Bruce Greenstein, secretary of the Louisiana Department of Health and Hospitals will step down May 1, amid state and federal investigations into a $185 million Medicaid contract awarded to a company where he briefly worked.
Greenstein, whose resignation was announced Friday, worked as a vice president at Maryland-based CNSI Corp. in 2005, between stints as a Centers for Medicare & Medicaid Services regional administrator and managing director of Microsoft's healthcare division.
[See also: Final Medicaid expansion rule issued by CMS]
In 2011, CNSI was awarded a 10-year Medicaid claims and billing contract -- which Governor Bobby Jindal recently cancelled at the urging of the state attorney general, James Caldwell. Caldwell is conducting a criminal investigation into the contract, in addition to a separate federal probe by U.S. Attorney Don Cazayoux in Baton Rouge.
Although Greenstein has said he made no efforts to influence the award, the Shreveport Times reported that during his 2011 confirmation hearing, Greenstein did admit to helping make changes in the bid solicitation process that made CNSI eligible for the contract, after he started working at the health department in 2010.
The other bidders for the contract, Atlanta-based ACS State Healthcare and Long Beach, Calif.-based Molina Medicaid Solutions (the state's Medicaid claims and billing contractor for about 30 years), both unsuccessfully challenged the award, arguing that CNSI had low-balled the price. CNSI was supposed to begin work next year, and is now challenging the contract termination.
As health secretary, Greenstein has been one of the Jindal Administration's largest supporters of a plan to privatize the Louisiana State University hospital system. He has also defended Jindal's reluctance to expand Medicaid.