Jindal health secretary resigns amid investigation

BATON ROUGE (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 from the $236,000-a-year post 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.

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

the governor. He didn't respond to messages Friday seeking further comment.

"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

to Jindal.

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


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.

Greenstein's resignation leaves Jindal without the chief defender of his opposition to the Medicaid expansion under the federal

health care law, as state lawmakers are pushing against the rejection.

It also removes from ongoing negotiations the architect of the Jindal administration's efforts to privatize the LSU-run public

hospitals that care for the poor and uninsured and that train many of Louisiana's medical students.

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.

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

Greenstein started work at DHH in September 2010.

Before taking the helm of Louisiana's

largest state agency, he was a health economist and managing director of

worldwide health

for Microsoft Corp. Other past jobs included work for the federal

Centers for Medicare and Medicaid Services and health policy

analysis for the Government Accountability Office, Congress'

investigative arm.

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

the same annual salary Greenstein was paid, according to Jindal's office.

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.