Reopening Virginia hinges on PPE and testing. But the state won’t give details on contract to boost supplies.

By: - May 8, 2020 6:50 pm

The Virginia Department of Emergency Management heavily redacted a copy of its contract with McKinsey, which the Mercury obtained through a Freedom of Information Act request.

The redactions start on the first page, beginning with the name of the McKinsey partner who signed the contract with the Virginia Department of Emergency Management.

On April 21, The Virginia Mercury submitted a Freedom of Information Act request to the department, asking for a copy of its $573,680 contract with McKinsey, a global consulting firm that’s positioned itself as a resource for states, the federal government and individual health systems in their response to the COVID-19 pandemic.

The Mercury also requested any reports or recommendations that McKinsey had issued through the contract. All of those reports — roughly 120 pages — were withheld. But the contract was released, replete with blacked-out passages that make its full scope difficult to understand.

Health Secretary Dr. Daniel Carey announced the contract at a news conference on April 10, describing it as an effort to boost testing — and personal protective equipment, he added after the briefing — in a state struggling to meet demand.

Since then, Gov. Ralph Northam has announced his intention to begin reopening Virginia next week — a decision predicated, in large part, on what he’s described as a boost in testing and stable supply of personal protective equipment for hospitals and other frontline workers.

“Over the weekend, we tested more than 6,000 people per day,” he said during a news briefing on Monday. “In mid-April, we were testing fewer than 3,000.”

“All of this depends on us having a good supply of PPE,” Northam continued, referring to the plan for reopening, “which we now feel that we have.”

But VDEM has refused to release full details of the publicly funded contract meant to strengthen that supply. Among many other blacked-out passages, the information redacted in the contract includes the name of the McKinsey partner and, at one point, what appears to be a reference to which state’s laws would govern the agreement.

A section of McKinsey’s contract with the Virginia Department of Emergency Management redacts a reference to the state whose laws would govern the agreement.

Alan Gernhardt, executive director of the Virginia Freedom of Information Advisory Council — a state agency tasked with resolving disputes over FOIA issues — seemed puzzled by those particular redactions. “I am not sure how a signature and the name of the state fit” within the exceptions to the code claimed by VDEM, he wrote in an email Friday.

But more significantly, significant portions of McKinsey’s recommendations to the state have been redacted, rendering most of the guidance unintelligible. One section, a bullet-pointed list of “potential actions the state can take itself,” was almost entirely blacked out. Another section includes an “optional phase two approach” — which McKinsey later provided through a contract extension — but the extensive redactions make it impossible to determine what was recommended.

Another section on a potential second phase of the contract was almost entirely redacted.

Additionally, VDEM is “withholding approximately 120 pages of reports” prepared by McKinsey “for the deliberative use of public officials regarding strategies and recommendations for addressing the COVID-19 emergency in the commonwealth,” wrote Brookie Crawford, the agency’s FOIA officer, in a response to the Mercury Thursday. 

To justify the withholdings, Crawford cited three sections of Virginia code governing certain exceptions to the state’s FOIA laws. The reports contain “proprietary and trade secret information as well as information identified as working papers for deliberative use by public officials,” she wrote.

The Mercury has requested additional clarification on why VDEM is citing the working papers exception, which is tailored to apply only to “records prepared by or for a public official… for his personal or deliberative use.”

The code exempts “working papers and correspondence of the office of the governor, the lieutenant governor or the attorney general; the members of the General Assembly, the Division of Legislative Services, or the clerks of the House of Delegates or the Senate of Virginia; the mayor or chief executive officer of any political subdivision of the commonwealth; or the president or other chief executive officer of any public institution of higher education in the commonwealth.” The law defines “governor’s office” broadly: including not just his chief of staff, counsel and director of policy, but also cabinet secretaries and certain other “individuals to whom the governor has delegated his authority pursuant” to state law.

The Virginia Department of Emergency Management heavily redacted a copy of its contract with McKinsey, which the Mercury obtained through a Freedom of Information Act request.

It’s unclear if the reports — delivered through a contract executed between VDEM and McKinsey — were ever intended for personal or deliberative use by a public official covered by the exemption.

It also appears that the governor’s office did not have a copy of the original contract. The Mercury sent its original request for the document to Jessica Killeen, Northam’s deputy counsel, who wrote April 20 that there were “no documents responsive to your request.” The contract itself stipulates that the “services and deliverables” — in this case, McKinsey’s recommendations — are the “extension and supplement to the government functions performed by the receiving public agency.”

The Mercury also asked Crawford why the bulk of the contract and the reports were being interpreted as “proprietary” or “trade secrets.” VDEM is “looking into [the questions],” she responded Friday.

“However, we will not have an answer to you by today,” she added.

A few things are apparent from the contract, a three-week agreement signed on April 11 and extended through May 1, a week past its original end date. One is that McKinsey — at least at first — appears to have been retained solely to help the state obtain more personal protective equipment, despite Carey’s initial reference to testing.

“So, actually, immediately following this session, we brought together McKinsey, a consulting group,” Carey said on April 10. State leaders were “aggressively seeking” answers to improve testing rates, he added.

“That’s, how do we get better in Virginia, what are lessons?” he continued. “In my conversations with other states — whether that’s Michigan, Maryland or North Carolina — we’re doing very much what those states are doing. But what can we do better? How can Virginia be the leader in testing?”

The contract, however, defines the scope of services as a “response assessment for PPE availability.” That supply has been a consistent concern for state officials, who signed another contract in late March to source protective supplies through a Norfolk-based logistics company.

Secretary of Finance Aubrey Layne confirmed Friday that McKinsey has submitted an additional proposal to state officials, offering to extend its consulting work to testing and contact tracing. The extension — which would cost approximately the same as the original services — has not yet been signed by VDEM.

If a supplemental contract is signed, Layne said that McKinsey would play the same role that it did in the state’s search for PPE — helping officials vet vendors, set up new systems and model supply needs. 

“I think they helped us evaluate,” Layne said. “In other words, more so, ‘Here’s a system set-up to determine if this is a credible vendor.’ A demand model, from the health side of things, as to how much demand do we really need. It was trying to put some parameters around the need for PPE.

“And I think we’ll need — though I don’t know if it’s going to be these guys — a similar type of deal for getting testing,” Layne added.

But without a full view of the contract, or access to McKinsey’s reports, it’s still unclear how the state is shaping its long-term response to the pandemic or why state agencies faced supply chain issues that restricted medical supplies and testing in Virginia for weeks.

Gov. Ralph Northam speaks at a media briefing on the coronavirus outbreak last month. (Ned Oliver/ Virginia Mercury)

It’s also uncertain how, and to what extent, those problems were overcome, as well how state officials will continue to address them. Northam has tied multiple facets of his response to a stable supply of protective equipment, from expanded testing — which requires sufficient protection not only for hospital workers, but primary care doctors, health clinics, pharmacists and even dentists — to the state’s phased reopening plan.

“These additional tools, paired with health data metrics, are informing our decisions about what restrictions to ease and when we can safely do that,” he said at a news briefing on Friday. “I want to reassure Virginians that we are not opening the floodgates here.”

But specific actions the state has taken have not been fully disclosed. McKinsey appears to anticipate a potential second wave of cases, recommending that state officials account for “a second peak in Virginia in later 2020” when considering their needs for protective equipment.

While the percent of positive test results are steadily declining in Virginia, overall cases — as well as hospitalizations and deaths — have increased or remained flat. Northam said Friday that his administration was basing its decisions on trends in data, even if the state’s day-to-day metrics appear to spike.

He was responding to a specific question on hospitalization numbers, which, on Thursday, showed an all-time high in the number of patients hospitalized with a pending or confirmed COVID-19 test.

“There might be days where there are a few more hospitalizations or days when it goes down,” Northam said.

“Again, let’s look at the trends,” he added later. “That’s what we’re following.”

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Kate Masters
Kate Masters

Kate grew up in Northern Virginia before moving to the Midwest, earning her degree in journalism from the University of Missouri. She spent a year covering gun violence and public health for The Trace in Boston before joining The Frederick News-Post in Frederick County, Md. Before joining the Mercury in 2020, she covered state and county politics for the Bethesda Beat in Montgomery County, Md. She was named Virginia's outstanding young journalist for 2021 by the Virginia Press Association.