Former Iowa Department of Human Services Director Jerry Foxhoven is filing a whistleblower claim against Gov. Kim Reynolds in the first step toward a wrongful termination lawsuit against the state. Foxhoven claims he was fired for objecting to continue paying part of the salary of Reynolds' deputy chief of staff, Paige Thorson, from the DHS budget.
Foxhoven had previously agreed to pay 69 percent of Thorson’s salary as she helped the state’s new Medicaid director, Mike Randol, become familiar with Iowa’s system. But Foxhoven said he disagreed with extending the arrangement into the 2020 fiscal year. By then, he said, Thorson was no longer working on Medicaid issues. In addition, the legislature had allocated money for the governor to hire a new health policy advisor.
“When they got the appropriation for it, I thought frankly that was going to solve the problem, that we wouldn’t be paying any of Paige Thorson’s salary at that point,” Foxhoven told reporters Thursday.
Foxhoven said he was told to continue the payments for Thorson, but he was concerned it would be considered an illegal shift of funds.
Reynolds said in a statement that Foxhoven never brought up any issues about the budget arrangements to her or her staff and that he never told her staff he would seek a legal opinion on the matter.
According to Foxhoven, he did not raise his concerns directly with Reynolds but he did discuss it with her chief of staff, Sara Craig Gongol, multiple times. Foxhoven said he told Craig Gongol he was planning to ask the assistant attorneys general working on another case at DHS.
“Either they would say it’s legal and okay or they would say it’s not legal, which I believed,” Foxhoven said, but he was ousted before asking the question. "They knew I was going to be sending an email to the Attorney General’s office on Tuesday (June 18). Monday they told me, 'Your position is over. Give me your key card and your cell phone and don’t go back to your office.'”
Reynolds said she would never ask anyone to do something they thought was illegal and that she's focused on choosing a new DHS director. She also told reporters this week that similar pay arrangements were common for past governors. She said no staff are currently being paid through the DHS budget, but she has asked the department to review the procedure to make sure it is done appropriately in the future.
Foxhoven said he takes that as a sign that his complaint was heard.
Reynolds has repeatedly said that Foxhoven was asked to resign for many reasons and implied this week that things were not going well at DHS, telling reporters to “go back and look at some of the articles that you’ve written.”
In recent months the agency has been accused of ignoring abuse at the Glenwood Resource Center, has faced a lawsuit over disciplinary techniques at the Boys State Training School in Eldora and is dealing with criticism after United HealthCare left the state’s privatized Medicaid system.
For his part, Foxhoven said he never heard negative reviews from Reynolds or her staff. “Everything I got from them was positive, that they liked the direction we were going, that they thought we were making a difference, moving the needle,” he said.
Foxhoven’s complaint will go before the State Appeal Board. His attorney, Thomas Duff, said he does not expect the board to revolve the case, however, and that a lawsuit will eventually be filed.
Democrats in the Iowa legislature have called for hearings looking into the situation, but Republican leaders say they do not plan to call for any investigations. Foxhoven said he has been interviewed by the State Auditor’s office, which is investigating his complaints. He said he also spoke to an investigator with the Office of Inspector General at the federal Department of Health and Human Services.