Firm bids to run California inmate medical system

The offer by The GEO Group Inc. of Florida caught the court-appointed receiver overseeing reform of California's inmate health care system by surprise.

In the five-page internal memo obtained Monday by the AP, the receiver's chief of staff repeatedly makes it clear that he believes the bid was solicited by the Schwarzenegger administration and questions the administration's motives.

Chief of staff John Hagar writes that The GEO Group has spent more than $300,000 lobbying the governor's office and Legislature since January. Campaign records on file with the secretary of state's office show the company also made a $50,000 contribution last month to the campaign for Proposition 11, the redistricting initiative on the November ballot backed by Schwarzenegger.

"The solicitation is all the more troublesome because the Federal Court has taken responsibility away from the Secretary of Corrections concerning the delivery of medical services," Hagar wrote in the memo to court receiver Clark Kelso.

Schwarzenegger spokeswoman Lisa Page denied the administration solicited GEO's bid. She said Hagar may be concerned about the overture by a private firm because "the receiver can't defend his $8 billion boondoggle."

That's the amount the court receiver says he needs to build medical facilities for 10,000 inmates.

Page said the GEO Group approached the administration but was referred to the state Department of Corrections and Rehabilitation.

Corrections spokesman Oscar Hidalgo said company officials met last month with Corrections Secretary Matthew Cate, who referred them to the receiver's office.

"There was no discussion beyond that because of the obvious, I guess: We don't run the prison medical system," Hidalgo said. "All we did was refer them to the receiver's office."