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Monday, February 02, 2009

WRHA's crackerjack policy has missing ingredient

You've got to hand it to the Winnipeg Regional Health Authority. Not only do they have a crackerjack policy that lets them accept millions of dollars worth of gifts from winning bidders on medical supply contracts. But they've made the process fun, just like the popular snack of carmel corn and peanuts which came with a prize in every box.

Surprise! You never knew what you would get. A whistle, a toy or a badge.

And, says the WRHA, neither do they -- until the brown envelope attached to the winning bid is opened.

It could be funding for research, equipment, or specific hospital programs. Or, it could be cash. Whoopee!

The upper echelon of the Winnipeg Regional Health Authority knew they'd get caught sooner or later. But they've prepared well and there's a reason they're so cocky.

They're ready to ride out any storm of criticism from the exposure in the Winnipeg Free Press that they've accepted more than $20 million in presents since 2000 from winning contractors.

The manner that these benefits arrived--- in brown envelopes ---may look dodgy. But CEO Brian Postl and his cohorts don't care how rank you think it is, they believe their policy on accepting these gifts is bulletproof.

A lot of thought went into the WRHA policy that governs the bid process--- like how do we do this and not go to jail.

First, the presents are not called presents. They're value-added benefits.

Value-added benefits are defined as (emphasis ours):
Any funds, items or services which directly benefit a Facility/Program/Agency or WRHA Logistics Services but may also benefit Board members, WRHA Logistics Services employees, Facility/Program employees, WRHA employees or physicians and are not identified as a mandatory requirement in the competitive bid document.

Second, the policy is written to make it clear the WRHA is accepting the benefits, and not asking for them. There is a distinction.

4.1.1 If value-ads are to be considered for acceptance the competitive bid document must identify that acceptance will be considered, but only after the decision for award has been made based on the award criteria (pricing, quality, etc.) as identified in the competitive bid document.

4.1.2 Specific value-ads cannot be defined as this could imply the desire is actually a requirement.

4.3.1 Companies shall be informed that where value added benefits are offered, the WRHA prefers that these be of an unrestricted nature.

The people evaluating the bids aren't to be told what's in the brown envelopes before they pick the winner.

Vender offerings of value-added benefits will not be disclosed by Logistics Services until an award decision has been made based on quality and pricing.

But, it's not clear to us whether the offer of gifts is kept secret until after the winning bid is picked or if the following takes place before that's done.

Value-ads that are offered must be disclosed to the following parties and reviewed by all prior to acceptance by WRHA senior management:
* Logistics Services
*Facility/Program/Agency via PRES (Product Review Evaluation Standardization) or assigned evaluation Committee

The WRHA is ready to duke it out with critics.

- The "value-ads" are not bribes. Bribes are payments made before a contract is awarded in order to sway the judges.
- They are not kickbacks. They are separate from the winning bid, not hived off it.
- They are not baksheesh, a term that refers to small payments for services like a tip.

They are closer to rewards, although that implies a connection between accepting the value-added benefit and awarding the contract which the WRHA denies.

They cannot be construed as influence peddling since the benefits go to a facility or program or, if to a board member, he is not a government official but a member of an arms length agency.

The presents are legal. But is taking them ethical?

Sec. 1.2 This policy shall be read in conjunction with Conflict of Interest/Personal Gains Policy ...

Uh oh.

Because the WRHA does not, at present, have a Conflict of Interest/Personal Gains Policy.

The ... above represents the words "presently under development" in the original policy document, a document dated June, 2007 which is posted on the WRHA webpage today.

In a form letter to suppliers, the WRHA tells them:

"Procurement policies have been developed to ensure that the procurement process is seamless and provides a fair and equitable working relationship for both the vendor and health care site communities. These policies have been posted and can be accessed on the WRHA website through the following website link .

The following procurement policies that are available are:
Value Added
Contract Compliance
Conflict of Interest/Personal Gains
Drug Product/Service Complaint Monitoring and Resolution
Product Review, Evaluation and Standardization

We tried the link.

It doesn't work.

We used the Search function to find the WRHA policies page.

Guess what?

Value Added.
Contract Compliance.
Complaint Monitoring. Check
Product Review. Check.
Conflict of Interest/Personal Gains.

The WRHA has had no operative Conflict of Interest/Personal Gains Policy for the past 18 months at least.

Does that mean that there have literally been no constraints on the board members on their use of the gifts from contractors?

This could be stickier than carmel corn.

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