Rep. England Says Alabama Got Played By Prison Health Vendor
Tuscaloosa Democrat State Rep. Chris England is calling out a state prison system healthcare vendor with a murky past who has filed for bankruptcy. and is questioning why the Alabama Department of Corrections (ADOC) would contract with them considering their questionable past.
At Issue
England is accusing YesCare of defrauding the state after the company filed for bankruptcy, leaving employees and vendors unpaid. He alleges corrections would have discovered a similar action by basically the same company under a different name.
"YesCare used to be a company called Corizon," England said. "Corizon filed bankruptcy. They closed one company, reconstituted under a different name, built a whole bunch of creditors and vendors."
Previous Legal Issues
Two years ago, the Department of Justice's US Trustee Program — the watchdog of the federal bankruptcy system — called for the dismissal of the then Corizon Health contentious bankruptcy.
After a year of spending "considerable resources" on the case, the Trustee's filing stated, there was still no approvable plan between the company and its creditors. In a mid-January motion, a committee representing prisoners who filed suit against Corizon alleging medical neglect requested that a federal judge dismiss the bankruptcy outright.
The Reynolds Center for Business Journalism called Corizon's bankruptcy action the "Texas Two-step". Reporter Alessandra De Zubeldia called the investigation into Corizon a case of "connecting the dots, "From volumes of court records, short-seller reports and shell company registrations to medical malpractice cases, as well as a major bankruptcy judge’s resignation, the investigation was complex and took the reporters, and their readers, on many twists and turns."
Two years ago, a comprehensive settlement agreement was reached with the creditors of YesCare's predecessor. According to court records, Under the terms of the agreement, approximately $75 million was to be distributed to Tehum’s creditors through a consensual Chapter 11 plan settlement. Tehum was a predecessor to Corizon who was YesCare's predecessor.
As a result of the Reynolds Center's reporting, several corrections agencies rebid their contracts with Corizon’s successor company, YesCare.
Reconstituted with a New Name But Same Issues
Under the new corporate name England says the company landed the Alabama prison healthcare contract, then proceeded to attempt to pull the same trick in Alabama.
The legislator is questioning why ADOC didn't do due diligence when considering YesCare as a healthcare provider. Instead, they continued doing business with YesCare despite the previous contract breaches involving unpaid vendors.
The legislator since 2006 claims the company not only defrauded the state but also questioned the quality of healthcare provided by YesCare, putting profits before performance. He also raised conflict of interest concerns about a former YesCare board member who represented the state in prison healthcare litigation after leaving the company's board.
ADOC did terminate its YesCare's contract in May after determining the company failed to fulfill its contractual obligations. They then entered into an emergency agreement with NaphCare to provide prison healthcare services. The department said YesCare experienced multiple payroll delays before its contract was terminated.
Who Is YesCare?
YesCare holds accreditations from the National Commission on Correctional Health Care (NCCHC), the American Correctional Association (ACA) and Prison Rape Elimination Act (PREA).
The company was contacted for response to Rep. England's claims but has not returned a message.
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