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Archive for the ‘ORM, Office of Risk Management’ Category

To limit exposure to official actions, make announcement late Friday or late Thursday before big weekend holiday

Posted in Governor's Office, OGB, Office of Group Benefits, ORM, Office of Risk Management, Teague, Transparency, Uncategorized on January 2, 2012| Leave a Comment »

It is a long-held tradition at all levels of government that anytime an agency does not want attention drawn to any official action, make the announcement late on a Friday afternoon when most of the “working” media have left for the weekend.

If that Friday just happens to be on the eve of a major holiday like Christmas or New Year’s, so much the better.

That’s what happened with the Division of Administration (DOA) and two news releases about major personnel changes recently. We waited until now to assist DOA in disseminating the stories.

DOA actually issued its official announcements not on Fridays but toward the close of business on Thursday, Dec. 22, and Thursday, Dec. 29 because, well, both Fridays were official state holidays for Christmas and New Year’s, respectively. It had the same effect, of course, as a Friday release on a normal work week: near zero media attention and less than zero media follow-up.

On Thursday, Dec. 22, the official news release went out announcing the appointment of Charles Calvi, Jr., to serve as Chief Executive Officer of the Louisiana Office of Group Benefits (OGB).

The following Thursday, on Dec. 29, it was announced that Mark Brady was leaving as DOA Deputy Commissioner of Administration.

Both announcements were made by Commissioner of Administration Paul Rainwater.

Actually, the second news release was not so much to announce Brady’s departure as to proclaim the appointment of Assistant Commissioner Ray Stockstill as his successor. In fact, Rainwater devoted precisely two sentences to Brady:

“Rainwater also thanked and praised outgoing Deputy Commissioner Mark Brady, who will assist the Division in transition through January before returning to the private sector,” the news release said. The release quoted Rainwater as saying, “‘Mark’s contribution has been invaluable, and I am grateful for the integrity, intelligence, and passion that he brought to the job and that I’m sure will serve him well in his next endeavors.’”

That’s it. Nothing about his tenure at DOA, nothing about his previous background, nothing about his reasons for leaving or his future plans except that he was “returning to the private sector.”

There were no mentions of the previous two OGB CEOs, both of whom left or were fired in 2011. Nor was there any explanation of how the two moves may be inter-connected or how Brady was at the forefront of last spring’s efforts to sell off OGB to private investors.

Tommy Teague was fired by Brady last April 15 when Brady and Rainwater concluded that Teague was not sufficiently enthusiastic about the administration’s proposed selloff of group benefits and its $500 million surplus.

He was replaced by Scott Kipper, who resigned effective June 24, after a controversial report by Chaffe & Associates of New Orleans did not square up with the administration’s insistence that the OGB sale and accompanying elimination of 149 jobs would be good for the state, 62,000 state employees and even more retirees and dependents.

When the Chaffe report did not say what Gov. Jindal desired, the administration subsequently retained Morgan Keegan to conduct a financial analysis of OGB preparatory to a second effort to sell off the agency despite vocal opposition from retired state employees, retired teachers and a state district judges’ association.

The Morgan Keegan report is expected to be finalized and submitted to the state in February but if events play out the way they did with the Chaffe report, don’t expect Rainwater to be forthcoming with contents of the report. Rainwater, despite harsh criticism from legislators, steadfastly refused to release the Chaffe report to lawmakers.

Rainwater did not hesitate to throw Brady under the bus during Brady’s testimony before the Senate and Governmental Affairs Committee. Committee members, lead by Sen. Ed Murray, subjected Brady to withering criticism over the administration’s refusal to release the report as Rainwater busied himself texting even as Brady twisted in the wind.

Following the Chaffe debacle and Jindal’s embarrassing setback in his efforts to sell three state prisons, the administration pulled back on its privatizing efforts. In the interim, the Office of Risk Management (ORM) has been transferred to a third private firm in apparent violation of the state’s contract with F.A. Richard & Associates (FARA).

The state paid FARA $68 million to take ORM off its hands and then amended that contract by another $6.8 million less than two weeks before FARA was sold to Avizent Risk Management Solutions of Ohio which was in turn recently purchased by York Claims Service of New York.

The state’s original contract with FARA specifically prohibits any transfer of contractual services without prior written consent. When a public records request was made for written consent to transfer the contract, DOA responded that no such documents exist.

Rainwater announced nothing further will be done toward the sale of OGB until early 2013. And while OGB proposed a rate increase of about three percent for the coming year, the administration insisted on at least a five percent bump. The bigger increase will obviously make the agency far more attractive to potential buyers.

Calvi has more than 40 years of experience in the healthcare, insurance and employee benefits fields. For seven years he worked for Gulf South Health Plan. He also worked eight years as CEO of BestCare, Inc., where he developed and owned the first Physician Hospital Network in the state.

Stockstill is a retire-rehire employee who had previously worked in DOA as state director for planning and budget until being named assistant commissioner in February of 2010. He retired from that $180,000 per year position, effective Christmas Day of 2010 and returned as a re-hire two days later.

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Notable Quotables (in their own words)

Posted in Contract, Contracts, Ethics, Governor's Office, Notable Quotables, ORM, Office of Risk Management, Privatization on December 12, 2011| 1 Comment »

“The Division of Administration has no records which are responsive to your request.”

–Attorney David W. Boggs, responding to a request by LouisianaVoice for copies of required written authorization for the transfer of the $74.9 million contract between F.A. Richard & Associates and the State to take over operations of the Office of Risk Management to a second company, and later a third.

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DOA apparently allowed several major violations of contract through poor oversight & management of ORM privatization

Posted in Contract, Contracts, Governor's Office, Legislature, Legislators, ORM, Office of Risk Management, Transparency on December 12, 2011| 7 Comments »

If Gov. Bobby Jindal’s privatization pilot program is any indication, legislators might wish to take a long, hard look before allowing the governor to move forward with privatizing the Office of Group Benefits, prisons, Medicaid or education.

Former Commissioner of Administration Angéle Davis on June 3, 2010, signed a contract whereby F.A. Richard & Associates (FARA) of Mandeville was to assume the operations of the Louisiana Office of Risk Management. Also signing the agreement were State Risk Director J.S. “Bud” Thompson, and FARA President/CEO Todd Richard.

Now, it appears that the terms of that contract with FARA may have been violated not once, not twice, but probably three times.

Under terms of that contract, the state agreed to pay FARA “a maximum amount of $68,118,971.” In May of this year, barely 10 months later, Thompson appeared before the Joint Committee on the Budget to request an amendment to FARA’s contract in the amount of $6,811,897, or exactly 10 percent, “not to exceed $74,930,868.”

Legislators were somewhat piqued to learn to learn from ORM Assistant Director Patti Gonzales that a little-known provision allows a one-time contract amendment of up to 10 percent by the Office of Contractual Review without concurrence of the legislature. The Office of Contractual Review works directly under the supervision of the Commissioner of Administration.

Then, less than two weeks after legislators learned they had no recourse in the matter, it was learned that FARA had been sold to Avizent, a national claims and risk management service provider based in Columbus, Ohio. Obviously, the deal was already in the works at the time the amendment was executed.

Understandably, that raised the issue of whether the contract amendment was needed more to sweeten the deal for Avizent than for FARA to carry out its contractual obligations.

No sooner had the dust settled from that transaction than in November of this year it was learned that ORM, a $400 million state agency, was going to be run—for a while, at least—by York Claims Service of New York City.

York operates as an independent adjustment company and third party administrator and is a subsidiary of York Insurance Services Group of Parsippany, New Jersey.

Close on the heels of that revelation, it was learned Cherie Pinac, manager of FARA’s Baton Rouge office, had submitted her resignation to accept a position with local claims adjusting firm Hammerman & Gainer. About that same time, it was also reported that Hammerman & Gainer would be subcontracted to take over ORM’s property claims.

But under terms of Section 11.0 (“Assignment”) of the June 3, 2010, FARA contract, it is specifically spelled out that “Contractor shall not assign any interest in this contract by assignment, transfer, or novation (Novation: the substitution of a new contract for an old one or the substitution of one party in a contract with another party; the replacement of existing debt or obligation with a new one.), without prior written consent of the state. (emphasis ours).

Under terms of Section 15.0 (“Subcontractors”), it is also stipulated that “The contractor may, with prior written permission from the state, enter into subcontracts with third parties for the performance of any part of the contractor’s duties and obligations.” (emphasis ours).

With that in mind, at 6:47 a.m. on Wednesday, Dec. 7, we made the following written request of Commissioner of Administration Paul Rainwater:

“Pursuant to the Public Records Act of Louisiana, R.S. 44:1 et seq., I respectfully request the following information:

Please provide me with the time, date and location at which I may view:

The written consent provided by the Division of Administration to F.A. Richard & Associates (FARA) granting FARA the authority to sell, assign or otherwise convey and/or transfer its interest, oversight or ownership/management of the operations of the Louisiana Office of Risk Management under the terms of Contract No. 692289 (signed by Todd Richard, J.S. Thompson, Jr., and Angéle Davis on June 3, 2010, and approved by the Office of Contractual Review on June 8, 2010) to Avizent Claims in May of 2011;

The written consent provided by the Division of Administration to F.A. Richard & Associates (FARA) and/or Avizent Claims the authority to sell, assign or otherwise convey and/or transfer its interest, oversight or ownership/management of the operations of the Louisiana Office of Risk Management under the terms of Contract No. 692289 (signed by Todd Richard, J.S. Thompson, Jr., and Angéle Davis on June 3, 2010, and approved by the Office of Contractual Review on June 8, 2010) to York Claims Service of New York/New Jersey at any time during calendar year 2011;

The written consent provided by the Division of Administration to F.A. Richard & Associates (FARA) and/or Avizent and/or York to subcontract or otherwise assign any portion of the operations of the Louisiana Office of Risk Management, specifically PROPERTY and/or LIABILITY lines claims to Hammerman & Gainer, Inc., of Baton Rouge, Louisiana, or any other subcontractor, said lines being inclusive of Contract No. 692289 and originally assigned to FARA.”

Rainwater apparently chose to ignore our request even though the state public records law says that any public record must be made available immediately upon request unless the record is unavailable. In such case, the custodian of the record (Rainwater) must respond within three working days to say when the record will be available for examination.

As second request was then made on Friday, Dec. 9 at 2:22 p.m.

Again, nothing.

So, at 9:17 p.m. on Sunday, Dec. 11, we sent an email to David Boggs of the Office of General Counsel for the Division of Administration (DOA) asking that he kindly remind his boss of the terms of the state law as well as the civil and criminal penalties (fines, attorney fees and imprisonment of up to six months).

While making it clear that an amicable resolution was preferred, we nevertheless made it clear that we would pursue legal remedies if the records were not provided by the close of business on Wednesday, Dec. 14.

At 4:53 p.m. On Monday, Dec. 12, the following email was received from David Boggs:

“The Division of Administration has received your public records requests dated December 7 and 9, 2011. You requested three separate consent letters provided to F.A. Richard & Associates, Inc. The Division of Administration has no records which are responsive to your request.

Sincerely,

David W. Boggs
Office of General Counsel
Division of Administration”

So there we have it:

• No “prior written consent” for Avizent to assume the $68.1 million, er, $74.9 million contract with the State of Louisiana to take over ORM;

• No “prior written consent” for York Claims Service to assume the contract;

• No “prior written permission” for Hammerman & Gainer to assume handling of ORM property claims.

Considering the manner in which DOA has failed to enforce the terms of the FARA contract, which are quite plain in both simplicity and intent, it should send up all kinds of red flags and set off alarms throughout the House and Senate.

In seeing the way in which Commissioner of Administration Paul Rainwater chose to ignore our indisputably legal requests for public records (until a lawsuit was threatened), it is abundantly apparent that there was an egregious lack of oversight in the way ORM is being run and in the fast and loose manner in which a $74.9 million contract is shuttled from one vendor to another—with no apparent authority to do so.

Several companies submitted proposals to take over the operations of ORM. Avizent was not among them. Nor was York Claims Service. Even Hammerman-Gainer, which expressed an early interest, never submitted a proposal.

Questions need to be asked:

• Why was a $6.9 million amendment to the FARA contract necessary when FARA was obviously already negotiating a deal with Avizent?

• Why did Avizent sell out to York?

• What role did the ORM contract play in those transactions?

• Why were written terms of the contract with FARA not enforced?

• How did Avizent, York and Hammerman & Gainer manage to enter into the picture?

• Should the state’s contract with FARA be revoked and/or declared null and void?

Hopefully, at least a few curious legislators will ask these—and more—questions before Bobby Jindal is allowed to privatize the entire state.

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ORM, an unwanted orphan, taken over by third company; could this be the future of OGB, prison privatization?

Posted in Contract, Contracts, Governor's Office, House, Senate, Legislature, Legislators, ORM, Office of Risk Management, Privatization on November 21, 2011| 1 Comment »

BATON ROUGE (CNS)—The crown jewel of Gov. Bobby Jindal’s privatization drive has taken yet another bizarre turn.

Well, maybe the Office of Risk Management (ORM) is not the crown jewel, but it his first effort at a move toward privatizing any state agency that shows up on his radar.

And if the path that ORM has followed since being taken over by private industry little more than a year ago is a fair example, legislators would do well to take a long hard look at any future moves in that direction—particularly as it might pertain to the Office of Group Benefits (OGB).

The $400 million agency, it was recently learned, will be transferred to its third operating company within 15 months. This time ORM is going to be run for a while by York Claims Service of New York City.

York operates as an independent adjustment company and third party administrator and is a subsidiary of York Insurance Services Group of Parsippany, New Jersey.

On March 15, 2010, ORM Director J.S. “Bud” Thompson, in a gathering of agency employees, broke the news that the agency was to be taken over by F.A. Richard and Associates (FARA) of Mandeville. It was at that same meeting that he laughingly informed his subordinates, “I still have my job.”

It wasn’t his last attempt at inappropriate humor. During a legislative committee hearing held to consider the approval of the transfer, he joked that he deserved a raise. That remark drew a sharp rebuke from State Sen. Ed Murray (D-New Orleans) who reminded Thompson that a serious matter was being considered and that he should treat it as such. Thompson did not return for the afternoon committee session.

Under terms of the contract that went into effect on July 1, 2010, the state was to pay FARA an amount “not to exceed” $68.2 million. FARA was to phase in its takeover over a five-year period.

The actual transfer began in September of 2010 when ORM Loss Prevention and Worker’s Compensation sections went over to FARA.

In May of 2011, less than eight months after the first units were transferred, FARA and Thompson were back before the committee seeking an additional $6.8 million that would bring the new contract to “a maximum amount” of $74.9, according to language in the amendment document.

Committee members were surprised to learn that the amendment was actually already a done deal because under law, the Office of Contractual Review may approve contract amendments of up to 10 percent one time without legislative approval and the amendment was exactly—10 percent.

Both ORM and the Office of Contractual Review are under the supervision of Commissioner of Administration Paul Rainwater.

Rep. Jim Fannin was somewhat miffed that the House Appropriations Committee, which he chairs, was circumvented by the 10 percent rule. It didn’t help that Patti Gonzales, assistant director of ORM informed Fannin that the full $6.8 million wasn’t really necessary because it was expected that only about $2 million of that would actually be spent.

Left unasked was the question of why it was deemed necessary to ask for the full $6.8 million.

The nearest thing to an explanation was a memorandum to Rainwater dated Feb. 28, 2010, in which Thompson requested Division of Administration (DOA) approval of the contract amendment.

“Since the implementation (of the FARA takeover) began, ORM has begun experiencing difficulty in retaining our experienced adjusters, as many are seeking employment elsewhere in state government,” Thompson said. “We are currently utilizing contract adjusters to supplement our in-house staff for lines not yet transitioned to FARA, at considerable expense to the state and with a significant loss of efficiency.”

Only about a week after Thompson weathered that committee hearing and the $6.8 million amendment was approved (the committee legally had no choice), it was learned that FARA had been sold to Avizent, a national claims and risk management company in Columbus, Ohio, that had an office in Baton Rouge staffed by only one employee.

Considering the complexities involved in such a transaction, it would seem reasonable to think negotiations had been ongoing for some time before the $6.8 million amendment was approved. Yet, not once was the pending sale revealed to committee members.

FARA’s senior management, including CEO Todd Richard “will also assume executive leadership positions in the parent company,” according to an announcement on FARA letterhead dated May 20, 2011.

On Oct. 26, an email from Gonzales to remaining ORM personnel announced that Cherie Pinac, manager of FARA’s Baton Rouge office, had submitted her resignation to accept a position with Hammerman and Gainer Claims Adjusters.

Now, less than month later, it has been learned that FARA has been sold to York and ORM will be handed off to yet another third party administrator.

This could mean one of two things:

• Private firms are finding that they cannot run the agency more cost efficiently than can the state;

• Once privatization takes place, the state loses all control of what happens to the agency down the road.

Or it’s entirely possible that both could—and will—occur.

This should be something for the Jindal administration to ponder carefully and with all due caution before plunging headlong into additional moves at privatization of OGB, prisons, public schools and Medicaid.

But don’t bet on it.

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Jindal’s privatization roadmap pockmarked with potholes

Posted in Charters, Education, Ethics, Governor's Office, Grant, Grants, Legislature, Legislators, OGB, Office of Group Benefits, ORM, Office of Risk Management, Privatization, Transparency on August 24, 2011| 1 Comment »

Gov. Bobby Jindal’s efforts towards privatization of state government can best be summed up in a single word: disastrous.

If a movie were to be made of the manner in which this administration has carried out its perceived mandate to privatize state prisons, education, health care, risk management and the Hazard Mitigation Grant Program, it would almost certainly feature Larry, Moe and Curly playing the parts of Jindal, Commissioner of Administration Paul Rainwater and former Superintendent of Education Paul Pastorek.

Take, for example, the $340 million, 10-year contract awarded by the Department of Health and Hospitals (DHH) to Maryland-based CNSI Corp. It’s difficult to imagine that anything could be botched any worse than the manner in which the contract winner was announced.

The awarding of the contract just happened to coincide with the confirmation hearings on DHH Secretary Bruce Greenstein. Smelling blood in the water, members of the Senate Governmental Affairs Committee asked Greenstein point-blank to name the company awarded the contract.

He refused.

And with good reason, it turned out. It turned out that Greenstein had once worked for CNSI. But, he assured the committee members after finally identifying the CNSI as the winning bidder for the contract to process Medicaid claims for the state he had taken himself out of the selection process and even erected a “firewall” between him and the contract selection.

But wait. There’s more. Turns out that Greenstein did indeed have some contact with his old employer and in fact, implemented changes in the request for bids that allowed CNSI to submit a proposal. That proposal actually ranked third among four bidders on the technical merits of its proposal but won the contract based on the lowest price which is still one of the largest contracts ever awarded by the state.

While it might not be privatization in the truest sense of the word, let’s go back to the 2010 legislative session when Rep. John Schroeder introduced a slew of bills aimed at dismantling state civil service and the Civil Service Board. Had his bills been successful (they weren’t), what would Jindal have replaced civil service with, contract workers? That’s already being done to some extent as we shall see presently.

Schroeder backed off at this year’s legislative session. It is, after all, an election year. But if he and Jindal are re-elected, don’t be surprised to see the civil service bills resurface. Even if Schroeder is not re-elected, Jindal will likely find a friendly legislator to introduce some version of the bills next year.

Then there were the privatization battles fought on two fronts during the 2011 session: prisons and the Office of Group Benefits (OGB). Both were shelved at least until next year but that doesn’t mean either issue is dead. Far from it. In fact, the OGB privatization effort is still simmering and the proposed prison sales will most likely be back on the legislative agenda next year.

But neither Jindal nor Rainwater appear particularly eager to defend the OGB privatization in a public forum. Both managed to be elsewhere recently when the Baton Rouge League of Women Voters held a luncheon to discuss the OGB issue. It would have been the perfect opportunity for Jindal or Rainwater to come clean with the public and explain exactly what the administration’s intent is for the agency and its $500 million surplus. Both men were invited to take part in the forum but Jindal was at yet another Baptist church somewhere in north Louisiana and Rainwater was speaking at a Rotary meeting in Alexandria.

It was the best opportunity yet for the administration to demonstrate its openness, accountability and transparency that Jindal hypes at all his fundraising appearances—in other states, that is.

Could there be a reason for their reluctance to discuss the merits of OGB privatization openly and to accept questions about their motives?

Well, let’s just look at the sequence of events thus far.

First there was the request for proposals (RFP—a term appearing with ever-greater frequency in this administration) that Goldman Sachs was recruited to help draft and then Goldman Sachs was the lone bidder—at a cool $6 million. That was not to take over OGB; that was just to evaluate the agency’s assets and to go out into the marketplace and find a buyer.

In the interim, Jindal had contracted Chaffe and Associates of New Orleans to conduct a quickie evaluation so that he could include the sale of the agency in his proposed executive budget. Chaffe was contracted for $49,999.99—one cent below the amounted that would have required approval of the Office of Contractual Review.

But then, Jindal did not include the OGB sale proposal in his executive budget after all, leading observers to speculate that perhaps Chaffe’s report did not reflect what the governor had anticipated. Requests were made for copies of the report but the governor was not forthcoming, choosing instead to disavow his own edict of openness and accountability.

Meanwhile, word got out that the report specifically said the only advantage to selling OGB would be if the buyer got the $500 million surplus.

When legislators began clamoring for copies of the Chaffe report, it was subsequently “leaked” to the Baton Rouge Advocate. Trouble is, the part about the only advantage of selling OGB was not in that report. Nor were any of the pages of the “leaked” report date stamped. Every document received by the Division of Administration (DOA) is routinely date stamped. Finally, there was a major discrepancy in the purported date that the report was received by DOA.

DOA attorney Paul Holmes, in a May 27 email to LouisianaVoice, claimed that the Chaffe report was received at DOA on May 25 but that it was part of the “deliberative process,” and unavailable for public inspection. Rainwater likewise, on May 31, told legislators that he had received the report on May 25 but again invoked the “deliberative process” excuse for not releasing it.

But when the report was “leaked,” it was noted that Chaffe officials did not sign off on the report’s signature page until June 3.

Is it possible that there were two separate versions of the report? One which didn’t say what the governor wanted to hear that is still being withheld from the public and another, more generic version that was “leaked” to the Advocate? Perhaps we will never know.

One thing we do know, however, is that the administration is determined to privatize OGB, even to the point of dealing with Wall Street bankers with problems of their own.

In rebidding its RFP for a broker, Morgan Keegan was named the contractor to shop around for a buyer for OGB. Morgan Keegan bid only $900,000, considerably less than Goldman Sach’s bid of $6 million on the original RFP.

It turns out, however, that Morgan Keegan has been placed on the auction block by its parent company, Regions Financial Corp., after MK agreed to pay $210 million to settle charges of fraud in the marketing of mutual funds filled with subprime mortgages that artificially inflated the funds’ prices.

Regions retained (who else?) Goldman Sachs to market MK. But Goldman Sachs was fined $587 million a year ago on charges that it misled investors in collateralized debt obligations linked to subprime mortgages.

John Maginnis, in his Louisiana Political Weekly column, more recently has called attention to the mismanagement of the $756 million program for hurricane victims to elevate their homes which was approved near the end of the Kathleen Blanco administration and reluctantly inherited by Jindal’s administration.

The program, administered under a $66 million contract with The Shaw Group has been bogged down with delays, shoddy work, payment disputes and more recently, charges of graft and corruption in the form of a whistleblower lawsuit by two employees of the program who claim that a state official accepted jewelry and meals in exchange for providing confidential information that enabled a contractor to pursue eligible homeowners.

Rainwater, embarrassed into finally acting, announced an investigation in conjunction with the federal Homeland Security inspector general and the state attorney general’s offices. The state official has been placed on leave.

Assuming “full responsibility,” Rainwater said, “I obviously wish we had acted quicker.”

Taking a break from his out-of-state fundraisers and visits to Baptist churches, Jindal paused long enough to issue an executive order to crack down on “incompetent, unscrupulous or predatory contractors and subcontractors.”

Maginnis, however, said Jindal should also be taking a “hard look” at the performance of Shaw, one of the largest of the state’s privatization contractors. He said the administration does not need to repeat its mistakes thus far with the monumental $2.2 billion Medicaid program it is contracting out to five insurance companies next year or with the ever-increasing number of charter schools.

Charter schools represent another blot on the privatization performance record. Abramson in New Orleans and Kenilworth in Baton Rouge, both run by Pelican Education Foundation, have come under intense scrutiny of late.

Operated by Cosmos Foundation out of Pennsylvania, Pelican has already had its Abramson charter revoked by the state. Its sister organization in Texas, Harmony Science academies, as well as similar Cosmos schools in other states, are subject of an FBI investigation into charges that teachers, imported from Turkey to teach, are required to kick back up to 60 percent of their salaries to Cosmos founder Fethullah Gulen.

In New Orleans, a Pelican official is alleged to have offered a state education department investigator a $20,000 bribe to “make problems go away.”

Thos problems included no supervision of students for weeks after a teacher left, sexual activity between students, teachers doing science projects for students, cheating on exams, and other deficiencies.

Perhaps someone should ask how Harmony could justify $7 million in travel expenses over a three-year period in Texas or how it could justify overall payments of nearly $250 million for 38 schools in that state.

More importantly, perhaps someone should ask why teachers are being imported from Turkey when teachers who live here are being laid off because of budgetary cutbacks–cutbacks imposed in order that charter schools might flourish.

More will be forthcoming on this issue in days ahead.

Now for the Office of Risk Management (ORM), the one agency that Jindal has successfully privatized. Or has he?

A year ago, the operations of ORM were taken over by F.A. Richard and Associates (FARA) of Mandeville under a contract that called for the state to pay FARA “not to exceed” $68.2 million to take over ORM over five years.

That was last July. Eight months later, FARA requested and received a $6.8 million amendment to its contract, which now said it would be paid “a maximum amount” of $74.9 million. In a matter of days following approval of the amendment, it was learned that FARA was sold to Avizent, a firm out of Columbus, Ohio. Avizent promptly laid off the only person working in its Baton Rouge office.

Now comes word that Avizent may be selling out to Sedgwick Claims Management Services of Memphis, which had earlier purchased Cambridge Integrated Services Group, Nationwide Better Health’s productivity solutions, Selective Settlements International, and Specialty Risk Services.

Catherine Bennett, communications manager for Sedgwick, said she had not heard reports of the Avizent acquisition and could not comment on the matter.

FARA/Avizent, meanwhile, has informed ORM that because of the backlog of documents to be scanned into its system, it would not be able to take over the Property Section of ORM by Jan. 1 as originally scheduled. That date has been pushed back to April 1.

Because of the delay, two ORM claims adjusters will be out of work as of Jan. 1. ORM has chosen to release the two employees, presently paid in the area of $25 per hour, in favor of retaining contract adjusters who are not state employees. They work for private adjusting firms and the state pays their firms $60 per hour to provide temporary adjusters for ORM.

So why would the state terminate employees making $25 per hour in favor of paying $60 per hour for contractors? Benefits. The state does not provide health coverage, retirement, sick leave, or annual leave for contract adjusters. Nor does it provide job security through civil service protection.

Can you say privatization?

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