Prison health care outsourcing stalled by bid protests
From The Current:
The Department of Corrections last week suspended its effort to outsource health care services for Florida prisons after receiving bid protests from three potential vendors.
The department is seeking bids on five-year contracts to provide care, including dental and mental health services, for inmates in each of the department’s four regions, as well as three regions collectively. Bids were scheduled to be due Dec. 19, but the department suspended the bidding calendar on Dec. 5 after Corizon, Wexford Health Sources and MHM Correctional Services filed protests.
Bonnie Rogers, a budget aide to Gov. Rick Scott, told the Senate Criminal and Civil Justice Appropriations Subcommittee on Thursday that the department is working to resolve the protests so procurement can continue.
Corizon and Wexford both argue that some conditions the Legislature has placed on the prospective contract, such as requirement that they achieve savings of 7 percent each year from 2010 spending levels, would expire after June 30, 2012, because they were enacted through proviso language in the budget lawmakers passed this past session.
“If the Legislature had attempted to cap spending on inmate health care services beyond that date, it would be encroaching on the authority of subsequent Legislatures to establish budget priorities and limit future spending, which it cannot do under applicable law,” Wexford’s protest states. “Such a limitation extending beyond the applicable fiscal year would also be an invalid attempt to make subsequent law for future years in an Appropriations Act.”
The companies maintain it will be difficult to maintain the 7 percent cost reduction the department is seeking for the life of the contract while also turning a profit as health care costs rise. Corizon says the department’s health care costs rose at an annual rate of about 3.4 percent during the past decade.
In its revisions to the requests for proposals, the department has lowered the value of the performance bonds companies would be required to post and reduced some of the financial penalties companies would face for failing to meet staffing or performance requirements. However, the companies contesting the health care bids contend that some of the terms, such as the penalties they could face for failing to comply with the department’s standards and the value of the required performance bonds, are “unreasonable” and “anti-competitive.”
Under Scott‘s budget proposal, the outsourcing effort is expected to save about $23 million in the 2012-13 fiscal year, though Rogers said during Thursday’s committee hearing that the number would likely have to change if the contracts cannot be executed in time.
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