The writer is a former CEO of the Nebraska Department of Health and Human Services.
”It’s deja-vu all over again.” — Yogi Berra
I don’t know if Yogi actually said the quote above, but this is how I felt when I learned that the State of Nebraska intended to award a new contract to provide child welfare services in eastern Nebraska to a new provider based only on cost of services.
When I began as CEO of the Nebraska Department of Health and Human Services in 2009, the state had just finished negotiating contracts to privatize child welfare services with six private contractors across the state.
As many Nebraskans are aware, this was an ill-fated project. Over the course of the following months, all but two contractors dropped out; one, in fact, declined even to sign the contract in the beginning.
The problem: Cost. The contracts simply did not provide enough money to provide the services the state was requiring.
This resulted in three contractors either choosing to pull out or forced into bankruptcy.
The result: The state was left with two contractors providing services in eastern Nebraska, with the privatization effort ending in the rest of the state.
But the problems with money continued. In order to keep the remaining contractors, it was necessary for the state to provide significant increases in their contract payments over the remaining term of the contracts.
Still, the state could not retain both contractors, leaving only one, Nebraska Families Collaborative (now PromiseShip).
Now, the state proposes to award the contract for child welfare services to St. Francis Ministries of Salina, Kansas, based only on cost. The state concedes, and the bid scoring shows, that the only reason this decision was made is because of lower cost. PromiseShip, the only other bidder, scored better on all other criteria.
Apparently, the lower cost of St. Francis’ bid (less than 60% of PromiseShip’s) was enough to justify the decision.
I am not trying to justify the amount of PromiseShip’s bid, but there is something wrong about awarding this large contract affecting the welfare of 40% of the state’s children receiving services to a new contractor with no experience or network of providers in Nebraska, based only on the fact that its bid is less than that of the incumbent contractor.
Considering the state’s long experience in paying for these services, the amount of that bid ought to have raised multiple questions.
PromiseShip has been providing these services for 10 years, with all resources and contractors in place to continue to provide these services.
Changing contractors at this time based only on cost and ignoring PromiseShip’s experience and success in providing these services, not to mention its scoring better on the substantive criteria, is a mistake and puts our children at risk.
It is deja-vu all over again.