The leading Democrat in the Missouri House says a contract awarded to the former employer of an operative in the governor’s office raises red flags.
House Minority Floor Leader Gail McCann Beatty wants the contract to review the state’s Medicaid program immediately placed on hold pending a review to find out if the Office of Administration is following proper rules in its granting process.
A bid costing three times more than three other submissions was awarded to Kinsley & Company, a firm that formerly employed Drew Erdmann, the state’s Chief Operating Officer (COO). In addition, portions of Kinsley’s bid have been redacted from the public.
McCann Beatty thinks the combination of circumstances is problematic. “It’s all of the little things that happened that led to this particular company getting this contract is what raises questions,” said McCann Batty.
One of the bidding companies, Navigant, filed a protest with the Office of Administration, calling for the award to be rescinded and rebid.
Navigant said Kinsley offered pre-conditions to its bid and should have been disqualified it from the process up front. Navigant also said the redactions in the online version of the Kinsley proposal “are so pervasive and excessive” that it’s of no value in determining Kinsley’s compliance or substance.
Office of Administration Commissioner Sarah Steelman told Missourinet the protest is being reviewed.
While talking to reporters in the St. Louis suburb of Clayton Wednesday, Governor Mike Parson offered support for the bidding procedure and expressed no concern over Erdmann’s previous ties to winning bidder Kinsley.
“Right now, we believe that bid process was the right way to do it,” said Parson. “There was no ties between Drew Erdmann and that company still that we’re aware of.”
Commissioner Steelman denies Erdmann had any influence on the bidding process, saying he “has no involvement in individual procurement evaluations or decisions regarding awards of state contracts.”
Erdman was handpicked by former Governor Eric Greitens to be Chief Operating Officer, a position the ex-head of state created.
Under Greitens, the Office of Administration issued the original request for proposal to perform the assessment of the Medicaid program. In it, the grading system for evaluating proposals was 40 percent based on cost, 40 percent on methodology and 20 percent on experience.
But that request for proposal was withdrawn within days, and then reissued with the importance of cost downsized to just 15 percent of the grading system.
In a letter to the Office of Administration, McCann Beatty said that change “seems designed to ensure that McKinsey’s high-dollar bid wouldn’t prove to be a large disadvantage.”
Missourinet examined the five bids on the Office of Administration’s bidding web pages. McKinsey’s documents had redactions spread throughout 222 PDF file pages with dozens of near full-page blackouts at the end. None of the other four bids appeared to have any redactions.
The St. Louis Post-Dispatch reported that Missouri Attorney General Josh Hawley’s office expressed concern about the redactions. “The attorney general’s office does not discern any basis for redaction in the bid proposal provided by the Office of Administration,” Hawley spokeswoman Mary Compton told the paper.
Of the other four bidders – Navigant, Accenture, Deloitte Consulting and KPMG – only Accenture outstripped McKinsey & Company’s $2.7 million price.
Accenture offered a bid “not to exceed” $2.8 million. Accenture was given a marginally lower score for cost 4.0 versus 4.1 out of 15 for McKinsey. The other three bids were all under $1 million. Deliotte offered a price of $981,000 while Navigant’s bid was $898,000 and KPMG’s was $750,000.
For her part, Democratic leader Beatty is calling into question the Chief Operating Officer position former Governor Greitens created. She says she has no idea what the purpose of the job is and wonders what services Erdmann is performing for the state in the post.
“Do we have any indication since he’s been here that, in fact, there has been any evidence of a more efficient government as a result of him being here, and I don’t know that there has been,” Beatty said.
Office of Administration Commissioner Steelman, who was appointed to her position by Greitens shortly after he became governor, told Missourinet she holds the Chief Operating Officer in high regard.
“Mr. Erdmann is working hard for the State of Missouri to improve state government for all Missourians,” said Steelman. “He is a huge asset to our state and one of the most honest and ethical people I’ve ever met.”