incurring costs.

    I mean, if hospitals and doctors in California were billing Illinois Medicaid, that would raise a red flag, right?


  7. - Small Town Liberal - Wednesday, Dec 18, 13 @ 9:29 am:

    - when you don’t give out raises -

    Did working for Big Jim skewed your perception of what the state can afford? I’m sure it was nice not making the full pension payments, but when 25% of the budget is going toward them, things get a little tight.

    Once we pay for your utopian vision of state employment, how are we going to afford anything for those folks to do?


  8. - Grandson of Man - Wednesday, Dec 18, 13 @ 9:33 am:

    “terrible job of checking incomes and addresses”

    I don’t believe this to be true. Workers “run clearances,” that is, run several databases to get income and other data. This now includes a database set up by a credit agency or agencies, to check if people are working and to verify their earnings. If the income doesn’t show up there, and the Medicaid “customers” don’t report it and verify it, it’s much harder to find. There is a form that workers send out to possible employers also, but not all of those come back.

    As far as addresses, with the databases available to them, workers can’t possibly know if people are living out of state. Cases are canceled when forms that are due are not received, for example during eligibility redeterminations. Assistance is also terminated when mail is returned undeliverable, whereabouts unknown.

    Workers were getting an influx of customers whose cases were canceled erroneously by Maximus, and that has been a problem.

    There is also, of course, a shortage of workers. When people are working as if on an assembly line, dealing with high volumes of work and trying to meet tough deadlines, accuracy can suffer. A few more workers whose tasks deal solely with reducing income fraud and residence problems are worth their weight in gold.


  9. - A guy... - Wednesday, Dec 18, 13 @ 9:54 am:

    I’d love to see AFSCME keep jobs, but they have to make a heck of a lot better case than they do. I agree that management objectives made clearer would give them a better shot at getting this right, but Medicaid fraud is a huge nut to crack. Doing it successfully would ease a lot of financial pressure and tension. What needs to change here is the “mindset” of AFSCME. In a hurry. Dramatically. My mind says they can do this if they clear the management deck and put people in there that know what to do, how to do it, and dedicate themselves to getting it done. The rank and file will follow such an example. Maximus provided a template. Just follow the darn thing.


  10. - RNUG - Wednesday, Dec 18, 13 @ 10:22 am:

    Small Town Liberal - Wednesday, Dec 18, 13 @ 9:29 am:

    My point, which you might have missed, is that the rank and file management don’t get raises while the politically connected few do get raises. They need to be treated the same if you want ot maintain any morale.


  11. - Small Town Liberal - Wednesday, Dec 18, 13 @ 10:32 am:

    - while the politically connected few do get raises -

    Simply not true, but go on believing what you want to believe.


  12. - Cassandra - Wednesday, Dec 18, 13 @ 10:34 am:

    Isn’t the rank and file management in the union, by choice. Then they would get the negotiated raises every 4 years. Actually, I thought PSA’s were unionized now and were thus doing pretty well. Or maybe RNUG is talking about the next level up, although surely there can’t be many non-unionized staff left in Illinois state government–only the very highest level execs.


  13. - walkinfool - Wednesday, Dec 18, 13 @ 10:36 am:

    We are the most “outsourced” of any state government, which accounts for the lowest state employee per capita. Whether the contractors all work as advertised, and whether we actually save any money by that structure, is highly doubtful.

    Still, I think this move to break the logjam on Medicaid review, by hiring Maximus, was a good thing. Perhaps it will work out by transitioning through the next 18 months.

    The problem, of course, is that as soon as the state tries to staff up to meet its responsibilities, even to lower costs and end “fraud”, the Governor will be attacked for hiring people.


  14. - AFSCME Steward - Wednesday, Dec 18, 13 @ 10:46 am:

    Cassandra

    Why are a majority of former merit compensatation employees, such as myself, unionized. Might it be because they went years without any raises, even during one of the biggest economic booms in U.S. history ? The merit comp staff have been mistreated for years. They deserve to be treated fairly. This historical mistreatment is resulting in a dumbing down of the positions not currently unionized. Highly qualified people no longer want to apply for non-union jobs. And to anser your question, not all PSA jobs are unionized.

    “Isn’t the rank and file management in the union, by choice. Then they would get the negotiated raises every 4 years. Actually, I thought PSA’s were unionized now and were thus doing pretty well. Or maybe RNUG is talking about the next level up, although surely there can’t be many non-unionized staff left in Illinois state government–only the very highest level execs.”


  15. - Norseman - Wednesday, Dec 18, 13 @ 11:02 am:

    The Quinn apologist strikes again.

    State employees are not responsible for the poor state of the budget. That solely rests on the fiscal mismanagement of the current and past Governors and General Assemblies.

    Utopian state employment - what a laugh. I don’t consider it a utopian job when you achieve a merit comp position because of your qualifications and efforts and get rewarded with no salary increases for 8 years. Worse, you have to put up with incompetent politically appointed managers (most pronounced during the Blago/Quinn administrations) who are more apt to get salary increases by moving from one politically appointed position to another than the people who do the work. The workload for these utopian jobs keeps increasing as the number of employees to do that work has decreased.

    The one positive that state employees could take solace in was the guarantee of pension benefits. Now because of the policy leaders’ decades of failure to properly fund them, they want to renege on that guarantee.

    You get what you pay for and you have been seeing and will continue to see the result of this. The quality of State Government is getting worse with the departure of experienced managers and professionals who are tired of being abused by low salaries, poor political management and attacks on their benefits.

    We’re going to continue to see posts such as this one discussing the competency of managers to do what is expected.


  16. - D.P.Gumby - Wednesday, Dec 18, 13 @ 11:11 am:

    Now if they will get rid of the bozo’s doing the exorcism of the state insurance roles that require absurd jumping through hoops to verify children/dependents that are more hassle than factually necessary.


  17. - RNUG - Wednesday, Dec 18, 13 @ 11:22 am:

    Cassandra - Wednesday, Dec 18, 13 @ 10:34 am:

    Yeah, I’m talking about the SPSA’s. Even before Blago, they often got the short end of the stick and after Blago came it it got worse.


  18. - RNUG - Wednesday, Dec 18, 13 @ 11:25 am:

    Should have added, SPSA’s cover a lot more than just the very upper management. There are something like 30 - 40 different sub-classifications under the SPSA title; you find a lot of the well paid technical staff in those titles.


  19. - Anon. - Wednesday, Dec 18, 13 @ 11:54 am:

    ==you find a lot of the well paid technical staff in those titles.==

    Well-paid? Maybe they should be, but they aren’t, especially compared to unionized people in the same profession, and often compared to the unionized people who work for them.


  20. - Johnnie F. - Wednesday, Dec 18, 13 @ 12:44 pm:

    Most non-union SPSA positions are being filled from the outside by those who have zero institutional knowledge of the agencies and positions they are responsible for. Therefore, they focus their new found leadership skills on petty managerial responsibilities like canceling staff Christmas pot-lucks and how long employees spend in the bathroom. Once they figure our the pay structure and where they fit in they spend most of their time looking free another agency to bounce to. Agencies leadership comes from the unionized front line supervisors.


  21. - Eugene - Wednesday, Dec 18, 13 @ 12:48 pm:

    The Maximus fiasco has caused me to lose a lot of respect for Patti Bellock and Dale Righter. The decision to hire Maximus was based on a whole slew of assumptions that had little to do with reality. Upset that redeterminations of Medicaid eligibility aren’t happening? Well, that’s what happens when you cut the number of DHS caseworkers by 1/3 while caseloads are rising. It isn’t a question of incompetence by state employees or even management. It’s just arithmetic.

    Further, it’s a matter of federal policy that eligibility determinations must be made by civil service employees. If you insist that determinations also be made by a private vendor as well, you guarantee a lot of duplication and wasted money.

    It’s disappointing that Sen. Righter and Rep. Bellock choose simply to ignore Maximus’ 30%+ error rate. Likewise, they have never come up with a direct response to the calculations that the Maximus contract is wasting at least $18 million in taxpayer funds.

    I’m afraid the two of them are just grinding an ideological ax.


  22. - Sick of it - Wednesday, Dec 18, 13 @ 1:26 pm:

    Word,
    Illinois Medicaid gets billed by providers all over the country….including Hawaii!


  23. - Eugene - Wednesday, Dec 18, 13 @ 1:43 pm:

    Cassandra: you raise some good questions. As to how much money taxpayers saved due to the Maximus contract, the answer is:0. In fact, they lost at least $18 million paying for duplicative work that was riddled with errors. But the other point is, the individuals who generate the bulk of Medicaid costs are aged and disabled. As for the number of projected DHS hires being high, it is less than half the reduction in headcount that has occurred over the past decade. What’s more, the hires do not require additional appropriations - DHS already has the budget authority, in part due to a huge number of vacant positions.


  24. - Budget Watcher - Wednesday, Dec 18, 13 @ 1:45 pm:

    DHS has had employee levels drop by almost 40% since 2002…almost 8,000 fewer employees. So we can’t be surprised when work such as eligibility redeterminations don’t get done. Some of those caseworkers have caseloads exceeding 2000 persons.


  25. - Arthur Andersen - Wednesday, Dec 18, 13 @ 1:52 pm:

    Amen, D.P. Gumby!

    What a fine idea. Hire a contractor that has already made several million off the State under Captain Squeezy to comb the retiree rolls looking for fake dependents-but they only get paid if they find a specified number of bast***s, if you will. Oh, and birth certificates and marriage licenses aren’r good enough. They want IRS data, too.

    There’s a perverse incentive if I ever saw one.


  26. - Norseman - Wednesday, Dec 18, 13 @ 2:51 pm:

    Well said D.P. Gumby & AA. A whole lot of unnecessary angst put on folks.


  27. - Cassandra - Wednesday, Dec 18, 13 @ 3:27 pm:

    Before I ran out and hired a few hundred more civil servants, I’d look at the application process and redetermination process itself and see what could be streamlined. How much and what kind of checking is necessary and why. I was surprised, for example, to read somebody’s comment about sending snail mail out to employers. Wouldn’t that person’s employment status be on some computer somewhere without having to send out a letter. And if a self-employed individual is reporting x amount of income, why wouldn’t the state check their IRS files (or rather, have the computer check it) and take that number. I suspect we are going to see
    better computer systems attached to this process once the Affordable Care Act gets past its startup pains, with the goal being that anyone could simply go on the computer themselves and apply and get redetermined. That is what the exchanges will eventually be able to do. A vast bureaucracy shouldn’t be necessary.


  28. - Demoralized - Wednesday, Dec 18, 13 @ 4:07 pm:

    ==Before I ran out and hired a few hundred more civil servants==

    Don’t look for that to happen anytime soon.

    ==I suspect we are going to see
    better computer systems attached to this process==

    You are assuming the state will spend money on IT. Plenty of people bemoan the state of the state’s financial system, for example, but then throw a fit at the cost it would be to completely overhaul that system. You have to invest in these things if you want to use technology.


  29. - AFSCME Steward - Wednesday, Dec 18, 13 @ 4:48 pm:

    Cassandra

    Perhaps you should understand the process before commenting on it.

    “Isn’t the rank and file management in the union, by choice. Then they would get the negotiated raises every 4 years. Actually, I thought PSA’s were unionized now and were thus doing pretty well. Or maybe RNUG is talking about the next level up, although surely there can’t be many non-unionized staff left in Illinois state government–only the very highest level execs.”


  30. - eyewitness - Wednesday, Dec 18, 13 @ 5:01 pm:

    What kind of people would call throwing 216,000 poor people off of a barebones healthcare plan “a stunning success”???


  31. - mcb - Wednesday, Dec 18, 13 @ 6:36 pm:

    So Maximus’ 30% error rate was terrbile. Haven’t 40% of those signed up on the rolls been removed so far. So the state employees were wrong 40% of the time, but they should get the work instead of the terrible contractor that is wrong 30% of the time? Maybe I’m missing something. Seems like the whole process has major issues.


  32. - mcb - Wednesday, Dec 18, 13 @ 6:38 pm:

    The only thing that’s obvious from this whole deal is that this was a handout to AFSCME from Quinn. Sorry I cut your pensions so here’s a win for you. Now please resume your endorsement of me.


  33. - Norseman - Thursday, Dec 19, 13 @ 12:28 am:

    STL, despite your blinders it is true. Obviously, it’s not universal, but most agency staff have seen political hacks get moved around to get salary increases. Besides, pay increases for Governor staffers is well publicized. If you’ve missed out, talk to your sponsor.


  34. - AFSCME Steward - Thursday, Dec 19, 13 @ 7:35 am:

    MCB

    Do you understand that Quinn was in a weak position & was trying to get whatever he could ? Quinn lost an arbitration concerning the Maximus contract. It was supposed to be terminated effective 12/31/13. He went to court in attempt to have the arbitration decision overturned. FYI, the courts normally side with the arbitrator unless there is something unsual about the case. Quinn actually won. He was able to settle the arbitration out of court & extend the Maximus involvement in Medicaid for up to 6 additional months. AFSCME chose this settlement rather than drag it out in court.

    “The only thing that’s obvious from this whole deal is that this was a handout to AFSCME from Quinn. Sorry I cut your pensions so here’s a win for you. Now please resume your endorsement of me.”


  35. - AFSCME Steward - Thursday, Dec 19, 13 @ 7:48 am:

    MCB

    Where did you get this information ? In my office, the roll has been decreased by a little less than 10%. Most of these cases are people who moved out of Illinois and were not using Medicaid anymore. What has occurred is a large number of incorrect cancellations, including pregnant women & families with small children who were unable to get medical care because of Maximus errors. Women with sick children were unable to get care for their kids until after the case got reinstated.

    This notion that state workers are making errors on 40% of the cases is absurd. The workers use what resources they have available to them to make eligibilty determinations. Many of the customers we serve lie about their situations. They fail to report fathers of children in the home. They fail to report income. Additionally, as has been reported on this blog frequently, Illinois has the lowest per capita staffing level of any state. As a result, piles on medical redeterminations never got done because of staffing shortages.

    The state could have gotten the resources received from Maximus on its own. Most of what Maximus provided was computer data, which the state could have purchased. Additionally, Maximus hired a whole bunch on new workers, which if the state had done would have cleaned up the backlog.

    The union successfully argued before the arbitrator, not only did the state violate the union contract by contracting with Maximus, but the state could have gotten the same results for less money if it had followed the contract. The so called “Medicaid errors” were the result of chronic understaffing and outdated computer systems.

    “So Maximus’ 30% error rate was terrbile. Haven’t 40% of those signed up on the rolls been removed so far. So the state employees were wrong 40% of the time, but they should get the work instead of the terrible contractor that is wrong 30% of the time? Maybe I’m missing something. Seems like the whole process has major issues.”


  36. - AFSCME Steward - Thursday, Dec 19, 13 @ 7:55 am:

    Cassandra, have you ever worked in a DHS office ? Do you have any idea at all of the enormity of the job ? Due to the state’s failure to address staff shortages for years, 520 employees is still not enough. Due to the ACA, hundreds of thousands of new persons will be added to the Medicaid rolls over the next few years. We needed the 525 workers just to service the existing cases. There will be a need for way more than 525 workers in the future.

    “Still, 520 workers seems like a lot”


Sorry, comments for this post are now closed.


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        * Illinois medical marijuana: $100 for patient card
        * Middle Road hotel project picking up speed
        * Road work to close lanes on Illinois 15 beginning Monday
        * Roadwork to close lanes on Illinois 15 beginning Monday
        * Tom's mailbag April 18, 2014
        * Man sentenced to six years for toddler's death
        * Mining-related event leads to report of small earthquake
        * REVIEW: 'Spamalot' is silly, silly, silly
        * Fatal crash in St. Clair County


        * The 10th District money race
        * Aurora Democrat calls out IHSA
        * Lawyers: Ill. hazing law vague, unconstitutional
        * Ill. House OKs lower-cost hunting bill for seniors
        * Quinn’s running mate takes new consulting job

        * Shimkus addresses current issues - Insuran...
        * Grant puts AEDs in Clark County - Paris Be...
        * Congressman's staff in Neoga today - Journ...
        * Congressman to visit Renewable Energy Cent...
        * Shimkus Honors 100th Anniversary of Heath ...
        * Congressman to visit with constituents in ...
        * IRS Tax Breaks Available for Disaster Vict...
        * Shimkus accepting Congressinal Art entries...
        * Rep. John Shimkus Spreads 'Obama Giving Aw...
        * Shimkus supports anti-spoofing legislation...

        * Loading Koch Industries Website Too Many T......
        * Maryland and DC among worst for food aller......
        * Cleveland State University to reestablish ......
        * Convicted political boss Al Sanchez runnin......
        * Candidates make last filings for local, st......

        * Illinois Lt. Gov. Simon opposes pension le......
        * Dillard Odd Man Out on Pension Deal Reaction...
        * Sen. Mark Kirk sides with Rauner on pensio......
        * Governor's race infighting threatens pensi......
        * SCHOONERS - Home of Everyone's Favorite Be......

        * Metra files reveal years of political patronage hiring
        * Peoria Mayor Sends Police to Track Down Twitter Parodist
        * Nine Vote Yes, But Only Five Are At The Meeting...
        * Aurora Planned Parenthood Draws Good Friday 'Way of the Cross' Observance
        * Dick Durbin’s ‘candy-flavored’ addiction
        * 86M full-time, private-sector workers now sustaining 108M benefit takers
        * Blago campaign account spends final dollars
        * Propagandizing our children: YA book review of Something Like Normal
        * Telematics can reinforce centralization
        * Legislative inspector general calls for laws targeting patronage and clout


        * Illinois filmmakers invited to enter state’s Shortcuts competition - 7th year for Illinois Film Office contest honoring local talent
        * Injured Worker Charged with Workers’ Compensation Fraud - Defendant Lied Under Oath to IWCC Arbitrator in an Attempt to Obtain Benefits
        * State-wide Veterans Service Offices Will Be Closed for Annual Training
        * Liquor Control Commission March Underage Compliance Report
        * Governor Quinn Releases First-Ever Illinois Bike Transportation Plan - Plan Formally Makes Bicycles Part of Illinois’ Long-Range Transportation Vision




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