Iowa DHS director Foxhoven resigns; governor appoints Gerd Clabaugh (updated)

Jerry Foxhoven has resigned as Iowa Department of Human Services director, effective today, Governor Kim Reynolds’ office announced on June 17. The news release did not give a reason for Foxhoven’s departure. Staff for DHS and the governor did not immediately respond to questions including:

  • Did Reynolds request Foxhoven’s resignation? UPDATE: Foxhoven confirmed that she did. See update below.

  • Was the resignation related to UnitedHealthcare’s impending departure from the Iowa Medicaid program on June 30?
  • Was the resignation related to DHS negotiations with Centene/Iowa Total Care, which will begin managing care for hundreds of thousands of Iowans on Medicaid as of July 1?

  • What is the status of negotiations with the state’s negotiations with Centene/Iowa Total Care regarding the Medicaid program?

    Appointing Foxhoven in June 2017 was one of Reynolds’ most significant early decisions as governor. The previous director, Chuck Palmer, faced criticism over Medicaid privatization and the department’s handling of child abuse investigations.

    Reynolds administration officials have repeatedly claimed that Medicaid would run more smoothly with private companies managing care. However, patients have continued to face service cuts, and health care providers still struggle to be paid on time (or at all) for some services. UnitedHealthcare was the second company to leave the Iowa Medicaid system; AmeriHealth Caritas left in late 2017.

    Foxhoven insisted in March that UnitedHealthcare pulled out of Iowa’s Medicaid program because the state refused to meet the managed-care organization’s unreasonable demands. The company claimed its decision “had nothing to do with performance measures” or accountability requirements, saying the state has “materially underfunded the Medicaid Program since its inception, by hundreds of millions of dollars.”

    David Hudson, a former member of the state’s Medicaid advisory council whom Reynolds declined to reappoint last year, warned that

    UnitedHealthcare’s departure puts Centene in a dominating position as it negotiates with Iowa over a contract for next fiscal year. “They can ask for anything they want. It’s a candy store for them now,” said Hudson, adding that Reynolds’ administration couldn’t afford to have Centene bail out, too.

    Foxhoven told reporters he doesn’t believe the situation puts Iowa negotiators in a tough spot. In fact, he contended their willingness to reject UnitedHealthcare’s unreasonable demands shows the state won’t be pushed around.

    Medicaid privatization wasn’t the only major controversy at DHS during Foxhoven’s tenure. Earlier this year, the Des Moines Register exposed a sharp rise in the death rate for residents of the Glenwood Resource Center since last summer.

    Foxhoven’s critics also disagreed with his defense of state action to close in-patient mental health facilities several years ago.

    Under Republican Governors Terry Branstad and Reynolds, DHS “has lost 1,058 workers from its 4,998 in 2011,” Lee Rood reported for the Des Moines Register last month.

    That included the elimination of at least 558 field operations workers, figures from the state show, a category that comprises social workers and income maintenance employees.

    More cuts happened last year — even after child deaths reached a high-water mark of 19 in 2017 and child abuse reports spiked to their highest point in a generation.

    Reynolds has appointed Iowa Department of Public Health Director Gerd Clabaugh to serve as interim DHS director. A June 17 news release said he “will continue to serve as director of the Department of Public Health until a permanent DHS director is named.” Clabaugh has headed the public health department since 2014.

    UPDATE: Foxhoven released this statement to reporters.

    “At the request of the governor, I submitted my resignation,” he wrote. “It was an honor to serve Iowans at the Department of Human Services during an important time of transition. I wish the many hard-working employees at the department the very best and know that they will continue to serve the people of Iowa well.”

    Peggy Huppert, state director for the National Alliance on Mental Illness, told Bleeding Heartland she learned Foxhoven was escorted out of the DHS building.

    Iowa Senate Minority Leader Janet Petersen released the following statement:

    I“The Governor needs to immediately launch a nationwide search for a new Director of the Department of Human Services who is truly committed to watching out for the most vulnerable children and adults in Iowa.

    “This means finding an advocate who will fight for more resources, push for stronger policies, and ensure that those policies are enforced for the betterment of all Iowans.
    “After years of mismanagement and neglect by Governor Reynolds and legislative Republicans, Iowans deserve a new Director with the backbone necessary to put quality care and proper oversight ahead of special interests.

    “The damage they’ve done to Iowans includes:
    · Creating and supporting a privatized Medicaid system that is unsustainable, unaffordable and unaccountable. It’s so bad that the federal government has launched an investigation into whether officials in Iowa and other states are providing sufficient and appropriate oversight to ensure that people with Medicaid are receiving the care to which they are entitled.
    · Decimating the state’s successful family planning network, resulting in more unintended pregnancies, more risky births, more teenage mothers.
    · Inadequately funding mental health services for children and adults.
    · Allowing dangerous practices and procedures at Glenwood, Eldora and other at state-operated facilities.

    “Finally, it’s especially bad news for Medicaid recipients, health care providers and Iowa taxpayers that the Governor’s Director is leaving (a) in the middle of negotiations with both out-of-state managed care organizations (MCO) and (b) when hundreds of thousands of Iowans are two weeks away from transitioning to a new MCO.”

    SECOND UPDATE: Iowa House Minority Leader Todd Prichard said in a statement,

    “The latest turmoil in the Reynolds Administration is bad news for Iowans who need access to affordable health care. It means more health care uncertainties for vulnerable Iowans and is just the latest sign that Medicaid privatization is failing miserably. I hope the Governor will use this as an opportunity to find a new leader for DHS who will tell her the truth about the failure of Medicaid privatization and finally fix it.”

    THIRD UPDATE: I didn’t realize Foxhoven testified on June 13 in federal court as part of Disability Rights Iowa’s class-action lawsuit against the state and DHS. Tony Leys has covered the trial, which mainly focuses on the use of restraints and isolation rooms at the State Training School for Boys in Eldora. I wonder whether the governor didn’t like something Foxhoven said in court.

    FOURTH UPDATE: Democratic State Senator Claire Celsi, a member of the Iowa Senate State Government Oversight Committee, released this statement on June 18.

    I am deeply disturbed by the departure of Jerry Foxhoven from the Department of Human Services. The timing of and circumstances surrounding this move by Governor Kim Reynolds should concern every Iowan.

    I hereby call on Chairwoman Amy Sinclair to immediately call for an interim Senate State Government Oversight Committee meeting to get to the bottom of this situation. Iowans deserve to know what is going on and what motivated Governor Reynolds to ask for Foxhoven’s resignation.

    The lack of funding and the gradual decrease in employees in the Department has resulted in a no-win situation for Iowans. Governor Reynolds’ disdain for and poor treatment of public employees is despicable. Any future director would be set up for failure under these circumstances.

    While I did not agree with every decision Mr. Foxhoven made while Director of DHS, I am keenly aware that Governor Reynolds is in charge of the general direction of our state and the departments she ultimately commands. In other words, her direction is followed by department directors and her budget suggestions have great influence over ultimate outcomes. The buck stops with Governor Kim Reynolds.

    I have heard from constituents in my district who state that Foxhoven was making progress in cleaning up the giant mess that he inherited from previous directors. He asked for input and was acting on that input. He also made some tough decisions and got rid of some ineffective managers during his tenure.

    Regardless of your opinion on Foxhoven’s job performance, the timing of his forced departure – just two weeks before the Medicaid transition to Iowa Total Care – is completely unacceptable.

    The appointment of IDPH Director Gerd Clabaugh as interim director is also concerning. Governor Reynolds tends toward the appointment of insiders to lead two large organizations simultaneously. I believe this is not a wise move. The employees of both DHS and IDPH deserve to have a leader that is dedicated to their respective organizations.

    Moving forward, I hope that Governor Reynolds opens up a national search for Foxhoven’s replacement. The new director should have the safety and well being of our most vulnerable citizens as their top priority. That person should also push back on Governor Reynolds and stand up for hiring more employees to tackle the backbreaking caseloads in the department.

    As we hurtle toward another huge Medicaid insurance company transition with sparse public information and little confidence in its success, I urge Governor Reynolds to please reconsider the decision to privatize Medicaid, which has been an unmitigated disaster for Iowa patients and providers.

    The governor’s staff have not replied to Bleeding Heartland’s inquiry, but Iowa Public Radio’s Katarina Sostaric received the following on June 18.

    “Gov. Reynolds asked Foxhoven to resign because she wanted to go in a new direction at the Department of Human Services,” governor’s spokesman Pat Garrett said Tuesday. “She has spent the first part of this year assembling a new team, from top to bottom, to carry out her vision. More changes will be announced in the coming days and weeks ahead.”

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