RALEIGH — Legislators questioned the need for a no-bid, $3 million contract the state health agency awarded a national firm to help improve Medicaid budgeting, as agency officials increased an estimated budget shortfall for this year.
The Washington firm Alvarez & Marsal is working with the state to improve financial controls and budgeting in the $13 billion state and federal health insurance program for poor families, the elderly and people with disabilities. The agency told a legislative oversight committee Thursday that the budget shortfall in the program would be $120 million to $140 million, slightly more than reported last month.
If I believed in reincarnation, and I dont, Id love to come back as a consultant for $3 million, said Sen. Tommy Tucker, a Union County Republican.
Mentioning the string of sole-source contracts the state Department of Health and Human Services has executed in the last 15 months, Tucker asked why the agency turned to an outside company rather than have some of its own employees restructure Medicaid budgeting.
Rep. Beverly Earle, a Charlotte Democrat, said she was concerned about the agencys practice of using sole-source contracts in this and in previous administrations.
DHHS Secretary Aldona Wos said state workers did not have the time to do the kind of work Alvarez & Marsal was hired to perform because DHHS is understaffed and employees are busy just doing their regular jobs.
We have to do our daily work, Wos said. As you see, we would love to be at our desks working, but were here to provide you with the information you request.
She called the firm experts in the United States in the tasks assigned in the contract. Im sure youll be happy with the end product as this unfolds, she said.
Rudy Dimmling, a senior director with Alvarez & Marsal, said the firm had done similar work in South Carolina, Pennsylvania and Maryland.
Medicaid budget overruns have tormented legislators in recent years, forcing them to scramble to find money to fill gaps. One year, the shortfall topped $600 million.
Rep. Nelson Dollar, a Cary Republican, applauded a Medicaid deficit that is comparatively small, considering the size of its budget.
Everyone should be congratulated for the tremendous progress thats been made in the state of North Carolina getting a handle on Medicaid at this point, and obviously we have a lot more to do, he said.