State awards contract to MCO with ties to indicted senator
NASHVILLE — The state announced Wednesday the awarding of a new contract to a TennCare contractor suspected of paying consulting fees to a former state senator indicted on federal bribery charges.
Doral Dental was the lowest bidder and achieved a score higher than six other competitors, according to TennCare officials. The value of the three-year contract is $13,466,160, about $3 million less than the state’s previous dental contract.
The state chose not to renew the managed care organization’s existing contract in April of this year, which led to the rebid process that began in July.
The initial decision not to renew came after it was revealed that Doral paid $1.1 million to a consulting firm linked to Sen. John Ford, and the Memphis Democrat was allegedly paid as much as $429,000.
Ford, who was charged with four other current or former state lawmakers in a government sting called Tennessee Waltz, resigned shortly after his indictment and is currently on house arrest.
The state threatened to deduct payment to Doral for the amount allegedly paid Ford after an agreement to put the money into an escrow account fell through. But officials were able to reach an agreement with the company in May.
TennCare Director J.D. Hickey said in a statement that Doral’s “new agreement includes what we believe are some of the tightest lobbying and disclosure provisions in any state contract.”
TennCare spokeswoman Marilyn Elam said one major change is the broadening of the disclosure clause to require all contractors “to provide every year in writing a disclosure on all types of agreements.”
“What we’re doing is shedding light on who is doing business with our contractors,” Elam said.
Besides tougher regulations, Elam said the $500,000 that Doral put in escrow will remain there for two years, or until the bureau gets a response from the state attorney general’s office saying Doral hasn’t committed any contract violations.
“If the investigation doesn’t find anything, the money will go back to Doral,” she said.
Gov. Phil Bredesen said Wednesday that Doral has had a good track record and he’s satisfied the company had to go “through a public competitive bidding process.”
“Doral had done what was perceived to be a good job,” Bredesen said. “I think they acted properly in going back and rebidding it.”
In June, members of the Fiscal Review Committee asked the state to terminate the contract of another MCO linked to Ford, Memphis-based UAHC Health Plan, formerly called OmniCare.
But Elam said the state decided last month to retain the MCO, but amend its contract so it assumes more risk for the cost of patient care.