Consultants Make Top Dollar to Scrutinize N.C. Medicaid

[hue]

http://www.northcarolinahealthnews.org/2014/02/14/consultants-make-top-dollar-to-scrutinize-n-c-medicaid/

A recent review of North Carolina’s Medicaid administration found a need for organizational improvements. Part of the answer for DHHS is to hire several high-priced consulting firms.
By Rose Hoban

In the wake of a consultant’s report stating that North Carolina’s Medicaid program needs to beef up its organizing, budget forecasting and administrative capabilities, health leaders have hired two more consulting firms to guide the Division of Medical Assistance, which manages the Medicaid program, through administrative changes.

In two no-bid contracts that allow for individual consultants to be paid as much as $803,000 per year, two management consulting firms will advise DMA on reorganizing the finance section and assessing the program-integrity and audit sections.

The first contract, for $3.25 million, went to the consulting firm Alvarez & Marsal to create a new organizational structure for DMA, including writing job descriptions and recruiting people to fill financial positions in the Medicaid program.

The consultants also will review the organization and performance of the NCTracks program and the division’s communications.

The firm Alvarez & Marsal is best known for being tapped in 2008 to manage the bankruptcy of financial giant Lehman Brothers at a cost of nearly a half-billion dollars. Critics of the financial bailout said that bill was too high.

The contract calls for work to be done by eight people with salaries ranging from $242 to $473 per hour and an “intern” earning $84 per hour. One of the consultants, a “director,” is slated for 2,040 hours of work for total earnings over the year of $803,760 (see chart.).

[okaawhatever]

1. It appears the firms have also been working for another tea party Governor in Louisiana:

More recently, Alvarez & Marsal drew scrutiny in Louisiana, where the firm received a $4 million contract to find efficiencies in that state’s Department of Administration. Louisiana included a clause in its contract with the firm that if the state does not meet savings targets based on Alvarez & Marsal’s suggestions, the state can withhold $600,000 of the total payment.

No such clause exists in the North Carolina contract, which also stipulates that the state can extend the contract for another year if necessary.


Sounds like they specialize in cost cutting in a way the Governors and their big money interests approve.