Daniels' new health plan concerns Dems

INDIANAPOLIS -- Democratic state lawmakers from the get-go didn't like Republican Gov. Mitch Daniels' plan to pay an IBM-led team $1.16 billion over 10 years to help run state programs for Medicaid, food stamps and other poor-relief benefits.\nDaniels signed the contract two weeks ago, but Democrats regained a majority in the Indiana House of Representatives in the November election and were insisting that dozens of questions about the deal be answered during a hearing Wednesday afternoon before the powerful Ways and Means Committee they now control.\nWhat systems will be in place to manage work by the contractors? What is the state's role in oversight and accountability of programs the vendor will run? Are there ways to gauge how well money is being spent?\nTop Democrats raised a new question Tuesday by suggesting that the deal violates a state law that says "a contract to administer any part of the Medicaid program may be for an original term of not more than four years."\nDaniels' spokeswoman Jane Jankowski and the state attorney general's office said the provision did not apply to this contract.\nDemocrats on Wednesday were expected to grill Mitch Roob, secretary of the Family and Social Services Administration, about the details, safeguards and wisdom of the deal in which IBM will help process applications for some benefits and give technical assistance to FSSA. The agency handles the work now.\nThe new legality question was raised by House Speaker Patrick Bauer, D-South Bend; Ways and Means Chairman William Crawford, D-Indianapolis; and Sen. Vi Simpson, D-Bloomington.\n"It seems like it is a pretty shaky contract and a pretty shaky proposal," Bauer said in citing the four-year Medicaid contract provision.\nSimpson cited the same law in a news release issued Tuesday in which she urged Attorney General Steve Carter not to approve the contract.\n"Today I am asking the attorney general to return the existing 10-year contract to the governor unsigned so a new legal and binding contract can be negotiated," she said.\nA reply from the attorney general's office said the office had approved the contract on Dec. 27 -- the day it was signed by Daniels -- and that it had reviewed the document as it was drafted over many months.\nThe letter said that state lawyers had reviewed the statute cited by the Democratic legislators and "are satisfied that it does not apply to the work to be performed by IBM regarding eligibility."\nJankowski said the provision Democrats were citing dealt only with contracts with the Office of Medicaid Policy and Planning. She said the contract in question is between IBM and FSSA's Division of Family Resources, which is charged with determining eligibility for Medicaid, so the state law did not apply.\nThe administration says the new plan should improve client services, reduce error rates, waste and fraud, and boost the state's welfare reform record.\nThere have been staunch critics of the plan, including democrats, caseworkers and their union representatives, and advocates for the needy.\nBauer has said the deal will allow private companies to profit from the poor. He and other opponents also say it might result in problems similar to those seen in other states that have opted for private vendors. The states include Texas, where some applicant benefits have been delayed.