NC legislators want to examine 'revolving door' of state employees working for vendors

lbonner@newsobserver.comDecember 18, 2013 

— North Carolina legislators are interested in slowing the revolving door that has caused some state employees to take jobs with vendors working for the state.

Talk of a new law warding off potential conflicts of interest was triggered by a state audit of the Medicaid claims system this month that found a senior program manager at the state Department of Health and Human Services had gone to work for the vendor, Computer Sciences Corp. State Auditor Beth Wood described the program manager, Paul Guthery, as the “go-to person” for the state on the massive computer project.

Guthery left his $126,500-a-year state job in August to work for CSC.

DHHS approved CSC’s hiring Guthery on Aug. 21, and Wood said the company offered him the job while he was employed with the state. He started work for the company on Aug. 27.

“This person left DHHS one day and literally went to work for the vendor,” she said.

Wood discussed the episode with the Joint Legislative Program Evaluation Committee on Wednesday. State legislators and some state employees must wait six months after they leave office or jobs before they lobby. But there’s no “cooling-off period” that prevents state workers from immediately going to work for a vender.

“This is a potential problem in all state agencies,” Wood said.

DHHS said in a statement that “it is not unprecedented” for state employees to leave to work for vendors. “North Carolina has seen many examples of this in years past,” the agency said.

CSC said in a statement that company complied with state law and company policy in making the hire.

“Before he came on board with CSC, Mr. Guthery conferred with N.C. DHHS officials on the propriety of his hire, and the State did not identify any prohibitions to Mr. Guthery’s working for CSC,” the statement said.

The audit recommends a law addressing state employees who go to work for vendors when the employees are “directly and significantly involved” with the companies as part of their state jobs.

Legislators want more information on how other states and the federal government handle the “revolving door” but also indicated they wanted to move cautiously.

“If there’s a problem, we need to address it, but I don’t want to overreach,” said House Majority Leader Edgar Starnes, a Granite Falls Republican.

NC Tracks, the name for the Medicaid claims system, was plagued with problems when the state started using it July 1 to pay health care providers’ claims. Though state officials say the system has improved, questions remain whether the state launched NC Tracks before it was properly tested and ready. CSC is being paid $484 million for developing the system and running it through 2020.

Guthery gave legislators at least five updates on the progress of the software system’s development over the past two years. DHHS on Wednesday downplayed his role and said in a statement that he did not authorize the July 1 launch.

“Paul Guthery was one of many people involved in this very large project going on for a very long period of time. At DHHS, Paul did not have sign off authority on the NCTracks project, and 3rd party experts oversaw the testing process of the system,” the statement said. “The Program Steering Committee authorized the launch of NC Tracks, and the federal government cleared it to go live as well.”

Bonner: 919-829-4821; Twitter: @Lynn_Bonner

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