Public Contracts — A Call For Transparency

recent article discusses an important issue in public pension and health plans — a lack of transparency. I realize this topic is a change from my normal posts discussing personal injury issues such as car accidents and work comp claims. But, it’s an important issue. It’s one important to Alabama. And, it’s one I’ve explored in a recent case representing a local healthcare business in Alabama with significant damages.

While the article discusses public plans in Kentucky, the issues also apply in Alabama. Some of our public plans have similar problems. What are two of the transparency problems we’ve discovered in our case? They are:

  1. Conflicts Of Interest:  Let’s face it – health and pension plans involve complex issues. So, the State often employs “consultants” with expertise in the field. That’s OK. These plans provide long-term benefits to our valued public employees. Expertise is needed. Here’s the problem. In our case, the State’s consultant managed the entire bidding process. He even scored the bids of companies competing for the contract. Yet, while handling the bidding process, he also accepted thousands of dollars from one bidder. And, no surprise, that one bidder won the contract! Although he accepted thousands of dollars and provided the winning bidder with important pricing information, neither the consultant nor the bidder disclosed their relationship. Alabama officials had no idea. The consultant concealed the relationship. Nobody can explain how this provider’s bid was better than the others? The bidding process should be fully transparent and beyond ethical question.
  2. Use Of Public Money To Favor Some Firms:  Health and pension benefits need specialized management. These plans need a contractor to administer benefits fairly between providers. Does anyone think it fair for the contractor administering state funds to choose one healthcare provider and pay it more for the same service than others? Should the contractor make physician or pharmacy choices for patients? Where’s the oversight? Clearly, payments should be transparent so everyone knows service providers are all being treated fairly and equally with the State’s money. When a contractor favors one company over another with public money, it negatively affects competition and service for all.

These are important issues. Conflicts of interest and favoritism in government contracts should be a public concern.

Although I’m discussing the issue in the context of a business case, this issue also applies in personal injury cases. Through the years, we’ve handled numerous car accident claims where roadway safety issues existed. We’ve handled numerous personal injury and work comp claims on government construction sites. Transparency is frequently an issue in public contracts. The bidding, award and safety processes should be transparent and beyond question. Too often, they are not. Too often, safety is sacrificed. This creates unsafe conditions that cause needless injury. Transparency in public contracts is an important issue in preventing needless personal injuries and damages to the people and business involved.

What is most disappointing about this process in our current case? When these bad issues were discovered, public officials seemed more concerned with saving face than actually fixing the problem. They even met with the other side to coordinate strategy and talking points. Embarrassment is no excuse for ignoring wrongdoing. We should expect better from our public officials and the companies handling public money.