Mississippi’s settlement of a lawsuit with state Medicaid contractor Centene was based on the same blueprint as other cases: private lawyers were hired by the attorney general to pursue allegations of wrongdoing against mega companies.
Republican Attorney General Lynn Fitch sent out a news release last month touting the $55 million settlement of the lawsuit that accused Centene of overcharging the state for pharmacy benefits it was contracted to provide to the Medicaid program.
The big difference is that Fitch’s predecessor – Democrat Jim Hood – often called news conferences to announce such settlements where reporters routinely quizzed the state’s only elected Democrat about the use of private attorneys for such lawsuits.
Hood was often savaged for the use of outside counsel by legislators, former Gov. Haley Barbour and others. Legislation was filed to try to prevent the hiring of private attorneys.
But when Fitch and state Auditor Shad White announced they had settled with Centene, the same people who used to complain about the use of private attorneys by Hood and his predecessor – Democrat Mike Moore – uttered not a single negative word.
There was no criticism even though the case against Centene had elements similar to Moore’s lawsuit against the tobacco companies from the 1990s – still the best known and perhaps most successful use of outside counsel. In that lawsuit, Mississippi received what is known as a “lead dog” commitment. If another state later received a better settlement, then Mississippi, as the lead dog, would get the same settlement.
In the Centene case, Ohio filed and settled the first lawsuit and received “lead dog” status.
And like with the tobacco lawsuits and scores of lawsuits since then, the private attorneys were paid only if they prevailed – a percentage of the settlement, or about $2.5 million in the Centene case.
In recent days, Fitch has announced she has filed another lawsuit against insulin manufacturers. The lawsuit alleges the companies are artificially inflating the price of the life-saving drug.
“As the mother of a diabetic, I know the emotional, physical and financial toll the unconscionable price of insulin has on families,” Fitch said in a statement. “I filed this lawsuit on behalf of every Mississippian who relies on this medication to survive. These companies are exploiting the vulnerable. I’m fighting back because you should never have to decide between paying the ever-increasing price of insulin or compromising your care.”
The insulin lawsuit is being pursued for Fitch by the attorneys who worked on the Centene case: Ridgeland-based Liston & Deas. And if they win, they will receive a percentage of the settlement – 5% of any settlement above $25 million – a larger percentage for smaller settlements. The attorneys pay all the expenses of the lawsuits, and they receive nothing if they lose.
Hood used to argue that the outside counsel was needed to pursue cases where the state did not have the expertise, manpower or finances to be successful against large corporations with deep pockets. In the Centene case, for example, work on the concept that led to the lawsuit began years ago.
The fact that Fitch is pursuing much the same course as Hood and Moore should not be a surprise.
During the campaign, a Fitch spokesperson said, “The default should be in-house counsel, of course, because it is usually the best, most efficient and most cost-effective way. But, just like any law firm, if there’s a case that requires specialized knowledge and the people’s interests are better served with some outside expertise working alongside AG attorneys, Lynn Fitch won’t foreclose the option.”
Also during the campaign, Jennifer Riley Collins, the Democratic nominee for attorney general, complained that many of the lawyers and others who had supported Hood financially were contributing to the Fitch campaign. The message some saw in that was that in Republican-controlled Mississippi, Riley Collins did not have much of a chance of winning, so they contributed to the Republican who essentially would play by the same rules as previous Democratic attorneys general.
During Hood’s tenure, $2.8 billion was awarded to the state in lawsuits assisted by outside counsel. The private attorneys received $121.1 million in fees and expenses, or 4.3% of the total awarded to the state, according to information compiled by Hood’s office before his tenure ended. Those numbers do not include the annual payments to the state from the tobacco lawsuit.
In the early 1990s, cigar-chomping Rep. Charlie Capps, D-Cleveland, the powerful Appropriations chair, warned Moore he had better not spend state funds on the dubious and unwinnable lawsuit against the cigarette makers.
Moore did not. But the state still is spending the money – about $100 million annually – Moore garnered in settlements from the litigation.