PROVIDENCE — After insisting for months that a Boston consulting company was “volunteering” its time and manpower to Rhode Island’s pursuit of a federal waiver that would give it unprecedented freedom in how it spends its state and federal Medicaid dollars, the Carcieri administration on Friday disclosed a $370,000 settlement with The Lucas Group.

The announcement of the settlement came three days after the Senate unanimously confirmed Gary Alexander as the state’s new $135,661-a-year chief of health and human services amid unanswered questions about the behind-the-scenes role played by this no-bid, no-contract consultant in Rhode Island’s attempt at a Medicaid overhaul.

The partners in the company include former New Hampshire health and human services commissioner John Stephen, an unsuccessful 2008 New Hampshire GOP congressional candidate for whom Alexander had campaigned and held a fundraiser in his home.

On its Web page, the Lucas Group took credit for having “originated” and “constructed” and then “led” the negotiations with federal officials that resulted in Rhode Island winning the far-reaching Medicaid waiver in the final days of the Bush administration. The waiver is expected to save the state $7 million this year and hundreds of millions of dollars over the next five years by steering the elderly away from nursing homes, redefining who is sick enough to be eligible for certain services and creating treatment networks for the people enrolled in this state and federal-financed medical program for the elderly, the disabled and the poor.

Not until Friday, however, did the Carcieri administration acknowledge the extent of the company’s role, having previously described it as “voluntary” with no promises or expectations of remuneration.

According to a statement by the governor’s office: “The Lucas Group requested payments totaling $468,127 for services the company performed in assisting the state on the Global Medicaid Waiver and identifying significant savings initiatives and reforms.”

“After several months of disagreement … [and] intensive mediation facilitated by retired Associate Justice, Richard Israel … the Office of the Governor agreed that even though no formal contract had been signed by the time the waiver was completed, the state did benefit, and payment to the Lucas Group is appropriate under the circumstances.”

The agreement appears to have been signed on Thursday by both Alexander and Department of Administration Director Gary Sasse.

Up until Friday, the Carcieri administration had been vague — or unwilling to answer questions — about the nature and scope of the work done by the Lucas Group, and Stephen in particular.

When Stephen’s name first surfaced months ago, along with that of The Lucas Group, Carcieri spokeswoman Amy Kempe said the company was working on the state’s global Medicaid waiver negotiations with federal officials on a “voluntary basis. ... We are not engaged with Lucas ... It’s strictly voluntarily offering advice and guidance.”

Multiple follow-up inquiries by The Journal went unanswered until Friday, when the administration released the settlement agreement and a statement that said:

“The relationship between the Lucas Group and the state began in the fall of 2008 with a series of informal, high-level discussions about the various benefits of a Medicaid waiver and the steps that needed to be taken …. As negotiations heightened and demand for information increased significantly, the relationship moved from informal assistance to a more definitive work plan as it became clear that the expertise and specialized human resources of the Lucas Group were needed to achieve the waiver.”

“No formal contract was ever signed,” the statement said, though the Department of Human Services sought permission to engage the Lucas Group under the state’s no-bid rules governing “sole-source” procurements. But events moved at a faster pace than the bureaucracy.

“Under strict time constraints to complete negotiations with the federal government, DHS continued to work with the Lucas Group although the sole source request had not been approved by the Department of Administration,” and “the work product by the Lucas Group [was] significant and was instrumental in helping the state obtain the unprecedented Global Medicaid Waiver.”

Asked why she had not disclosed the extent of the company’s role earlier or the efforts to give it a “sole-source” contract, Kempe said: “Up until the point there is a contract, the work is voluntary.”

“At some point, there may have been an intention to retain their services, but that did not come to fruition, therefore no contract … I will have to let you judge if it was accurate for me to say their work was voluntary … Personally, I was not aware of the request for the sole source contract, but that is not unusual. I am not involved with those types of decisions.”

kgregg@projo.com