Joseph W. Sedtal, deputy secretary of administration for the Maryland Department of Public Safety and Correctional Services. File Photo by Bryan P. Sears.
The Board of Public Works unanimously approved a $724 million contract for pretrial detention medical and mental health services Wednesday over the objections of a troubled incumbent.
The vote by the three-member board approves the contract with Centurion of Maryland despite an ongoing set of appeals filed by private equity backed YesCare, which is currently providing services to the Department of Public Safety and Correctional Services. An attorney representing YesCare called on the board to delay the vote, citing its policy on not weighing in on contracts that face a protest.
Wednesday’s effectively cut ties with an embattled incumbent contractor. It also put the board in a difficult position of having to decide the fate of a contract as the losing bidder appeals to the Maryland State Board of Contract Appeals.
“Agencies should not look to the Board of Public Works to resolve protests unless the circumstances are extenuating,” said Comptroller Brooke Lierman, who voted with Lt. Gov. Aruna Miller and Treasurer Dereck Davis for the Centurion contract. “Also, vendors should not file frivolous appeals with the hopes of putting the state in a posture in which we have limited leverage.”
It is important for both sides to “respect, not railroad, our administrative and judicial processes,” Lierman said.
“However, we will not allow the state to be taken advantage of and for Marylanders to suffer when vendors bring forward frivolous appeals,” she said.
The contract with Centurion of Maryland LLC includes a five-year base term and a single two-year renewal option for a total cost of about $724 million, roughly $144 million more than YesCare’s bid.
YesCare filed two protests with the corrections department that were denied. The company appealed those denials to the Maryland State Board of Contract Appeals. Hearings for both appeals are pending.
“The only issue before this board is whether or not it’s going to follow its own rule — there’s a long-standing rule — in COMAR [state regulations] that says that when timely appeals are pending, of a protest before the Board of Contract Appeals, and there are such timely appeals here, the board does not award the contract,” said Philip Andrews, an attorney representing YesCare. “Doing so is an exception. Those exceptions are supposed to be rare. It doesn’t happen often.”
Andrews said the corrections department had not proved to the board that the state had a substantial interest in awarding the contract before the appeal was resolved.
But Joseph W. Sedtal, deputy secretary of administration for the Department of Public Safety and Correctional Services, urged the board to approve the contract despite the contract appeals, citing the “immediate needs” of the agency.
“We recognize the board’s concerns about an award in the face of a protest,” Sedtal said. “The department would not be taking this action and bringing this before you now if we did not believe an award without delay protects the substantial state interest to provide mental and medical health care to the population under its protection to the best of our abilities.”
Sedtal acknowledged Centurion’s bid was higher than YesCare, but defended the new contract as the “best value for the state and to the taxpayer.”
“Having a low bid does not automatically ensure a successful proposal,” he said.
The vote Wednesday is the latest in a series by the Board of Public Works as the corrections seeks to address concerns about medical and mental health care in its facilities.
YesCare was responsible for services for those awaiting trial as well as inmates within the state’s prison system.
Maryland officials, as with those in other states, have complained about the quality of care provided by YesCare, which won the original contract six years ago under the name Corizon. That company later spun off YesCare while it tries to restructure itself during ongoing bankruptcy proceedings.
YesCare has drawn criticism in Maryland for how it provides services, as well as failing to pay bills from local hospital systems and a Western Maryland volunteer fire company. There are also ongoing concerns about inadequate staffing by YesCare.
In March, the Board of Public Works approved a nine-month, $125 million extension with YesCare as the department called for new bids on contracts that separated health care services for inmates and its pretrial population.
The contract awarded Wednesday to Centurion is on top of a $1.7 billion contract the company was awarded to handle health care for the state’s prison system. YesCare held that contract, as well, and also appealed that award.
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