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home : • politics : • government
January 27, 2020

6/19/2014 10:33:00 AM
Eye on Augusta: DHHS Cancels Million-Dollar Contract with Embattled Consultant Amidst "LePlagiarism" Scandal
The DHHS letter dated June 12 rescinding part ofthe contract was addressed to Alexander Group Inc., 22 Whispering Pine Terrace, Greenville, Rhode Island. Above is a Google Maps image of that address, the Alexander Group, Inc. headquarters.
The DHHS letter dated June 12 rescinding part of

the contract was addressed to Alexander Group Inc., 22 Whispering Pine Terrace, Greenville, Rhode Island. Above is a Google Maps image of that address, the Alexander Group, Inc. headquarters.
by Andy O’Brien

After several weeks of withering criticism over allegations of rampant plagiarism, the Maine Department of Health and Human Services announced last Friday that it has cancelled its contract with controversial conservative consultant Gary Alexander of the Alexander Group. In September, the Maine Department of Health and Human Services awarded a $925,000 no-bid contract to the Rhode-Island-based consultant to produce five reports to study the financial feasibility of accepting millions of dollars in federal Medicaid money as well as to come up with recommendations for reforming Maine's social safety net.

Democrats and other critics have maintained from the outset that the Alexander Group had no standing to conduct rigorous research. They argued that the contract award was ideologically driven and any resulting study would simply offer up predetermined, biased results that would be used to bolster Governor LePage's anti-welfare re-election campaign. In April, during the last session of the Legislature, Democrats passed a bill to cancel the contract, but the measure was vetoed by the governor on April 28, and his veto was upheld by House Republicans. Republicans defended the contract, arguing that Alexander, who most recently served as Pennsylvania's head of Public Welfare, had helped save Rhode Island money when he was that state's Department of Health and Human Services chief. In 2010, LePage had offered Alexander the job of Department of Health and Human Services Commissioner, but he reportedly turned it down because it didn't pay enough.

Plagiarism Accusations Emerge

At the end of May, the Bangor Daily News and Portland Press Herald columnist Mike Tipping revealed multiple examples of blatant plagiarism in Alexander's most recent report, in which the consultant lifted two pages directly from a 2011 report by the Center on Budget and Policy Priorities without proper citation and copied passages from the Kaiser Family Foundation, the Commonwealth Fund and the University of Southern Maine's Muskie School of Public Service. After that news broke, the governor suspended payments to Alexander, expressing "grave concerns" about the accusations and promised to "get to the bottom of it." According to Tipping, LePage even personally called plagiarism expert Professor Mike Smit of Dalhousie University, whom the columnist consulted for his column, to get a recommendation for plagiarism-detecting software. As Tipping noted, many of the plagiarized passages could be found by simply doing a Google web search of some of the passages.

Democratic leaders pounced on the "LePlagiarism" scandal, renewing calls to cancel the contract and recoup the spent money. On June 2, the governor responded to the criticism by telling Democratic President Justin Alfond and Speaker Mark Eves to butt out.

"After the defeats you suffered during the past legislative session, I understand your need to score political points. But please stay out of the executive branch's business," wrote the governor.

Alexander has since acknowledged errors in the report, but wrote in a statement that "grammatical errors do not undermine the substantive analysis and policy recommendations offered by the reports."

Finally, on June 13, DHHS announced it was ending its relationship with the embattled consultant and asked for a portion of the money to be paid back. In a letter to Alexander from DHHS, newly promoted Chief Operating Officer Sam Adolphsen, who oversaw the original contract when he was the department's former "director of strategic development," wrote that the state would withhold $145,153 not yet paid out for the plagiarized report and request a partial refund of $27,000 for the previous "Medicaid Expansion Analysis." Adolphsen stated that the consultant could keep the $474,760 already paid out for services provided.

"The early termination of the contract will result in a total loss to the Alexander Group of $450,400," wrote a DHHS spokesperson in a statement. "The total amount paid to the Alexander Group is $474,760. Of that amount, $239,075 was State funds and $235,685 came from Federal funds."

Democrats have accused DHHS of misusing the federal portion of the funds, which is dedicated for Medicaid and the Temporary Assistance for Needy Families (TANF). As one astute observer noted last fall, a typo in that original contract with the Alexander Group identified the funding as coming in part from "Temporary Assistance from Needy Families."

Concerns About Alexander Were Made Known

When news of the Alexander Group contract broke last winter, it prompted Pennsylvania state auditor Eugene DePasquale, in an op-ed printed in the Portland Press Herald on January 6 and in The Free Press on January 8, to question whether the LePage administration had done any research on Alexander before inking the deal. DePasquale said he was "shocked" to hear the LePage administration hired Alexander and urged Mainers to "avoid the troublesome fate suffered by the people of Pennsylvania under Alexander's 'stewardship.'"

An audit conducted by DePasquale's office alleged that thousands of home care workers had paychecks delayed for up to four months due to Alexander's mismanagement of payroll providers. As a result, the audit reported that thousands of care recipients switched to a more expensive care model that ended up costing Pennsylvania taxpayers at least $7 million annually. During his tenure in Pennsylvania, Alexander earned the reputation of waging a "war on the poor" for taking Medicaid health care coverage away from 130,000 people, including 80,000 children. He also reduced eligibility for low-income single parents to receive child care and restricted access to food stamps for impoverished elderly recipients by asset-testing them.

"The initiatives implemented during Alexander's tenure were wrong for Pennsylvania," wrote DePasquale. "I sincerely hope the people of Maine don't get hurt by the same problems."

Maine Republicans fired back, calling DePasquale a partisan Democrat with an agenda, but others pointed out that Alexander had other problems in Pennsylvania. While managing the $27.6 billion public welfare budget, Alexander also came under criticism for continuing to commute dozens of times a year using a state-owned car from his house in Rhode Island, where he managed a real estate company on the side, according to the Philadelphia Inquirer. Alexander resigned from his post in February 2013 to "pursue private-sector opportunities." Shortly after his resignation, the Corbett administration fired three top officials at the Department of Welfare.

Republicans argue that as Rhode Island's Secretary of Health and Human Services under former Governor Donald Carcieri, Alexander helped save the state millions by obtaining a "global waiver" from the federal government. They have asserted that the waiver allowed for "more flexibility" in the state's Medicaid program by converting the funding for the public health insurance program into a block grant. However, the Center for Budget and Policy Priorities, the same think tank Alexander plagiarized, called the waiver a "sweetheart deal" between the former Republican governor and the Bush administration.

As the CBPP stated in 2011, "The federal government effectively unloaded additional federal money on the state and gave Rhode Island federal funds beyond what it would receive under the regular Medicaid program, in return for the state accepting a cap on its Medicaid expenditures at an inflated level that it never expected to reach anyway." The CBPP report authors doubted that other states could receive such a deal, as ordinarily the block grants are designed to cut federal Medicaid funding, not increase spending as has happened in Rhode Island.

Reports Recommend LePage Policies

During Alexander's short business relationship with the State of Maine, the consultant had other credibility problems besides the plagiarism scandal. In addition to missing multiple deadlines to release the reports as required in the contract, Alexander also came under fire from critics for allegedly inflating the estimated cost of expanding Medicaid. Like LePage, Alexander is a vocal critic of Medicaid expansion, and the Alexander study backs up the governor's assumptions. According to Alexander, it would cost the state over $800 million over the next 10 years to expand Medicaid to 70,000 low-income Mainers and consume half of the state budget by the year 2024.

Former State Economist Charles Colgan said that the Alexander Group report erroneously relies on predictions that Maine's poverty rate will increase by 30 percent over the next six years. He said those numbers run counter to his own analysis of economic trends.

Kathy Gifford, a Medicaid analyst for Indianapolis-based Health Management Associates, told the Press Herald that the report used a lower federal Medicaid reimbursement rate in their calculations, which could have led to the report's projected costs of expansion being inflated by $575 million.

Critics also panned the Alexander Group's feasibility study because it did not factor in the economic activity that would be stimulated by the injection of millions of dollars in federal money into Maine's economy. In the study, Alexander dismissed assertions that the expansion could create over 3,000 jobs as "Neo-Keynesian," an economic theory that suggests jobs can be created through government intervention in the economy.

Although the LePage administration maintains that there is "value" in the Alexander Group's recommendations for reforming the state's welfare programs, many of the recommendations that weren't lifted verbatim from the CBPP were actually ideas that the governor already proposed last session, but were rejected by legislative Democrats. One recommendation, which would eliminate exemptions from work requirements and remove allowances for TANF recipients to attend school while receiving benefits, was proposed by Rep. James Gillway on behalf of the governor last spring.

The Alexander Group also came up with several recommendations attacking general assistance for the poor, such as chopping up GA reimbursements to municipalities into smaller block grants, discontinuing emergency assistance for adults without children, restricting GA to only individuals who don't receive other benefits, or simply eliminating the program altogether.

In a statement to The Free Press, Alexander called the policy recommendations in his reports "practical reforms to help lift the poor out of poverty and support the neediest like the intellectually disabled, poor children and elderly while delivering value to the taxpayers."

Whether the content of the $474,760 Alexander Group reports is original or even factual, Governor LePage will no doubt continue to hammer home the same message. Still, it's unlikely voters will be hearing Governor LePage cite the reports be name on the campaign trail. And for Alexander, the ordeal appears to have already affected his credibility in conservative circles.

According to the Bangor Daily News, upon hearing news of the scandal, GOP Rep. Paul Ryan of Wisconsin rescinded an invitation to Alexander to testify at a June 1 hearing before Congress regarding GOP efforts to rollback "War on Poverty" social safety net programs.

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