Medicaid’s second-in-command resigns

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Chief Financial Officer Margaret King has announced plans to leave Medicaid in April, the latest in a series of changes at the state agency following the sudden resignation of then-director David Dzielak in December.

On Friday, King notified interim Medicaid director Drew Snyder that she would retire. King has been with the agency since 1991 and has served as CFO since 2010.

“Over the last 26 years, Margaret has played a key role in shaping the Mississippi Division of Medicaid into what is today,” Snyder said in an email Tuesday. “I appreciate her willingness to stay on for the next few weeks to ensure a seamless transition, and I wish her all the best in her future endeavors.”

But, according to several people in the health care community, what Medicaid is today is an agency in need of a major overhaul. And as the agency’s second-in-command for nearly eight years, King bears much of that responsibility, they said.

“Drew has inherited an agency in significant need of updating and reorganizing,” said Rob Church, an independent health care consultant and the former commissioner and CFO of Alabama Medicaid. “And the CFO plays a central role in all the operations of the agency.”

As CFO of Medicaid, King was charged with overseeing and approving all financial matters at the agency, including vetting dozens of the agency’s contracts. In addition, the CFO must make sure the agency complies with federal Medicaid regulations and regularly completes financial reports and makes them available to the agency.

In recent years, the Division of Medicaid faced scrutiny in all of these areas from both lawmakers and the health care community.

One of the most controversial points for the agency has been complying with a mandate from the federal Centers for Medicare and Medicaid Cervices to update its $533 million hospital reimbursement formula. For years, hospitals around the state have argued that the formula is arbitrary and fails to properly reimburse some hospitals for money they lose treating Medicaid patients. The federal government agreed, but for years the Division of Medicaid ignored their orders to rework the formula.

Meanwhile, the budget of Medicaid has continued to rise, reaching nearly $1 billion in state dollars and totaling more than $6 billion when federal matching funds are included.

This has been a sticking point for Mississippi’s fiscally conservative Republican majority in the Legislature, which has complained that Dzielak’s administration failed to provide lawmakers with adequate explanations or financial data and reports, something House Medicaid Chairman Chris Brown, R-Nettleton, chalked up to an “overall lack of transparency at the agency.”

“With a new director, I’m optimistic that that will change,” Brown said shortly after Dzielak’s resignation in December.

Although King has appeared at legislative hearings and committee meetings, presentations and responses to lawmakers’ questions at these meetings typically fell to the Medicaid director, even when the questions centered on financial issues.

At a Medicaid hearing in December, prior to Dzielak’s resignation, the director announced the agency was facing a $46 million deficit for fiscal year 2018. Dzielak testified that the agency was unable to reduce that number further, a point that frustrated several Republican lawmakers.

“We asked the question, you knew there was going to be a deficit appropriation. Well, was there (anything you could have done) to offset that deficit? And he said there’s nothing we can do. Well, that’s not true. There’s always something we can do,” Brown said.

Drew Snyder

Since Snyder took the reins of the agency in December, his most public achievement has been slashing the agency’s deficit. At a House Appropriations meeting in January, Snyder and King presented a final appropriation request of $26.4 million.

Snyder told the House committee that one way this was achieved was by eliminating or delaying the implementation of several small contracts and transferring the work to in-house employees.

Medicaid is currently undergoing a review of all the contracts in the agency, according to agency spokesperson Matt Westerfield.