With potential sanctions for his agency’s failure to meet court-ordered prison health care standards looming, Arizona Department of Corrections Director Charles Ryan laid the blame largely at the feet of private contractor Corizon Correctional Healthcare.
Ryan testified before U.S. Magistrate Judge David Duncan on Tuesday in the Parsons v. Ryan prison health care case. The case was settled in 2014 but slogs on in court as DOC and its contractor continue to miss the mark on more than 100 health care standard.
Both Ryan and Assistant Director Richard Pratt, who is responsible for overseeing prisoners’ care, face civil contempt charges if they cannot show they’ve taken all reasonable steps toward improvement.
They testified for two days about the lackluster response from Corizon to their verbal and written demands.
Ryan said he made numerous attempts to get Corizon to make changes during regular meetings with Corizon leadership and in writing.
For example, he said he has pushed Corizon to increase the stock of medications on site at DOC facilities, rather than relying so heavily on an out-of-state pharmacy, and to fly Corizon personnel to Arizona facilities to compensate for vacant positions, which are largely blamed for the provider’s deficiencies.
But according to his testimony, Corizon has not done much to comply with Ryan’s requests or demands.
Ryan did say communication between his department and the contractor has improved since “CEO number seven,” Steve Rector, was appointed, but still, “they’re not perfect.”
Duncan said Ryan’s testimony showed he had been approaching Corizon “aggressively” in his attempts to compel compliance to an extent the judge had not been made aware of.
But questioning by plaintiffs’ counsel David Fathi of the ACLU’s National Prison Project indicated Ryan could have done more.
Corizon originally won a three-year contract with the opportunity for two one-year extensions under state law.
Ryan acknowledged Corizon did receive the two extensions and two rate increases of 4-percent per prisoner per day since 2015 despite Ryan’s admitted displeasure with Corizon’s performance.
Each extension and raise came after Ryan and Pratt sent letters expressing a need for Corizon to do better.
“Corizon must demonstrate immediate improvement in the performance measure scores,” Ryan read to the court from a letter sent in July 2016, a month after granting a 4-percent rate increase. “ADC will not tolerate perpetuation of the status quo.”
“Corizon cannot continue to conduct business as usual,” the letter went on, suggesting the contractor determined sanctions imposed by the department were merely the cost of doing business and that Corizon’s behavior would force court monitoring on the system for years to come.
The department itself fined Corizon at $5,000 per instance of noncompliance, but in May 2015, the contract was amended to cap monthly sanctions at $90,000. Plaintiffs counsel pointed out that amounted to less than a quarter of the company’s daily gross income of more than $400,000.
Under questioning about that choice, Ryan said it was a “negotiated business decision.”
The cap has since been removed, but $3.5 million in incentives taken from available health care funds has vastly outweighed sanctions. The dollars were available because of a lower than anticipated prisoner population and Medicaid savings, according to a document filed by the department on Wednesday.
Between October and January, Corizon racked up $675,000 in fines for noncompliance, but received $2.55 million in incentives for overall compliance.
Ryan did say no further incentives will be offered once the $3.5 million on the table is exhausted.
However, Corizon’s current contract worth more than $140 million will expire on June 30. The company has entered a bid for a new contract, and Ryan said Corizon CEO Rector has already asked about the potential for additional incentives, which Ryan said he has denied.
In an emailed statement to reporters, Corizon spokesman Kurt Davis said Ryan’s testimony provided a “factual look at the high level of healthcare Arizona inmates are receiving.”
“The ACLU lawyers have attempted to push a calamitous narrative, but the expert witnesses and the testimony of Director Ryan clearly demonstrated the opposite,” Davis wrote.
While it’s true both Ryan and Duncan acknowledged the improvements made over the years, each made it clear Corizon’s performance has not been entirely satisfactory.
As Davis pointed out in his statement, Corizon has reached 94 percent overall compliance with the more than one hundred performance measures as of January.
“One hundred percent would be a perfect world, but I don’t know that 100 percent is realistic in terms of achievement,” Ryan told Duncan. “I’m not aware of any corrections that achieves that type of threshold. That’s not to say we should not continue to strive for that, but that’s a pretty lofty goal. Perfection is not achievable.”
However, Duncan admonished Ryan for referring to overall performance on the stand, saying the stipulation did not direct the court to consider overall compliance but rather compliance with each individual measure. And to suggest overall compliance is more important than any single measure found to be substantially noncompliant is not in keeping with the settlement.
That, Duncan said, continues to represent an “abject failure” in Arizona’s prison health care.
For months now, Duncan has threatened fines of his own against the state of up to $1,000 for each instance of noncompliance with 11 specific performance measures tracked in each of 10 state prisons. Those measures include requiring providers to discuss the results of diagnostic reports with their patients within five days of receiving them and ensuring that medications be transferred along with prisoners who are moved to another facility.
The last two days of testimony were intended to resolve whether the fines would be imposed at last. But Ryan and the state will have to wait a bit longer.
The court ran out of time Tuesday to hear all necessary testimony, and so, the parties will reconvene on the issue April 10.
Correction: An earlier version of this article stated that the $3.5 million in incentives the Arizona Department of Corrections made available to private contractor Corizon came from savings from vacant DOC positions and the department’s operating budget. DOC Director Charles Ryan issued a written statement on March 28 to correct his testimony on the source of the incentive pay.