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Newsmonger: State rejects GEO's bid for psych hospital, Fusion Centers under fire, Ethics probe heads to hearing

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State rejects GEO's bid for psych hospital

What exactly was it that tanked the GEO Group's proposal to take over management of the Kerrville State Hospital? Was it the patient found dead in a scalding bath at a South Florida GEO-run psychiatric hospital, his body discovered with skin "sloughing" off his face? The rehab programs at GEO's Montgomery County psychiatric facility, which the Texas Department of State Health Services recently described as "bedlam"? Or the company's management of a juvenile lockup in Mississippi, which a federal judge claimed "allowed a cesspool of unconstitutional and inhuman acts and conditions to germinate"?

None of the above. And the real reason DSHS last week rejected GEO's bid to privatize the Kerrville State Hospital gives us some insight into just how companies like GEO manage to cut costs for states looking to save cash by privatizing jails, psych hospitals, and youth correctional facilities: by slashing staffing levels at the expense of care.

Following the Lege's directive last year to solicit bids to privatize one of the state's psychiatric hospitals, GEO Care, a wholly-owned subsidiary of the private-prison behemoth, was the only company that submitted a proposal, saying it could run the Kerrville facility at 10 percent below current costs.

In a letter sent to the Legislative Budget Board and Gov. Rick Perry's office last week, DSHS Commissioner David Lakey outlined why the agency rejected GEO's proposal. "Although many of the issues identified in the proposal could possibly be addressed, the savings in the proposal were achieved primarily through reductions in staffing and benefits to a degree that would put both our patients and the State of Texas at risk," he wrote.

To lower costs, the GEO proposal would have cut facility staff by 21 percent, from 542 hospital staffers to 428. GEO also would have cut psychiatric nursing assistant staff from 167 to 118, a 29 percent reduction. "It is my belief that these staffing levels are not sufficient to serve the individual needs of patients at this facility or to ensure a safe environment for patients and staff," Leaky wrote.

In a summary assessment of the GEO bid DSHS sent the Current last week, the agency said the proposal "did not ensure compliance with fundamental requirements of operating a facility as indicated in the RFP and as required by law." GEO's submitted policies didn't live up to the rules governing state mental health hospitals, as outlined in the Texas Administrative Code, the agency noted.

The agency also expressed concern that GEO's proposal woudln't meet minimum staff-to-patient ratios mandated for the state's psychiatric hospitals. Current state hospital staffing patterns, including those at Kerrville, were implemented due to a federal class action lawsuit filed in 1974 accusing the state of an array of serious violations at its psychiatric hospitals. The case was settled in 1997 after Texas implemented new staffing patterns to ensure quality care and patient safety.

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