A company that was chosen over 11 other companies for a state contract worth nearly $1 billion may have violated a state law in 2011 when it submitted a sworn affidavit that no other entities owned more than 5 percent of its company.
When Michael Rashid, president and CEO of the AmeriHealth Mercy Family of Companies (AMFC) signed off on a three-year, $926 million contract with the Department of Health and Hospitals (DHH) in September of 2011, he submitted a required disclosure of ownership dated Oct. 7, 2010 and signed by AMFC Senior Vice President of Legal Affairs and General Counsel Robert Gilman.
The contract calls for AmeriHealth Mercy to provide “a broad range of services necessary for the delivery of healthcare services to Medicaid enrollees participating in the Medicaid Coordinated Care Network (CCN) Program.”
Services include developing and maintaining an adequate provider network, access standards, utilization management, quality management, prior authorization, provider monitoring, member and provider services, primary care management, fraud and abuse monitoring and compliance, case management, chronic care management and account management.
The contract includes 24/7 access to a health care professional, service authorization, provider payments, claims management, marketing and member education, according to the contract document.
Such disclosures of ownership are standard with state contracts to ensure that there are no conflicts of interest or ethics violations that would occur if a state employee or immediate family member held an interest in a company contracting with the state.
Gilman signed the notarized disclosure form which identified AmeriHealth Mercy Health Plan of Philadelphia, PA., as the only entity having more than a 5% ownership of AmeriHealth Mercy of Louisiana.
The only problem with that was that AmeriHealth was jointly owned by Mercy Health System and Independence Blue Cross (IBC) with each owning 50 percent of AmeriHealth.
That arrangement had been in existence since 1996 but in August of 2011, two months before Gilman’s affidavit and a month before Rashid signed the contract with the state, IBC purchased an additional 10 percent and Blue Cross Blue Shield (BCBS) of Michigan bought the remaining 40 percent, giving the two Blue Cross entities 100 percent ownership of AmeriHealth.
http://www.crainsdetroit.com/article/20110809/FREE/110809869/blue-cross-buys-40-stake-in-national-medicaid-company
Bruce Greenstein was appointed Secretary of DHH by Gov. Bobby Jindal in July of 2010 and he was confirmed by the Louisiana Legislature in June of 2011 after a contentious standoff with the Senate and Governmental Affairs Committee over Greenstein’s refusal to identify the winner of a $185 million Medicaid contract with DHH. http://www.gov.state.la.us/index.cfm?md=pagebuilder&tmp=home&cpid=27
He finally relented and admitted that the winning contractor was his former employer, CNSI of Gaithersburg, MD. Circumstances of that contract have prompted a federal investigation by the U.S. Attorney’s office and Greenstein has announced he will resign in May.
In early August of 2011, barely a month after Greenstein was officially confirmed, IBC and BCBS of Michigan announced that they would partner to expand services to Medicaid beneficiaries nationally through the AmeriHealth Mercy Family of Companies. http://www.ibx.com/company_info/news/press_releases/2011/08_09_IBC_and_BCBS_of_Michigan.html
The joint announcement noted that a 2010 report from the National Association of State Budget Offices indicated that Medicaid represented states’ second largest budget obligation after education, averaging 22 percent of total state spending.
The announcement then gave a hint of what states might expect.
“AmeriHealth Mercy provides Medicaid managed care services directly to Pennsylvania, Indiana and South Carolina and has subcontracts to provide these services in Kentucky and New Jersey,” it said, adding that AmeriHealth Mercy was chosen to provide Medicaid managed care coverage in Louisiana.
While BCBS companies are supposedly separate and independent in each state and though BCBS of Louisiana currently does not participate in a state Medicaid contract (its contract is with the Office of Group Benefits to administer claims of state employees, retirees and dependents), BCBS has been moving in partnership with AmeriHealth Mercy into other states, including Florida.
The AmeriHealth Mercy contract signing coincided with Greenstein’s appointment and his wife’s employment by BCBS of Louisiana but there is nothing to indicate a connection.
Still, the association between two separate Blue Cross companies and the winner of a state contract worth nearly $1 billion coupled with the curious failure of the winning bidder to list both its owners on the disclosure of ownership form could raise a few eyebrows.
Louisiana Voice 
OMG! THE TANGLED WEB WITH SHIMMERING DEW DROPS GLINTING IN THE LIGHT!
The “drops glinting in the light” from the tangled web totally encasing Louisiana woven by jindal and his primarily out-of-state henchmen are not from dew, but rather from those same people’s urine. Isn’t it time to flush the entire jindal administration and stop the stench?
Why isn’t the Attorney General’s office doing any investigating of this? It took a Federal Grand Jury to get them off their asses about the 2011 clusterf**k with Greenstein and the other Jindal cronies. And where’s the legislature asking questions?
Guess it’s time for another Fed. grand jury.
This administration thinks and acts like they are above the law 24/7. Why hasnt a stop been put to this?
Sounds like the FBI needs to set up a satellite office on the 4th floor.
I’d like the FBI to monitor or tap his phone, computer, ipod and blackberry or whatever else he uses that the people of la pays for. I believe that he is more corrupt that he beats EWE by a few miles. I don’t know if EWE ever had such control over the legislature as Jindal. Wire the 4th floor Governor’s Office, check out what goes on there in the Claiborne Bldg., 8th floor Commissioner’s Office, the DOE, DHH, AG’s offices, etc. Just line them all up, bring the whole FBI agency here and they will be busy for a long, long time. It seems like the commode is backing up and rotor router can’t be found!!!
Even for this administration, that would be a little too much Big Brother for us. Unless there is real evidence of criminal wrongdoing, a judge would have to approve a warrant for such surveillance.
We already have Homeland Security doing that to American citizens (without warrants in many cases) and that makes us a little uncomfortable.
I”m sure you’re right, Tom. Maybe granting immunity to those that know what’s going on will open the door to the inside of Jindal’s world. Hopefully some insiders will tell the truth. (That’s saying a lot coming from someone, who won’t give their name, huh.) Or better yet, give big $$$’s for inside details, because I believe some insiders know what’s going on and regret their involvement, perhaps it will help to clear their conscience.
Who and what head do local FBI office report to or fall under? US Attorney? Who is he, locally, and how does he prioritize what gets attention?
The U.S. Attorney is former Democratic Congressman Donald Cazayoux.
The administration does not care about the legality, the efficacy, or the cost of any of these programs. The goal is to get the infrastructure in place to effect their political agenda and to make it impossible or very difficult for subsequent administrations to roll back the changes. They are more concerned with “blowing up the bridge behind them” than any future court rulings.
If you get rid of the historical infrastructure by surplusing and selling the assets, what recourse will future administrations have but to make the best out of the deals and programs that this administration has framed? Neither Jindal nor his appointees will be around to be held accountable for the future financial disaster they are creating and yet they will have completely re-engineered the political, financial, and, in some respects, social structure of this state.
I believe you give them too much credit. They dont care aboit high minded goals such as those you describe, if they did they would have integrity about the way they are implemented. Thia is all pure and simple greed and corruption.
I don’t consider the blind pursuit of ideological purity particularly high minded. And I don’t underestimate the long-term profit to be made by the private companies/political contributors as a part of their agenda. But how do you suppose the state would go about reconstructing a public hospital system if all the hospital properties are sold? How easy would it be to rebuild a public school system if all the schools are closed or under contract to a private company?
Would it not be interesting to know could the corporate veil be pierced who the stockholders are in the companies being contracted with by our state the campaign contributions the closed door non public meetings the quid pro quos etc., that characterizes the united states of greed…Cheney and Halliburton got nothing on these guys
Perhaps Mr. Greenstein will reveal the level of Jindal’s involvement in this backroom deal…