Health Care Finance COO Fired Over Contract Steering Allegations

Health Care Finance COO Fired Over Contract Steering Allegations

Posted by Alan Suderman, City Paper, on Jun. 11, 2012 at 11:44 am

The chief operating officer of the Department of Health Care Finance was fired today over allegations that she tried to "steer business towards some minority firms and away from others" in the bidding on the forthcoming contract for the District’s health insurance exchange, a new insurance marketplace that’s the centerpiece of President Barack Obama‘s healthcare reform efforts, emails obtained by LL show.

Jennifer Campbell, the COO, was placed on administrative leave early last week by her boss, DHCF Director Wayne Turnage. In emails Turnage sent to senior members of the Gray administration last week, he explains that one contractor, CGI, approached him with allegations that Campbell was trying to force CGI to partner with Darryl Wiggins, a politically connected owner of a document management company. (Wiggins was a political adviser to former Mayor Adrian Fenty and has been the chairman of all three of Ward 4 Councilmember Muriel Bowser‘s campaigns. Wiggins was also part of n team with Mayor Vince Gray‘s campaign chairwoman Lorraine Green and recently convicted campaign aide Howard Brooks that unsuccessfully tried to win the city’s lottery contract.)

Turnage also writes that he’d received an allegation that Campbell was trying to steer another contractor, Compass Consulting, toward a different potential partner, Cedrick Simon.

Campbell could not immediately be reached for comment, and there is no hard proof in the emails to substantiate Turnage’s allegations. It’s not clear from the emails why Campbell would have favored those individuals. Turnage, who declined to comment, is also asking the Office of the Inspector General to investigate, according to the emails.

Wiggins tells LL he’s done nothing wrong and CGI is trying to discredit him and the city’s procurement process because it doesn’t want to team up with any local businesses. He says CGI approached him about forming a partnership and that he has only met Campbell once, and that was several months ago. Wiggins says he doesn’t know what Campbell may have told CGI, but that all of his dealings have been above board.

"I don’t deal in political hook ups," Wiggins says. "I don’t operate this way."

Wiggins says he’s working on similar insurance exchange contracts in other states and it was through one of those partnerships that he was introduced to CGI. Emails between Wiggins and CGO that Wiggins provided to Turnage, and later to LL, don’t have any evidence of coercion. The emails do show Wiggins making the case that it was in CGI’s best interest to form a joint partnership with local companies (including his own) in order to get the preference points awarded to Certified Business Enterprises.

"As I said to you, during our first meeting, 12% points is insurmountable. Please [remember] that when considering the business value of the [joint venture]," Wiggins wrote to CGI’s vice president. (CBE’s can receive up to 12 preference points, which translates to knocking 12 percent off the submitted bid.)

Wiggins tells LL he has a stellar business record in document management, and his value to any joint venture would have been much more than just bringing CBE points. The vice president at CGI, Holli Ploog, did not immediately return requests for comment.

In his emails, Turnage says that after meeting with CGI, they "took immediate action" against Wiggins, "terminating contact and any discussion of a partnership." Turnage also writes that Compass "fired one of the employees that the owner was directed to hire." It’s not clear if that employee was Simon, who could not be reached immediately for comment.

In his emails, Turnage stresses that the District’s bidding process for the insurance exchange must be "above reproach" and that he’s ordered his staff to check with other contractors to see if there have been other allegations of shenanigans. Insurance exchanges are a key part of Obama’s healthcare overhaul and are supposed to provide a competitive marketplace where the uninsured (and others) can find affordable insurance plans.

Health Care Finance has one of the biggest budgets in city government, at about $2.5 billion a year. Last year, it saw a much higher profile dismissal when Turnage canned former minor mayoral candidate and confirmed receiver of Gray campaign money Sulaimon Brown.