Yahoo Finance How this tiny KY clinic got $57 million in contracts to test & vaccinate for COVID-19
As Dr. Matt Dawson tells it, Wild Health, Inc. was in the right place at the right time.
As the second surge in COVID-19 infections washed over Kentucky last summer, state officials were scrambling to find reliable ways to test broad swaths of the population, in order to gauge the state’s true positivity rate — an endeavor that requires a steady supply of nasal swabs and a means to process those tests.
Wild Health, Inc. happened to have supplies and capacity to do both. Separate from the pandemic, the Lexington-based health care clinic uses a combination of DNA sequencing, blood, microbiome tests and lifestyle factors to treat its fewer than 2,000 patients — a type of emerging care called genomic-based personalized medicine. Founded by emergency medicine physicians, some of whom graduated from UK’s College of Medicine, the company bills itself on its website as “an answer to a broken medical system” since it works to tailor its care to the individual and “prevent chronic disease,” rather than just treating it. A related firm run by the same executives, Wild Health CBD, sells cannabidiol products.
The clinic operates a laboratory in Lexington to do this testing. In the spring and early summer of 2020, before community testing for coronavirus was widely available, Wild Health began swabbing its patients and processing their tests in its Lexington lab.
“What happened with the pandemic is, we had a problem like everybody else did: our patients could not get a COVID-19 test,” Dawson, Wild Health’s CEO and co-founder, said last week. “Because we have scientists on our team, we realized this was a problem we wanted to solve for our patients, first. So, we started doing the [Centers for Disease Control and Prevention’s] gold standard PCR test in our lab.”
Word got around that a local clinic could offer fast, reliable testing and demand snowballed. A few nearby horse farms asked Wild Health to test their staff. Then, Keeneland and Churchill Downs contacted the clinic. Wild Health provided testing for all trainers and staff ahead of the 2020 Kentucky Derby.
“It grew and grew until, eventually, the University of Kentucky asked us to help,” Dawson said, and so did Kentucky’s Cabinet for Health and Family Services and the Department for Public Health.
Simply put, Wild Health filled a need on a scale and at a time few other places could, including the state. As a result, demand for the company’s services skyrocketed, launching Wild Health into a household name as the Cabinet for Health and Family Services and Department for Public Health granted the privately-owned health care clinic ample room to offer COVID-19 testing, and now vaccinations, across large swaths of Kentucky.
In roughly a year, Wild Health has secured contracts for reimbursements exceeding $57 million in state and federal money to test — and as of March 22, vaccinate — Kentuckians, according to contracts obtained by the Herald-Leader. Wild Health scaled up from around 50 employees pre-pandemic to now managing more than 900 temporary employees and contractors.
“We could do it, and so we did,” Dawson said. “We just realized there was such a need. Every time someone asked us to do it on a bigger scale, we were buying more equipment, hiring more people and it just kept growing to where it is today.”
‘Robust testing is essential’
People in and around Lexington who were regularly tested for coronavirus likely first learned the name Wild Health last summer. That’s when the company was awarded a contract through the Cabinet for Health and Family Services, with UK as a subcontractor, to test all students and staff returning for the fall semester, before then expanding to free community testing.
“Kentucky remains at war with the coronavirus, and a robust testing program is essential to protecting one another, fully reopening our economy and getting all of our children back in classrooms,” Gov. Andy Beshear said at the time, urging people to take advantage of the “free public health resource.”
The initial cost for testing students was a flat $63.75 per test result, according to copies of the contract. By August, it increased to $74 per test. The Cabinet’s ongoing contract for Wild Health to test UK students, staff and faculty extends through the end of June 2021. By March 31, Wild Health had billed for roughly $6 million to test those populations.
Separately, when community testing through UK began in August, the state reimbursed Wild Health at the same per-test rate. All told, the state agreed to reimburse the clinic $3,762,000 for community testing through the end of October.
At a time when accessible testing for COVID-19 across Kentucky was hard to come by without scheduling days or a week in advance, Wild Health was by comparison a well-oiled machine. In August, Wild Health began offering community testing from a handful of locations on and around UK’s campus, including in the corner of the Kroger Field parking lot. The clinic reliably offered dozens of same-day drive-thru slots every five minutes. All coronavirus tests are processed in Lexington, and more than 96% of results are returned within 24 hours, according to Dr. Luke Murray, who oversees Wild Health’s coronavirus response. When demand for testing was at its peak, the clinic would swab close to 5,000 people’s noses a day.
The need persisted, and by the fall, the Cabinet extended the clinic’s contract again. Between August of 2020 and March of 2021, during which Kentucky saw its third and most deadly surge of coronavirus cases, Wild Health’s community testing contract with the state grew by 659%, to $28,574,370. UK has so far reimbursed the clinic $17,825,995.25 for all of its testing services the end of March, a UK spokesman said.
‘A sweetheart deal’
When the paramount need in Kentucky switched from testing for COVID-19 to vaccinating against it, the state again asked Wild Health to help.
The mentality was, “we needed allies. We needed vendors. We were not going to be able to do all of this on our own,” said Transportation Secretary Jim Gray, who oversees Kentucky’s vaccination efforts. “There’s a limit to what volunteers can do.”
In April, as a stop-gap measure until the summer, when the site was expected to close, UK hired Wild Health to operate its Kroger Field vaccination site in place of UK staff and volunteers at a rate of $81 per dose. That started roughly three weeks ago, but because Wild Health and UK are still jointly staffing the site, a spokesperson for the university did not immediately know how many doses Wild Health had administered.
UK hired Wild Health to dole out vaccinations at a time when demand at regional vaccination sites had already begun to recede, as the state contends with more vaccine hesitancy. On Tuesday, the UK Board of Trustees announced the site would be dismantled in the next few weeks.
Like with testing, Wild Health’s reach for administering vaccines extends well beyond Lexington. In late March, the Kentucky Department for Public Health awarded Wild Health a $23.1 million contract to vaccinate 300,000 residents across Kentucky by the end of June, through a partnership with the Federal Emergency Management Authority (FEMA).
But like other vaccination sites, demand for shots is dropping. Wild Health is on pace to hit less than 10% of the goal set out in the contract, Murray said.
To date, Wild Health has given close to 20,000 vaccinations at six Lexington high schools, more than a dozen college campuses, a handful of mass regional vaccination sites, including Alltech Arena and Kentucky Dam Village, multiple businesses including the Toyota plant, and the new Lynn Family Stadium in Louisville.
The Department for Public Health has also tasked Wild Health with driving mobile vaccination units to dozens of rural sites in and around Henderson and Laurel counties, to give shots to more isolated Kentuckians.
Several Republican lawmakers last month on the Government Contract Review Committee criticized what they called a no-bid process for awarding that contract. State Sen. Stephen Meredith, R-Leitchfield, called it “a sweetheart deal.”
Secretary Gray takes issue with this characterization.
“When you’re in the middle of a war, you don’t issue [request for proposals] for munitions. You go and get them,” he said this week. “We went beyond the emergency order procurement requirements.”
Mark Carter, who has overseen a ramping up of the Cabinet for Health and Family Services’ contract tracing for much of the pandemic, said two other proposals from companies outside of Kentucky were considered — one was more expensive and the other less, but that company had fewer resources.
Wild Health’s proximity, its well-established presence and success administering tests in Lexington, and its willingness to toggle between mass vaccination sites and mobile sites gave it a leg up, said Carter, who called the company an “excellent partner” to the state.
Sen. Meredith questioned why the state was using taxpayer money to pay a private company to provide a service other agencies, like health departments, had been providing without pulling a profit.
“I don’t understand why we’re not working with our health departments and hospitals in these rural areas,” Meredith said, “rather than spending $23 million that these folks don’t even have to bill for. This is a plum contract.”
Carter, reiterating a point Beshear has made throughout the pandemic, said it’s not one or the other. “It’s not really an ‘or’ kind of thing. I see it as an ‘and,’” he said. “It’s a way we’re supplementing the entire vaccine distribution process across the commonwealth.”
‘It’s not like we’re competing’
UK’s closure of its Kroger Field vaccination site is a sign of the times. Earlier this year, when vaccine demand outpaced supply, regional sites capable of providing thousands of doses a day were largely regarded as the best way to meet peak demand. Today, as demand has waned and Kentucky increasingly contends with vaccinating a more reluctant population, the state is dissolving some of its mass sites and reapportioning those doses directly to smaller communities, where people may be less willing to drive a distance to get their shot.
Wild Health’s partnership with FEMA is part of that shift. In the coming weeks, the clinic has plans to park its mobile vaccination units in church parking lots, at state parks, campgrounds, community centers and at malls across western, southern and eastern Kentucky.
Some of those areas fall within the Lake Cumberland District Health Department’s 10-county coverage area. Director Shawn Crabtree, who hasn’t heard from Wild Health but knows they’re working to vaccinate people in his district, said he’s all for it. His department, like many others, is struggling to push out its weekly allocation of doses.
“If they can come in and get a bunch of people to show up, I’d be thrilled,” Crabtree said Monday of Wild Health. “It’s not like we’re competing with each other. Together, we’re all trying to entice people to get vaccinated.”
That’s how Dawson and Murray see it, too — a piecemeal effort with a singular goal.
“We started Wild Health to solve a problem that we thought was not being solved” by the traditional health care industry, Dawson said. “I think the COVID-19 testing and vaccinations are just an outgrowth of that: it was another problem we thought was not being solved quickly enough, and we saw that we could help solve it, so that’s what we did.”
