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Privatizing of Florida prisons' health care hits snag

TALLAHASSEE — As Florida faces legal obstacles in its plan to turn dozens of state prisons over to a private firm, a second privatization venture faces harsh criticism.

The Legislature not only decreed that 29 prisons in South Florida be privately run — a plan declared illegal by a judge — but ordered all inmate health care statewide to be handled by private firms.

The outsourcing of physical and mental health care, dentistry and prescription drugs to more than 100,000 inmates was a campaign pledge of Gov. Rick Scott, who called for competitively bid health care contracts. Born as a cost-saving measure, it has been controversial from the start.

The project helped cost former prison chief Ed Buss his job in August when Gov. Rick Scott and his top aide objected to the way the first proposal was crafted. They ordered language removed that appeared to favor an accrediting agency run by the husband of Buss' prison health care consultant, Betty Gondles.

Buss and Gondles, who helped write the original proposal, are both gone, but the controversy remains.

Lately the project has run into so much resistance from private vendors, who have bombarded the state with more than 600 questions, that the Department of Corrections has pushed back its schedule to implement the project by several weeks.

"Privatization of inmate health care is a good idea for Florida taxpayers," said Mark Hale, chief executive officer of Wexford Health Sources, a Pittsburgh firm that may seek the contract. "But it will be very difficult for the state to successfully contract to provide quality inmate care while fully achieving the highest possible savings."

Among the vendors' complaints:

• The five-year contract mandates one price for the full five years, which vendors say makes no allowance for inflation, and they are required to provide the medical care at a cost at least 7 percent lower than the state.

• Companies will be fined $50,000 per prison if they haven't installed 90 percent of their staff within a month of being hired. Firms say existing vacancy rates at state-run prisons are much higher than that.

• A qualified vendor must already be caring for at least 50,000 inmates, which could disqualify a Miami company, Armor Correctional Health Services, at a time when Scott's priority is creating jobs. Armor provides health care to inmates in county jails in Hillsborough and Broward counties.

• Vendors must post a performance bond of $82 million, which they say is exorbitantly high. "Seems excessive," MHM Services, one prospective vendor, told the state.

Another health care firm, Corizon, said a bond that high is "difficult if not impossible to obtain and could serve to limit competition." Their comments were included in questions the vendors posed to the state.

A spokeswoman for the prison system, Gretl Plessinger, said the financial guarantee is needed to protect taxpayers.

"If the vendor fails, the state is responsible for the continuum of care," she said. "Taxpayers will be on the hook to pay premium rates for replacement staff."

The health care bid is actually five proposals in one, because the huge Florida prison system is divided into four regions.

Companies can apply for a contract in Regions 1, 2, or 3 or in all three. Separately, prisons in South Florida's Region 4 were ordered privatized in another part of the budget now under attack in court by the union for prison guards, the Police Benevolent Association.

The prison system says it will answer vendors' questions by Nov. 18. Bid proposals are due Dec. 12 and will be opened the next day. The choice of vendors is subject to approval by a 14-member panel of state lawmakers, and the state hopes to start a transition to privately run care by April 2012.

Reach Steve Bousquet at bousquet@sptimes.com or (850) 224-7263.

Privatizing of Florida prisons' health care hits snag 11/08/11 [Last modified: Wednesday, November 9, 2011 9:01am]
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