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New York City has decided to cut ties with health care company DocGo by declining to renew the provider’s $432 million contract to care for and transport migrants upstate, the mayor’s office confirmed to Crain’s Tuesday.
DocGo’s emergency, no-bid contract to provide services to migrants in and outside of the city is set to expire May 5. Instead of renewing the contract, the city says it intends to end the DocGo contract and issue a competitive request for proposals to identify a new provider that will take over the work.
“As part of our work to reduce spending, we will not be renewing the full DocGo emergency contract that currently serves approximately 3,600 migrants at this time and will instead be issuing a competitive RFP to take over this work moving forward,” said Camille Joseph Varlack, Mayor Eric Adams’ chief of staff, in a statement.
Once the contract period ends, the city says it will use an existing contract with Garner Environmental Services to care for some 1,800 migrants downstate for roughly three months. Garner’s services will cost the city $10 less per person, per night compared to the existing DocGo contract, according to the mayor’s office.
Varlack said the city is also working with Comptroller Brad Lander’s office “on a temporary extension for the upstate DocGo hotels to ensure we are not disrupting children in school and are not leaving our upstate partners without proper notice.” She said DocGo will continue to serve families upstate until the new RFP provider is selected.
DocGo spokesperson Abigail Rush said the company is “immensely proud” of the work it has accomplished on the city’s behalf and added that DocGo will continue to provide medical services, case management and other services to asylum seekers in New York City under the existing contract and other continuing contracts with the city.
Rush emphasized that DocGo’s contract has been extended through the end of the year to provide services to migrants upstate.
“The contract between the New York City Department of Housing Preservation and Development (HPD) and DocGo for housing of asylum seekers in hotels in Upstate New York has been extended through the end of 2024,” Rush said in a statement. “This extension is designed to ensure sufficient time to transition and/or close emergency sites as needed and when directed by the City.”
The news about DocGo’s contract broke after the market closed. Its stock was priced at $3.85 a share on Tuesday, down from a 12-month high of $10.50 in August.
DocGo has been beset by controversy over the last year. In a July New York Times report, migrants in DocGo’s care said they had been misled to believe the company would help them find work and that they had endured threats from the company’s hired security teams.
Meanwhile, DocGo CEO Anthony Capone resigned in September after the Albany Times Union revealed he had misrepresented his college education.
State Attorney General Letitia James launched a probe into DocGo last summer, and City Comptroller Brad Lander began a “real-time audit” of the company’s migrant services contract in September. Investors in the company filed a class-action lawsuit against the firm in October, seeking to recoup the losses they suffered after the company’s stock prices fell following negative news coverage.
Lander praised the city’s decision to wind down its emergency contract with DocGo but raised concerns over the city’s continued reliance on emergency contracts for migrant services. A recent comptroller review of Garner, the replacement contractor, found the company to be “extremely expensive.”
“While I am glad to see the Administration shift away from DocGo, we continue to be concerned more broadly about the costly emergency contracts the City is using to staff services for asylum seekers,” Lander said in a statement. “Our office will watch closely to ensure that asylum seekers do not see a lapse in services and urges the City to issue an open-ended transition to non-profit organizations to avoid paying for-profit companies millions more than necessary.”
City Hall said the decision to part ways with DocGo will be good for city coffers.
“This will ultimately allow the city to save more money and will allow others, including non-profits and internationally recognized resettlement providers, to apply to do this critical work, and ensures we are using city funds efficiently and effectively,” Varlack said.
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Caroline Spivack , 2024-04-09 23:20:10
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