I mentioned yesterday that a strange coalition helped deliver the Health Reform Legislative Task Force‘s contract to the Stephen Group of Manchester, New Hampshire.

Five Tea Partiers (Rep. Joe Farrer, Rep. David Meeks, Rep. Kim Hammer, Rep. Terry Rice, Sen. John Cooper) joined four Democrats (Rep. Deborah Ferguson, Sen. Linda Chesterfield, Rep. Reginald Murdock, Sen. Keith Ingram) in voting for the Stephen Group. 


The other finalist, Boston-based Public Consulting Group (PCG), was supported by seven Republicans, a mix of legislators who voted for and against the private option — including the Republican chairs and co-chair of the committee and private option architect Sen. David Sanders (Sanders was joined by Sen. Jim Hendren, Rep. Charlie Collins, Sen. Cecile Bledsoe, Sen. Jason Rapert, and newly elected representatives Justin Boyd and Michelle Gray). 

Those are two very curious groups. What gives?


One issue impacting the Dems, and perhaps some of the Tea Partiers as well, was a fear that PCG might be more friendly to the idea of Medicaid managed care. I spoke with Ferguson after yesterday’s vote and she said this was a factor in her decision. 

“That was my concern with them, absolutely,” Ferguson said. “One of the strengths of our Medicaid program over other states is that we have done a very good job of coordinating and managing care instead of going to insurance managed care. I like that [Stephen] supported that approach. I think what we’ve done in Medicaid is wise, which is keeping that 15 or 20 percent administrative cost in the state. Any time you go with insurance managed care, you certainly see a decrease in provider reimbursement that is shifted to administrative costs of the insurance companies.”


Ferguson also said she liked what the Stephen Group said about previous work on long-term care in South Carolina. “I liked that they moved a lot of the nursing-home people to Community First Choice.” For background on the Community First Choice Option (CFCO), which provides additional federal Obamacare funds to states that commit to providing home/community based services as an option for families of the elderly and the disabled, see here and here. “We do have to address Medicaid spending and the two areas of Medicaid spending that I think you have to address the most are long-term care/nursing-home care and behavioral health,” Ferguson said, and said she was most impressed with the Stephen’s Group’s presentation on these issues. She added that she appreciated the Stephen Group’s pledge to subcontract with Arkansas companies for data management. Ferguson said that PCG was also impressive: “they were my second choice and it was a difficult decision.” 

On Twitter, Rep. Nate Bell (who is not on the task force) speculated that the CFCO was one factor uniting the Ds and Rs who supported the Stephen Group (some conservatives backed a move toward CFCO during the session, including Hammer).

More likely, conservatives were influenced by the Stephen’s Group’s promise to “scrub” the Medicaid rolls (audit and check eligibility of beneficiaries). Both Meeks and Hammer focused on this extensively during questioning. “Scrubbing the rolls” is of course a very, very popular right-wing talking point among those Tea Partiers who believe the greatest moral imperative of any government is to guard against the possibility of even a single poor person scamming the system. I snark, but even if the task force wants to aim for savings by tightening eligibility verification in the existing program, that’s really a tangential issue to the ambitious goals it is charged with exploring in the next six months. The state could simply hire a vendor to do that directly. That’s really an irrelevant side issue for this consultant (presumably the Stephen Group would just subcontract that task). This seems like the kind of goofiness that comes when politicians do procurement. 

Meeks and others also were skeptical of PCG because of the group’s previous work in the state for Arkansas Health Insurance Marketplace


And, of course, as you can see in the Meeks tweet above, cost was almost certainly a factor, both for the Dems and the Tea Partiers who voted for the Stephen Group, which bid a $1 million contract as opposed to PCG’s $2.2 million dollar contract. One thing here that will be interesting to watch: PCG’s proposal was for much longer and more intensive scope of work. Given the ground that the task force is supposedly going to cover, I have a suspicion that the Stephen Group’s price tag will be revised upward.

I am skeptical that this choice will matter that much in the end (basically because we are going back over such well-trodden ground). That said, for what it’s worth, I’ve heard from Republicans (both those who previously supported and those  who previously opposed the private option) who are not happy with the decision. They say that PCG offered the most promising new ideas that might lead to task force members finding common ground, and that the Stephen Group’s proposal may not fully meet the demands of the contract. The final approval of the contract is up to Legislative Council next week. 

For anyone that’s made it this far into the weeds of legislative procurement, what stands out to me at this point is that coalition-building on the task force is scattered and unpredictable. There are no clear voting blocs, at least not yet, other than the scattering of Dems sticking together. Part of this may simply be a lack of trust between those who want to continue the private option and those who have pledged to kill it. I would also note that if the legislature begins to tinker with the private option’s policy design, that means there will inevitably be spoils, and I expect sub-dramas to play out based on various interested parties, constituencies, lobbyists, etc. — in ways that may surprise and will often be hard to track. Should be fun!