The winning firm had an unfair advantage due to Bush administration links, say companies in complaints to GAO

Defense contract award protested | The winning firm had an unfair advantage due to Bush administration links, say companies in complaints to GAO. | By Walter F. Roche Jr., Los Angeles Times Staff Writer | October 26, 2007

WASHINGTON -- A Defense Department medical services contract worth up to $790 million was awarded last month to a Wisconsin-based company three months after it hired a former Bush administration appointee who had supervised military health programs at the Pentagon for the last six years.

William Winkenwerder Jr., assistant secretary of Defense for health affairs from 2001 until April, joined Logistics Health Inc. as a director and consultant in June. The firm beat out two other bidders with proposals that ranged from $80 million to $100 million less, records show. Under the new contract, Logistics Health will provide immunizations and physical and dental exams for reservists and National Guard members.

Logistics Health of LaCrosse, Wis., is headed by another ex-official of the Bush administration -- former Secretary of Health and Human Services Tommy Thompson.

"They stacked the deck," said Fran Lessans, president of Passport Health, one of the losing bidders. Her Baltimore-based firm lost despite a bid projected over five years to cost nearly $100 million less than Logistics Health's winning proposal.

"It was wired. There is no doubt in my mind," Lessans said of the Defense procurement process.

Two other firms involved in the bidding have filed formal protests with the Government Accountability Office. A draft copy of one protest letter, reviewed by The Times, cited Winkenwerder's role and complained that the winning bidder may have "gained unequal access to information not available to other competitors" by hiring the former Pentagon official.

"This creates an organizational conflict of interest and potentially constitutes prohibited contact," the draft letter said.