No health care experience doesn't stop DHHS consultant $310,000 salary

Sep. 07, 2013 @ 06:39 AM

RALEIGH — A man who works for the husband of North Carolina Health and Human Services Secretary Aldona Wos landed a lucrative government contract to provide her with advice and help clean up financial problems within the large state agency.

Wos' agency released Friday to The Associated Press the consulting contract entered into by Joe Hauck after The News & Observer of Raleigh reported some details about his pay. He's been paid more than $228,000 since he and Wos signed his initial personal services contract in late January, according to DHHS records, or a few weeks after Gov. Pat McCrory took office.

The department had refused for three weeks to provide a copy of Hauck's contract to the AP or say how much he was being paid — information considered a public record under state law.

Hauck is the vice president of sales and marketing for New Breed Logistics, a High Point company for which Wos' husband Louis DeJoy is the chief executive officer.

The contract was originally signed Jan. 25 but was extended on at least four occasions — also with Wos' signatures. It pays Hauck $125 per hour as a contract employee. The original contract covering two months capped his pay at $44,000.

Hauck's latest contract extension is due to expire Nov. 30, with compensation capped at $310,000, department spokesman Ricky Diaz wrote by email Friday. His pay-to-date would make him among the agency's highest compensated employees, The News & Observer reported.

Hauck's resume, attached with his contract provided by DHHS, lists no prior experience in the field of health care.

The resume does say Hauck has "35 years of executive management experience across a broad spectrum of business operations and communications disciplines." That includes work on brand development and strategic sales and marketing initiatives at New Breed, where he's worked since 1997, according to the resume. He previously worked as a consultant at the former Exide Electronics in Raleigh and in the technical communications and documentation fields.

Hauck did not respond to messages left for him this week with his assistant at New Breed, which specializes in supply chain management.

Diaz suggested Friday that Hauck has earned his salary many times over, scrutinizing department operations and identifying weaknesses in an agency that oversees the state's $13 billion Medicaid program. The department will save millions of dollars by his efforts to reduce the number of temporary workers, expanding internal audit operations and working on consolidation plans, according to Diaz.

Hauck "provides solid business insight with ability to ascertain and analyze organizational requirements, forecast goals, streamline operations and execute new program concepts," Diaz wrote. A spreadsheet listing Houck's hours and pay this year show him working 281 hours between Feb. 28 and March 28 and 267 hours between March 28 and April 25.

Wos' leadership of DHHS — fraught for years with Medicaid cost overruns — has been under scrutiny for months. A Greensboro physician, former ambassador to Estonia under President George W. Bush and campaign fundraiser for McCrory, Wos has used her government position to surround herself with aides with strong Republican ties.

Diaz, a 24-year-old former campaign spokesman for McCrory, is paid $85,000 a year to manage the agency's message and oversee compliance with the state's public records law. Wos' chief adviser for policy issues is another 24-year-old, former McCrory campaign staffer Matthew McKillip. He is paid $87,500.

The department also hired former State Auditor Les Merritt, a Republican, in May on a one-year contract at $150 per hour, with his compensation capped at $312,000, according to his contract released Friday. Merritt is working on budget and payment issues within the state mental health division, Diaz said. DHHS also released contracts Friday of a handful of other short-term workers.

In a statement, Wos said challenges within DHHS, as confirmed in a state audit earlier this year, required her to assemble a strong leadership team and bring in experts "who we knew could deliver immediate results."

Wos took heat for hiring as her director of North Carolina's pre-kindergarten and child-care subsidy programs someone who for years led an organization who opposed formal pre-K programs. Her choice withdrew from the post.

Like Wos, Hauck has been a strong political supporter of McCrory, who took office in January. Hauck and his wife have donated $14,750 to McCrory's gubernatorial campaign, according to records at the N.C. State Board of Elections.

All told, New Breed employees and members of their families gave more than $216,000 to McCrory's campaign, according to a report issued earlier this year by Progress NC, a left-leaning policy group. The company led by Wos' husband also gave $25,000 to the Republican Governors Association, which supported McCrory's campaign.

On Friday, Progress NC spokesman Gerrick Brenner repeated the group's call for members of the GOP-controlled state legislature to investigate hiring and compensation practices in the McCrory administration.

"DHHS is an example of cronyism gone wild and Gov. McCrory is defending their hiring practices," Brenner said. "So now it's time for the legislature to step in and investigate. It's their duty to provide oversight."