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Legislative panel delays prison, Medicaid contracts

By Bob Johnson
Associated Press Writer

MONTGOMERY — A legislative panel Thursday delayed a massive $223 million, three-year prison health care contract with a Missouri firm after questions were raised about why the contract didn't go to a company that offered to do the job for $9 million less.

The Legislature's Contract Review Committee also delayed a contract for $3.7 million with a Texas company to consolidate medical information about state Medicaid patients in one computer file after lawmakers raised questions about the company's performance in other states.

Lawmakers also questioned whether the Medicaid computer contract, to be paid from a federal grant, was the best use of resources for the cash-strapped agency whose commissioner has predicted it will need almost $200 million in additional funds next year.

Reviewing process

The committee spent more than three hours reviewing 363 state contracts worth almost $290 million, but much of the attention was concentrated on the Medicaid and prisons health care pacts.

Prisons Commissioner Richard Allen said the 35-month prison health care contract with correctional Medical Services of St. Louis, which is to take effect Nov. 1, would spend $67 million the first year, $76 million the second year and almost $80 million the third year on providing health care to Alabama's more than 24,000 prison inmates.

By comparison, the Department of Corrections only spends about $12.4 million a year to feed prisoners, Allen said.

Delay request

Rep. Blaine Galliher, R-Gadsden, asked that the contract be delayed after Michael Davis of the Balch & Bingham law firm told lawmakers his company represents Wexford Health Sources of Pittsburgh, which bid $9 million less for the contract. Davis told committee members that Wexford wants to meet with prison officials before Gov. Bob Riley signs the contract.

The committee can delay a contract for up to 45 days, but can't stop one. It only takes one objection on the eight-member committee to delay a contract.

Galliher also expressed concern that several corrections officials who evaluated proposals for the health care service were former employees of Correctional Medical Services, including Ruth Naglich, associate commissioner for health services.

6 years

Allen said no one that reviewed the proposals had worked for the company in the past six years.

"I have full confidence in these people. There was no politics involved in this selection," Allen said.

The acting chairman of the contract review panel, Rep. Alvin Holmes, D-Montgomery, also questioned why the contract did not go to the lowest bidder among the three companies that sought the pact.

"All three of these companies are capable. You could have selected any one of them," Holmes said. The current prison health care provider, Prison Health Services of Brentwood, Tenn., also sought the contract.

Allen said cost was only one factor considered by prison officials, who wanted to make sure that the health care company could provide adequate staffing.

Computer records

Medicaid Commissioner Carol Steckel told committee members her agency's contract with Affiliated Computer Services would allow the agency to create an electronic health record for Medicaid patients.

The record will allow doctors to see the results of previous
lab tests and help them in
ordering treatment for patients, particularly those with chronic ailments like diabetes, she

But committee members repeatedly questioned Steckel about troubles the company has had in other states, including allegations in Georgia and Colorado that it lost personal information concerning Medicaid recipients and others receiving state assistance.

Copyright 2005 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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