Governor Fires Firm that Found 40% Error Rate in Illinois’ Medicaid Rolls

Published December 18, 2013

Illinois has fired the private company that found 40 percent of the state’s Medicaid enrollees shouldn’t be in the system. Now the state will hire hundreds of unionized, public employees to do the job.

Gov. Pat Quinn (D) signed an agreement with the state’s largest public employee union, the American Federation of State, County and Municipal Employees, to have state workers take over the review of Illinois’ 2.7 million Medicaid enrollees.

“This ruling provides the best and most efficient way forward,” Illinois Healthcare and Family Services Director Julie Hamos said in a statement.

Firm Was ‘Stunning Success’

Lawmakers say the private company, Maximus, was “a stunning success” and never should have been fired.

“As of the latest update, 216,000 people who were receiving Medicaid benefits were taken off the program because the third-party contractor was involved,” said state Sen. Dale Righter (R-Mattoon), noting Maximus looked at only about a half million Medicaid files.

State Rep. Patti Bellock (R-Hinsdale) said before Maximus took over the review, state workers did a terrible job of checking incomes and addresses.

“These people were not even living in Illinois,” Bellock said. “They were [in] Wisconsin, Indiana, Michigan.”

Maximus was due to be paid $37 million next year, but that’s now likely headed for “renegotiation.”

Unionized Government Workers Being Hired

Instead, Bellock said Illinois is going to spend tens of millions of dollars more to hire 500 new unionized public employees.

“At an average of between $80,000 and $100,000 a year for an average worker, that would be $50 million,” Bellock said.

HFS spokesman Mike Claffey says the state is hiring 50 workers to take over the Maximus review, and 500 jobs are being added in other parts of state government.

AFSCME represents tens of thousands of state employees. Illinois’ state workforce is nearly 97 percent unionized.

Aimed to Appease Unions?

The union was furious with Quinn for signing pension reform earlier in December. No one is saying if this agreement to hire hundreds of new union members will ease that anger, and Righter says Quinn clearly did not stand up for state taxpayers.

“When so much else is going wrong within his own administration and within state government generally, why on earth would you ever change something that is working that well?” Righter asked, wondering aloud about Quinn’s deal with the union.

Bellock, however, said it is the people who are in the Medicaid system who truly need the benefits that are the biggest losers.

“It’s not just to save money for the taxpayers,” Bellock said. “It is also to provide a medical home for our most vulnerable population. It is so we can sustain (the Medicaid) system and pay our providers.”

As a result of Quinn’s deal, Illinois will go on a hiring spree, and Maximus has been told its last day on the job is April 30.

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