The now-scrapped contract for Medicaid claims processing and bill payment had been awarded to CNSI, a Maryland-based company that once employed Gov. Bobby Jindal's health secretary, Bruce Greenstein.
State Inspector General Stephen Street told the House Appropriations Committee that he's asked the governor's Division of Administration and the Department of Health and Hospitals not to comment on the investigation.
Meanwhile, Greenstein didn't show up Tuesday for the discussion of his department's budget, instead leaving it to his chief deputy. Appropriations Chairman Jim Fannin said it was irresponsible for Greenstein to miss the hearing.
"If there's some questions he didn't want to answer, they do a great job not answering questions anyway," said Rep. John Schroder, R-Covington. He added, "I think it's very disrespectful he's not here today."
The contract award is under investigation by a federal grand jury and the state attorney general's office, which said the contract was improperly handled.
Street, who is looking into the contract as well, cited confidentiality laws governing federal grand juries and inspector general's investigations.
He said he sent a letter to Jindal administration officials "respectfully requesting that they refrain from commenting on specific matters that are under investigation while we are in the process of coordinating with law enforcement partners."
CNSI, which was supposed to take over the Medicaid work next year, is challenging the termination of its contract by the state.
Fannin, D-Jonesboro, said Greenstein called him about two weeks ago — before the federal and state investigations were made public — asking him to move the budget hearing because of a scheduling conflict. Fannin said he couldn't rework the plans, and he said Greenstein should have shown up.
"When you have the largest budget unit in the appropriations bill, then it's important for this secretary to be here," he said.
Greenstein worked for CNSI from 2005 to 2006. When the Medicaid contract was awarded two years ago, Greenstein denied any involvement in the selection.
But Greenstein acknowledged under questioning from lawmakers 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.
Jindal's commissioner of administration, Kristy Nichols, announced the contract termination last week, saying the decision was made in consultation with the attorney general's office.
CNSI won the 10-year contract in 2011, beating 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.