'Personal relationship' complicates city bid to bring in self-insurer, 'stinks to high heaven'

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News 12 at 6 o'clock / Monday, Nov. 19, 2012

AUGUSTA, Ga. -- A personal relationship is taking center stage as the city looks to award a multimillion dollar self-insurance contract.

There was a formal swearing-in process. Stinging allegations were made.

"You are walking into a contract dispute of $500,000 every year," declared Aetna representatives during an appeals hearing.

But it is an internal letter that could complicate the city's plan to bring in Blue Cross Blue Shield as a self-insurance provider.

"It has come to my attention that you were unaware that I am dating an employee of BCBS Georgia," said employee benefits consultant Lisa Kelley in a letter to Deputy Administrator Bill Shanahan.

"It stinks to high heaven," said Augusta Commissioner Alvin Mason. "There have got to be thousands of consultants out there that we could have utilized for this process."

It is a $23 million contract. Aetna is appealing the process.

"My personal relationship in no way affects my ability to consult on behalf of Augusta Richmond County in a fair and unbiased manner," Kelley said. "He is simply one of 30,000 Wellpoint BCBS employees with no access whatsoever to your account or decisions made about your account."

Commissioner Mason doesn't buy it.

"I mean, think about that. That doesn't look good in anybody's eyes as far as I'm concerned," Mason said. "And certainly from a procurement standpoint, there is a problem."

It is a possible problem on style and substance with Aetna being the top rated and lowest cost provider.

"I'd like to know who is responsible for allowing this to happen." Mason said.

We took that question to City Administrator Fred Russell.

"Your recommendation is deny the bid protest?" we asked.

"Yes," replied Russell.

"Why?" we asked.

"Because we have done everything right," Russell said. "We followed all the rules."

So what about the possible conflict of interest?

"I do not think it had any impact on the decision," Russell said. "Anything further than that I am not going to comment on."

Russell contends BCBS could provide a greater level of continuity for employees. BCBS is the current provider for workers.

"I hear all of that junk that is being thrown our way in terms of reasoning, but it doesn't fly," Mason said.

He worries the city might be setting itself up for a lawsuit.

"We probably will be heading for court once again," Mason said.

The committee took no action on Monday. It goes to the full commission on Tuesday.

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