The University of Arkansas for Medical Sciences got Legislative Council approval today for its $720,000 contract with Deloitte consulting firm to study a “strategical alliance,” in Chancellor Dan Rahn’s words, with St. Vincent Health System. No further legislative action is needed.
Deloitte has said it could complete the study by year's end.
The approval came after a couple of questions about UAMS’ choice of Deloitte, since the consultant also has contracted with St. Vincent and was selected by UAMS without bids. Two legislators, Joann Coleman, a non-practicing lawyer who has been working to stop the UAMS-St. Vincent agreement, read to the committee an Aug. 27 e-mail from UAMS’ anti-trust counsel, Clifford D. Stromberg of Washington, D.C., in which he expresses concern that Deloitte is not really “neutral,” in that it was hired first by St. Vincent Health System. Asked by committee co-chair Rep. Larry Cowling to respond, Rahn said he believed the e-mail referred to an earlier structure of the contract in which one document would have served both institutions.
Coleman also noted that Stromberg said if UAMS decided Deloitte’s result showed bias, that could be solved by hiring another consultant to “pressure test it” — at an added expense to the state, she noted.
(Stromberg also indicated some support for the idea in his e-mail, saying that while UAMS should probably hire its own consultant, it could be costly and result in different methods of analysis that could add complexity and delay.)
The e-mail, which Coleman obtained through the Freedom of Information Act, was a response to an Aug. 3 e-mail from Melony Goodhand, UAMS vice chancellor of Finance and CFO, in which she writes that she has “great anxiety about releasing all our market data to our local competitor” and expresses concern about Deloitte’s claim that it will have the study done by the end of the year, questioning the company’s ability “to do any kind of decent job in 10 weeks. … In 2 years Navigant could not get to this level of analysis.”
(UAMS contracted with Navigant in 2010 to determine how it could cut costs; the cost of that contract, $15 million, and another, for ambulatory care, was raised by Sen. Randy Laverty; Rahn defended the need for the Deloitte contract saying the goal of the studies did not overlap but were “interdigital,” a word each legislator tried to work into following questions.)
Coleman also said she was concerned that no non-disclosure agreement had been signed by the parties. Rahn did a quick check and informed the committee that UAMS had signed the agreement, but learned after the committee vote that UAMS had not received a signed agreement of non-disclosure from St. Vincent. He told the committee that UAMS would not enter into a contract with Deloitte until St. Vincent also signed the non-disclosure agreement. UAMS expects to get that disclosure today.
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