By the end of this month New Jersey will have paid nearly $26.6 million to the consulting giant McKinsey & Company for its help in developing a pandemic response plan, collecting and analyzing reams of data, shoring up long-term care facilities, building out the state’s contact tracing process and rolling out the COVID-19 vaccine program.
With far fewer employees than in years past, the state has not been able to do all the work in house, officials note, and they are now seeking to fill some of the gaps.
This includes Gov. Phil Murphy planning to spend an additional $1.37 million for disease surveillance and data collection, reporting and analysis within the state Department of Health’s Communicable Disease Service, an office that has played a key role in the response to the pandemic.
State health commissioner Judy Persichilli told lawmakers during a budget committee hearing Wednesday that this funding would allow the DOH to create a new unit that would build on the work done by analysts in the department, and more effectively coordinate and study data.
“We’ve never had a centralized hub, so we’re developing one. To me, it’s one of the biggest weaknesses that the department had when we started this pandemic,” Persichilli told the members of the Assembly Budget Committee during its review of the health department’s proposed $1.04 billion spending plan for the 2022 fiscal year, which begins in July.
More in-house analysis
“Over time, as technology has evolved, the needs of the Department have evolved,” said DOH spokeswoman Dawn Thomas. “With this investment, we are aiming to create a holistic system that provides a broad view of the health needs across populations.”
From predicting hospitalization trends to calculating the pace of the virus’ spread to collecting and posting scores of metrics on the state’s COVID-19 dashboard — one of the most public-facing aspects of its pandemic response — New Jersey has relied heavily on data analysis since the first case appeared in early March 2020. But the DOH, like other state agencies, has been downsized significantly over the years, forcing officials to shuffle existing staff, tap external advisers and hire consultants to handle the extra workload.
That led the state to tap McKinsey, the New York-based consultants, which had been hired in the past by the Murphy administration for various roles. According to documents provided by health officials, the state Office of Emergency Management — which worked alongside the health department to lead the pandemic response — signed its first pandemic contract with the consulting giant in late April 2020 for three months of work at a cost of nearly $5.5 million. That was followed by a $7.8 million, six-month deal for August through December, and then a third agreement for $13.3 million that runs through April 30.
Different contracts with McKinsey
According to the initial contract, McKinsey was called on to help the state create plans for safe reopening, enforcing COVID-19 restrictions and assisting the private-sector response; it also called for the consultants to identify, collect, analyze and report multiple public health metrics to enable the state — and its citizens — to navigate the pandemic. The second contract called for McKinsey consultants to help implement long-term care reforms — which had been identified as necessary by a separate consultant — and expand the state’s struggling contact-tracing program. The third deal added vaccine rollout assistance to McKinsey’s list of duties.
McKinsey is also consulting for several other state agencies, according to northjersey.com, which reported the state plans to pay the company nearly $35 million over four years for its work, which includes aspects of the COVID-19 response. Murphy criticized the company’s role in the opioid epidemic as “appalling” and “offensive” following a New York Times report late last year that linked the consultants to Purdue Pharma’s aggressive past marketing of OxyContin, an opioid, but Murphy has also defended the work McKinsey has done for New Jersey.
The Murphy administration’s heavy reliance on consultants like McKinsey — and the underlying government staffing issues — raised questions for members of the Assembly Budget Committee on Wednesday. Assemblywoman Serena DiMaso (R-Monmouth) noted a “good amount” of data analytics had been outsourced and asked Persichilli what lawmakers could do to help.
“Do you need more staff? It’s a budget question. Do you need more people with expertise?” DiMaso said.
“You could help by passing the budget,” Persichilli said. “The money is in the budget.” Murphy, a first-term Democrat running for reelection, has outlined a nearly $45 billion spending plan for the coming year, which lawmakers must approve by July 1.
Hiring challenges during pandemic
Assembly Budget Committee chairwoman Eliana Pintor Marin (D-Essex) also pressed Persichilli on the health department’s staffing levels. “Your department right now is critical. You are the one that is giving guidance to the governor and his team on what to do next” in terms of COVID-19 strategies, “and we want to make sure you have the resources you need moving forward.”
Persichilli conceded that hiring new staff has been a challenge during the pandemic, especially under the state’s “laborious process,” but said her department is making progress to add personnel. “We’re getting the job done,” she said.
According to the governor’s proposed budget, the DOH had 548 staffers at the start of the 2020 fiscal year — 27 fewer than the previous year. The department plans to add 143 employees during fiscal year 2022 at a cost of about $1 million in new salaries and benefits, an expense that would be covered by a mix of state, federal and other dollars. These workers would be deployed to a mix of programs, with the largest staffing increases in family and public health programs.
Included in the new funding for the communicable disease service is $575,000 dedicated to hiring staff and acquiring new software to support the new centralized analytics hub, according to Thomas, the DOH spokeswoman.
“The central analytics hub will enable integrative, responsive data analysis at the department,” Thomas said. “The department has individuals who analyze data, but much of this work is focused on diseases/conditions and health care quality reporting requirements, we want to build upon these efforts and integrate our data systems.”