The Maryland Board of Public Works voted Wednesday to nix an emergency modification to the Department of Public Safety and Correctional Services’ health care contract that would have tacked an additional 30% onto the state’s monthly fee for unspecified COVID-19 costs.
Comptroller Peter V.R. Franchot (D) said that the state has a statutory obligation, but “also a moral imperative, frankly, to ensure the safety and well being of the inmates that are under our care.”
He made clear that his concern was not about the price tag, but the lack of accountability.
“I guess the concern here is that we’re simply reimbursing this company for its own failures as far as implementing the contract that they signed to and agreed,” Franchot said to the board, “and there we are paying extra money and attributing it to COVID-19.”
In early April, Department of Public Safety and Correctional Services Secretary Robert L. Green entered into an emergency contract with the department’s medical provider, Corizon, to the tune of $3.2 million per month. This additional funding was intended to account for a 30% increase to their monthly fee to account for additional staffing, overtime, personal protective equipment, testing materials and other medical supplies.
The emergency contract was poised to last into September with an option to extend through the balance of the year, contingent upon the state of emergency.
The state’s original contract with Corizon, finalized in December 2018, was set at a flat fee of $680 million over five years. According to the Board of Public Works agenda, the emergency contract modification term began on March 16, potentially tacking an additional $30 million to the contract’s flat rate.
Green stated that the department has the option to opt out of the emergency contract at any point in time.
Franchot proposed to pay the company for the past three months that the contract has been enacted, further instructing the department to end it by June 30 and opt to pursue an agreement that allows the state to reimburse Corizon for medical expenses once it has been provided with auditable “receipts for additional COVID related medical service expenditures that are being performed outside of the contract scope of work.”
Treasurer Nancy K. Kopp (D) and Lt. Gov. Boyd K. Rutherford (R) voted favorably.
The department will be seeking a partial reimbursement from the Coronavirus Emergency Supplemental Funding program, which reimburses state and local governments for costs incurred as a result of COVID-19.
‘A point in time decision’
Franchot called Maryland’s original contract with Corizon “controversial,” alleging that the company underbid the state by $50 million, a concern he said was brushed to the side based on reassurance surrounding the company’s reputation.
“Well, all of a sudden, we’ve got this $3.2 million, nine-month emergency contract, which is about $30 million,” he said.
Franchot questioned Green about the necessity of the contract since the actively reported infection rate in Maryland correctional facilities does not match early projections.
Green explained that the emergency modification was “established with a great sense of urgency” as officials watched with alarm while prisons around the country saw up to 70% of their populations infected.
“This was a point in time decision to make sure that we safeguarded the health care of over 18,000 individuals that are in our custody,” he said.
As of June 15, the Department of Public Safety and Correctional Services was reporting 766 positive COVID-19 in its staff and inmates — 53% of which were seen in staff.
Of these positive cases, 266 staff members and 90 inmates have reportedly recovered.
Green said Wednesday that five inmates are currently in the hospital, seven at the agency’s surge facility created at Jessup Correctional Institute and five being cared for at a surge facility in downtown Baltimore.
There are some who believe it could have been — and may become — much worse.
“The proactive and expeditious manner in which the containment and mitigation issues that were put forth by the secretary and our team, I believe helped to mute what would have been [an] otherwise devastating picture,” said Dr. Sharon L. Baucom, chief medical director for the Department of Public Safety and Correctional Services.
Baucom explained that while hospitalizations for other conditions, like trauma and oncology, decreased from March to April, hospitalizations for COVID-related respiratory infections increased by 73%, and stays lengthened from an average of four days to up to 14 days during the same time period.
Green said that the department is currently participating in “point prevalence,” or point in time, testing and has seen an increase in confirmed cases, adding that as courts begin to open and inmates begin to travel in and out of the system, the potential for infection only rises.
Additionally, late last month, Gov. Lawrence J. Hogan Jr. (R) announced that he was mandating universal testing in all of the state’s adult and juvenile detention facilities.
Since that announcement, the department has reported the completion of tests in 4,036 staff and 7,892 inmates. In 2019, the department’s average daily population of rested around 18,800 incarcerated individual.
Baucom said that each test costs $56.
Franchot said that that measure causes the state to lose accountability for where its taxpayer dollars are spent, noting that of the $3.2 million emergency contractual allotment for April, only $2.5 million was spent on “COVID-19-related expenses.”
“That’s $700,000 in April that Corizon did not spend, did they return that to the state?” Franchot asked.
“No, Mr. Comptroller, the emergency modification did not provide for a return back to the state of any funds based on the flat rate increase,” Green responded.
Lobbyist Bruce C. Bereano, who testified in opposition of the emergency contract on behalf of Wexford Health Sources — the department’s former medical provider, said that this was a ploy to get more money out of the state.
Bereano said that Corizon officials had come to the state four times before looking for contract increases, and were turned down each time.
“I just think it’s a way of bailing out a company that has its financial difficulties and underbid this contract,” he asserted.
Phil Andrews, Corizon’s legal representative, countered, saying that Wexford left the department’s health care system in such a shambles that it left Corizon’s contract “under financial pressure” before the pandemic’s onset.
Green said that he “absolutely reject[s]” the notion that the contract related to anything other than “the absolute, astounding and shocking impact that this virus could have upon a congregate setting such as ours.”
Christopher McCulley, the deputy secretary of administration for the Department of Public Safety and Correctional Services, said that as the emergency contract is currently laid out, Corizon is not required to send the state a detailed invoice of expenditures.
Franchot said he is on board with a scenario where the state reimburses Corizon for COVID-19-related services as long as there is a “detailed breakdown of expenditures.”
“I don’t think giving them $30 million without any strings attached is the right thing to do,” he said.