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Archive for the ‘Transparency’ Category

‘Deliberative process’ defense used to protect ALEC records in Texas; reminiscent of 2012 LouisianaVoice experience

Posted in ALEC, American Legislative Exchange Council, Governor's Office, House, Senate, Legislature, Legislators, Public Records, Transparency on September 11, 2013| 7 Comments »

Because we have all the metaphorical snakes we can kill right here in Louisiana, it’s rare that we dwell on events in other states unless there is a direct link to developments in the Louisiana political arena.

But a request for public records in Texas pertaining to the American Legislative Exchange Council (ALEC) under that state’s Freedom of Information Act raised a red flag when a favorite but questionable phrase of Louisiana officials was invoked by a Texas legislator in an effort to prevent the release of records.

For the record, we do not believe it a coincidence that the “deliberative process” ploy, so popular with Gov. Bobby Jindal and his minions reared its ugly head in Texas over the issue of whether or not ALEC records are public.

It is our opinion, impossible to prove because of the veil of secrecy thrown over this organization in an effort to conceal its agenda from public scrutiny, that Jindal did not originate the deliberative process maneuver to protect public records from becoming just that—public.

But he certainly knows how to use—perhaps abuse is a better word here—the exception that he slipped into a law that he proudly points to in his national travels as the “gold standard” of transparency that he rammed through the legislature in 2009.

While that 2009 law requires elected and appointed officials to disclose their personal finances, it did little to open up the records of the governor’s office to public examination.

Now, the Freedom of Information Foundation of Texas (FOIFT) has filed a brief with the Texas Attorney General in support of a request for records by the Center for Media and Democracy (CMD).

That request challenges ALEC’s efforts to declare its communications immune from state public records law—even communications with Texas elected officials.

FOIFT’s brief, filed late last month, supports CMD’s position and raises additional arguments countering claims by Rep. Stephanie Klick that the lobbying organizations communications with lawmakers are not subject to disclosure.

Texas was the first state in which ALEC made a formal request of the Attorney General that its records should be exempt from Texas sunshine-in-government laws. ALEC has even begun stamping documents with a disclaimer that says materials such as meeting agendas and model legislation are not subject to any state’s open records laws.

FOIFT counters that assertion by saying the arguments by Klick and ALEC are “mutually inconsistent.”

“Rep. Klick invokes the deliberative process privilege, which involves policy discussions internal to a governmental body,” not between a legislator and a third-party special interest group funded by lobbyists trying to influence legislation,” the brief says. At the same time, it says, “ALEC invokes its members’ First Amendment right of association, which involves its internal discussions and membership.”

Accordingly, it says, because ALEC is communication with Klick in her official capacity as a state representative, the requested documents should be officials records to which the public has a First Amendment right of access.

All of which raises the question of which came first the chicken (Jindal) or the egg (ALEC) insofar as the origination of deliberative process?

Our opinion, for what it’s worth, is that Jindal devised that ploy straight from ALEC’s playbook—just as have so many of his policies, from privatization of prisons and hospitals to school vouchers and charters to pension, healthcare and workers’ compensation reform to massive layoffs of state employees.

Jindal and his legislative floor leaders are in lock step with ALEC and that’s a sad commentary on those officials’ inability to think and act for themselves. Their every move is dictated by ALEC, which writes “model legislation” for its members to introduce in state legislators and assemblies back home.

Sometimes, lawmakers even forget to change key wording in their bills, exposing their efforts for what they are—shams, sacrifices offered up at the altar of profiteering enterprise either by puppets or co-conspirators.

It’s no wonder that ALEC wants to protect its records at all costs.

The affair in Texas is reminiscent of our own experience with Rep. Joe Harrison (R-Gray) in July of 2012.

Harrison, the State Chairman of ALEC, sent out a letter on state letterhead soliciting contributions of $1,000 each from an unknown number of recipients of his form letter to finance the travel of Louisiana legislative ALEC members to an ALEC conference in Salt Lake City set for July 25-28.

The letter opened by saying, “As State Chair and National Board Member of the American Legislative Exchange Council (ALEC), I would like to solicit your financial support to our ALEC Louisiana Scholarship Fund.”

Not college scholarships, mind you, but to support “over thirty Louisiana Legislators serving on ALEC Task Forces.” Contributions, Harrison said, “will allow the opportunity (for legislators) to attend conferences funded by the ALEC Scholarship Fund.

“The conferences are packed with educational speakers and presenters, and gives (sic) the legislators a chance to interact with legislators from other states, including forums on Medicaid reform, sub-prime lending, environmental education, pharmaceutical litigation, the crisis in state spending, global warming and financial services and information exchange. All of these issues are import (sic) to the entire lobbying community.

“I, along with other members of the Louisiana Legislature, greatly appreciate your contribution to the scholarship fund. Your $1,000 check made payable to the ALEC Louisiana Scholarship Fund can be sent directly to me at 5058 West Main Street, Houma, Louisiana 70360.

LouisianaVoice submitted a public records request to Harrison requesting, since the contribution solicitation was written on Louisiana House of Representatives letterhead, that Harrison provide the identities of every person to whom the solicitation was sent.

Harrison never responded to the request but House Clerk Alfred “Butch” Speer jumped into the fray, responding, “I have looked further into your records (omitting the word “public” from our request). Rep Harrison sent that one letter to a single recipient,” he said, overlooking the fact that it was a form letter that opened with “Dear Friend.” Not a very personal way for a letter to be sent to a single recipient.

Also unexplained by Speer was how a single $1,000 contribution might cover the travel expenses of “over thirty” legislators to attend the conference.

Speer, ignoring that the letter was printed on state letterhead, said, “The origin of a document is not the determining factor as to its nature as a public record. Whether the letter was or was not composed on state letterhead…does not, per force, create a public record.

“What Rep. Harrison was attempting is of no moment unless he was attempting some business of the House,” he said.

Speer again apparently ignored the fact that the House and Senate routinely pay per diem, travel and lodging for lawmakers to attend ALEC conference. In fact, between 2008 and 2011, the House and Senate combined to pay 34 current and former members more than $70,000 for attending ALEC functions in New Orleans, San Diego, Washington, C.C., Phoenix, Atlanta, Chicago, Dallas and Austin.

If those ALEC trips were not for state business, why in hell were the House and Senate shelling out that money for legislators’ expenses and per diem?

Mr. Speer’s reasons for protecting the names of the recipients of that letter was, to say the lease, quite disingenuous and his effort to protect that information goes against the grain of everything for which a public servant is sworn to uphold, protect and serve.

What’s more, his arguments don’t even come close to accurately defining what is and what is not a public record. We don’t claim to be attorneys at LouisianaVoice, but we can read the public records act.

For Mr. Speer’s erudition, it can be found in LA. R.S. 44:1-41 and Article XII, Section 3 of the Louisiana Constitution.

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Deloitte Consulting representative said to have boasted company has inside track for IT consolidation contract

Posted in Computers, Contract, Contracts, Governor's Office, IT, OGB, Office of Group Benefits, Public Records, RFP, Request for Proposals, State Agencies, Transparency on September 4, 2013| 8 Comments »

Ten companies have responded to that request for proposals (RFP) calling for the consolidation of information technology (IT) but because of the number of submissions, the scheduled awarding of the contract was moved back “seven to 14 days,” according to an email to bidders by Neal Underwood, assistant director of Statewide Technology.

One of the vendors being mentioned as the potential winner of the contract, expected to be worth millions of dollars, is Deloitte Consultants, one of three companies that met regularly with Division of Administration (DOA) representatives and state IT executives over the past year in discussions of what services they could provide the state.

Moreover, a confidential source said a Deloitte representative has already confided in several persons that the company “had a good shot” at winning the contract because it had been meeting with state officials over the past year.

That scenario evokes memories of the privatization of the Office of Group Benefits (OGB) a couple of years back. DOA brought Goldman Sachs in to help formulate the RFP for the privatization and the Wall Street banking firm was subsequently the lone bidder—at $6 million.

Goldman Sachs subsequently withdrew from the project in a dispute over indemnification but re-bid when the RFP was issued a second time. Blue Cross Blue Shield of Louisiana eventually landed the contract to administer the agency’s claims.

So now we have Deloitte working with state officials for a year to help formulate the RFP and the company is now said to have the inside track to winning the contract. Déjà vu all over again.

At least two other companies, including IBM, were said to have held meetings with the state in the months leading up to the issuance of the RFP. One of those reported to have attended those meetings was Northrop Grumman but that company was not one of the 10 companies submitting proposals, sources say.

Several other companies reportedly requested permission to attend the pre-proposal meetings but were denied the opportunity.

The meetings would seem to fly in the face of a July 19 memorandum from Richard “Dickie” Howze, interim state chief information officer, to DOA section heads and Council of Information Services directors in which he cautioned against any contact with potential vendors during the RFP process at the risk of possible termination.

“During this procurement process it is crucial that you and your staff do not have any contact with vendors who are potential proposers or who may be part of a proposals as a subcontractor regarding this RFP or other related RFPs,” the memo read.

Besides Deloitte and IBM, companies submitting proposals included Dell Marketing, First Data, Gabriel Systems, Information Services Group (ISG), KPMG, Peak Performance Technologies, RNR Consulting and Tecknomic.

Even though the RFP was only for “Information Technology Planning and Management Support Services,” the state wrote into the RFP that the vendor awarded the planning RFP would not be precluded from the implementation of the consolidation, in effect guaranteeing the winner of the planning contract the contract for implementation of the plans.

It also alluded to recommendations for “potential legislation to support effective implementation and administration” for “effective governance models for the statewide centralized IT services organization.”

It was not immediately clear why “potential legislation” would not have been addressed during the 2013 legislative session and prior to the issuance of the RFP as opposed to issuing a contract and then attempting to address legislative issues as they arose during the course of the contract.

In conjunction with the RFP, DOA also issued a request for information (RFI) for business reorganization (and) efficiencies planning and implementation consulting services which would seem to be an exercise in redundancy given the fact that a similar efficiency study was conducted during the tenure of former Commissioner of Administration Angele Davis and that yet another such study is already underway using Six Sigma methodology.

Six Sigma is a methodology that employs tools and techniques for process improvement. The concept was pioneered by Motorola in 1981 and is widely used in different sectors of industry.

Just as with the RFP for the planning and management support services, several vendors responded with proposals. Oral presentations, as with the RFP, however, were limited to a select few companies, including Deloitte, McKinsey & Co., Alvarez & Marsal and CGI Technologies.

McKinsey & Co. is primarily an organization offering internships to trainees for conservative political causes. Gov. Bobby Jindal, who seems hell bent on privatizing virtually every agency and service in state government, worked for McKinsey & Co. for less than a year in the only private sector job he has ever held.

The RFI required that vendors, among other things, present their approach/methodology to identify operational efficiencies, experiences in other governmental settings, and the areas of governmental services “that would produce the maximum benefit.”

Portia Johnson, executive assistant to Commissioner of Administration Kristy Nichols, sent an email to companies who submitted responses to the RFI. That email said:

“Thank you for your interest in RFI 107:01-000001238 Business Reorganization Efficiencies Planning and Implementation Consulting Services. Due to the vast response and in the interest of time, the State has chosen several vendors representative of the industry to interview. Although you have not been selected to proceed in the process, we have taken any documents submitted by you under advisement.”

Said another way: “You have been eliminated for consideration because we have other vendors with whom we prefer to do business. But we are going to go through your proposals and we will probably steal some of your ideas and you won’t get a dime for your efforts. Thank you for your trouble.”

  • CNSI and the federal investigation of its $200 million contract with the Department of Health and Hospitals (DHH) and the ensuing resignation of DHH Secretary Bruce Greenstein, who had maintained continued contact with his old bosses at CNSI during the bidding, selection and contract awarding processes;
  • Biomedical Research Foundation (BRF) and its inside track advantage by virtue of its CEO/President also serving on the LSU Board of Stuporvisors, which issued the contract to BRF to run the LSU Medical Center in Shreveport and E.A. Conway Medical Center in Monroe;
  • Goldman Sachs helping to write the RFP for the takeover of OGB and subsequently being the only bidder on the RFP;
  • Meetings between state officials and vendors for a year leading up to the issuance of an RFP for the consolidation of IT services in more than 20 departments within the state’s executive branch;

Folks, we’re beginning to detect a pattern here.

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Inspired by LSU records litigation, LouisianaVoice will seek $500 per day fine for DOA failure to produce public records

Posted in Boards, Contract, Contracts, Courts, Governor's Office, Judges, LSU, Public Records, Transparency on August 30, 2013| 17 Comments »

Don Quixote, Jimmy Faircloth, Chicago Cubs, Bobby Jindal William Jennings Bryan, LSU Board of Stuporvisors, Minnesota Vikings, Jimmy Faircloth (again), Houston Astros, Bobby Jindal, Charlie Brown.

They all have one thing in common—the inability to grasp the brass ring. Yeah, we know, the Minnesota Vikings went to the Super Bowl four times, but how many of those did they win? The same number Jimmy Faircloth has won going to bat for Bobby Jindal in the state courts on various issues pushed by the governor.

Like Charlie Brown, Faircloth keeps trying to kick the football being held and suddenly pulled away by Lucy, aka Bobby Jindal only to fall flat time after time.

The futility of the Cubs and Astros should by now be familiar to Faircloth who this week was again shot down by the Louisiana Supreme Court, this time on the issue of turning over the list of semifinalists and finalists for the LSU presidency.

That list apparently is the equivalent to a closely guarded state secret and even now Faircloth refuses to capitulate to the state’s high court.

“Writ denied. Stay denied” was the terse message in the Supreme Court’s ruling. During my 20 years with the Office of Risk Management where I worked with state attorneys to defend lawsuits against the state, that language meant one thing: we write a check to the plaintiff. Period.

Ah, but the ever-optimistic Faircloth proclaimed that those four words were “not a comment by the Supreme Court one way or another concerning who’s right or wrong on the lawsuit.”

Huh?

“That’s simply the court saying we’re not going to hear the case now.”

Huh? Again.

Uh, Jimmy, loyalty to one’s boss is a fine attribute. But there comes a time when those of common sense must understand the finality of an issue and throw in the towel.

This is one of those times.

It is more than apparent by now that Faircloth/Jindal/LSU is not going to emerge victorious in this little showdown over the public’s right to know what its representatives are doing behind closed doors.

The continued resistance to the courts and the insistence that the records do not have to be produced only feeds an already growing suspicion about the forthrightness, honesty, and candor of this administration which has managed to operate in the dark shadows of obscurity, ambiguity and deceitfulness during Jindal’s nearly seven years in office.

Requests for public records by LouisianaVoice—records that are in no way protected—have been met time after time after time after time by delaying tactics, generally preceded by a cryptic email that reads, “Pursuant to your public records request, we are still searching for records and reviewing them for exemptions and privileges.  Once finished, we will contact you regarding delivery of the records.  At that time, all non-exempt records will be made available to you.”

This was the message from Division of Administration (DOA) attorney David Boggs on Aug. 7 to a request we submitted on Aug. 1. The Boggs response was already three working days late by the time he sent his response. The state’s public records law stipulates that records must be made available immediately upon request unless they are unavailable in which case the custodian of the record must respond in writing as to when the records will be available within three working days.

LouisianaVoice is still waiting for the records we requested 29 days—20 working days—ago. At the minimum fine of $100 per day, that comes to $2,000 for each of the seven records we requested, or $14,000 total.

The LSU litigation, however, has inspired us. District Court Judge Janice Clark imposed a $500 per day fine for LSU’s non-compliance. That bill currently totals more than $50,000.

We will likewise request the $500 per day fine, plus court costs, attorney fees and damages. The $500 per day fine alone comes to $70,000—money we can certainly use but which the taxpayers of Louisiana would not be asked to pay if the administration had simply complied with the law as public servants are expected to—and should—do.

Jimmy Faircloth, David Boggs or whomever DOA designates may wish to prepare for another defense after we file suit.

Not that he minds. Whenever he is given one of these dogs to defend, he simply turns on the time clock and the meter begins ticking—at the expense of you, the taxpayer. And he has done quite well defending indefensible lawsuits from pension reform to vouchers to public records. He has been paid more than $1 million to date by the Jindal administration, enough to place him in the upper tier of state legal contractors.

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Our random observations on freedom of expression, ATC, questionable meeting and action by Jindal’s LSU Board

Posted in ATC, Attorney General, Boards, Ethics, Governor's Office, Health Care, Politicians, Privatization, State Agencies, Transparency on August 26, 2013| 15 Comments »

We’ve come across a few odds and ends lying around that we feel might warrant a second look.

Another take on blood tests and one-vehicle accidents

First we would like to acknowledge that we initially wrote a piece based on erroneous information from certain people whose judgment we trusted but who were wrong. Because of their advice, we also were wrong in saying that blood alcohol tests are “routine procedure” in one vehicle accidents. It turns out that is not the case and we respectfully defer to the state trooper who investigated Attorney General Buddy Caldwell’s accident last week. The trooper said in his report that Caldwell did not appear to be impaired and accordingly, he did not take a blood sample for testing. We have been informed by State Police and others that it is not “routine procedure” to take blood tests in single-vehicle accidents.

ATC moves in with State Police, not so the ATC director

The Louisiana Office of Alcohol and Tobacco Control has been moved from its former headquarters at United Plaza on Essen Lane in Baton Rouge to the Louisiana State Police compound on Independence Boulevard, ostensibly to save money.

ATC Director Troy Hebert and his administrative assistant Jessica Starns, however, were allowed to remain at the United Plaza offices and to even rent additional space for Hebert’s office.

What’s with that? Shouldn’t an agency director be physically located at the same address as his employees and not several miles across town? That would be like having a governor who spends all his time in other states. Oh, wait. We already have that, don’t we?

Baton Rouge publisher opposes freedom of expression

Normally, a member of the Fourth Estate would be up in arms at any suggestion at muzzling a critic of government, a suggestion any publisher, editor of reporter would quickly point to as a threat to the First Amendment’s guarantee of freedom of speech.

Such is not the case of one Baton Rouge publisher, we’re told. Reports have it that this publisher, a staunch supporter of Gov. Bobby Jindal, has gone on rampages in his office, ranting to his subordinates and anyone else who will listen that he wants Robert Mann stripped of his tenure at LSU—and fired.

Mann, who has worked with three U.S. senators (Russell Long, Bennett Johnston and John Breaux) and former Gov. Kathleen Blanco, currently holds the Manship Chair in Journalism at the Manship School of Mass Communication at LSU.

A journalist and political historian, Mann also just happens to author a controversial political blog called Something Like the Truth http://bobmannblog.com/ in which he generally takes the Jindal administration to task for its roughshod trampling of all who dare disagree with him, be they state civil service employees, doctors, college presidents or legislators.

Mann is careful to feature a prominent disclaimer which says, “Opinions expressed on this blog are solely those of the author, not LSU, the Manship School nor the Reilly Center for Media & Public Affairs.”

But that apparently is not enough for this publisher, who dutifully prints every inane press release by the governor that purports to make the state look good despite reams of negative national surveys on poverty, obesity and health care.

So much for a fair and independent press serving as a watchdog on behalf of the citizenry. We’re just sayin’…

Cerise Memo: LSU Board quorum?

Remember our story last week about that July 2012 meeting in the LSU President’s conference room where former Department of Health and Hospitals Secretary Alan Levine pitched the privatization plan for LSU’s 10-hospital system?

There was a key sentence then-head of the LSU Health Care System Dr. Fred Cerise included in his memorialization of that meeting regarding Levine’s presentation:

“The LSU board members present indicated they want LSU’s management to pursue this strategy,” the Cerise Memo said.

But wait. The LSU Board of Supervisors consists of 15 voting members, all appointed by the governor, and one student member who has no vote.

The Louisiana Open Meetings Law, R.S. 42: 4.2, headed “Public policy for open meetings; liberal construction,” reads thusly:

  • “Meeting” means the convening of a quorum of a public body to deliberate or act on a matter over which the public body has supervision, control, jurisdiction, or advisory power. It shall also mean the convening of a quorum of a public body by the public body or by another public official to receive information regarding a matter over which the public body has supervision, control, jurisdiction, or advisory power.
  • “Public body” means village, town, and city governing authorities; parish governing authorities; school boards and boards of levee and port commissioners; boards of publicly operated utilities; planning, zoning, and airport commissions; and any other state, parish, municipal, or special district boards, commissions, or authorities, and those of any political subdivision thereof, where such body possesses policy making, advisory, or administrative functions, including any committee or subcommittee of any of these bodies enumerated in this paragraph.
  • “Quorum” means a simple majority of the total membership of a public body.

The statute further stipulates that “every meeting of any public body shall be open to the public unless closed pursuant to R.S. 42.6, R.S. 42:6.1 or R.S. 42:6.2.”

First of all, R.S. 42:6 clearly states that a public body “may hold executive session upon an affirmative vote …of two-thirds of its constituent members present.”

R.S. 42:6.1 simply lists the reasons an executive session may be held which you may explore in greater detail here: http://www.lawserver.com/law/state/louisiana/la-laws/louisiana_revised_statutes_42-6-1

R.S. 42:6.2, re-designated as R.S. 42:18 in 2010, applies only to the Legislature. http://www.legis.state.la.us/lss/lss.asp?doc=99494

But let’s return to R.S. 42:4.2, that pesky little law about quorums.

Remember, the Cerise Memo said that the “LSU board members present” indicated their desire for the LSU administration to move forward with the Levine proposal.

Remember also, the LSU Board of Supervisors is comprised of 15 voting members.

But there were only four members of the LSU board present at that meeting, according to Cerise’s notes. They included Rolfe McCollister, Bobby Yarborough, Dr. John George and Scott Ballard.

Hardly a quorum.

But then, it was the likely intent of those present to avoid having a quorum because a quorum (eight voting members, in this case) would necessitate public notices of such a meeting and making said meeting open to the public.

Obviously, that was not the wish of the board members who did attend. They wanted, above all else, to avoid a full quorum so that the meeting could be conducted in secret.

If you check out our masthead, we recently added an anonymous quote:

  • It is understandable when a child is afraid of the dark but unforgivable when a man fears the light.

Former U.S. Supreme Court Justice Louis Brandeis (Nov. 13, 1856-Oct. 5, 1941) is credited with coining the phrase, “Sunlight is the best disinfectant.”

But in avoiding the necessity of opening up that July 17, 2012, meeting to the public by purposely skirting the requirement of a quorum so as not to qualify as an official meeting, those four board members were legally barred from taking any official action.

Yet, that minor point of law did little to deter them from directing the LSU administration to pursue Levine’s plan.

Yes, we are fully aware that the four board members not only spoke for the entire board but for Gov. Bobby Jindal as well. As Elliott Stonecipher recently noted in his blog Forward Now, state ethic laws prohibited Levine from conducting business with the State for two years after his departure as DHH Secretary. http://forward-now.com/?p=8403

Levine’s last day at DHH was July 16, 2010. The meeting at which he presented his plan to LSU administrators and board members was on July 17, 2012.

And we don’t believe in coincidences. And anyone who doesn’t believe Levine was in constant contact with the administration in the days, weeks and months leading up to that July 17 meeting is…well, a fool.

Such is the Gold Standard of Ethics that Jindal has bestowed upon the people of Louisiana.

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Cerise, Townsend firing came soon after fateful 2012 Levine meeting with LSU officials to discuss LSUMC privatization

Posted in Contract, Contracts, Governor's Office, Health Care, LSU, Privatization, Public Records, Transparency on August 21, 2013| 31 Comments »

LouisianaVoice has obtained a copy of the minutes of a meeting in Baton Rouge a little over a year ago which led to the firing of the head of the LSU Hospital System and the CEO of Interim Louisiana Public Hospital in New Orleans by the Jindal administration.

LSU Health Care System head Dr. Fred Cerise and Interim Louisiana Public Hospital CEO Dr. Roxanne Townsend were fired just days apart last year—Cerise in late August and Townsend in early September—following a July 17 meeting at which former Secretary of Health and Hospitals (DHH) Alan Levine pitched a plan to privatize the state’s system of LSU medical centers.

Levine was at the meeting on behalf of is firm, Health Management Associates (HMA) but was recently hired as president and CEO of Mountain States Health Alliance.

Present at that meeting, besides Cerise, Townsend and Levine were then-LSU President William Jenkins, DHH then-Secretary Bruce Greenstein, LSU Medical Center Shreveport Director Dr. Robert Barish, HMA CFO Kerry Curry, LSU Health Science Center Shreveport Vice Chancellor Hugh Mighty and LSU Board of Supervisors members Rolfe McCollister, Bobby Yarborough, John George and Scott Ballard. LSU Health Science Center New Orleans Chancellor Larry Hollier and Vice Chancellor for Clinical Affairs at LSU Health Sciences Center New Orleans Frank Opelka also participated by teleconference.

Opelka was promoted to Cerise’s position when Cerise was replaced.

The meeting was held in the LSU president’s conference room.

Both Cerise and Townsend expressed reservations about Levine’s proposal but several members of the LSU Board of Supervisors who were present at the meeting “indicated they want LSU’s management to pursue this strategy,” according to a summary of the meeting prepared for Jenkins by Cerise prior to his being replaced by Opelka.

Along with his two-page summation of the meeting, Cerise also submitted a third page containing a list of five concerns he had with the privatization plan pitched by Levine. It was that list that list of concerns which most likely got Cerise removed as head of the LSU Health System via an email from Jenkins.

HMA, headquartered in Naples, Florida, was the subject of a scathing report by CBS news magazine 60 Minutes less than six months after Levine and Curry met with LSU officials in Baton Rouge and Levine has since moved on to become the CEO of Mountain States Health Alliance.

The thrust of the 60 Minutes story which aired last Dec. 2, was that profits, not patient care, was the driving force behind HMA’s emergency room decisions and that emergency room doctors were pressured to admit emergency room patients “regardless of medical need” to boost the company’s bottom line.

Some speculation had HMA squarely in the mix insofar as the proposed privatization of LSU’s 10-hospital system but the 60 Minutes story apparently thwarted those plans.

Levine denied that in an interview with the Baton Rouge Advocate last October. “I have had no conversations with LSU about taking over any of the existing LSU hospitals,” he told the paper. “I was there (in Baton Rouge) as a former (DHH) secretary. I was not there to pitch my company.”

Little more than a month later, following the 60 Minutes story by CBS correspondent Steve Kroft, Levine found himself trying to salvage the HMA image.

HMA, which owns 70 hospitals in 15 states, was accused on camera by several former employees of setting admission targets and that doctors were coerced into admitting more patients. The former employees said doctors who did not meet quotas were threatened with their jobs.

Despite Levine’s denials that HMA was interested in managing the LSU hospitals, Jenkins seemed to think otherwise. “I would say he would be interested in business,” Jenkins said in the same story containing Levine’s denial. “You would be surprised how many companies across the country are interested in these hospitals.

Levine, according to Cerise’s notes, recommended as an initial step that LSU sell its hospital in Shreveport (LSU Medical Center) and use the proceeds to “offset budget cuts for the rest of the LSU system.”

He suggested that the buyers would form a joint venture with LSU, invest capital into the facility and develop a strategy for LSU “to more aggressively compete in the hospital market.”

“The LSU board members present indicated they want LSU’s management to pursue this strategy,” Cerise’s notes said. “Greenstein stated that LSU should look to generate two years of funding to address the state funds shortfall in the system through the sale of Shreveport’s hospital.”

It was at that point that Cerise indicated his concern that such a strategy would take time to develop and that LSU would likely need to go through a competitive public procurement process and “likely legislative approvals.”

It was subsequently determined that legislative approval was not legally required; all that was required was for the legislature to be informed of the administration’s actions.

“There appeared to be agreement that LSU develop a plan that would not result in closure of hospitals,” Cerise’s notes said. “When the question was posed to the group, ‘Will LSU close hospitals,” George responded, ‘We hope not.’ The clear message was that the board members did not want LSU to proceed with any hospital closures at this point.”

Since that meeting, Earl K. Long Medical Center in Baton Rouge and W.O. Moss Medical Center in Lake Charles have each closed.

“Cerise asked Greenstein if he would allow LSU to draw federal funds to try to fix part of our problem and he replied, ‘Yes.’”

Among the concerns expressed by Cerise in an addendum to the meeting meetings which he addressed to Jenkins:

  • There is no commitment by DHH to mitigate the budget reduction while we work on the very complex Shreveport deal. Therefore, if later in the year, we realize that w cannot close a Shreveport sale by year end, we will run a deficit which is against the law and grounds for removal of those causing the deficit;
  • There will be a significant community/political reaction to LSU assuming a competitive posture with a profit partner while receiving favorable Medicaid and uninsured financing from the state;
  • We could see a significant negative community reaction to a plan that sells the Shreveport hospital and spends a large amount of the proceeds on hospitals in south Louisiana. There are also local contractual relationships which might be adversely affected and objected to;
  • We need to be transparent with the legislature. If our plan is to spend as if we will complete a “joint venture” and secure funding later in the year, the board and the legislature need to realize that wer have no alternative solution if the plan fails later in this fiscal year. This will put Shreveport and New Orleans at risk as well as put LSU at risk of running a deficit;
  • The only certain way for LSU is to live within its newly assigned budget is to close multiple facilities now. If we do not do this, we are running the risk of delaying and creating an unmanageable budget crisis later in the year that will put Shreveport and New Orleans at risk. That risk includes others blaming LSU for not taking actions earlier.

“I am asking that you share this memo or at least the substance of it with the full board to ensure they are informed and that their direction to us that we delay definitive budgetary action until the end of August to better assess the likelihood of a Shreveport sale with a statewide distribution of the proceeds is clear and unambiguous,” Cerise said in his memorandum to Jenkins.

At the conclusion of the meeting, Jenkins called for the creation of a task force to include then-Commissioner of Administration Paul Rainwater, Greenstein, George, Yarborough, McCollister, Ballard, Mighty, Barish, Hollier, Cerise and Townsend.

But in a matter of weeks, Cerise and Townsend were gone.

And a year later, a blank contract was agreed to which allows Biomedical Research Foundation of Northwest Louisiana (BRF), an organization with no appreciable cash flow and no experience in running a hospital, to assume control of LSU Medical Center in Shreveport and E.A. Conway Medical in Monroe—facilities with combined revenues of about $400,000.

Moreover, BRF will receive all the facilities’ assets with the state getting the liabilities.

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