Market Overview

AHF Files Lawsuit Against King County Dept. of Health Over Flawed AIDS Funding Grant Process


Healthcare Foundation (AHF)
, the largest global AIDS organization
and largest provider of HIV/AIDS care in the United States, has filed a
lawsuit against the King County Department of Public Health over what
AHF asserts is the flawed Request for Application grant application
process and its subsequent award of Ryan White grants for HIV/AIDS care
and services in Seattle. Through its lawsuit, filed Friday, March 17,
2017 in the Superior Court for the State of Washington in and for the
County of King, (Case #17-2-06620-6 SEA), AHF seeks the court's
intervention to overturn recent Ryan White grant awards made by King
County in several categories, including the ‘non-selection' of AHF in at
least two categories in which AHF was the sole bidder or respondent to
the County's Request for Application (RFA) process. Ryan White grants
are largely pass-through grants from the federal government that provide
funding to community-based organizations such as AHF to support the
provision of medical and support services to low income people with HIV.

In its Motion for a Temporary Restraining Order against the
Department of Public Health, AIDS Healthcare Foundation asserted that:

"… local administrative agencies may not burden or restrict
competition in the award of federal funds under the Ryan White program
by ‘[p]lacing unreasonable requirements on firms in order for them to
qualify to do business, … [o]rganizational conflicts of interest,' or
through ‘[a]ny arbitrary action in the procurement process'."

AIDS Healthcare has a well-grounded fear of an immediate invasion of
its rights to an objective, impartial, and fair review of the proposal
it submitted under the September 2016 RFA due to several material
irregularities that provided substantial advantages to competing

AIDS Healthcare also added in its TRO Motion that:

"…two of the four reviewers in the Psychosocial Support Services
category [in which no grants were awarded—and in which AHF was the sole
applicant] stated that they had conflict of interest due to professional
relationships with competing applicants."

In its accompanying Complaint for Injunctive Relief, AHF formally
petitioned the Court:

" … for an order directing the Department of Public Health (‘Public
Health') to (1) enter into contracts with AIDS Healthcare Fund (‘AIDS
Healthcare') for the six categories of HIV-Related Care Services for the
Seattle Transitional Grant Area dated September 15, 2016 for which AIDS
Healthcare submitted applications or (2) enter into contracts with AIDS
Healthcare for the two categories of HIV-Related Care Services for the
Seattle Transitional Grant Area dated September 15, 2016 for which AIDS
Healthcare was the only applicant to submit applications. Alternatively,
AIDS Healthcare requests that this Court grant both preliminary and
permanent injunctions to prevent Public Health from entering into any
contracts with applicants based upon Public Health's Request for
Applications (RFA) for HIV-Related Care Services for the Seattle
Transitional Grant Area dated September 15, 2016."

Background on AHF's Ryan White (RFA) Grant
Application Experience in King County

On September 15, 2016, King County announced and opened its request for
application (RFA)
process for its latest Ryan White grant cycle, which began March 1, 2017.

By October 11, 2016, AHF submitted applications to the King County
Department of Health for Ryan White grants to provide HIV/AIDS care and
services in six program categories: psychosocial support services;
medical transportation; Minority AIDS Initiative (MAI) early
intervention services; non-medical case management services; outreach
services; and outpatient ambulatory medical treatment adherence. The
approximate value or amount of these six grants was $169,000.

On December 29, 2016, King County's Ryan White Program Manager Kate
informed AHF that the health department's grant review
committee rejected all six of AHF's applications.

  • January 3, 2017 - AHF files for an appeal protesting the
    "non-selection" of its RFAs.
  • February 21, 2017 - AHF files a supplementary
    to its protest of "non-selection."
  • March 1, 2017 – New Ryan White grant year commences.
  • March 13, 2017 – King County Department of Health informs AHF that it
    has rejected
    AHF's appeal

King County Health Dept. Audited, Fined $2M by
HRSA Over Earlier Mismanagement of Ryan White

In addition to its current lawsuit, AHF is also accusing the Department
of Public Health of being a poor steward of federal HIV/AIDS funds. For
the period between 2011 and 2013, the Public Health Department was
audited by HRSA (the overseer of Ryan White funding), which found $5
million in questionable costs that had inadequate documentation
supporting its Ryan White expenditures. While it appears that these
issues compelled King County to return approximately $2 million to HRSA,
the health department has yet to account for the entire period in

Background on AHF and its Involvement with Ryan

Established in 1987, AIDS Healthcare Foundation (AHF) is the largest
HIV/AIDS service organization in the world. Domestically, AHF operates
medical clinics, HIV specialty pharmacies, HIV managed care programs,
and HIV prevention, testing, and education services in 16 States and the
District of Columbia, including over 24 metropolitan areas like Seattle
receiving funding under the Ryan White CARE Act.

Since 2012, AHF has served thousands of clients in King County, and has
partnered with local community based organizations to augment the local
response to HIV/AIDS and reach many more in need of services. After
making substantial local investments as well as commitments in staff,
facilities and partnerships, AHF responded to the RFA with a series of
modest proposals to further strengthen the local response to the

In the United States, the HIV/AIDS epidemic is predominantly driven by
people who are unaware they are infected, or are aware of their status
but are not in regular care. Without access to regular care and
antiretroviral medication, people with HIV/AIDS are sicker, and
unwittingly infectious. Getting people aware of their status, into
regular care, and adherent to a medication regimen are the keys to
reducing new infections and stopping the epidemic. The purpose of the
Ryan White CARE Act is to expand services and points of access to care,
which makes the health department's decision to unfairly exclude AHF so
bewildering, especially in light of the recent HRSA audits of the
Department of Public Health.

"As it does when AHF begins providing services in a new area, we built
our services in King County a number of years before Ryan White
contracts were available for bid. We did so in order to first establish
relationships and alliances with other service organizations, to
determine need and augment existing services, and to become part of the
network of care providers in the area," said Jonathan Petrus, AHF
Chief/National Bureau & Investment
, who supervises domestic
operations in regions that include King County. "Just as we have done in
other geographies, AHF invested substantial amounts of our own resources
locally. Our goal is to reach those people and areas of King County
still in need of services, which, of course, is the primary purpose of
the Ryan White CARE Act."

According to the 2016
Epidemiology Report for Washington State and Seattle/King County
, at
the end of 2015 there were 7,071 people living with HIV or AIDS in
Seattle/King County and 13,021 people who have been diagnosed with HIV
in the state of Washington.

AIDS Healthcare Foundation (AHF), the largest global AIDS
organization, currently provides medical care and/or services to over
707,000 individuals in 38 countries worldwide in the US, Africa, Latin
America/Caribbean, the Asia/Pacific Region and Eastern Europe. To learn
more about AHF, please visit our website:,
find us on Facebook:
and follow us on Twitter: @aidshealthcare
and Instagram: @aidshealthcare

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