Greenstein resigns post

(AP) — Louisiana Gov. Bobby Jindal’s health secretary and close ally, Bruce Greenstein, is resigning amid ongoing state and federal investigations into the awarding of a Medicaid contract to a company where Greenstein once worked, officials said Friday.

The Jindal administration canceled the nearly $200 million contract with Maryland-based CNSI last week after details leaked of a federal grand jury subpoena involving the contract award.

The governor’s office announced Greenstein’s decision, saying his resignation takes effect May 1. Jindal spokesman Kyle Plotkin said the governor didn’t ask Greenstein to leave his position as secretary of the Department of Health and Hospitals.

Jindal appointed current Deputy Secretary of the Louisiana Department of Health and Hospitals (DHH), Kathy Kliebert, to serve as Interim Secretary of the agency. Courtney Phillips, who currently serves as Chief of Staff at DHH, will replace Kathy Kliebert and serve as Interim Deputy Secretary, according to a news release on Friday from the governor’s office.

Greenstein offered no explanation in his two-page resignation letter, instead recounting his accomplishments and thanking the governor.

“This state’s gracious people and generous culture have left a permanent and meaningful impact on the lives of my family and me. I am grateful for our time here and I will forever remember this period of our lives with fondness and pride,” he wrote.

When the Medicaid contract was awarded two years ago, Greenstein denied any involvement in the selection.

But he acknowledged under questioning from lawmakers in his 2011 confirmation hearing that a change he pushed in the bid solicitation made CNSI eligible for the Medicaid contract. He also met with a top CNSI official within days of taking the health secretary’s job.

Greenstein worked for CNSI from 2005 to 2006.

The state attorney general’s office has said the 10-year contract for Medicaid claims processing and bill payment was improperly handled, and it is conducting its own criminal investigation into the contract award.

David Caldwell, head of the attorney general’s public corruption unit, said there was inappropriate contact between CNSI and DHH employees, among other issues.

In a statement, Jindal praised Greenstein’s tenure at the health department, during which he oversaw the privatization of many state-run health facilities and shifted much of the Medicaid program to private managed care.

Greenstein also has been the architect of Jindal’s ongoing push to privatize the LSU-run public hospitals that care for the poor and uninsured and that train many of Louisiana’s medical students, an effort that has been criticized as poorly handled.

“Bruce has successfully led one of the largest transformations of our state’s health care delivery system,” Jindal said.

When Greenstein leaves, his deputy secretary, Kathy Kliebert, will serve as interim secretary of the department.

Greenstein hadn’t been seen at public events since news of the Baton Rouge-based federal grand jury probe. Lawmakers were irritated that the health secretary skipped his agency’s budget hearing earlier this week.

On Friday, a DHH spokeswoman referred all questions about Greenstein’s resignation to the governor’s office.

CNSI, which was supposed to take over the Medicaid work next year, is challenging the termination of its contract by the state. CNSI beat three other companies for the work, but critics said the company underestimated the true cost of the job and made incorrect assumptions to win the bid.