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Archive for the ‘Ethics’ Category

There is more damage control awaiting the most ethical administration in Louisiana history and just as with the Bruce Greenstein saga, the Department of Health and Hospitals (DHH) is front and center.

The Louisiana Board of Ethics last Thursday (Feb. 19) voted to file ethics charges against Galen Schum, DHH Secretary Kathy Kliebert’s brother-in-law, because of his failure to comply with state law requiring him to report income he received from a company under contract to DHH. ETHICS CHARGES

On Nov. 17, 2011, while Schum was serving as Director of Regional Operations for the Office of Behavioral Health (OBH), Magellan Health Services signed a two-year contract with OBH to administer behavioral health managed care services for children and adults.

That contract, approved on Jan. 23, 2012, and which went into effect on Mar. 1, 2012, was originally in the amount of $354 million for two years, but was amended to a three-year contract for $547.78 million and is scheduled to expire on Saturday.

On Feb. 13, 2012, just three weeks after the contract was approved and just over two weeks before it went into effect, Schum submitted a job application to Magellan and was hired on Feb. 27, only two days before the contract took effect.

He resigned from Magellan on Jan. 31, 2014 but during the time he was employed there, he earned more than $146,000 in salary, according to documents obtained by LouisianaVoice.

Kliebert was serving as Deputy Secretary of DHH when the Magellan contract was approved on Nov. 17, 2011, and remained in that capacity until April 1, 2013, when she was elevated to her current position of Secretary.

State law (R.S. 42:1114) provides with respect to the filing of financial disclosure statements, “…that each public servant and each member of his immediate family who derives anything of economic value, directly, through any transaction involving the agency of such public servant or who derives anything of economic value of which he may be reasonably expected to know through a person which (1) is regulated by the agency of such public servant, or (2) has bid on or entered into or is in any way financially interested in any contract, subcontract, or any transaction under the supervision or jurisdiction of the agency of such public servant shall disclose the following:

  • The amount of income or value of any thing of economic value derived;
  • The nature of the business activity;
  • Name and address, and relationship to the public servant, if applicable, and
  • The name and business address of the legal entity, if applicable.

The disclosure statement is required to be filed each year by May 1 and shall include such information for the previous calendar year.

R.S. 42:1102 defines “immediate family” as the children of the public servant, spouses of his children, his siblings and their spouses, his parents, spouse and the spouse’s parents.

“Galen Schum violated …the Code of Governmental Ethics by failing to file a financial disclosure statement on or before May 1, 2013, disclosing income received during 2012 from Magellan Health Services, Inc., and on or before May 1, 2014…at a time when Magellan Health Services, Inc. had a contract with the Louisiana Department of Health and Hospitals—Office of Behavioral Health and while his sister-in-law, Kathy Kliebert, served as the Deputy Secretary and Secretary of the Department of Health and Hospitals,” the Board of Ethics document says.

The board issued a formal request that the Ethics Adjudicatory Board:

  • Conduct a hearing on the foregoing charges;
  • Determine that Galen Schum has violated (state law) with respect to the foregoing counts, and
  • Assess an appropriate penalty in accordance with the recommendation of the Louisiana Board of Ethics to be submitted at the hearing.

Other documents obtained by LouisianaVoice indicate that Schum, on Jan. 18, 2011, in his capacity as Director of Regional Operations for OBH, presented a report to the Louisiana Commission on Addictive Disorders on the status of OBH’s ongoing privatization efforts—efforts which led directly to the awarding of the Magellan contract.

It was at that same Jan. 18 meeting that Kliebert announced to the commission that she had been selected as the new DHH Deputy Secretary and would be leaving her position at OBH.

Schum also participated in a commission meeting on Oct. 11, 2011, at which time he gave the commission “a brief update on the Louisiana Behavioral Health Partnership,” according to commission minutes of that meeting.

Schum said that the selection of the Statewide Management Organization (SMO) had been completed and that Magellan Health Services “was the vendor selected to be the Louisiana SMO, and that the Office of Behavioral Health was currently involved in the contract negotiation process with Magellan.”

Finally, the minutes of a Magellan Governance Board meeting of June 20, 2012, indicate that Schum was employed as a Reporting Analyst for the company.

Magellan had come under sharp criticism from the Legislative Auditor’s office in August of 2013 in a report that said the administration’s privatization of mental health and addictive disorder treatment programs had created confusion and added costs for local human services district that provide the care. http://www.nola.com/politics/index.ssf/2013/08/audit_shows_privatization_of_m.html

That audit report, which examined privatization results at human services districts in Baton Rouge, Houma, New Orleans and Amite, said privatization had caused problems with claims payments which increased costs for the districts and made it more difficult for the districts to receive reimbursement for services. The report also said the districts lost money under a requirement that they use Magellan’s electronic health records system.

The Capital Area Human Services District in Baton Rouge, for example, told auditors that its administrative costs for billing claims had increased $270,000 a year since the privatization took effect. That cost was attributed to problems with claims reconciliation and collection, the audit said.

Meanwhile, the report said, DHH failed to ensure that Magellan processed claims in a timely manner, often taking weeks or months to process claims. The report also said DHH failed to penalize the company when it did not meet planning and technical benchmarks. “No sanctions have been imposed on Magellan for not meeting all required contract provisions,” it said.

Just another Jindaled state agency headed for yet another privatized train wreck.

But don’t say we never warned you.

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By Robert Burns (Special to LouisianaVoice)

When Hurricane Gustav struck south Louisiana on Sept. 1, 2008, almost three years to the day after Katrina, it set in motion a series of events that would ultimately:

  • upset the Livingston Parish political structure;
  • leave the parish facing a bill for more than $40 million in cleanup costs;
  • see a call for but never a follow up on an investigation into the formation of a fictitious corporation (at a fictitious address headed by a fictitious person) which somehow managed to be the only bidder on a lucrative contract;
  • result in the arrest of another contractor who was also serving as an FBI informant to help root out fraud, and
  • leave residents more than six years later still wondering who are the good guys and who are the bad guys.

First, some background.

The massive cleanup that followed Gustav required fast action and, regrettably, such fast action oftentimes opens the door for governmental abuse. The Federal Emergency Management Agency (FEMA) declared that to be the case in Livingston Parish’s cleanup, and the agency denied an astounding $59 million in clean-up costs.

Crucial to FEMA’s decision was Corey delaHoussaye, a contractor hired by Livingston Parish to assist with U.S. Army Corps of Engineers permitting issues nearly a year after the storm struck.  DelaHoussaye, coincidentally, also served as an FBI informant during the cleanup.  Livingston Parish District Attorney Scott Perrilloux, along with the State Office of Inspector General (OIG), have accused  delaHoussaye of submitting his own fraudulent invoices for hours they assert he did not perform work as part of his $2.3 million billings.  DelaHoussaye attorney, John McClindon, contends that the OIG got a search warrant for delaHoussaye’s residence on July 17, 2013 but delayed executing it and arresting delaHoussaye for eight days so it would coincide with a council meeting to approve delaHoussaye’s final $379,000 in invoices.  DelaHoussaye wasn’t paid, and he sued the parish for nonpayment.

Meanwhile, Perrilloux sought an indictment against delaHoussaye, but he came up one vote short in an 8-2 vote of the grand jury in December of 2013.  Undeterred, Perrilloux proceeded with a bill of information containing 81 counts, including 73 of filing false public records, but last Friday Perrilloux dropped 19 of those 73 counts.

On Monday, 21st Judicial District Judge Brenda Ricks ruled that insufficient evidence exists to proceed with a trial—a major victor for delaHoussaye.  Perrilloux presented only one witness during Monday’s hearing: OIG investigator Jessica Webb, who testified that, during times delaHoussaye charged the parish for hours worked, he sometimes was at an anti-aging clinic, at Greystone Country Club playing golf, or at Anytime Fitness working out.

McClindon, calling the OIG’s investigation “half baked,” said the OIG’s office seized his client’s computers and “looked at what they wanted to look at,” ignoring emails and failing to talk with anyone.

Similarly, at the trial of Murphy Painter, former director of the State Office Alcohol and Tobacco Control (ATC), former OIG investigator Shane Evans testified that he merely “wrote down” what ATC employee Brant Thompson said to him regarding Painter’s being “manic depressive, out of control, and selectively enforcing alcohol statutes,” and admitted the OIG did zilch to corroborate Thompson’s assertions even though it was Thompson’s initial characterization that reportedly prompted Gov. Bobby’s firing of Painter. (Subsequent details later revealed Painter’s firing was steeped in the time-honored tradition of Louisiana politics as usual.) http://louisianavoice.com/2013/02/06/emerging-claims-lawsuits-could-transform-murphy-painter-from-predator-to-all-too-familiar-victim-of-jindal-reprisals/

A company called Comprehensive Business Solutions, with an address on Coursey Boulevard in Baton Rouge, was created by someone named Patterson Phelps of Mandeville in March of 2010, according to corporate records filed with the Secretary of State’s office.

That date was just prior to the Livingston Parish Council’s issuing invitations to bid on a lucrative contract for cleanup.

The only problem is there is no such business at the address given and in fact, never was, and no one has been able to ascertain who Patterson Phelps is, other than speculation that it was an alias for a member of the parish council who was attempting to obtain the contract for himself.

A spokesperson for the Secretary of State said the corporate papers were filed electronically with payment made by credit card and that no records exist that would reveal who was actually responsible for creating the shell company.

The parish council did indicate it would instruct Perrilloux to conduct an investigation into the identity of the mystery person, but no results of any investigation, if it was ever conducted, have been made public.

Perrilloux, apparently fuming over Ricks’ ruling, said after the hearing that he would proceed with trial anyway and added, “Just because they wear a black robe doesn’t mean they know everything.” Legally, Perrilloux cannot proceed with a trial unless Ricks’ ruling is overturned by the First Circuit Court of Appeal or the Louisiana Supreme Court. He later said he would appeal the decision.

Brian Fairburn was Livingston Parish’s Emergency Manager and Coordinator for Homeland Security at the time Gustav struck.  His job was to hire monitors who would oversee operations to ensure FEMA reimbursement eligibility.

Fairburn testified that Mike Grimmer, then-Livingston Parish President, indicated to him that he had grave concerns regarding some of the itemized charges on the FEMA project worksheet and likely would not sign off on it.  When asked why, Fairburn indicated Grimmer told him, ‘“The costs are too high and we have permitting issues.’ (He) specifically told me we were taking kickbacks, that we were just out there creating work for these contractors to do.”  When asked whom Grimmer asserted was taking kickbacks, Fairburn responded, “Jimmy McCoy (Councilman from District 2), and he included me as being in on it also.” Fairburn added that Grimmer, “tried to ruin McCoy,” and that he “wanted to show that there was trouble, corruption, and crime in the parish.”  Fairburn also testified that he was terminated soon after the Gustav project but added that when Layton Ricks defeated Grimmer for parish president, he was rehired.

Brian Fairburn testified that during a meeting on November 26, 2008, Eddie Aydell of Alvin Fairburn and Associates (no relation to Brian) expressed serious reservations about proper permitting with the Army Corps and that Aydell was “scared” the Corps would assert that permits should have been issued before work was begun.

It was at that juncture that delaHoussaye was hired to assist with permitting issues.  Brian Fairburn said that McCoy said that the parish “would not” be obtaining any Corps permits and that Grimmer “shut the project down,” after which the Corps issued a cease and desist order on drainage projects.

FEMA’s attorneys were not happy with state and parish attorneys’ attempts to turn the hearing into a trial of delaHoussaye, and they strongly objected to 20 exhibits and depositions, including photographs of delaHoussaye and his son, which they said were unrelated to the hearing.  FEMA attorney Linda Litke said, “delaHoussaye was hired a year after the disaster in 2009 to basically go through the documentation and clean up the mess……  The parish attempted to criminally indict him…..They have now attempted to proceed with criminal action against him without an indictment.  It is reprehensible that they would bring this documentation in this case……DelaHoussaye is a confirmed FBI informant.  He was a whistleblower, and that is why the parish has gone after him.”

Perhaps the most riveting testimony was that of former Parish President Mike Grimmer, who testified that McCoy signed a contract addendum even though Grimmer was the only one with authority to do so.  He said he was “unaware the contract addendum was even out there.”  He indicated the addendum greatly increased the prices, including an increase in the per linear foot price.

Grimmer stated that he got calls from irate homeowners regarding crews, “trespassing on their properties….. and the trees had been taken with no permission.”  Grimmer also testified he obtained invoices for payment on work performed at local schools and North Park which had already been paid by other local agencies.  He referenced Legislative Auditor Daryl Purpera’s report which he testified that he’d requested.  He said it reinforced his concerns about documentation problems for cleanup operations. Grimmer’s response took “no exception” to the report.

That report also cited a contractor for hiring direct family members of Council members McCoy and Don Wheat which the report said may have violated ethics laws, so the matter was referred to the Louisiana Ethics Board.  Wheat, Councilman from District 6, responded angrily to the report and stated that Gov. Jindal’s GOHSEP’s Office had indicated the FEMA report was “fundamentally flawed” and on appeal and that Purpera, “continued with the same flaws and I urge you to correct your mistakes.”

Grimmer expressed shock when he attended an Office of Emergency Preparedness (OEP) meeting in May of 2009 and a $42 million tab for wet debris removal was “dropped in my lap.”  Grimmer asked for a breakdown and, on June 9, 2009, he got one and an indication that the final tab was estimated at $92 million.  He refused to sign off on the $42 million and verbally instructed all work to cease, and the Army Corps followed up with a written cease and desist order shutting down all drainage work.

FEMA attorneys then provided the panel with a handout of a power point presentation created by Grimmer entitled, “The Truth about the Debris Cleanup.”  Slides were presented depicting:

  • an oak tree removal for $8,415;
  • two other single-tree removals for $6,570 and $4,600, and
  • a pile of limbs for $2,805.

Grimmer said those types of vastly inflated costs prompted his decision to shut down the entire project.

Grimmer, over the objections of state and parish attorneys, last May told a three member arbitration panel that he alone would have been accountable to Purpera if he’d approved the project worksheet and that contractors, monitors, councilmen, and others would all be “gone and happy.”  He expanded on how the whole episode and his decision had adversely impacted him in the community, with long-time friends and business associates distancing themselves from him and people being angry at him but that, “at the end of the day,” he felt he’d made the right decision and felt vindicated by Purpera’s report.

Cross examination at that hearing focused on Grimmer’s frosty relationship with council members and his having referenced five such members as “the five amigos.”  Grimmer confirmed McCoy and Wheat were included in the five.  Grimmer admitted that delaHoussaye shared the fact that FBI investigator Steven Sollie had contacted him and that he was cooperating in an FBI investigation of the Gustav cleanup operations.  State and parish attorneys sought to get Grimmer to admit that he “had no interest” in the project’s costs until he obtained knowledge of the ongoing FBI investigation, a charge Grimmer vehemently denied.  Grimmer also indicated that, though he couldn’t remember which one, a FEMA monitor was paid $20,000 to make debris FEMA-eligible.

The panel ruled in FEMA’s favor.

If Perrilloux follows through and if the state’s and parish’s appeal hearing of FEMA’s decision is any guide, a trial is likely to air some of the dirtiest elements of Livingston Parish political corruption.  Louisiana Voice has obtained a transcript of the 2,197 page appeal hearing, and the contents are interesting, to say the least.

Perhaps that may be why delaHoussaye attorney McClindon said after Ricks’ ruling, “It would probably be best for us all to sit down and work this whole thing out.”

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The Baton Rouge Advocate had a superb story today (Sunday, Feb. 22) that revealed that Gov. Bobby was out of state 45 percent of the time during 2014 at a direct cost of $314,144 to taxpayers in travel, lodging, meals and rental vehicles for state police security details. You can add another $58,500 (45 percent of his $130,000 per year salary) in additional costs for which taxpayers got no return while he was chasing the pipe dream of becoming president. http://theadvocate.com/news/education/11626690-63/frequent-flier

What you are about to read, though, is not about that. We’ve written about his travels before and The Advocate’s story thoroughly documents the actual costs of his travel to the extent that it would be redundant for us to beat that drum here.

Instead, this story, while much shorter than my usual posts, is simply about a Smart Phone.

And it says volumes about just how casually this administration takes its responsibility for the looming $1.6 billion state budget deficit.

It also says a lot about how certain people are not above helping themselves as they prepare to head out the door even as the institutions they are sworn to protect are swallowed by the expanding financial crisis—non unlike the captain abandoning a sinking ship with passengers still on board. We can only hope they remember to turn off the lights as they leave.

It speaks to the disdain contempt these people have for moral codes and legal constraints which require that they put the welfare of the state first and their own interests last.

And it practically shouts the double standard, the hypocrisy, and the lack of character ingrained in the makeup of the very people entrusted with running the state in the most economical, most responsible and yes, the most principled, manner possible—and their willingness to take ethical shortcuts even as they create and then walk away from a huge fiscal mess for someone else to clean up.

All this fuss over a Smart Phone?

Yes, because the entire affair is symptomatic of a much greater illness—official callousness, obliviousness and indifference—character flaws this state can ill afford in its leaders.

All over a Smart Phone.

You see, Commissioner of Administration recently decided she wanted a new Smart Phone.

Not a state-owned Smart Phone, one that would remain for her successor when she leaves office, but a Smart Phone for her very own personal use, owned by her.

And she wanted the State of Louisiana (taxpayers) to pay for it, according to our source inside the Division of Administration.

And she wasn’t shy about asking the Office of Telecommunications Management (OTM) to purchase one for her.

But OTM said no.

Nichols persisted.

OTM continued to say no.

Nichols finally relented.

But it was the very act of trying to get the state to pony up the money for a Smart Phone for her personal use that rubs salt into the state’s festering fiscal wound and calls into serious question the very integrity of the entire administration of Gov. Bobby.

It Nichols’ apparent disregard for well-defined rules and regulations disallowing just such actions that leaves the authenticity of everything she says and does subject to scrutiny and justifiable skepticism.

She should never have made such a request…and she knows it.

Her attempt at compromising her office and that of OTM, however, was only an extension of an attitude that runs throughout the upper levels of state government.

From the purchase of the luxury Eddie Bauer and Harley-Davidson trucks by former Insurance Commissioner Robert Wooley, to long-term Enterprise auto rentals for State Department of Education employees, to legislators who use campaign funds for LSU, Saints and Pelican tickets and for expensive meals, to last year’s unconstitutional attempt to bolster State Police Superintendent Mike Edmonson’s retirement by $55,000 a year, to Deputy Commissioner of Administration Ruth Johnson’s ordering of two desktop computers, a laptop and expensive furniture for her office, there is an attitude of entitlement that permeates the offices of those who impose a completely different set of standards on the rest of us.

And it’s an attitude that flows from the top down.

And the real tragedy is nobody will do a damned thing about it.

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What began as an 18-month $350 million contract with a San Diego firm with ties to former U.S. House Speaker Newt Gingrich has morphed into a 15-month $500 million agreement with the Office of Group Benefits OGB to administer the state’s prescription drug program for more than 220,000 state employees, retirees and dependents.

But details have emerged that raise questions about a possible conflict of interests involving a consulting firm retained by a teachers benefits program in Alabama and OGB in Louisiana which ultimately recommended awarding contracts to the same company by both states.

OGB’s contract with MedImpact was originally for $350 million and was to run from Jan. 1, 2014 through June 30 of this year but has been amended to $500 million and the terms shortened to March 31, which equates to an increase of about 74 percent.

Gingrich launched the Center for Health Transformation as part of an ambitious consulting and communications conglomerate to let consumers, not health maintenance organizations (HMOs), choose their doctors, medical treatments and hospitals. http://hl-isy.com/Products-and-Services/Pharmacy-Benefit-Evaluator/PBE-Abstracts/2012/MedImpact

But Gingrich failed to reveal that his idea would be financially beneficial to drug manufacturers, health insurers and other health care professionals who paid up to $200,000 annually to participate in the center’s operations.

MedImpact was one of those companies.

Gingrich’s taking money from organizations and then using the weight of his name to advance their interests was described as “a massive financial conflict of interest” by Sid Wolfe, director of health research for the watchdog group Public Citizen. http://www.washingtonpost.com/wp-dyn/content/article/2007/06/10/AR2007061000484.html

Even former Congressman Billy Tauzin of Louisiana has entered the picture as co-chair of Medicine Access and Compliance Coalition (MACC), an assortment of health care providers who advocate lower drug prices through the federal 340B Program. http://www.huffingtonpost.com/2013/08/13/billy-tauzin-drugs_n_3719468.html

Section 340B of the Public Health Service Act requires pharmaceutical manufacturers participating in the Medicaid drug rebate program to provide outpatient drugs at discounted prices to taxpayer-supported health care facilities that provide care for uninsured and low-income people. http://www.aha.org/content/13/fs-340b.pdf

Despite the magnitude of the MedImpact contract, it is the company’s connections to Buck Consultants, hired by the state to select the winner from among four proposals for that contract, which appears more than a little questionable.

OGB’s Notice of Intent to Contract for the Pharmacy Benefits Management (PBM) service, obtained from the Division of Administration (DOA) nearly four months after requested by LouisianaVoice—and then only after we filed a lawsuit against DOA—says, “Representatives of Buck Consultants, OGB’s actuarial consulting firm, provided assistance to the (selection) committee throughout the review and evaluation process.”

Buck Consultants, readers may remember, figured prominently in the controversy over DOA’s mishandling of OGB and the dissipation of more than half of OGB’s $500 million reserve fund.

Commissioner of Administration Kristy Nichols told a legislative committee that Buck Consultants had recommended that the state lower premiums for members of OGB, a move that led directly to the evaporation of the reserve fund. Communications between Buck and DOA obtained by LouisianaVoice, however, refuted Nichols’ claim.

Four firms submitted proposals to administer the prescription drug program for OGB. They were CVS Caremark, Express Scripts, Catamaran and MedImpact. CVS was disqualified because of sanctions imposed on the company in January of 2013 by the Center for Medicare and Medicaid Services (CMS).

Catamaran was the previous contractor but the company and the state have been involved in extended litigation which is expected to continue at least through June 30 of this year.

“As indicated in the Buck report, the proposal submitted by MedImpact has been determined to be the most advantageous to the state…,” said the Notice of Intent to Contract. “Accordingly, the committee recommends that the contract …be awarded to MedImpact.”

The connections between MedImpact and Buck, a global human resource benefit consulting firm that is part of the Xerox conglomerate, however raise conflict of interests issue—a relationship that LouisianaVoice traced back to the awarding of a contract to MedImpact in 2010 to administer the pharmaceutical benefits program for Alabama public school teachers, retirees and dependents through the state’s retirement system.

The Alabama Public Education Employees’ Health Insurance Plan (PEEHIP) board members, lacking pharmacy specialty training, retained Buck Consultants in late 2009 and early 2010 to handle the entire process, including writing the request for proposals (RFP), receiving and scoring the RFPs and making a recommendation for a contract.

Buck handled the entire process and gave the board the choice of contracting with MedImpact which was named by Buck primary contact person Michael Jacobs as having the best of several proposals submitted. The entire recommendation to the board took up a single paragraph in the board minutes.

The employee for the Retirement System of Alabama (RSA) who negotiated and signed the contract between the state and MedImpact later admitted in deposition that he had been involved in a relationship with a female representative of MedImpact.

But it was the relationship between Buck, Jacobs and MedImpact that warrants a closer look.

Even as he was contracted by RSA to issue, receive and evaluate the RFPs, it turns out that Buck, unbeknownst to Alabama officials, was simultaneously under a $50,000 contract to MedImpact. BUCK DEAL WITH MEDIMPACT

Jacobs, in a Dec. 23, 2009, letter to MedImpact Vice President of Business Development Bryan Boda, noted that the term of the contract was from Dec. 24, 2009, through Feb. 28, 2010, but upon written notice, “will be extended for an additional term, as mutually agreed to by both parties.”

Attached to that letter was a description of the scope of services to be provided by Buck which, among other things called for Buck to:

  • Provide MedImpact with marketplace information without disclosing anything to identify MedImpact’s proposal;
  • Collect competitor information, utilizing the internal proprietary Buck database of vendor information and drawing upon Buck’s “extensive data base” on PBM industry practices as well as outside public sources;
  • Develop a competitive employer marketplace analysis;
  • Present its final report during a final meeting with MedImpact at its (MedImpact’s) corporate headquarters.

It should pointed out that attorneys for three Alabama pharmacies excluded from participation in the prescription drug program for the teachers found it necessary to obtain the letter of agreement between Buck and MedImpact from Buck after MedImpact refused to provide the information.

The discovery of the contract between Buck and MedImpact during the time Alabama was in the process of selecting a prescription drug administrator for PEEHIP immediately raises the question of whether a similar arrangement existed between the two during the time Louisiana was selecting an administrator for OGB’s prescription drug benefits program.

An email to Buck Consultants posing that question was not answered.

MedImpact also refused to divulge what it was paying for prescription drugs, revealing only what it was charging Alabama. In one case, attorneys for the three pharmaceutical companies did obtain a document showing that MedImpact paid about $26 for an amoxicillin prescription but charged the state $96.

That, of course, also raises the question of how the billing is done by MedImpact for OGB. Does MedImpact pass along a 300 percent mark-up to OGB at a time when the state is, for all practical purposes, broke? MedImpact calls itself a transparent company but like our “transparent” governor, it has not been forthcoming thus far with details about what it pays for prescription drugs or about its contract with Buck Consultants.

And at the other end of the spectrum, it appears that not nearly enough hard questions have been asked by officials—either in Alabama or Louisiana.

After all, how can it be considered an acceptable practice for Buck Consultants to contract with a state to issue an RFP, evaluate the proposals and make a recommendation to award the state contract to a firm already contracted with Buck Consultants for Buck to collect competitor information?

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Senator Daniel R. Martiny's Picture

STATE SEN. DAN MARTINY

C.B. Forgotston may have opened a can of worms…with the unwitting help of State Sen. Dan Martiny (R-Metairie)—and much to Martiny’s chagrin.

Forgotston, you see, is an independent old cuss who used to work for the legislature and he has been serving for a number of years now as an unofficial overseer of all things state government and few events escape his skeptical critique of the actions and motives of elected officials, particularly legislators, or as he calls them, leges.

Called “King of Subversive Bloggers” by no less an expert on cynicism than Baton Rouge Advocate columnist James Gill, Forgotston is beholden to no one and any leges who crosses swords with him does so at his own peril.

Martiny may have found out the hard way when he sent this email to Forgotston Sunday around 4:16 p.m. informing C.B. that his emails to the good senator were no longer welcomed:

From: “Martiny, Sen. (Chamber Laptop)” <dmartiny@legis.la.gov>

To: “C.B. Forgotston” Date: Sun, 15 Feb 2015 16:16:34 -0600 Subject:

Re: Where’s Buddy?

Take me off your list until u do something positive about anyone.

Martiny was responding to Forgotston’s “Where’s Buddy” post in which he took Attorney General Buddy Caldwell to task for the AG’s reluctance to do his job in telling the Caddo Parish Commissioners they are in violation of the Louisiana State Constitution by virtue of their illegal participation in the Caddo Parish retirement system.

Forgotston noted that Legislative Auditor Daryl Purpera has done his job in saying commissioners’ participation in the retirement system is illegal but Caldwell, as has been his M.O. since taking office, has been strangely quiet on public corruption.

And while there is certainly nothing wrong in going after free-lance pharmaceutical salesmen (drug dealers), child pornographers and the like, Caldwell has displayed an obvious dislike for making waves in the political waters and has steadfastly run from public corruption cases.

And we know that while the 1974 State Constitution took much of the prosecutorial duties from the attorney general, the AG is still the legal adviser for all state agencies and if nothing else, Caldwell should step forward and whisper in officials’ ears when they are seen skirting the edge of the law. (Commissioner of Administration Kristy Nichols’ open violation of the state’s public records law comes immediately to mind. So does Auctioneer Board attorney Larry Bankston’s advice to the board to actually refuse to release public records.)

But we digress.

If you notice, Martiny’s message for C.B. to delete future mailings to him was written on his Senate chamber laptop, which some might interpret as an unwillingness on his part to hear from citizens on matters that concern them.

“My periodic mailings address issues of concern to me primarily about state and local government,” Forgotston said on Monday.

“The mailings are sent to each lege via a public server owned by taxpayers. The address to which it is sent is also provided by the taxpayers.”

Forgotston said that after a “gentle reminder,” Martiny, an attorney, relented and acknowledged the provisions of the First Amendment to the U.S. Constitution.

“Other leges may not be as familiar with the First Amendment as is Martiny,” he said. “As a public service, here is some background on the First Amendment which leges might find useful in dealing with members of the public.

“The First Amendment states, ‘Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the government for a redress of grievances.’” (Emphasis Forgotston’s)

The right to freedom of speech, he says, “allows individuals to express themselves without interference or constraint by the government. (Emphasis Forgotston’s)

“The right to petition the government for a redress of grievances guarantees people the right to ask the government to provide relief for a wrong through the courts (litigation) or other governmental action. (Emphasis Forgotston’s)

“Not only do we have a right to contact the leges regarding matters of government, they are prohibited from interfering with our exercise of that right,” Forgotston said. “That includes the blocking of emails as some leges have done in the past.

“Any lege not wishing to receive my communications, please forward me a copy of your letter of resignation from the lege and you will be promptly removed from all future mailings.”

Now, just to give you a little background on Sen. Martiny, who:

  • Fought a bill by State Sen. Dan Claitor (R-Baton Rouge) which would have prevent legislators from leaving the House or Senate and taking six-figure jobs in order to boost their state retirement. It’s worth noting that several legislators had been appointed to cushy state jobs by the Gov. Bobby administration. Noble Ellington of Winnsboro was named second in command at the Louisiana State Department of Insurance at $150,000 per year; Jane Smith of Bossier City was appointed Deputy Secretary of the Department of Revenue ($107,500), though she admitted she knew nothing about taxes or revenue; Troy Hebert of Jeanerette was named Commissioner of the Louisiana Alcohol and Tobacco Control Board ($107,500); Kay Katz of Monroe, named to the Louisiana Tax Commission ($56,000); former St. Tammany Parish President Kevin Davis named Director of Governor’s Office of Homeland Security and Emergency Preparedness ($165,000), and former St. Bernard Parish President Craig Taffaro was appointed Director of Hazard Mitigation and Recovery ($150,000).
  • Pushed through an amendment that gutted Senate Bill 84 by Sen. Ben Nevers (D-Bogalusa), a bill originally designed to protect vulnerable borrowers from predatory payday lenders. Nevers sought to cap payday loan annual interest rates at 36 percent which was an effective way to rein in those lenders who were charging annual percentage rates of up to 700 percent. Martiny’s amendment removed the APR cap and instead simply limited borrowers to 10 short-term loans each year.
  • Pushed through a bill that was subsequently signed by Gov. Bobby which prohibited state contractors from entering into agreements with labor unions, prohibited public entities from remaining neutral toward any labor organization, and prohibited the payment of predetermined or prevailing wages.
  • Introduced a bill that was subsequently signed by Gov. Bobby which re-created 17 state boards, offices and commissions. Louisiana already has far more boards and commissions than any other state but apparently no one saw a need for reducing the number.
  • Introduced a bill subsequently signed into law by Gov. Bobby that gave judges on state district courts, courts of appeal and the Louisiana Supreme court pay raises ranging from 3.7 percent to 5.5 percent—even as Louisiana civil service employees were forced to go without a pay raise for the third straight year.
  • Introduced but later withdrew a bill that would have allowed the Louisiana Department of Economic Development (DED) the authority to offer air carriers a rebate of up to $500 annually for each incremental international passenger flying to or from a state airport for a period of up to five years.
  • Introduced a bill allowing DED to offer tax credits refundable against corporate income and corporate franchise taxes for businesses agreeing to undertake activities to increase the number of visitors to the state by at least 100,000 per year. (We’re beginning to see the problem with the state’s economic incentive tax breaks here).
  • Introduced a bill to provide tax credits for solar energy systems of up to 50 percent of all costs.
  • Introduced a bill that would have allowed the Commissioner of Insurance to fire the Deputy Commissioner of Consumer Advocacy without cause.

Let’s examine that very last one again. Louisiana law provides for the appointment of a deputy commissioner of consumer advocacy by the Commissioner of Insurance.

This is important, provided that person is wholly independent of Commissioner of Insurance Jim Donelon who gets the bulk of his campaign finances from insurance companies he is supposed to regulate.

Donelon, obviously, cannot be expected to ride herd over his benefactors. That’s just not the way politics works in Louisiana. So a consumer advocate in the department is critical—especially after all those stories about Allstate and State Farm denying legitimate claims from Hurricane Katrina and other tactics such as the Delay, Deny, Defend strategy as taught the insurance companies by Gov. Bobby’s former employer, McKinsey & Co.

The law provides that the consumer advocate may be terminated only for cause.

But Martiny wanted to change that and though the bill did not pass, one has to wonder about his motives.

To learn that, you’d probably have to email him at dmartiny@legis.la.gov

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