AUGUSTA — Republicans on the Legislature's budget-writing Appropriations Committee on Thursday defended a controversial no-bid, $1 million contract with a Rhode Island company to study and issue an analysis of Maine's welfare programs.
The contract, issued to the Alexander Group, the group's CEO, Gary Alexander, and Republican Gov. Paul LePage have come under withering criticism from Democratic leaders and others in recent days over the contract issued by the Maine Department of Health and Human Services and signed in September.
Maine DHHS Commissioner Mary Mayhew issued a statement defending her agency's actions and Alexander's company as a credible and competent vendor.
The group, hired for $925,000, is contracted to issue a five-part series of reports and recommendations aimed at finding savings and other efficiencies in the state's welfare programs.
The first portion of the report, meant to examine the impact of a possible Medicaid expansion in Maine — had a contracted target due date of Dec. 1. While that portion of the report has yet to be delivered, Republicans seemed unfazed by the missed deadline.
"They've done similar types of analysis and work for other states — five other states, I believe it is," said state Rep. Dennis Keschl, R-Belgrade. "In most of those states, they've found ways to save money in the program."
Keschl said looking for savings in Maine's welfare system is a responsible thing to do.
"I think it's prudent to do, this type of investigation and the Alexander Group seems to have some success in the past and I think we should move forward," Keschl said.
Rep. Cathy Chase, R-Wells, said she agreed that the efforts to find fraud, waste and abuse in the state's welfare system, which consumes a large portion of the state's overall budget, made sense to her, as well.
She said the final recommendations from the Alexander Group may or may not be implemented, based on what the Legislature decides. The last portion of Alexander's report is not due until May, after the Legislature adjourns.
Adrienne Bennett, Lepage's press secretary, confirmed LePage has met twice with Gary Alexander in Augusta.
The first meeting was in March, before Alexander was awarded the contract for the work. The second meeting came in October after the contract was issued, she said. She said the first meeting with Alexander was to discuss fraud in Maine's welfare system.
Bennett said the company had been updating DHHS with verbal reports, so the notion that the consultant had missed its due date was misinformed.
"He has a track record with working with the federal government and working to receive flexibility for (Medicaid) plans that work with various states," Bennett said.
She said the decision to hire Alexander was in the hands of DHHS and that LePage was not directly involved in the contract process. She said there were no written communications between LePage's office and DHHS regarding Alexander's contract.
In her statement issued to the media via email Thursday, Mayhew said DHHS had issued other no-bid or "sole-source" contracts in the past, some for amounts larger than that paid to the Alexander Group.
"The notion that the cost of this contract is larger than most and, as such, should have gone out to bid is motivated by politics and reflects both selective and short-term memory," Mayhew said in the prepared statement.
She noted that part of the delay on the first portion of Alexander's report was because DHHS did not produce the data he needed for his analysis in a timely manner.
"We are confident that the work completed by the Alexander Group will be of the highest quality and will be valuable as Maine continues to reform its welfare programs to make them more efficient, cost-effective and sustainable and to ensure that we are serving those who are most in need," Mayhew said.
Democrats, however, said they remained concerned and frustrated over the lack of information on how well Alexander's company was vetted and of the company's "unique qualifications" that made them eligible to receive the contract without competing for it.
"Why the need to do this no-bid, sole-source contract?" Rep. Mike Carey, D-Lewiston asked. "Why the behind-closed-doors things? Why the choice of this group? This isn't a question about whether or not public money needs to be accounted for. It's, 'How did we spend public money and is this right?'"
Earlier this week, Pennsylvania Auditor General Eugene DePasquale was critical of Maine's lack of research on the Alexander Group before hiring them.
Gary Alexander served as that state's secretary of its Department of Public Welfare. An audit done by DePasquale's staff that was issued in November suggested mismanagement by Alexander cost the state $7 million in increased Medicaid costs.