Hendrickson’s concerns about Loyal Source included what he described as 40 percent staffing deficits, employees working without proper clearances and licenses, and billing errors resulting in overpayments of millions of dollars, among other issues, according to his attorneys.
“Mr. Hendrickson is now blowing the whistle to Congress with the hope that his evidence will prompt urgent investigation into the gross mismanagement, waste of taxpayer funds, and indefensible failures in the provision and oversight of mandated medical services to noncitizens in CBP custody,” Andrea Meza, an attorney with the nonpartisan Government Accountability Project, said in a statement to The Washington Post.
The organization, which defends federal whistleblowers, sent the 20-page letter to the Democratic and Republican leaders of the Senate Judiciary Committee, the Senate Homeland Security and Governmental Affairs Committee and the House Homeland Security Committee. The letter provides a timeline of Hendrickson’s attempts to draw attention to what he viewed as urgent problems with Loyal Source’s performance.
Hendrickson’s lawyers told lawmakers that their client had tried since January 2022 to get CBP to issue Loyal Source a warning notice seeking immediate improvements in areas such as record keeping and urgent care practices, but his efforts were repeatedly thwarted by his supervisors in the contracting office.
The letter urges lawmakers from both parties to conduct oversight of Loyal Source and the CBP contracting office, and to take steps to strengthen protections for other CBP or Loyal Source whistleblowers who risk losing their jobs by coming forward.
CBP contracting officials have selected Loyal Source as a finalist for one of the largest contracts in the agency’s history. The repeatedly delayed contract selection process and an ongoing investigation into the child’s death have exacerbated long-festering strains between CBP medical officials and the CBP contracting office that oversees Loyal Source, according to Hendrickson’s timeline and other CBP officials who spoke on the condition of anonymity to describe the tensions.
The Florida-based company provides care and medical screening for the thousands of migrants taken into CBP custody daily along the U.S.-Mexico border, where many people, including children, arrive sick or injured from their journeys. The company staffs U.S. border facilities under a $25 million-per-month contract extension because CBP has been unable to finalize a new deal.
Senate Judiciary Chairman Richard J. Durbin (D-Ill.) said in a statement Thursday that Hendrickson’s allegations raised serious concerns and pledged to investigate.
Sen. Gary Peters (D-Mich.), the chairman of the Senate Homeland Security and Governmental Affairs Committee, said he was “deeply alarmed” by the letter and would press CBP to respond to the whistleblower claims.
“We must protect the health and safety of all individuals in U.S. custody, including by ensuring they have access to quality health services when needed,” Peters said in a statement.
Hendrickson, a veteran contracting official, was assigned to work with CBP’s Office of the Chief Medical Officer (OCMO) soon after it was created in 2020 following the death of several children in U.S. Border Patrol custody, according to the letter. When Hendrickson began reporting problems with Loyal Source’s performance, with the backing of CBP’s senior medical officials, he clashed with his supervisors in the CBP contracting office who defended Loyal Source, the letter states.
“Tragically, a year after Mr. Hendrickson was removed from the [contract office] position, on May 17, 2023, 8-year-old Anadith Reyes Alvarez died while detained in a CBP facility after her mother’s repeated pleas for medical care to Loyal Source staff,” the attorneys wrote. “Had Mr. Hendrickson’s and his OCMO colleagues’ concerns about Loyal Source been addressed in 2021 or 2022, Anadith might still be alive.”
Hendrickson’s attorneys denounced what they described as specific “areas of wrongdoing” witnessed by their client during the past three years, including “shocking deficiencies” in oversight of Loyal Source and the company’s provision of medical care, a failure by CBP contract officials to heed the warnings and concerns of CBP medical officials, and “unlawful retaliation” against Hendrickson.
Erin Waters, a spokesperson for CBP, said in a statement the agency “takes its obligations to investigate whistleblower allegations seriously.”
“CBP remains committed to ensuring that contract oversight – and the procurement process writ large – are conducted correctly and with the utmost integrity and professionalism,” Waters said. “CBP is dedicated to the ongoing review and evaluation of our practices to ensure that all individuals in our custody receive the best care possible.”
Loyal Source declined to respond to Hendrickson’s allegations, saying the company is prohibited from replying to media inquiries under the terms of its CBP contract.
The CBP medical contract has been a source of frustration among senior officials at the agency for at least a year. CBP tried to hire a competitor of Loyal Source in September 2022, but Loyal Source and others filed administrative protests alleging unfair treatment, triggering repeat delays. Loyal Source’s most recent protest, filed Nov. 3, is awaiting a ruling by the Government Accountability Office, the federal entity that adjudicates contract procurement disputes.
The delays have left CBP in a bind, as the agency continues to rely on Loyal Source even as the CBP investigators have found significant problems with the company’s staffing levels, financial management, medical record keeping and patient safety.
Loyal Source’s contracting protests have rankled senior CBP officials who are eager to hire a different company but also say there is no other medical-services firm large enough to quickly replace Loyal Source at a time when migration is at record levels and the government can’t afford interruptions in care.
On Aug. 10, CBP issued a warning to Loyal Source, known as a cure notice, demanding immediate fixes to the company’s record-keeping and reporting practices, its urgent-care protocols and other company practices.
It wasn’t until Anadith died that the agency took action, according to the letter. The CBP investigators probing her death determined Loyal Source staff mishandled medical records showing the child had a heart condition and sickle cell anemia, failed to seek help from a physician and disregarded her mother’s pleas for urgent care.
CBP responded to the death by reassigning its chief medical official and placing the office under the supervision of Alexander Eastman, a senior medical official at the Department of Homeland Security.
Hendrickson’s lawyers told lawmakers that officials in the contracting office have been soft on Loyal Source despite red flags.
The company regularly staffed border facilities with lower-paid medical aides or paramedics, instead of doctors and nurses, and Hendrickson’s attorneys said he organized an emergency meeting at CBP in January 2022 to alert contracting officials that the company was running entire shifts at CBP facilities “where no provider is available at all.”
When Loyal Source told CBP it was having problems with staff retention and asked the agency for more money, Hendrickson began investigating the company’s pay scales, according to the letter. “Through his research he learned that Loyal Source was paying employees under market rate, but Loyal Source’s overhead and profit margins were disproportionately high,” it said.
Two current Loyal Source employees interviewed by The Post have also cited low pay and a lack of bonuses for remote postings as the main source of the company’s staffing shortages.
Some of Hendrickson’s claims are related to alleged financial mismanagement and waste. In the spring of 2022, the company sought $1.6 million in additional payments from CBP, saying it had made invoice mistakes and accounting errors, according to the letter.
Hendrickson suggested at the time that CBP try to negotiate a reduced payment.
“He thought it was gross waste to pay a contractor additional funds when their expenses were already high and they were very clearly failing to meet the required contract terms,” the letter states. CBP eventually paid the company the full amount, but according to Hendrickson’s letter, CBP investigators have opened a fraud inquiry into Loyal Source’s billing discrepancies.
After the invoicing dispute, Hendrickson clashed again with his supervisors in spring 2022 when he rated Loyal Source’s performance negatively using the government’s established grading system for contractors.
Hendrickson’s letter says he was backed by CBP medical officials, but the contracting office removed him from his position and changed the company’s evaluation to “exceptional” and “very good.” Hendrickson told CBP’s internal affairs division he thought the negative evaluation was being changed to allow Loyal Source to bid for the new medical contract, according to the letter.
Three months later, CBP medical officials tried to assign Hendrickson to help oversee the selection process for the new contract, but the contracting office blocked his appointment, according to the letter.
More recently, as CBP prepared to select finalists for the $1.5 billion contract, the contracting office picked Loyal Source, overruling the recommendations of a CBP advisory board that did not believe the company should qualify, according to three CBP officials who spoke on the condition of anonymity to discuss the sensitive procurement process.
