Health commissioner grilled on contract for faulty COVID-19 tests

A bipartisan committee of legislators on Thursday grilled Tennessee’s health commissioner and other officials for failing to take better precautions before entering a multi-million dollar contract for faulty coronavirus testing services.

The legislature’s Fiscal Review Committee called health commissioner Lisa Piercey, state emergency management director Patrick Sheehan and state purchasing officials to appear and answer questions at a hearing about a no-bid, $26.5 million contract with Nomi Health.

The contract, first reported on by Newschannel 5, was signed by state officials May 1, despite objections raised by some lab experts with the Tennessee Department of Health. By June 12, the state had gotten out of the contract due to the Utah-based company providing coronavirus tests that weren’t up to the state’s standards, though Tennessee was still on the hook for $5.9 million.

Piercey defended the actions of state officials, describing how the state was inundated with proposals from dozens of vendors this spring for coronavirus supplies amid supply chain uncertainty. The Nomi Health company, Piercey recalled, was the only vendor who included personal protective equipment as part of the package.

“You’ll remember then, PPE was like gold,” Piercey said.

But the equipment Nomi provided included things like veterinary wipes and arm-length gloves used during the birth of livestock, legislators discussed during the hearing. The test kits weren’t sensitive enough to be used, the department found.

Sen. Brenda Gilmore, D-nashville, pushed back on why there weren’t more protections included in the contract to allow Tennessee to recover money initially spent when the goods and services weren’t what was guaranteed.

During discussion, the attorney for the state’s procurement office, Paul Krivacka, disclosed that unlike most contracts, the one signed with Nomi Health was “actually on the vendor’s paper” and not a document the state created itself.

Sen. Bo Watson, R-hixson, and Rep. Michael Curcio, R-dickson, both raised concerns about the state’s processes to prevent loss of taxpayer money like what occurred with the contract.

“It surprises me you didn’t ask the people who are actually responsible for overseeing the tests about his particular vendor,” Curcio told Piercey, who countered that she had sought additional input outside of the emails she sent.

Curcio said it appears as if “the same four to five people” are the ones making all the decisions, pointing to the qualifications of Piercey’s staff of health experts, including those who had raised objections to using the company as Piercey moved forward with Nomi.

“It’s starting to feel a little incestuous,” Curcio said.

He asked Piercey’s staff to specify what items the state paid for in the $5.9 million Nomi refused to refund. Those items included some PPE, technology and hardware setup and a management fee.

Mike Perry, the state’s chief procurement officer, said Tennessee is now using a bidding process for “85 to 90% of what we buy now.”

Emails reported by Newschannel 5 show a Republican consultant pitched the company to Gov. Bill Lee’s chief of staff Blake Harris, who connected Nomi with Piercey.

The committee hearing ended without members taking any action.

One of its chairs, Sen. Todd Gardenhire, R-chattanooga, appeared to make Piercey and others uncomfortable as he required those testifying to remove their masks. Piercey told him she preferred to keep it on and offered to pull the microphone closer, but he insisted on the removal and said he was hard of hearing.

“Y’all need to respect that just as much as I respect you wearing a mask,” Gardenhire said as he scolded Sheehan, the emergency management director.