vs. ) DOAH CASE NO. 85-3929B1D
) DOC CASE NO. 85-CO-2336-R STATE OF FLORIDA, DEPARTMENT )
Intervenor. )
Notice was given, and on December 4, 1985, in Tallahassee, Florida, a formal Section 120.57(1), Florida Statutes, hearing was held in this cause. Charles C. Adams presided as the Hearing Officer. The parties in the person of counsel have submitted proposed findings of facto and those findings have been reviewed before the entry of this recommended order. Those findings are more completely discussed in an appendix to the recommended order. Moreover, the transcript of proceedings was prepared and filed with the Division of Administrative Hearings, and it has been examined in aid of the preparation of the Recommended Orders together with the evidence submitted and post-hearing depositions that were filed.
For Petitioner: F. Alan Cummings, Esquire
John M. Alford, Esquire HOLLAND & KNIGHT
For Respondent: Drucilla E. Bell, Esquire
For Intervenor: Nancy G. Linnan Esquire
Martha H. Hall, Esquire Kenneth J. Plante, Esquire
This hearing dealt with the consideration of the adequacy of the proposals by the Petitioner and Intervenor which were offered in response to the Respondent agency's RFP inquiry about a contract for the delivery of health services. Consideration of the dispute was as envisioned by Section 120.53(5), Florida Statutes. Respondent had determined that the Petitioner's proposal was unresponsive, and the proposal of the Intervenor was found to be acceptable. Petitioner challenged this opinion, leading to an assessment through the hearing process of the responsiveness of the proposals submitted by the Petitioner and Intervenor.
On September 12, 1985, the State of Florida, Department of Corrections, the Respondent in this action, issued request for proposals number 85-CO-2336-R. (A request for proposals is commonly referred to as an "RFP.") The purpose of this RFP was to obtain the assistance of a vendor or contractor in the provision and management of medical services at a newly constructed reception/medical facility located in southern Florida. Following the review of four responses to the RFP a decision was made on October 15, 1985, to award the project to Emergency Medical Services Associates, Inc., the Intervenor. In the face of this intended agency action, the Petitioner, Correctional Medical Systems, Inc., filed a Notice of Intent to Protest on October 18, 1985. This was followed by a Formal Written Protest dated October 23, 1985, which was amended on November 7, 1985. These pleadings raise the issues which are described in this Recommended Order.
In particular Respondent, through the RFP, sought the ideas of the contractors necessary for the provision of comprehensive health care services in the new facility which is known as the South Florida Reception Center. Among the specific requirements of the RFP were the supply of medical and psychological personnel physical and psychological examinations,
x-ray and laboratory facilities, the provision of an infirmary and an intensive care mental health unit. The RFP called for the provision of the services for three years with an option to renew for a second three-year term upon agreement of the provider and Respondent.
In addition to the Petitioner and Intervenor, two other firms submitted responses to the RFP. Those companies were Correctional Health Services, Ltd., and Prison Health Services, Inc. The price quotations given by the four responding vendors were as follows:
Correctional Medical Systems, Inc. $11,084,805.00
Correctional Health Services, Ltd. 11,560,000.00
Emergency Medical Services
Associates Inc. 13,687,419.00
Prison Health Services, Inc. 15,720,387.00
In issuing the RFP the Respondent had as its goal the ability to select from competitive proposals that proposal which best met the needs of the agency. This method of selection was utilized, notwithstanding the fact that health services are not required to undergo the rigors associated with the bid laws of Florida. The RFP, in its terms, had allowed the unsuccessful bidders to protest the Respondent's decision of the matter of a contract award based upon authority set forth in Section 120.53(5), Florida Statutes.
Three of the four proposals submitted by the four companies were rejected by the Respondent as being nonresponsive or irregular. Petitioner's proposal was rejected in view of the Respondent's belief that the proposal failed to contain a firm fixed price. Prison Health Services' bid was depicted as being inadequate, in that it failed to offer a fixed price and to include a legally binding proposal. Correctional Health Services' proposal was deemed nonresponsive for the failure to include resumes of key personnel within that organization. These determinations of irregularity or of lack of responsiveness were based upon a facial review of the submissions by the contractors and no further steps were taken by the Respondent to make an in-
depth analysis of those proposals or to compare them to other proposals prior to deciding the ultimate question of which contractor it preferred to engage in this undertaking. The proposals from the four contractors were received and opened on October 7, 1985.
William Stancill, the General Services Administrator to the Respondent had reviewed the submissions by the four vendors with an eye for any failings in those documents pertaining to what he perceived to be mandatory requirements of the PEP. This assessment lead Stancill to recommend the rejection of the three vendors for lack of compliance with mandatory requirements.
Having reached this conclusion, the vendors other than the Intervenor were told that their proposals were unacceptable. Again, upon the facial examination of the proposals, only that proposal of Emergency Medical Services Associates was found to be responsive. 1/
Before the proposals were received from the various contractors, Respondent held what is known as a responders' conference to discuss the terms of the RFP. In the course of this conference, an indication was given to the potential responding parties on the topic of the Respondent's desires as to a price quotation. In the RFP, paragraph 5.2 [page 28] indicates "The cost proposal will be stated in terms of a fixed price for each year of the contract and option "
In the course of the proposal submitted by the Petitioner, it offered the following comments about its price:
CMS' price for each year of the contract is shown based on a 5 percent yearly increase. If the Medical Care Component of the Consumer Price Index deviates more than 2 percent from the projected 5 percent increase in a given year, CMS reserves the right to renegotiate its price with the Florida Department of Corrections for that year.
This price is not fixed as contemplated by the terms of PEP, and this submission by the Petitioner fails to comply with the PEP on this subject. This failing is not cured by the testimony of Richard Turpenoff, Vice President of Financial Services for the Petitioner, when he describes personal involvement with the submission of seventy-five to a hundred health care proposals for correctional facilities and the fact that this language set forth in the present response to PEP had been used on those occasions. Nor is it beneficial to the Petitioner when it indicates that this type of language set forth in the response to the price demands of the PEP is that which has been used by health care providers throughout the industry. Petitioner's idea of reserving to itself the ability to discuss with the Respondent an equitable adjustment in the price of its services, in what the Petitioner foresees as an unlikely event that the Medical Care Component of the Consumer Price Index were to rise drastically over the period of the contract, is in itself a departure from the terms of the PEP. The PEP does not allow for this interference with the orderly process of the contract terms through any suggested negotiations, and it does not suffice to say that those negotiations are not unilateral in nature. Further, it is insufficient rehabilitation of the response to the PEP to indicate that the Petitioner has not abandoned any of its contracts before the expiration of the terms of those agreements. In this connection, the testimony of Joseph Rowan, Executive Director of Juvenile and Criminal Justice International, an expert in health care, states that he has
reviewed a large number of proposals and has seen numerous proposals with provisions similar to that set forth in the Respondent's statement on price and concludes that the provision in the proposal is a firm fixed price. That statement is rejected. It is rejected because the interpretation given to this provision on the part of the Respondent in the person of Mr.
Stancill is more compelling. Stancill believes that the Petitioner's quotation is not binding and is therefore not a fixed price, and that understanding is accepted.
The Petitioner's deviation from the requirement for fixed price is one which may not be considered a minor irregularity, in that it is not an item which does not have an adverse effect on the cost or performance as described in paragraph 4.7 [page 25] of the PEP. The terms of the PEP as paragraph 4.7 and Rule 13A-1.02, Florida Administrative Code, contemplate the waiver of minor irregularities in the proposals submitted by the contractors. By not submitting a fixed price, Petitioner has failed to comply with a mandatory requirement of the PEP, and its offer is unresponsive. Finally, in the last four years, the Medical Care Component of the Consumer Price Index has exceeded 5% in each of those years and has reached as high as 8.7% in one of those years.
As with the Petitioner's submittal, in examining the propriety of the submission by the Intervenor, it is the question of mandatory compliance with the RFP that is critical to the qualification of the latter proposal. To this end, the Petitioner has attempted to identify in the course of the final hearing those items within the proposal by the Intervenor which Petitioner argues constitute noncompliance in categories in which compliance is mandated.
The first area of concern by the Petitioner pertains to subparagraph 5.1.2 of the RFP [page 27]. This provision relates to job descriptions and resumes of employees included within the FTE count. It says:
A job description for all employees to be employed by the Contractor in the institu- tion, must be included. (Format samples are attached.) Resumes of any designated senior administrative/management or professional personnel should be included. As a minimum, the positions equivalent to senior adminis- trator, the chief health officer, and the nursing Director must be designated and a resume provided.
Having considered the language of this provision, and the explanation concerning the provision as provided by Stancill, this provision is found to require the submission of job descriptions for all employees that the contractor intends to utilize in the institution. Further, it is necessary that the contractor designate by name and provide resumes for those persons holding the positions within the organization which are equivalent to the senior administrator, chief health officer and nursing director.
This provision cannot be construed, as urged by the Respondent and Intervenor, to countenance the idea that only the job descriptions pertaining to positions equivalent to senior administrator, chief health officer and nursing director must be provided.
In its submission, the Intervenor failed to submit job descriptions for employees in the classifications clerical assistant, medical records librarian, rehabilitative therapist ward clerk, clerk typist, pharmacy assistant and, arguably, clinical psychologist. Those job descriptions identified were provided at a later date. An additional conference was held between the Respondent and Intervenor following the Respondent's stated intention to select the Intervenor as the contractor, and in the course of this meeting, the Respondent established what it would accept in the way of the provision of services under the term medical assistant. That indication was to the effect that this job title must pertain to licensed nurses and medical technicians. In Florida, there is a specific category of licensed professional referred to as "medical assistant," found at Section 458.34, Florida Statutes, (Ch. 84-543, Laws of Florida) as it deals with assistants to physicians. The job description related to medical assistants as provided by the Intervenor more closely corresponds to the duties of licensed nurses or persons who assist those nurse practitioners, not persons who work under the direct supervision of a physician as described in Chapter 458, Florida Statutes. This job description also refers to the possibility of filling positions with persons who have worked as emergency medical technicians, EMTs.
While the Intervenor failed to submit the job descriptions which have been identified in the previous paragraph, and as such violated subparagraph 5.1.2 of the RFP, this noncompliance is not a failure to comport with mandatory terms of the RFP. The mandatory terms as generally described in paragraph 3.1, and as defined by the following paragraphs and subparagraphs, do not point to the idea that the failure to provide the job descriptions is mandatory and a fatal defect in the proposal. While paragraph 3.1 and its ensuing provisions do regard the
provision of resumes and background information related to key personnel as being mandatory the provision of job descriptions for the personnel at issue is not a mandatory item. Finally, the omission of those job descriptions in this instance has not been found to have a bearing on cost or performance.
In a related vein, the inability, in theory, to compare the job descriptions of one contractor with those of another would impair the purchaser's efforts at selecting between the proposals. However, this comparison is not needed if the other contractors have been excluded based upon noncompliance with mandatory requirements of the RFP. Indeed, the other three proposals were properly discarded for noncompliance, and no comparison has been made. In the absence of the necessity of comparing job descriptions, it was not inappropriate for the Respondent to allow for the provision of the missing job descriptions subsequent to the submission of the basic proposal or to engage in discussion about the needs under the category medical assistant following the submission of the proposal.
The Petitioner next challenges the accuracy of the claims which have been made by the Intervenor reference James A. Brigham, a key person in the plans of the Intervenor in its attempts at honoring the terms of a contract with the Respondent. Brigham is the Intervenor's Director of Marketing. On page 3 of the proposal of the Intervenor, in the introductory remarks, it is stated:
Mr. Brigham was formerly an executive with and helped to found and manage Correctional Medical Systems, Inc. He has worked directly with the Department of Corrections in the states of Illinois, Alabama, Georgia and Missouri.
In fact, Brigham neither founded nor managed Correctional Medical Systems, Inc. Although he has offered advice in the formative years of that corporation through his affiliation with another corporate entity which was associated with Correctional Medical Systems, Inc., that experience cannot be elevated, even under the most liberal construction, to a level of founding and managing.
Brigham has never been employed by Correctional Medical Systems per se and has not served in any executive capacity with that organization. The resume of Brigham, which is a part of the proposal by the Intervenor, also sets forth that Brigham served as the Executive Vice President of Spectrum Emergency Care, Inc., in the years 1977-1983. (Spectrum is the other corporation
previously mentioned which Brigham was associated with when advising Correctional Medical Systems.) His service as Executive Vice President lasted from 1977 through October 1, 1982. He did serve as an employee of Spectrum Emergency Care between the years 1977 and 1983. In the course of that employment, he prepared proposals and consulted with various states in the area of provision of medical care within correctional facilities. In that regard he had some contact with the states of Illinois, Georgia, Missouri, Arkansas and Alabama.
Correctional Medical Systems was organized in 1979 to promote comprehensive medical services within correctional facilities throughout the United States. The focus of Spectrum in this regard had been primarily the provision of physician staffing in correctional facilities.
It is not evident from what has been presented in the course of this hearing why these inaccurate statements were set forth in the RFP in describing Brigham's association with Correctional Medical Systems and Spectrum. On balance, having considered those statements and having reviewed the deposition of the witness Brigham on the subject of his experience, these inaccuracies within the RFP response are not found to be sufficient to recommend the rejection of this proposal.
Paragraph 2.7 [page 1O] of the RFP states:
The proposal shall indicate the contractor's plans to secure and maintain standards of the Commission on Corrections accreditation of the health services program, regardless of whether the entire institution may be accredited.
This refers to standards established by the American Correctional Association. Petitioner claims that the Intervenor did not describe in its proposal how it intends to provide access information to the incoming prisoners pertaining to health care. As argued by the Petitioner, this is a requirement by the American Correctional Association in its standards dealing with the provision of medical care access information to prisoners.
However, the RFP cannot be construed as requiring a contractor to identify how it would comply with that provision as a feature of its response to the RFP. The RFP is read to stand for the proposition that the contractor, in cooperation with the Respondent, shall make efforts to gain accreditation by the American Correctional Association and does not extend to the idea of a separate statement in its proposal of how it will provide access information to incoming prisoners. Moreover, it was established in the course of the hearing that at the point of intake of inmates into the Florida system of corrections, those inmates are routinely made aware of their right to receive medical services.
At paragraph 2.1, lettered section C, [page 7] of the RFP, there is a discussion of the length of stay contemplated in the mental health unit of the facility. In particular it states:
The patients in this mental health unit are expected to be successfully treated or stabi- lized within 30 to 60 days so as to permit assignment to another institution.
This obligates the contractor to the establishment of a program varying in length from thirty to sixty days which will meet those requirements of successful treatment or stabilization. In preparing a budget to address this requirement, it leaves to the contractor the decision on whether the program needs to be thirty or more days. The latitude is afforded to use as few as thirty days in preparing the budget, which the intervenor did.
By its terms, the RFP calls for the processing of eighty adult offenders and twenty youthful offenders per week for a total of a hundred inmates a week to be seen at reception for routine physical exams. This requirement of the RFP has been addressed in the budget statement of the Intervenor in Attachment D [page 2], described as a hundred physicals times 52 weeks or fifty-two hundred examinations. This item is separate from another item set forth on that page dealing with physical examinations which are on an annualized basis with a calculation being made that approximately five persons will be examined per day in the category of annual examinations. It has not been shown that the Intervenor budgeted for five examinations a day related to the intake function of receiving and processing inmates, when twenty per day was called for by the RFP.
None of the other claims of the Petitioner set forth in the formal protest and its amendments on the subject of alleged infirmities within the Intervenor's response to proposal have been proven.
The Emergency Medical Services Associates proposal had been reviewed by the evaluation committee of the Respondent which had the responsibility to make decisions on the sufficiency of such proposals and was found to be satisfactory. This determination has not been shown to be in error through proof in this hearing.
CONCLUSIONS OF LAW
The Division of Administrative Hearings has jurisdiction over the subject matter and the parties to this action as envisioned by Paragraphs 120.53(5) and 120.57(1), Florida Statutes.
The RFP under consideration mandated that the contractors submitting proposals would offer a fixed price for each year of the contract and the ensuing option period. A fixed price is a price not subject to change, and it does not contemplate the ability to negotiate any change in price. By its submission in response to the RFP, the Petitioner has offered a quotation which is equivocal in that it ". . . reserves the right to renegotiate its price with the Florida Department of Corrections . . . ." Having failed to offer a fixed price, the submission by the Petitioner is not in compliance with a mandatory provision in that it adversely affects the price or cost of the project. Having determined that the Petitioner has filed to comply with a mandatory provision of the RFP by failing to submit
a fixed price, the Petitioner's proposal is unresponsive and should be rejected.
By contrast, those infirmities found in the RFP submitted by the Intervenor are minor irregularities. Rule 13A- 1.02(9), Florida Administrative Code, defines this term as:
A minor irregularity is a variation from the invitation to bid/request for proposal terms and conditions which does not affect the price of the bid/proposal or give the bidder or offerer an advantage or benefit not en- joyed by other bidders or offerers, or does not adversely impact the interest of the agency.
The inclusion of paragraph 4.7 in the PEP, which described minor irregularities as being those not adversely impacting cost and performance, is in furtherance of the aforementioned rule.
Finally, paragraph 3.1 to the PEP and those subsequent paragraphs which are tied to the general statement of mandatory requirements establish the items which the contractor must comply with and by the terms of those provisions preclude the characterization of failure to comply with those provisions as being a minor irregularity.
In looking at the attack which the Petitioner has made on the quality of the proposal offered by the Intervenor, as described in the facts portion of this order, none of the deficiencies that were shown are other than minor irregularities. They do not adversely affect the price or cost of the proposal or the performance under the terms of the PEP and in this instance do not afford any advantage or benefit not enjoyed by other contractors who responded to the PEP. The possibility existed that some advantage or benefit would have been afforded the Intervenor which was not given over to the competitors, to include the Petitioner, but for the fact that those competitors are found to be unresponsive to mandatory terms of the PEP. Therefore, there was no necessity for comparison between the proposals on the merits in a fashion in which the failure to provide certain information related to job descriptions would have become a critical item in any attempt to try to contrast the quality of the submissions by the various contractors. There being only one contractor who has submitted a proposal which does not have irregularities which violate mandatory provisions of the PEP, it is not unreasonable for the contractor to submit supplemental information about its intentions and for the Respondent and Intervenor to meet to
resolve the particulars of the Intervenor's submission in response to the RFP. When these problems with the proposal of the Intervenor are examined, they cannot be said to cause an adverse impact on the interest of the Respondent.
In Florida, there is a licensed position known as "medical assistant" as set out in Section 458.349, Florida Statutes, (Ch. 84-543, Laws of Florida). This individual works under the direct supervision and responsibility of a licensed physician. The description given of medical assistant within the supplemental filing by the Intervenor contemplates supervision by persons other than physicians and is not seen to be synonymous with the statutory position. Moreover the discussion and agreement between the Respondent and Intervenor did not describe the licensed "medical assistant." Rather it contemplates licensed nurses and licensed medical technicians.
As described in the findings of fact the failure to submit certain job descriptions, six or seven in number, and the problems associated with the description of the work of James Brigham, are minor irregularities. The record does not reveal any other inadequacies in the proposal submitted by the Intervenor. Therefore, the Intervenor's proposal is found to be responsive and in compliance with the RFP and Rule 13A-1.02(9), Florida Administrative Code, and the Intervenor and Respondent are empowered to enter into a contract as contemplated by the RFP. See, also, Harry Pepper & Associates, Inc. v. City of Cape Coral,
352 So.2d 1190 (Fla. 2d DCA 1977); and Systems Development Corp.
F. Alan Cummings, Esquire John M. Alford, Esquire HOLLAND & KNIGHT
Drucilla E. Bell, Esquire Assistant General Counsel Department of Corrections Building 6, Room 331
Nancy G. Linnan, Esquire Martha H. Hall, Esquire Kenneth J. Plante, Esquire
CARLTON, FIELDS, WARD, EMMANUEL, SMITH & CUTLER, P.A.
Louie L. Wainwright, Secretary Department of Corrections 1311 Winewood Boulevard
