KDADS secretary Tim Keck pitches privatization of troubled Osawatomie hospital

The Kansas Department for Aging and Disability Services is looking to a private company in hopes it can rebuild and run a state psychiatric hospital more effectively and at a lower cost.

KDADS gave a presentation Wednesday at the Statehouse about the bid from Correct Care Recovery Solutions, which runs mental health facilities across the country, to rebuild and run the troubled Osawatomie State Hospital. The hospital lost federal certification in 2015, losing about $1 million per month.

KDADS secretary Tim Keck, who also has given presentations in Osawatomie, Wichita and Independence, said he thought Correct Care could run Osawatomie at a lower cost than the $616 per patient per day the state currently spends. He said he thought the company also could more effectively recruit staff because of its experience and national footprint.

Keck said the contract could be finalized near the end of the year, and the rebuild likely would cost between $100 million and $175 million.

The proposal includes a 210-bed facility that Keck said would more effectively care for patients. He said KDADS would continue operating its 60-bed acute unit that may soon be again certified by the Centers for Medicare and Medicaid, bringing the total to 270 beds. The current facility has 206 beds, and Keck said 150 were operational as of Wednesday.

Lawmakers, however, have been skeptical of efforts to privatize the hospital and approve a plan to do so.

Sen. Laura Kelly, D-Topeka, questioned Keck over Correct Care’s history in Florida. An investigation by the Tampa Bay Times and Sarasota Herald-Tribune raised concerns about care and deaths in Florida mental health hospitals, including those run by Correct Care.

“The concerns that they’ve had about Correct Care have not been much different than what they’ve had about the state-operated facilities in Florida,” Kelly said.

Keck said most of the cases cited in the article didn’t relate to Correct Care’s management.

According to the investigation, six patients have died at Correct Care facilities in Florida since 2011.

Rep. Brenda Dietrich, R-Topeka, said she thought the push for privatization was an effort to save money and that she would need more information before she decided whether she would support it.

The effort to privatize comes as the department moves closer to regaining certification from the Centers for Medicare and Medicaid.

The hospital failed a survey aimed at re-certification in May because CMS found it wasn’t meeting regulations that govern how it hands out medications, prepares food and treats patients. But KDADS announced earlier this month the hospital had passed an initial step toward regaining certification for its acute care unit, which accounts for 60 of its 206 beds.

The hospital must still pass another review that could come as soon as November before it gets funding back. Keck has estimated the hospital will start getting about $400,000 of the missing $1 million each month once certified.