AUSTIN — A little-known, Frisco company whose owner has lofty goals to buy the Dallas Cowboys has won a $295.3 million state contract to track down Texans potentially infected with the coronavirus, though both Republican and Democratic lawmakers raise questions about the business’ ability to do the job.
MTX Group Inc. won the 27-month contract in a whirlwind bidding process, beating out 10 mostly big-name corporations, such as IBM, AT&T Global Business Services and Accenture LLP.
The comparatively tiny Frisco firm agreed to manage an ambitious, state-led effort for contact tracing, which public health experts say is vital to containing the spread of COVID-19. The push, entirely paid for with federal dollars, aims to detect who has been exposed to people infected with the virus; monitor such people for symptoms; and instruct them how to get tested and where, according to a copy of the contract obtained by The Dallas Morning News.
While the biggest deal MTX Group snared before its new Texas gig carried only about one-sixth the price tag, the SalesForce app developer is on the hook to create a virtual call center before the end of this month and eventually hire, train and staff it with as many as 1,000 contact tracers.
The company also will coordinate its tracers’ work with that of up to 4,000 others hired by state and local health departments, public universities and nonprofit groups, said Chris Van Deusen, a Department of State Health Services spokesman. MTX Group already has a web-based tool it developed this year for COVID-19 contact tracing that has been deployed in several states. One Fort Worth epidemiologist questioned whether MTX’s tracing plan incorporates enough time to conduct what can be complex interviews.
On Wednesday, company founder and chief executive Das Nobel, who moved to Frisco from upstate New York early last year, declined to comment.
Nobel, who has spoken of rapidly building a huge company and eventually buying Jerry Jones’ NFL franchise, the most valuable sports franchise in the world, directed reporters’ questions to the state’s public health agency.
The effort to contain the disease collides with concerns from staunchly conservative activists in the Texas GOP, who are concerned about “Big Brother” type government intrusion on citizens. In recent days, some have raised alarms about the new contract.
Nobel, in a promotional video about contact tracing, said MTX Group has the answer.
“We have a legal team that we put our minds together to really look at what’s going to work, how do we ensure privacy,” he said. “And that’s exactly what our contact tracing has enabled, and [is] having a tremendous success in about 17 states as part of the COVID-19 response.”
While the company’s proposal offered an option for “proximity-based contact tracing” through Google and Apple, the state declined, Van Deusen said.
Earlier this week, department commissioner John Hellerstedt said the company will offer its app to other partnering entities, such as the state, local public health departments and universities, that will hire the bulk of the contact tracers.
Sen. Angela Paxton, a McKinney Republican whose district includes part of Frisco, is among senators skeptical of MTX Group’s readiness to lead such a massive effort – needed to save lives but also protect Texans’ privacy.
“Performance review is a routine and critical part of vetting vendors who bid for state contracts,” Paxton said in a written statement.
“The Legislature expects [the department], like any state agency, to have explored the vendor’s ability to meet contractual obligations by conducting a rigorous performance review during the vetting process,” Paxton said. “Whether they did or did not, and if their findings support the vendor’s ability to perform such large-scale services for the state of Texas, are questions that deserve straightforward answers.”
‘Tons of questions’
Sen. Paul Bettencourt, R-Houston, said lawmakers “have tons of questions.”
Many legislators feel they should have received advance notice that so large a contract was being awarded so fast, said Bettencourt, a member of the budget-writing Finance Committee. But they were not notified before the contract was signed May 13, just 16 days after Gov. Greg Abbott announced the contact tracing effort as part of his plans for reopening Texas businesses.
Some worry that laws to improve contracting that were passed a few years ago were trampled, he said.
“It was a request for proposal,” he recalled. “In two days, it was returned. In less than a week, it was awarded. And there is no legislative oversight on this.”
Though The News obtained a copy of the contract Wednesday, several senators said they’d received theirs under a “legislative privilege,” and couldn’t discuss it in detail.
Sen. John Whitmire, a Houston Democrat who’s the longest-serving senator, though, stressed that to quell the pandemic, contact tracing has “got to be done right.”
Speaking of MTX Group, Whitmire said, “It’s a relatively new company — so it’s actually hard to do your due diligence on a company that just kind of showed up and got a contract of this magnitude.”
Over four years, MTX grew from roughly three employees to a $10 million company with a 200-person workforce, according to a 2019 article in the legal trade publication Vanguard. Roughly 150 of the company’s employees are based in India, the article said. A majority of the businesses’ customers are public entities, it said. But whether the client is government or for-profit, MTX Group’s forte has been integrating a sales-tracking tool into their existing IT systems or customizing the software. In Kentucky, that involved using SalesForce to track liquor licensees.
Sherry Sylvester, a spokeswoman for Lt. Gov. Dan Patrick, said the department “did not review this issue with our office or the Senate. We are looking into it now.”
Van Deusen, the department spokesman, though, said MTX Group “had the best bid and the best cost. We looked at their track record. We were impressed by what they had done. They’ve done contact tracing in other states.”
Of the 11 bidders, seven bids “qualified for scoring” and two emerged at the top, Van Deusen said. Of those, the bid by MTX was for a “substantially lower cost” and offered a more seamless integration with the state’s existing contact tracing system.
Hellerstedt “is adding a group within the department that will manage all aspects of the program,” Van Deusen said. “Call tracers are being hired and supervised by individual organizations, like universities and nonprofit groups, and MTX will bring those workforces together with the training and technology to do the work,” he said. MTX Group could hire as few as 500 tracers of its own, which would bring the contract’s total cost down to $180 million, he said. The contract runs through August 2022, although the state and MTX Group could agree to extend it for an additional two years.
John Wittman, a spokesman for Abbott, said lawmakers gave the department authority to negotiate and sign contracts.
Abbott not ‘a party’ to contract
Abbott appointed Hellerstedt and Phil Wilson, the acting executive commissioner of Texas Health and Human Services who signed the deal with MTX Group.
Still, Wittman said Abbott was not a “party to any contract with MTX.” The department, though, followed the protocols established by the Legislature when entering into this contract with MTX, Wittman and Van Deusen said.
The company is supporting contact tracing call centers in New York, New Mexico, Oklahoma, Georgia, New Hampshire, Vermont and Illinois, Van Deusen said. It has built an app that allows people to enter their symptoms and receive guidance on whether to be tested.
The project most similar to what MTX Group is launching in Texas is in New York City, where it’s building a virtual call center from the ground up, Van Deusen said. That includes setting up the call center technology, training staff, onboarding people into the call center systems, developing scripts, workflows for reaching out and following up on contacts and workforce management and scheduling. The contract is worth $45.94 million, but none of the funds have been spent to date, according to city records. A spokeswoman for the New York City health department did not respond to a request for comment.
In a video on his LinkedIn page, Nobel recently announced the company’s plan to hire 25,000 call center agents across the country, all of whom can work from home.
If “you lost a job, or [are] in college looking for an internship, you all can participate in this,” he said. “We look forward to talking to you and helping each state as part of their reopening strategy with the call center contact tracing solutions.”
It’s not clear if those positions are part of the Texas contract. The agreement allows MTX Group to collect $34.50 an hour for contact tracers, and $35.65 an hour for case investigators. That doesn’t mean the company’s paying workers at anywhere near those hourly rates, though.
The company’s proposal estimates the calls to contacts will last roughly 10 to 15 minutes each. Public health experts, however, said while some calls may be that short, others can take much longer if people have questions or are already showing symptoms.
“It’s so important to build a decent rapport with people, even contacts,” said Diana Cervantes, an epidemiologist at the University of North Texas Health Science Center in Fort Worth.
Bettencourt, the Houston GOP senator, noted that the contracting arm of the giant Health and Human Services Commission — of which Hellerstedt’s department is just a part — has botched several huge procurements over the past 15 years.
They include Accenture’s problem-plagued “integrated eligibility” contract for call centers to screen low-income Texans applying for safety-net programs (2005-2006), Austin-based 21CT’s $110 million Medicaid fraud-detection contract that was awarded without any competition (2014) and problems during Abbott’s tenure as governor with spreadsheets used to score bids for massive health insurance contracts.
“It just feels like the agency is Groundhog Day, that we’re repeating ourselves” with the MTX Group deal, Bettencourt said.