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Failure to penalize troubled vendor makes Maryland a ‘laughingstock,’ lawmaker says – Maryland Matters

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Failure to penalize troubled vendor makes Maryland a ‘laughingstock,’ lawmaker says – Maryland Matters


The Maryland State Home in Annapolis on June 30. Photograph by Bruce DePuyt.

State lawmakers have been unsparing of their criticism of the Maryland Division of Well being on Tuesday, accusing the company of failing to pursue monetary compensation in opposition to a vendor that has acknowledged critical shortcomings.

One after one other, members of the Common Meeting’s Joint Audit and Analysis Committee expressed astonishment that the company determined — as a matter of coverage — to not search liquidated damages from Optum, a well being claims-processing firm whose shortcomings have been the topic of a harsh audit final month.

The Minnesota-based agency processes billions of {dollars} in behavioral well being claims annually. The overview of Optum’s efficiency, which was performed by the Workplace of Legislative Audits (OLA), uncovered quite a few issues.

Auditors found greater than $220 million in funds for behavioral well being companies that lacked correct documentation or haven’t been recovered, lapses that prevented the state from receiving practically $30 million in federal reimbursement for which it was eligible. As well as, psychological well being suppliers, who’ve been stretched skinny and topic to burnout because the pandemic started, have been compelled to spend lengthy hours reconciling cost errors.

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Company officers gamely sought to reassure lawmakers that they’ve penalized and withheld funds from Optum, however they acknowledged that they determined to not search liquidated damages for worry of harming their relationship with the agency. The admission appeared to stun members of the panel.

“I believe it sends the fallacious message to contractors that work with the state — and makes a laughingstock of our contracting course of,” mentioned Sen. Clarence Lam (D-Howard), a committee co-chair. “If we enter into contracts with distributors who’re unable to ship, and but don’t pursue damages when these contractors are costing the state thousands and thousands of {dollars}… it’s an instance of what’s damaged with our state procurement course of.” 

Del. Kirill Reznik (D-Montgomery) referred to as the company’s choice “unconscionable” and a harmful precedent. 

Though auditors calculated that the state has suffered lots of of thousands and thousands in losses because of Optum’s struggles — by claims that have been improperly denied, duplicate funds, overpayments and uncollected federal funds — the agency was handled gently, auditor Josh Adler mentioned. 

“It’s virtually, in my thoughts, it’s like [they were] too large to fail,” he instructed the panel. “The division’s place was simply ‘we are able to’t do something.’” 

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Lam urged it can fall to the incoming administration of Gov.-elect Wes Moore (D) to chart a brand new course, although one other auditor, Brian Tanen, cautioned in opposition to delay. “The findings should not static,” he mentioned. “The potential losses improve daily that goes by.” 

Well being Secretary Dennis Schrader, who skipped a Nov. 1 dialogue lawmakers convened, was absent on Tuesday as nicely. His absence annoyed lawmakers who wished to know who set the coverage to not sanction Optum extra harshly. 

The company officers who spoke on Schrader’s behalf rejected the declare that the contractor’s failures harm the state financially. 

“It’s our rivalry that the state has not misplaced cash,” mentioned Assistant Secretary Webster Ye, pointing to unspecified cost withholdings and penalties. His feedback elicited sounds of disbelief from Del. Andrea Harrison (D-Prince George’s) that have been audible through the on-line assembly.

“I don’t consider that there have been losses,” mentioned Deputy Secretary Steve Schuh. He mentioned the choice to not search liquidated damages — what he referred to as “the nuclear choice” — shouldn’t be interpreted as an indication the company is glad with poor efficiency. 

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Lam referred to as Schuh’s feedback “non-sensical.” He mentioned the division’s protection of its actions represented “such a contortion of the reality that it places Cirque du Soleil to disgrace.” 

Issues with ‘nearly each side of the contract’ 

Lawmakers from each events signaled their unhappiness with the company’s oversight and the period of time it takes to get info. “We’re not getting the solutions that we expect we ought to be getting,” mentioned Del. Steven Arentz (R-Higher Shore). “I believe it’s vital, as a result of we’re coping with some huge cash right here. Loads of taxpayer {dollars}.”

Though practically all OLA audits of presidency businesses uncover some areas the place enchancment is required, chief auditor Greg Hook mentioned the MDH’s efficiency on this occasion was notable. “As a result of monetary significance and repeat nature of many findings, we decided that MDH’s accountability and compliance degree was ‘unsatisfactory.’” That designation triggers a proper “follow-up overview” throughout the subsequent 12 months. 

Adler instructed lawmakers that auditors “recognized issues with nearly side of the contract” — together with gaps within the preliminary procurement, a failure to vet Optum’s many subcontractors, a failure to check Optum’s system earlier than it went reside, shortcomings within the system itself, and the company’s unwillingness to impose stiffer penalties. 

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He mentioned the company feared that if it went after the seller extra aggressively, “it could discourage [the company] from resolving the various issues it has.” One other worry, he mentioned, was that Optum may file swimsuit in opposition to the state in response. Adler referred to as the well being division’s stance “opposite to the intent of state legislation.” 

Though the corporate has two years remaining on a five-year contract, the company has signaled it’s shifting on. Earlier this month officers acknowledged they’re nearing completion on a revamped procurement course of shall be used within the seek for a alternative. 



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Maryland

Guns flood the nation’s capital. Maryland, D.C. attorneys general point at top sellers.

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Guns flood the nation’s capital. Maryland, D.C. attorneys general point at top sellers.



The lawsuit announced on Tuesday claims three stores sold one person 34 guns over six months and ignored the buyer’s red flags.

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The nation’s capital is grappling with a deadly flood of weapons. Prosecutors are pointing fingers at three federally licensed gun stores in Maryland.

Attorneys general of Maryland and Washington D.C. filed a lawsuit Tuesday against three gun shops for selling firearms to a straw purchaser – the same stores identified as the top retailers of recovered crime guns in Maryland between August 2020 and July 2021, according to a report commissioned by the state attorney general’s office.

According to the lawsuit, the three stores in Montgomery County, Maryland, roughly 25 miles northwest of Washington D.C., collectively sold 34 semiautomatic pistols to one person in six months. Only two remained with the purchaser, while the rest are presumed to be trafficked, prosecutors said.

Some have been recovered from people accused of assault, a stabbing, and drug distribution, the lawsuit added, while most remain unaccounted for.

“Federally licensed gun dealers know the law and they know what to look for to spot possibleillegal trafficking. As this lawsuit demonstrates, gun dealers cannot just choose to ignore these warning signs and guardrails,” said Maryland Attorney General Anthony Brown. “Let this be a warning to other dealers who put public safety at risk to make a profit: We are watching, and we will hold you accountable for illegal conduct that fuels gun violence across our region.”

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The lawsuit comes as public health experts and gun safety advocates warn about an alarming level of gun violence across the nation — guns are the leading killer of children in the U.S. and kill nearly 50,000 people a year. Lawsuits in other states have also targeted sellers and traffickers as culprits in gun crimes, including New Jersey, Michigan, and Philadelphia.

Lawsuit: Man bought 34 guns in 6 months

Three federally licensed gun stores – Engage Armament, United Gun Shop and Atlantic Guns – collectively sold Demetrius Minor, an “obvious straw purchaser,” 34 guns between April 6 and October 5, 2021, according to the lawsuit filed in Montgomery County Circuit Court.

According to Engage Armament’s records cited in the lawsuit, Minor spent more than $31,000 at the one store for at least 25 guns. In July 2021 alone, he came to the store at least four times and bought five guns, prosecutors said.

Minor gave many of the weapons to a relative, Donald Willis, a Washington D.C. resident with a record of violent felonies, the lawsuit said, and Willis then spread the guns to other “dangerous individuals.” Minor has been convicted for his role in the straw sales. But Tuesday’s lawsuit said the stores “who chose profits over safety” have faced no consequences for their “critical role in fueling gun violence” in the D.C. metro region.

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At least nine of the weapons, which the lawsuit contends were “illegally sold,” were found at crime scenes in Washington D.C. and surrounding Maryland suburbs. “Many more are likely in the hands of other individuals legally barred from possessing firearms and will be used in future crimes,” the lawsuit said.

The lawsuit cites a federally required form to buy a gun — the ATF firearms transaction record — which is used to determine whether a gun sale is legal. The form notes that straw purchases are illegal, meaning the firearm must go to the person who legally bought it. It also states that the seller is responsible for ensuring the sale is legal, and simply conducting a background check does not fulfill obligations.

The lawsuit notes that just as straw purchases are illegal, it is also against the law for a firearm dealer to help advance illegal sales, and federal law requires licensed dealers to report when an unlicensed buyer purchases two or more handguns within five days.

Atlantic Guns denied the straw sales allegations in a statement to USA TODAY on Tuesday.

“Atlantic Guns, Inc. has never and will never knowingly sell to someone who we have reason to believe is committing a straw purchase,” the store said, declining to comment further before review of the lawsuit.

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Engage Armament and United Gun Shop didn’t immediately return USA TODAY’s requests for comment.

Cities and states across U.S. go after sellers to battle gun violence

The lawsuit Tuesday is the latest to sweep the nation as cities and victims of shootings target firearm stores and traffickers to battle gun violence.

Last July, Philadelphia announced a lawsuit against three vendors that the city said were the source of more than 1,300 crime guns between 2015 and 2019. The weapons were used in shootings, a home invasion, drug crimes, vehicle theft, and more, according to the city.

Three Missouri men were charged earlier this year for illegally selling guns to the people who fired shots into the Super Bowl victory parade that killed a mother and injured over 20 people earlier this year.

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In Michigan, the parents of a 14-year-old Oxford High School student who was severely injured in a 2021 mass killing, named a gun store as one of the defendants in a lawsuit, alleging Acme Shooting Goods negligently and illegally sold the firearm used in the school assault that killed four people and wounded seven others. Acme sold the gun to the shooter’s father while ignoring signs it was a straw purchase, the lawsuit alleged.

In July 2023, a northern Indiana gun shop that police called a key supplier of Chicago’s criminal firearms market announced it was closing its doors after Chicago sued Westforth Sports in 2021 over what it said was a pattern of illegal gun sales.

A USA TODAY investigation earlier this year found the majority of guns used in crimes are sold by a small fraction of the nation’s gun shops. Two of the Maryland gun shops named in Tuesday’s lawsuit – United and Atlantic – were on a list by the Bureau of Alcohol, Tobacco, Firearms and Explosives of stores that sold at least 25 guns traced to a crime over a year that were purchased within the past three years.

Contributing: Nick Penzenstadler and Grace Hauck, USA TODAY



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Declines in revenue, federal aid drive cuts in proposed transportation projects – Maryland Matters

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Declines in revenue, federal aid drive cuts in proposed transportation projects – Maryland Matters


Transportation projects around the state will be put on hold as officials grapple with ongoing budget constraints and a growing list of expensive projects.

A combination of budget pressures has created a $1.3 billion funding gap over a six year period, which Transportation Secretary Paul Wiedefeld said forced his department to defer projects across the state.

“We just don’t have enough dollars to do what we have to do within our means. So that’s what we’ve had to do,” he said.

The agency Tuesday released a draft of its latest Consolidated Transportation Program, a six-year budget that contains $19 billion in projects around the state. Wiedefeld said the draft required tough choices to address the budget gap, a “historical issue” that continues.

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Wiedefeld said the state’s transportation funding shortfall is driven, in part, by an end to federal COVID-19 aid. Other factors include inflation, increased construction costs, less than expected revenue from the state’s gas tax, and reduced federal funding.

“The biggest one we do is we take a look at our financial forecast and all the ups and downs that may occur in the financial forecast,” Wiedefeld told reporters during a briefing Friday. “And so, in doing that, what we learned was that some of the projections that we had in terms of the growth of some of our sources were not growing at that rate, particularly our largest source of revenue, the motor fuel tax. There were some others that were either not growing or remaining flat again, not growing to the level that we’d hoped for.”

Wiedefeld said that resulted in roughly a $350 million decline in projected revenues over the six-year period of fiscal 2025-2030.

“At the same time, our operating costs continue to grow at a rate a little bit more significant that we have projected,” said Wiedefeld, adding $300 million in projected costs over the six-year period.

Counties scramble for answers, options as state signals deferral of transportation requests

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Additionally, lawmakers earlier this year restored proposed cuts in state aid to local governments as part of Highway User Revenues as well as proposed cuts to transit systems run by 23 counties and Baltimore City. Restoration of those proposed cuts added another $400 million over six years, Wiedefeld said.

“So those three things basically are our realities that put pressure on the financial forecast,” he said.

Finally, Wiedefeld said the amount of federal aid is falling short of expectations.

“We were pushing all the modes to really buckle down and see where else we could get federal dollars for delivering projects,” he said. “We were shooting for roughly 80% federal, 20% local match, overall for the program. Basically, we were not able to achieve that, and we’re probably not going to be able to achieve that into the future.”

Instead, Wiedefeld said the state now expects a 75-25 split. “That 5%, although it sounds small, is significant, obviously, when you think of the amount of federal dollars that would bring down,” he said.

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The resulting lack of revenue means counties will see priority projects not already underway slowed down or paused

“In effect, projects that are into the future — larger projects that we want to construct — we have to slow those down in terms of the process to get them to construction, until we have available dollars to pick that back up,” Wiedefeld said.

One large project that could suffer is the proposed widening of the American Legion Bridge.

“So, on the American Legion bridge, obviously, we have the record of decision for this, you know, larger improvement there,” said Wiedefeld. “But given the stress that we’re under, we’re going to have the state highway particularly focus on the pure state of good repair issues around the American Legion bridge.”

The state applied for a federal grant to help pay for the costs of repairing “structural issues with the bridge,” he said. “So that’s where we’ll be focusing,” Wiedefeld said.

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News of the delays was delivered to county leaders by Wiedefeld and transportation officials during the Maryland Association of Counties summer conference last month.

The transportation secretary said he will also seek to slow down the purchase of zero-emissions buses in the coming years, as some major bus manufacturers are having issues with the performance of electric buses, as well as availability.

Moore warns of difficult fiscal decisions ahead

A new clean diesel bus costs the state $750,000. A hybrid bus costs about $1 million each. A new electric bus costs $1.4 million each.

“So, as you play that over the program period, if you defer that, it actually saves a lot of dollars,” Wiedefeld said. “It allows us not to dig deeper into operating cuts, that we would have to do, or system preservation cuts.”

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Wiedefeld said he will not request cuts to his department’s operating budget as he did last year when he cut 8% across the board. He will also not request cuts to county aid or local transit networks.

“What we’ve done is we’ve gone through all those projects, and we’re going to defer those projects at a logical deferred point,” Wiedefeld said. “So basically, some of those projects were in different levels of study. We want to make sure that they stop at a point where we don’t lose any of the effort that we had done, but we don’t have the available funds right now to continue those projects. What you’ll see in the capital program is basically those projects that will be deferred.”

A year ago, Wiedefeld proposed cuts to county shares of highway user revenues and to local transportation networks.

Highway user revenues — decimated in cuts more than a decade ago — had yet to be restored to previous levels. Proposed cuts, nixed this spring by the General Assembly, would have eliminated planned increases in future years.

“Even so, the fiscal 2025 funding for HUR (highway user revenues) falls significantly short of Maryland’s appropriate and historic funding levels, even without adjusting for inflation,” the association of county governments said in a post on its website. “This gap becomes even more pronounced when accounting for rising road maintenance and materials costs.”

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The association said it would continue to seek restoration of state highway aid.

“MACo and county leaders will continue urging Maryland policymakers to advance a sustainable plan to address critical infrastructure needs across the state,” the group said in its statement. “Proper restoration of the HUR formula should be a priority in advancing solutions that create sensible and reliable support for all locally maintained roadways.”



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University System of Maryland to only allow university-sponsored events on October 7

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University System of Maryland to only allow university-sponsored events on October 7


University of Maryland President William Pines announced this weekend that only university-sponsored activities “that promote reflection” will be held on October 7th.

The day will mark one year since Hamas terrorist attacks in Israel killed around 1,200 people and took around 250 hostages. Israel retaliated, declaring war on Hamas, which has resulted in more than 40,000 people dead, according to Gaza health officials.

This came after the Students for Justice in Palestine (SJP) group had reserved the McKeldin Mall and Jewish organizations on campus had reserved Hornbake Plaza on October 7th to mark the day.

The announcement cancels both of these events.

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“Jointly, out of an abundance of caution,” wrote Pines in an email to the campus community, “we concluded to host only university-sponsored events that promote reflection on this day. All other expressive events will be held prior to October 7, and then resume on October 8 in accordance with time, place and manner considerations of the First Amendment.”

This policy is in place for all University System of Maryland Schools.

“The intent is not to abridge students’ right to free expression; the intent is, instead, to be sensitive to the needs of our students. Our university communities may use this day to safely come together to reflect and to share, to learn and to listen, and, yes, to challenge one another. That’s the premise—and the promise—of higher education.”

-University System of Maryland Statement

SJP wrote in a statement on its Instagram account: “We as Students for Justice in Palestine are deeply angered, though not surprised, by the University of Maryland administration’s decision to cancel our reservation for a vigil at McKeldin Mall on October 7th.”

It continues, “Rest assured that we will find ways to mark this one year of genocide and one year of resistance.”

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University of Maryland students worried about antisemitism on campus

The Jewish Student Union also posted a statement to its Instagram account.

“We are reassured to learn that Students for Justice in Palestine at the University of Maryland will no longer be permitted to host their event on McKeldin Mall, or anywhere on campus, on October 7th,” the organization writes.

“Only university-sponsored events will occur on October 7th,” they continued. “While this is not an ideal situation, it ensures that our physical and psychological safety is protected on this day of grief.”

In the email from Pines, he noted that a safety assessment had been done and that there was “no immediate or active threat.”

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The Jewish Student Union added that they would be holding an event to memorialize the day at Maryland Hillel, a center for Jewish life and students, which is located just off campus.

The UMD Chapter of Jewish Voice for Peace also released a statement standing with SJP “in their anger with the university admin’s decision to cancel our registration to hold a joint vigil on October 7th.”

The email from Pines added that “we encourage our entire community to mark the anniversary of October 7 with remembrance and reflection.”

At the moment, it’s unclear what university-sponsored events will take place on October 7th, at the College Park campus.





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