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Public Safety Committee Meeting Committee Room- 8/24/2009- 12:25 PM
PUBLIC SAFETY
1. Approve renewal and/or Request for Proposal for Health Services
Agreement for Inmates.
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AGENDA ITEM
TO: COMMISSION
FROM: JAMES W. ELLISON, COUNSEL FOR SHERIFF STRENGTH
DATE: July 31, 2009
SUBJECT: Renewal and/or Request for Proposal for Health Services Agreement for Inmates
BACKGROUND: Augusta, Georgia currently contracts with Correctional Medical Services,
Inc. (CMS) to provide comprehensive medical care to the inmates at the Charles B. Webster
Detention Facility, the Augusta-Richmond County Law Enforcement Center (Richmond County
Jail), and the Augusta-Richmond County Correctional Institution. This contract was dated
December 3, 2002 and went into effect January 1, 2003. The original term of the contract was
for one year. The contract provided that it would be renewed annually for one year terms unless
either party provided written notice of non-renewal to the other party at least ninety days prior to
the expiration of the then existing term. The contract has been extended for one year terms for
the calendar years 2004, 2005, 2006, 2007, 2008 and 2009.
Last year, there was consideration to terminate the contract and to place the contract out
for bid again. However, CMS offered a deal if Augusta would renew the contract for an
additional year. The original contract provides for annual increases based upon change in the
United States Department of Labor consumer price index plus an additional 2% and an increase
in the per diem rate for each inmate in excess of the inmate population referenced in the contract.
(1,275 inmates). Last year, CMS offered to extend the contract for an additional year at no
additional price increase. In other words, they would perform the same services in 2009 for the
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amendment was entered into extending the contract through the calendar year 2009 at the same
price as paid in 2008. A copy of the original contract and the amendment is attached hereto.
Pursuant to correspondence dated July 21, 2009, CMS has again offered to extend the
contract for an additional year and they would again forego any increases in the contract. In
other words, they would perform the services required under the contract for the same costs as in
2008 and 2009. A copy of that correspondence is also attached.
ANALYSIS and FINANCIAL IMPACT: As noted above, CMS has offered to perform the
services under the Health Services Agreement for the same price as previously done in 2009.
This would mean that Augusta would be paying the same amount for inmate medical services for
the calendar year 2010 as it did in 2009 and 2008, in other words no increase in three years.
According to correspondence from CMS, this is an approximate savings of $222,338.
On previous occasions when the Health Services Agreement was put out for bid, all the
bids were substantially higher than paid under the previous annual contract. For example, the
contract with Physicians Health Services effective January 1, 2001 was for a base price of $2.058
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million per year. When the contract was put out for bid for a contract effective January 1, 2003,
the winning bid was for a base price of $3.17 million. It is therefore possible, if not probable,
that the winning bid for this contract if put out for bid this year would involve a substantial
increase over the contract price currently offered by CMS for an additional one year renewal.
However there is no way to know this definitively.
Another consideration is the construction of the new pods at the Phinizy Road facility.
These new pods are expected to be completed in November of 2010. These new pods will
increase our maximum inmate capacity in the amount of 478 inmates. The Request for
Proposals, as well as the Health Services Agreements are based upon the number of inmates
combined in the three facilities. Based upon past experience, when the new pods are opened for
inmate occupancy, our overall population will quickly increase to its maximum. Therefore, it is
possible, if not likely, that the proposals will be based on the increased number of inmates in
November of 2010. This may well mean that Augusta will be paying for health services for
inmates (in excess of 400) for the first 10 months of 2010 who are not yet incarcerated. Under
the current contract, if we exceed the inmate population provided in the contract, we pay an
additional per diem per inmate for every inmate over the designated population. It would seem
more economically feasible to renew the CMS contract for one more year, pay the extra per diem
for the last month or two of 2010, and then re-bid the contract for the year 2011 when we have a
consistent maximum population to place in the Request for Proposal and on which proposed
contracts will be based. However it is possible that an RFP and proposed contracts can be drafted
to somewhat minimize this concern.
RECOMMENDATION/ OPTIONS: There are two options: (1) Agree to the offer by CMS to
renew the contract for one additional calendar year at same price with a termination date of
December 31, 2010. Some time around the middle of 2010, issue Request for Proposals for a
new contract with an effective date of January 1, 2011; or (2) Put the contract out for bid and
hope that all the bids do not involve a substantially higher costs than currently offered by the
existing contactor and make all efforts to draft RFP and contracts to minimize wasteful spending
of taxpayer dollars due to increased populations from the opening of the new pods.
James W. Ellison
Counsel for Sheriff Strength
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