- Associated Press - Thursday, March 26, 2015

TERRELL, Texas (AP) - A multimillion dollar deal to privatize a public psychiatric hospital in Terrell has been canceled after a state audit revealed contract irregularities by the Texas Health and Human Services Commission.

According to the Austin American-Statesman (https://atxne.ws/1Cs43JG ) the State Auditor’s Office released a report Wednesday detailing how the process to privatize Terrell State Hospital bypassed procurement laws, used a flawed scoring system and did not consider if the state was receiving the most cost-effective deal.

The report says that Health and Human Services Executive Commissioner Kyle Janek played a role in some of the contract problems. The tentative contract was approved last October, but Janek stopped talks with Correct Care Solutions in late February about six weeks after the audit began.

Janek says that he halted the contracted because “we negotiated with the company that did respond, yet I felt that we were not going to reach a deal that was good for the taxpayers.”

A spokeswoman for Correct Care Solutions said the company was disappointed that the contract has been canceled.

The report claims that commission staffers were ordered by Janek to prepare bid documents for the contract four months before the agency had permission to pursue privatization. It also says that the commission pitched a $30 million contract, which the audit says is “unreasonable” because the takes more than $50 million to operate the hospital.

The commissioner said last year that he began to explore privatization as a way to improve the hospital after a 65-year-old Pittsburg woman died at the hospital after being restrained for 55 hours.

This is the third contract in four months from the Texas Health and Human Services Commission that has had issues.


Information from: Austin American-Statesman, https://www.statesman.com

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