Bidding scandal embroils friends

A lobbyist implicated in the case was friends with an Agency for Health Care Administration official.

By DIANE RADO

© St. Petersburg Times, published July 8, 2000

TALLAHASSEE -- When lobbyist Don Yaeger needed a favor at the state Agency for Health Care Administration, he could turn to Jim Clark, a bureau chief with whom he had nurtured a friendship.

The two men went to lunch and attended Florida State University football games together last year. Yaeger would call Clark at the office or send e-mails to Clark's home.

As it turned out, Clark played a key role in decisions on a controversial, $24-million contract that was awarded to one of Yaeger's clients earlier this year. At one point, Clark approved an extension -- at Yaeger's request -- that would give more time to a company Yaeger was working with to submit a bid.

Clark said Friday that the agency's legal staff was consulted before giving that extension, and that Yaeger got no special treatment.

"I would have given the extension no matter who had asked," he said.

The $24-million contract is now at the center of a bidding scandal at the Agency for Health Care Administration. Sarah Grim, a health care executive in Missouri, has gone to the FBI with allegations that Yaeger and another lobbyist, Michael Colodny, said they could "guarantee" she would get the contract if she paid them $1.2-million. She said Yaeger constantly reminded her of people he knew at the top of the agency. Yaeger has said that he didn't guarantee anything and is considering a lawsuit against Grim.

Concerned about the allegations, the Agency for Health Care Administration took depositions from Grim, Yaeger, Colodny, Clark and several others involved in the bidding process. Agency secretary Ruben J. King-Shaw Jr. ordered that the contract be thrown out and the bidding process start over.

The depositions reveal a friendship that had developed between Clark and Yaeger.

"I developed a relationship with Jim Clark as a friend, as one of the smartest people I had ever worked with, and I really appreciated his passion for things that he and I have in common," Yaeger testified.

Clark, 61, has worked in variety of public jobs for the past 30 years, including serving as secretary of the department of human services in South Carolina. He joined Florida's Agency for Health Care Administration in the spring of 1999 and serves as chief of the bureau of Medicaid Program Development.

In an interview Friday, Clark said he first went to lunch with Yaeger in about June 1999 at the request of Douglas Russell, another agency official with whom Yaeger has socialized. Yaeger and Clark had something in common: sports. In addition to his lobbyist activities, Yaeger was a writer for Sports Illustrated and a sports book author. Clark, an FSU alumnus, was an avid FSU fan with season tickets to Seminoles' games. "We talked about football," Clark recalled.

Clark said in his deposition that he had been to a couple of football games with Yaeger, but "I very carefully paid for my ticket." Friday, he said he usually saw Yaeger at the games. Only once did he actually go to Yaeger's home and drive to the game with him.

In the fall of 1999, Clark agreed to go to lunch with Yaeger and Douglas Russell. As it turned out, Colodny was there as well, along with some officials who wanted to do Medicaid business with the state. The word was out that a company doing reviews of the way hospitals and other facilities spend their federal Medicaid funds had notified the state that it was pulling out. The state would be starting a bidding process to look for a company to take over. That was the genesis of the $24-million contract.

Clark said he was very guarded about any comments he made at the lunch. Agency secretary King-Shaw said Friday that he had no problem with Clark going to lunch and having a general conversation about Medicaid services. At that point, bidding documents hadn't gone out.

After the bidding process was under way, Clark got a call from Yaeger in late January. At the time, Yaeger was working with the Missouri Patient Care Review Foundation, headed by Grim, to put together a proposal for the Medicaid review contract. "He (Yaeger) said that someone that he was representing wanted to get their proposal in but had been snowed out and the airports were closed in New Orleans and in Atlanta," Clark said in his deposition.

Clark said he decided to grant the extension of a few days in the interest of getting more bidders and making the process more competitive.

What Yaeger didn't know at the time was that Grim had become so concerned about the conversations she had been having with Yaeger and Colodny that she had gone to the FBI. She never submitted a proposal.

Yaeger quickly got hired to help another company, Keystone Peer Review Organization, in the bidding process. He contacted Clark about a potential problem. At one point, an administrator under Clark was considering splitting the Medicaid contract between two companies -- Keystone and another company. Clark disagreed, saying one company should get the job. He said he already had decided to overrule the plan to split the contract by the time Yaeger had contacted him.

Within a month, Keystone was told it had won the contract.

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