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High-Tech Healthcare in Iraq, Minus the Healthcare

by Pratap ChatterjeeSpecial to CorpWatch
January 8th, 2007

Cartoon by Khalil Bendib

The convoy of flat-bed trucks picked up its cargo at Baghdad International Airport last spring and sped north-west, stacked-high with crates of expensive medical equipment. From bilirubinmeters and hematology analyzers to infant incubators and dental appliances, the equipment had been ordered to help Iraq shore up a disintegrating health care system. But instead of being delivered to 150 brand-new Primary Health Care centers (PHCs) as originally planned, the Eagle Global Logistics vehicles were directed to drop them off at a storage warehouse in Abu Ghraib.

Not only did some of the equipment arrive damaged at the warehouse operated by PWC of Kuwait, one in 14 crates was missing, according to the delivery documents. The shipment was fairly typical: Military auditors would later calculate that roughly 46 percent of some $70 million in medical equipment deliveries made to the Abu Ghraib warehouse last spring had missing or damaged crates or contained boxes that were mislabeled or not labeled at all.

Not that it really mattered. Just over three weeks before the April 27th delivery, the U.S. Army Corps of Engineers had canceled the construction of 130 of the 150 PHCs for which the materiel was intended. As a result, the equipment that could help diagnose and treat Iraqi illness (and escalating bomb or gun injuries) now sits idle waiting for someone to figure out what to do with it.

Even if the equipment finally makes it through the bureaucratic logjam, lack of trained personnel to operate it, especially outside major cities, will severely limit its utility. The Army Corps had written a 15-day training plan into the contract, but over time, this had been whittled it down to ten and then to just three days. Iraqi Ministry of Health officials have given up hope that any training at all will accompany the sophisticated equipment.

But if Iraqis have failed to benefit from the idle PHCs, the $70 million contract to supply them has been a shot in the arm for Parsons Global. The Pasadena, California-based engineering company reaped a $3.3 million profit according to an audit report issued by the Special Inspector General for Iraq Reconstruction (SIGIR), an independent U.S. government agency. And that is in addition to the $186 million that U.S. taxpayers shelled out to Parsons to build dozens of clinics that have yet to dispense a single aspirin.

While the new buildings remain uncompleted and millions of dollars worth of expensive equipment are stored under lock and key, a dwindling number of doctors at existing hospitals perform operations without basic supplies of disinfectant and anaesthesia. A severe shortage of nurses further imperils patient care.

This failed planning and wasted money has been a hallmark of the last three years of healthcare in Iraq. Today the country faces a medical crisis that many say exceeds conditions under sanctions. Compounding this crisis is the violence that creates a steady flow of seriously injured victims.

One Hospital, Two Tales

While militias and the U.S. military struggle for control of Iraq’s central al-Qadisiyyah Province, civilians in the city of Diwaniya  struggle to find basic health care and simply stay alive. Set in the heart of Iraq’s richest agricultural lands, Diwaniya should be a center of prosperity and trade: It straddles a branch of the Euphrates river and is served by the main Baghdad to Basra railroad.  But war has turned these advantages into targets.

The state of health care reveals much about the impact of the occupation and the war on the long-suffering population. With up to 1 million people, Diwaniya has just one small state pediatric and maternity hospital. It is one of 18 hospitals that the U.S.-based construction and engineering firm Parsons was contracted to rebuild for just over $4 million.

With offices in 14 countries and in twice that many in U.S. states, Parsons claims 2005 revenues exceeding $3 billion. On its web site the company pledged to “elevate” the hospitals “to international standards.”

Dr Ali Fadhil, an Iraqi doctor turned journalist, described a different reality in his testimony before a Congressional committee this summer: “I would first like to say that Parsons bears the most responsibility for the poor quality of work. But other bodies observed Parsons' work, and all of them are partially responsible for observing and evaluating the work done by the local Iraqi firms. These bodies are the Project and Contracting Office (PCO) in Diwaniya and the Army Corps of Engineers.”

A year earlier, a September 2005 article in a Army Corps of Engineers publication cited the Diwaniya hospital is as an example of how happy local people are with the U.S. rebuilding effort and quoted Barry Stuard from the Corp’s Arkansas office, who said that a local sheik tracked down American soldiers just to express appreciation.

But just months after the article appeared, Fadhil, a Fulbright Scholar, had taken his cameras to the hospital. He filmed two-days-old premature twins, Zahara and Abbas, struggling for life in a hospital that had neither the equipment nor the drugs they needed for survival.

“Zahara is in a particularly bad way,” Fadhil narrated in his documentary Iraq’s Missing Billions. “She needs a ventilator and drugs to help her breathe, but the hospital has virtually nothing. Her father has gone into town to buy vitamin K on the black market, which he has been told his children will need. Zahara starts to deteriorate and in desperation the doctor holds a tube pumping unregulated oxygen against the child's nostrils.”

Both children died during the filming. “How is it possible,” Fadhil asks, “that after three years of occupation and billions of dollars of spending, hospitals are still short of basic supplies?” (Parsons did not respond to this or any other questions put by CorpWatch)

Despite its pledge to “work very closely with the Iraqi Ministry of Health and the SPMO” (Sector Program Management Office) on the clinics, Fadhil says that Parsons did not ask the hospital staff and officials about their needs. This lack of consultation, ministry officials say, resulted in random refurbishment of the hospital wards and little improvement in the hospital's efficiency or ability to manage a growing patient population.

Out of this money, Parsons reportedly paid $1 million to Lebanese sub-contractor Malik Faqih to provide security and cleaning services for the hospital, says Fadhil. Among the visible results of this "Phase 1" of construction is a thick ribbon of razor wire atop a fence and some basic cleaning services. But as Fadhil’s film reveals, $4 million later, the hospital remains a mess.

A shortage of workers resulted in low quality work, long periods when doctors and medical staff could not enter the hospital, and dangerous conditions for patients. Hospital statistics document that deaths among children have actually risen since the start of reconstruction, while the doctors blame overcrowding caused by a decrease in available beds coinciding with a huge influx of patients over the last year.

Parsons' local subcontractor patched rather than fixed the hospital's weak and cracked roof, which still leaks, making damage to floor, ceiling, and walls likely. The paint job Parsons did inside the hospital is already cracking off and the water-permeable flooring allows mold to grow underneath. Toilets it installed already broken and even lighting is deficient, with non-functioning bulbs and melted plastic shades.

Fadhil says that his research shows that Parsons subcontracted with two Iraqi companies - Mansour Company for an oxygen factory and with Dhifaf Al-Nahrain for generators. But Parsons did not, as its contract mandated, train the medical staff on how to use, maintain, or repair the equipment. The result is that the oxygen factory and generators now go unused.

The hospital's most significant problem at the moment is its sewer system. Here Parsons made another mistake: It replaced the second floor pipes but left 20-year old iron pipes in the ground floor sewer system. Now, as Fadhil’s documentary clearly shows, many of the hospital's sewer pipes are so clogged that raw sewage bubbles into the hospital's operating room and other critical areas.

Nor has Parson’s tended such essential needs of a maternity/pediatric center as incubators. Most of the hospital’s 17 incubators, date back to the 1970s and are in very bad condition or broken, the documentary reveals.

What We Asked For, We Did Not Get

Days before the equipment arrived in Abu Ghraib, Dr Lezgin Ahmed, general director of planning at the Kurdish health ministry offices, just below the ancient hilltop city of Erbil, northern Iraq, proclaimed his frustration with the U.S. plan to fix the Iraqi healthcare system to this reporter.

"They told us that they had money for seven PHCs in Erbil, three in Dohuk. We were asked where they should build them, that's all,” said Dr Ahmed. “We didn't approve it but we accepted it without interference because it was part of the plan for all of Iraq. They simply asked us for the numbers and locations. What we asked for, we did not get," he said, noting that the ministry would have preferred repair of existing facilities.

Six of the 150 PHCs were slated for the western Kurdish region of northern Iraq. In the Brayati neighborhood of Erbil, just five miles from Ahmed’s office, a partially constructed grey building topped with red water tanks, appeared abandoned. The windows and doors were sealed with cinder blocks to prevent intruders after work halted in late March. No construction workers or security guards were to be found. In other cities across northern Iraq, such as Koya and Sulamanya the story was the same: buildings, most lacking even paint, stood abandoned. In Halabja Taza, close to the eastern border with Iran, a security guard at an empty Parsons PHC agreed to talk. Nawshin Shakir Qasim explained that the contractors did a really bad job and the roof was leaking. “The Americans soldiers fired the contractor. Now there is no more money so all the work has stopped,” he said.

Indeed, just two months before my visit, SIGIR inspectors traveled to five PHCs in Kirkuk, northern Iraq, and came to similar conclusions about the quality of the work. The auditors snapped pictures of poorly placed roof beams, honey-combed concrete, walls made of brick fragments held together with plaster, and staircases crumbling into dust even before they were finished.

The SIGIR auditors also questioned Parsons’ progress reports. One building, declared 56 percent complete, was a shell of uneven bricks. Another floor that was balanced on wooden sticks was listed as half complete, according to the SIGIR report.

If health care is in short supply, blame is plentiful. The SIGIR report concludes that a wide range of factors contributed to the failures, ranging from disputes among Iraqi construction companies, poor quality of local materials, and lax oversight by the Army Corps, which conducted "windshield surveys" – hasty drive-by inspections.

The Army Corps blames Parsons. “They failed to adequately plan project schedules to include known issues, resulting in unrealistic, risky construction and purchasing schedules,” wrote the  division' commander, Brigadier General William H. McCoy Jr. “They failed to exercise adequate due diligence to control costs."

And predictably, Parsons blames the Army Corps. In a written reply to the military, the company says that it estimated the job would take two years, but the Army Corps. ordered it to finish the clinics in one year. (The contract was canceled after Parsons failed to complete the job in 25 months.) The company also says that it informed the military that did not have enough supervisory staff to oversee all 150 clinics simultaneously as the military demanded.

In a reply, included as an appendix to the SIGIR report, McCoy counters that Parsons "ignored, or failed to respond adequately to, numerous expressions of concern by the government over these issues, and in some cases failed or refused to provide the government with information that would have allowed the government to make decisions to assist Parsons in regaining control over subcontractor performance and cost," he added.

By the time the contract was canceled on April 3, 2006, Parsons had completed only six clinics. Project managers estimated that another 14 could eventually be completed and equipped.

Meanwhile, some 130 sets of medical equipment, partially damaged, are warehoused at Abu Ghraib, in the hope that someday the project might be completed.

The PHC program "was the most important program in the health sector," Stuart Bowen, the director of SIGIR, told the Los Angeles Times. "It sought to fulfill a strategy to get health services to rural and remote poor in Iraq."

In September 2006, four months after the contract was canceled, Congressman Chris Van Hollen (D-MD) questioned Ernest Robbins, the manager of Parson’s Iraq project: “What is the recourse for the taxpayer under these circumstances? Don't you think that Parsons, given what has turned out to be a very shoddy job, should return some of its profits to the taxpayer”?

Robbins told the Congressional hearing: “No, sir, I will not.”

Iraq’s Health Care System

While some critics focused on the failure to deliver the PHC system, others questioned the whole U.S. approach. Iraq had developed a centralized free health care system in the 1970s using a hospital based, capital-intensive model of curative care. The country depended on large-scale imports of medicines, medical equipment and even nurses, paid for with oil export income, according to a “Watching Brief” report issued jointly by the United Nations Children’s Fund (UNICEF) and the World Health Organization (WHO) in July 2003.

Unlike other poorer countries, which focused on mass health care using primary care practitioners, Iraq developed a Westernized system of sophisticated hospitals with advanced medical procedures, provided by specialist physicians. The UNICEF/WHO report noted that prior to 1990, 97 percent of the urban dwellers and 71 percent of the rural population had access to free primary health care; just 2 percent of hospital beds were privately managed.

Infant mortality rates fell from 80 per 1,000 live births in 1974, to 60 in 1982 and 40 in 1989, according to government statistics. A similar trend characterized under-five mortality rates which halved from 120 per 1,000 live births in 1974 to 60 in 1989. (Later studies have questioned these optimistic Iraqi government figures.)

Najaf Teaching Hospital

“Sometimes change occurs all at once. More often, it proceeds and makes its impact felt at a gradual pace. The latter example is the case for the extensive overhaul taking place at the Najaf Teaching Hospital. Under this venture, rehabilitation efforts focus on the main hospital building and consist of repairing damaged floors, walls, and ceilings; improving mechanical, electrical, and plumbing systems; and upgrading emergency power and sewage treatments”

Army Corps press release, April 17, 2005

“The Najaf Teaching Hospital has transformed from a run down hospital that once harbored militia into a full-time operational outpatient clinic capable of outpatient surgeries and emergency room visits ... Phase two repaired heating, air conditioning, plumbing and mechanical components that serve the hospitals 1st floor, provided security grills on windows, and a vehicle access control gate.”

Army Corps press release, June 7, 2005

"They keep saying there's renovation but, frankly, we don't see it," said Liqaa al-Yassin, director of the hospital, her exasperated face framed by a black hijab, or scarf. "Each day I sign in 80 workers, and sometimes I see them, sometimes I don't." She walks a visitor through the hospital's hot, dim halls, the peeling linoleum on the floors stained by the thousands of lighted cigarettes crushed underfoot. Anxious women, draped in black head-to-foot chadors, or veils, sit in the sultry rooms fanning their sick children. "My child has heart problems, she can't take this heat," pleaded one mother as Dr. Yassin walked past.

“Poor Planning and Corruption Hobble Reconstruction of Iraq,” Craig S. Smith. New York Times, September 18, 2005

With the 1991 Gulf War that followed Iraq’s invasion of Kuwait, the situation changed dramatically. The war damaged hospitals, power generation, and water treatment facilities; foreign nurses left the country; and the health budget was slashed. From US$500 million in 1989, the import budget plummeted to US$50 million in 1991 and then to $22 million in 1995. Spending per capita fell from a minimum of US$86 to US$17 in 1996.


In the eight months following the 1991 war, mortality rates for children under five shot back up to 120 per 1,000 live births, the highest recorded increase for any country in the world in the 1990s, according to the UNICEF/WHO report. (Only 14 countries had an overall mortality increase among young children during the 1990s. Nine of them were in Africa, where HIV infection was the predominant cause of elevated mortality.)

For over-50 year olds, the mortality rate rose from 1,685 per month in 1989 to 6,731 in 1994 according to the UNICEF/WHO report. Iraq’s health care system was accelerating fast in the wrong direction.

The war and the sanctions destroyed the capital-intensive model of free and sophisticated care. Water was often contaminated and the electricity supply erratic, making it difficult to operate the expensive medical equipment. Deaths from diarrhea rose fivefold and malnutrition-related diseases such as respiratory infections became widespread.

From 1996 to 2002, the UN-administered Oil-for-Food program allocated US$4.8 billion for medical supplies and related support. The program’s emphasis on basic health care including vaccination caused a drop in infant mortality. But because the UN program barred cash transfers, Iraqi salaries stayed low and there was no money for training or recurring expenses.

In 1994, hoping to prevent doctors from emigrating, the Iraqi government encouraged private medical practices. Four years later it allowed hospitals to charge some fees. The government also encouraged organizations including the Red Cross and the Red Crescent to build PHCs and help support hospitals.

After the invasion, sanctions were lifted, and the government finally started to earn cash on its oil income, allowing it to raise medical salaries. But the damage to the health care system was hard to reverse. For example, according to the UNICEF/WHO report, Iraq now has more doctors than nurses--an unusual predicament for a poor country—and very few of them specialize in the community or social medicine the country needs.

Today Iraq needs either to initiate a major renovation program to resurrect its old medical system or it needs to switch to a preventative health care model based at primary health case clinics. In the last three years, owing to lack of money and security, it has done neither.

Post-Invasion Planning

The failure by the occupation forces to revitalize healthcare tracks back to immediately after the invasion, when U.S. Agency for International Development (USAID) dispatched Fred “Skip” Burkle to run the Ministry of Health. A doctor with four post graduate degrees, the American had worked in Kosovo, Somalia and northern Iraq after the Gulf War.

He faced a health sector that–like the oil and electricity sectors--was devastated by post-war looting and had lost much of its infrastructure to theft and violence. Some 12 percent of hospitals were damaged and 7 percent looted. Central records were destroyed along with the country’s two major communicable disease laboratories and four out of seven of its central warehouses.

“I spent many months preparing for the invasion of Iraq, for what I expected to be a humanitarian crisis,” Burkle told CorpWatch. “In the decade before the invasion, we saw a decline in every health indicator, which told me what to expect. I’ve been in a number of wars and humanitarian crises where we’ve developed systems over years, and we know how to do this, and how to do this on the run.”

“So I spent my time planning a surveillance system and figuring out how to decentralize it, so that it was not Baghdad-centric. Remember, there were no communication systems between Baghdad and the provinces. I was also concerned about looting, as I had observed this first hand after the first Gulf War, as the first civilian to enter the country.”

Burkle’s suggestions were never implemented. Two weeks after arriving in Iraq,  the White House informed him, he says, that it wanted a "loyalist" in the job and recalled him to the U.S.

More than two months passed before the new Republican appointee arrived. Unlike his predecessor, Jim Haveman was not a doctor, had never lived outside the U.S. and had never taken part in post-war or post-disaster reconstruction, He had a degree in social work, experience as director of community health in the state of Michigan, and was a former director for International Aid, a faith-based relief organization that promotes Christianity in the developing world. He also previously headed up Bethany Christian Services, a large adoption agency that urges pregnant women not to have abortions.

Haveman told CorpWatch that he arrived to find that the ministry was still a mess. “I walked into a situation with two empty 11 story towers, 120,000 employees, 240 hospitals and 1,200 clinics (but the) employees had not been paid for three months. The ministry had a $16 million dollar budget.”

He says he is proud that he got the administrative staff back into the building within 45 days, get the ministry up and running, draw up a budget, completed large-scale immunizations successfully, and respond to disease outbreaks. He believes that he helped the ministry to switch from a prescription-based healthcare system to prevention and primary health care, wrote up a mental health code, implemented new training systems, supported professional groups and worked closely with NGOs and international agencies. (see box for Haveman email to CorpWatch)

Critics acknowledge that Haveman got the ministry building and payroll up and running but say that he focused on the wrong priorities such as rewriting the list of medicines that the state medical company should import. Asked what medicines they were able to buy, Dr Nasser Jabar Sheyal, an assistant to the health minister, told CorpWatch in spring 2004: “We make recommendations but we don’t decide anything. This is an occupied country, not a democracy, and the Americans make all the decisions.”

“The fact is that Kimadia, Saddam’s medical supply bureaucracy created under the UN’s failed oil-for-food program, was so riddled with corruption and bribery that little medication was available,” Haveman wrote later to defend his decision to rewrite the list. “Suppliers received kickbacks and sent expired drugs that were exorbitantly overpriced. Half of the medications on hand were unusable, and some were 30 years old.”

Meanwhile, under orders from Paul Bremer, the U.S. administrator of Iraq, senior doctors and health administrators with decades of experience, were fired because they were members of the Ba’aath party. The ministry was handed over to the Da’wa party, a conservative Islamic group, with little experience in this field.

The party appointed Dr Khudair Abbas, a respected breast cancer surgeon to head the ministry. He started with a disadvantage: Abbas, who had studied in India and practiced in the UK, had not worked in the Iraqi health system since 1979. A year later, after Haveman left, Abbas also quit the ministry.

Documents referenced in this article.





Testimony of Dr Ali Fadhil, Dr Mary Paterson, Dr Richard Garfield to Democratic Policy Committee:


Some Da’wa officials struggled along bravely. Amar al-Saffar, the deputy minister in charge of finance for the health ministry, candidly confessed that he too, was out of his depth. “I was not planning to be a part of the crew at the ministry. I came to serve my party [Da’wa] and I don’t know how I found myself in this ocean, but I have to swim. Unfortunately the current is very strong,” he said. “My only experience is that for six years, I was the executive manager of an optical instruments business in Dubai.”

While many top bureaucrats quit, he stayed on until he was kidnapped in November 2006 from his home in Adhamiya. His fate was unknown at the time of writing.

Meanwhile doctors in Iraq began to resent the expatriates who were given control of the system in which they had labored for so long. Dr Koresh Al Qaseer, president of the Iraqi Surgeons Association, explained that he had a lot of respect for Dr Abbas’s medical expertise, but did not believe that his team knew Iraq’s needs.

"Who are these people who left for 20 years and now think they can run our country? They don't know anything about it, and they don't care,” he said angrily. “Believe me they did not leave because of Saddam, they left to pursue their careers and to make money. We have 35,000 doctors in Iraq, we don't need outsiders to come and run our hospitals but we do need training."

Richard Garfield, a professor of nursing from Columbia University in New York who has visited Iraq almost every year since 1996 as an advisor to UN health adviser, agreed that training was necessary, but he believed that that was just the first step – a fundamental overhaul of the system should have been conducted.

What Iraq needed, he said, was a focus on community health, health education, outreach for basic health promotion programs, and the elaboration of financial management, systems planning, and pharmaceutical administration systems appropriate to a middle-income developing country.

He summarizes the mistakes the CPA made:
* investing in supplying medicines to a system where medicines were used poorly;

* holding short training courses with no supervision or follow-up to teach techniques that were not practiced in the country;

* catering to professional organizations that represented few people; and

* contracting U.S. firms to build hospitals and clinics, few of which were built and fewer still well-utilized.
While the CPA fumbled the health care reform, Iraq’s escalating lack of security halved the number of patients willing to visiting hospitals.  This crisis in care was especially problematic for people with chronic diseases and pregnant women. The accompanying rise in harassment of and violence against women has limited access of health services.

The violence was also directed at doctors, on the assumption that they were wealthy or a part of the strategy of civil war. Since the invasion, 2,000 Iraqi doctors have been murdered and some 250 kidnapped, the Brookings Institute reported in December 2006. Altogether more than half of Iraq’s 34,000 doctors have fled the country, some fleeing to drive taxis in Lebanon.

Abt Associates

The CPA prioritized certain health contractors over others: It awarded UNICEF an $8 million grant and gave the WHO $10 million. But the CPA funneled the big money to private U.S. contractors such as Abt Associates, a Massachusetts-based consultancy, which won a $43-million contract in April 2003 to modernize the Iraqi Health Ministry and provide supplies.

No matter that UNICEF and WHO had been working in Iraq for years, had stockpiled medicines, and had staff ready to go, they were effectively sidelined. The contracting process also completely shut out non-profit groups such as the Red Cross and Red Crescent Society which had decades of experience in Iraq. (see box)

Shutting Out The NGOs

From 1999 until mid-2002, the International Federation of Red Cross and Red Crescent Societies worked closely with the ministry of health, to rehabilitate 34 Primary Health Clinics (PHCs). The non-governmental organizations also supplied basic furniture and medical equipment for 72 PHCs. But things changed after the U.S. invasion in spring 2003 and the CPA took charge.

Hassan Rawi, an architect who worked as relief and rehabilitation manager for the Federation in Baghdad, helped design dozens of PHCs during the sanctions. He told CorpWatch in April 2004, that he stopped working with the ministry after it became clear that the new officials were completely disorganized. "We went to several meetings with them in September 2003 and October but everything changed so often, we gave up," said Rawi.

Muhammed Al-Azawi, the Baghdad director of LIFE, a Michigan based Iraqi-American NGO, one of the biggest relief organizations in the country, was also frustrated when he tried to coordinate with the ministry. "We heard that Bechtel was going to repair our hospitals, but they have not done the job--simply handed it over local sub-contractors who are inexperienced and corrupt." (It needs to noted that the hospital repair contract was not awarded to Bechtel, but to Parsons).

Asked why his ministry would not collaborate with the NGOs, Abdul Wadood Mahmud al Talibi, general director of Kimadia, the pharmaceutical company in charge of importing medicines told CorpWatch in April 2004: “We are the new government here and everything must be approved by us,” he said. “You say that other countries have multiple agencies building health centers? Well, we don’t want to encourage personal profit like under the old regime.”

Later, the U.S. appointed senior health advisor, James Haveman, would recall matters very differently. “We always planned and traveled with the Red Crescent. In fact Dr Hakki who worked with our team went over to be the director,” he told CorpWatch in early January 2007.

Meanwhile the NGOs have persevered. Unlike Parsons and the Army Corps, the Red Crescent has quietly and successfully built and renovated PHCs across the country from Al-Qadissiyah in Basra to Zergele in the Qandil mountains in northern Iraq. LIFE also continues to operate clinics in Baghdad, Basra, Miqdadiyia and is restoring another clinic in Museiab.

But what Abt had was an inside track: Janet Ballantyne, vice president for international development, had joined the company just six months after working as counselor and acting deputy administrator at USAID. She was also USAID mission director for Russia from 1996 to 1999, a position she also held in Nicaragua from 1990 to 1994.

Abt claimed to have considerable experience, having administered nearly $908 million in U.S. government contracts in the previous 12 years. The company website highlights work on programs ranging from AIDS treatment in South Africa, child immunization in Asia, healthcare delivery restructuring and financing in Central Asian republics, to managing clinical trials for AIDS/HIV vaccines in the U.S.

But despite its history and high-level connections, Abt ran into considerable difficulties on the ground in Iraq. Mary Paterson, who had previously worked in the Middle East, was chief of party for the Abt Associates contract.

She quickly clashed with Haveman after criticizing the CPA’s healthcare plan to invest the ministry money in new clinics.

“The main emphasis at the CPA was on reconstruction projects, with the underlying assumption that there was no health infrastructure in Iraq worth preserving and that understanding the existing situation was not important since everything would be replaced,” she told a Congressional hearing in the summer of 2006.

“Mr. Haveman's response addressed to one of my team leaders,” she told the committee: “‘We are done with the corrupt government of Saddam Hussein. Why do we need to study what they had in the past?’ This ideology had the effect of isolating Iraq health experts since they represented the old, obsolete system that no one needed to understand."

Paterson told CorpWatch that a mere $16,000 a month could have restored normal operations at 25 primary health clinics in the Al Karkh district of Baghdad.

“Addressing pressing needs to support existing essential services in existing clinics was a clear priority and could lead to quickly improved services more effectively than large-scale new construction and renovation plans,” she said. “Simple equipment such as stethoscopes, blood pressure monitoring equipment, sterile supplies, essential drugs and vaccines, and basic infrastructure such as generators were needed in most areas, and could have been supplied from existing stocks or from willing donors.”

Haveman asked Abt to withdraw her from Iraq. Paterson returned to the U.S. in August 2003, to find out that she had been frozen out of new work at Abt, forcing her to resign her job. Three more chiefs of party came and went in the next four months, making it impossible to effectively plan or complete tasks.

Over the nine months of its contract, Abt lurched from one project to the next: it held a visioning exercise for ministry staff, it handed out new uniforms for nurses at one hospital, it designed a survey of Iraqi households to better understand “the nature of demand for health care and to identify appropriate strategies for providing primary health care” and then canceled the survey.

Then Abt botched its most important project--providing emergency supplies to existing clinics. It missed its October 2003 deadline by eight months and even then, shipments arrived with items such as cabinets and gynecological exam tables missing or damaged. For example, autoclaves were ordered from a vendor in India that had never manufactured them before.

USAID auditors would later report that “almost every shipment received had some type of problem with the paperwork (i.e., no commercial invoice, no packing list, improper consignment, discrepancies between the quantity of units received and that specified on the packing list).” One of the procurement officials, who worked on the contract, told USAID auditors later that in his almost 20 years of experience with procurement for the agency, he had “never witnessed such a debacle.”

Another major Abt project was a centralized computer-based rapid-response disease surveillance system for Basra and parts of Baghdad. The system relied on telephone reporting to track selected communicable diseases and input real-time data entry and information availability.

This venture went nowhere because, apart from the lack of electricity, hospitals had no working telephone system. Hospital directors were each issued MCI cell phones that allowed them to summon the military, but that could not call ordinary Iraqi telephones. Indeed, the hospitals did not have a working intercom system, let alone pagers. One doctor told CorpWatch that the only way they could communicate --even during emergencies--was by walking, or running, between wards.

It became clear that Abt hadn’t even delivered a working database to support the surveillance system. The ministry of health computer on which the database was loaded had a virus that blocked access. The backup computer disks that Abt provided were in a “read only” format that prevented the ministry from inputting data and keeping them current. The database project was quietly shelved.

Abt staff finally left Iraq in April 2004 when things turned increasingly violent. USAID canceled the contract, after paying out $20.7 million. A USAID audit concluded that: Abt’s “activities did not provide the level of support envisioned under the contract and often offered little, if any, benefit to the Ministry of Health.”

Abt spokesperson Peter Broderick, emailed CorpWatch a response to the USAID audit: “Despite these extremely difficult and dangerous conditions, we are proud of our accomplishments in Iraq. We believe our work and that of USAID contributed significantly to the Iraqi health care system and the development of meaningful reform strategies. We support the only recommendation of the audit in question--that the USAID Mission improve its process for reviewing and approving requests for modification to future contracts.”

USAID did initially decide to hire a follow-up contractor and issued an ambitious $100 million request for proposals. Abt, among others, applied for the new contract. Then mysteriously, USAID first cut the proposed grant to $15 million, and then canceled it altogether.

Asked what USAID was working on now, Harry Edwards, a USAID press officer, told CorpWatch that USAID had completed all health-related projects in October 2006 and handed over responsibilities for the sector to the U.S. Army Corps of Engineers. “The broader National Capacity Development program currently underway provides capacity building activities to various Iraqi ministries which will include the Ministry of Health. A vital component of the program is a "Train-the-trainers" component expected to create an independent self-sustaining capacity building activities within Iraqi ministries,” he added in an email response.

New Technology, Old Problems

Even the repair and expansion of existing health care facilities in safe parts of the country was botched, leaving hospital administrators frustrated by the lack of basic supplies and simple training.

In Sulamanya, a relatively peaceful and prosperous town in Northern Iraq where violence is practically unknown, the engineer in charge of construction at the health ministry told CorpWatch that Parsons promised $29 million to build five new primary health care centers, one new pediatric hospital, and to repair a maternity hospital. The ministry was allowed to select sites but the contractors and USAID determined the design and budget.

Not one of the PHCs in the province has been completed. Engineer Hewa, who was in charge of construction for the ministry, traveled to Baghdad in 2004 to review plans for the new hospital but that was the last time anybody talked about it. Nobody from the Army Corps or the company even visited the proposed site, according to Hewa.

The only thing completed was a new elevator that the Al Monel company installed in the pediatric hospital. During a site visit to the hospital in Sulamanya in April 2006, a security guard showed this reporter the new elevator large enough to fit a hospital bed. It hadn't worked for a couple of days, he said, because local mechanics didn't know how to fix it. The head technician promised to hire a new mechanic who could.

Elevators appear to be Parsons Achilles heel. At the Najaf Maternity Hospital, a New York Times reporter found that only one of the hospital's four elevators functioned while the others awaited repairs.

The company was paid in full in June 2004 to install a new elevator bank at the Hilla General Hospital. When SIGIR auditors visited the hospital three months later, the administrator reported that just a couple days before, a renovated elevator crashed and killed three people.

Parsons did not return CorpWatch’s phone and email requests for comment.

Cancer Hospital Remains Unfinished


Most prominent among the long list of failures is the Basra Children's Hospital, which was intended as crown jewel of U.S. aid to Iraq. Instead, it has become a showcase for everything that went wrong. In August 2004, USAID awarded the $50 million contract to build the Hospital to Bechtel, a San Francisco-based engineering company, one of the largest engineering companies in the world, which has become synonymous with the building of nuclear power plants, gold mines and large projects like the new Hong Kong airport.

The idea was to create a state-of-the-art facility to treat childhood cancer, a pressing need in a city where cancer rates have skyrocketed following the first Gulf War. (Contested data link the rise in cancer to extensive U.S. use of depleted uranium weaponry in the region.)

The facility, championed by the First Lady Laura Bush and Secretary of State Condoleezza Rice, looked suspiciously like a political propaganda effort. And as with much U.S. aid, it was designed with little local consultation: the city lacked clean water and already has a leukemia ward where lack of funding means that each bed is shared by two or three children.

The hospital was planned by Project Hope, a charity headed by John P. Howe III, president of the University of Texas, San Antonio, and a Bush family friend. Project Hope had built similar hospitals in Poland and in China. Howe pushed the project after Rice and Bush invited him to visit Iraq to assess the country's healthcare system.

Before construction began in August 2005, the project attracted skeptics, who were concerned that it was a white elephant. Republican Congressman Jim Kolbe criticized the project: “Why build a hospital for kids, when the kids have no clean water?” the Arizonan asked. But it went ahead: No new technology would be spared in this showcase facility featuring with 94 beds, private cancer suites, CAT scans, a linear particle accelerator for radiation therapy, no.

But like every so many U.S.-initiated projects, the money to build this fancy facility would disappear when things went wrong. A year after the August 2005 groundbreaking, the project became a target for attacks, according to the company. The price tag rose from $50 million to an estimated $169.5 million. Cliff Mumm, president of the Bechtel infrastructure division, predicted that the project would fail. "It is not a good use of the government's money" to try to finish the project,” Mumm told the New York Times. "And we do not think it can be finished."

In July 2006, Bechtel was asked to withdrew from the project, which is now on hold. USAID spokesman David Snider’s cheerful spin on the stall was that the contract did not actually require the company to complete the hospital. "They are under a 'term contract,' which means their job is over when their money ends ... (so) they did complete the contract."

Iraqi officials were angry. "The pretexts given by Bechtel to the Iraqi government to justify its failure in finishing the project are untrue and unacceptable, especially the ones regarding the rise in security expenses," Sheik Abu Salam al-Saedi, a member of the Basra provincial council told the New York Times.

Asked about this comment, Bechtel spokesman Jonathan Marshall told CorpWatch that it was “irresponsible.”

“Given the many tragic deaths suffered by our subcontractors on the project and the evacuation of the area by many international aid workers “ his claim [should not] stand unchallenged,” Marshall wrote in an email response.

Deputy Minister Amar Al-Saffar charges that part of the failure traces back to Bechtel’s decision to hire a Jordanian company to oversee work by local Iraqi construction companies, instead of working directly with the Iraqis. "Our counterparts should have full faith in the Iraqi companies," Saffar told the New York Times, in July, less than four months before his kidnapping.

Marshall agreed that a Jordanian team (Mid Contracting, Universal Hospital Services, and Hospital Design and Planning) had been awarded the sub-contract, but pointed out that the workers were mostly Iraqi.

“We could not find Iraqi firms of equal caliber for this job, although Iraqi subcontractors were, of course, employed extensively,” Marshall told CorpWatch. “Bechtel’s record of hiring Iraqi firms was exemplary. We held major conferences in Baghdad and Basra to inform and recruit Iraq partners. Over the life of the project, we hired Iraqi subcontractors to perform about 75 percent of the work. At peak, our projects employed 40,000 Iraqi workers. Bechtel also trained and employed more than 600 Iraqi nationals on its professional staff.”

Looking Back …

Almost four years after the invasion, CorpWatch asked some of the planners who worked at the ministry about the situation today. All agreed that the health care system was in major crisis and that the security situation was a key challenge. But they were at odds over why things had turned sour.

Burkle, the first ministry director under the CPA, looks back in anger at the invasion itself. “Decisions were made by inexperienced military planners, who were often more concerned about how it would look politically,” he told CorpWatch. “I was disgusted.”

“The humanitarian planning team denied themselves access to valuable expertise by failing to establish good working relations with UN agencies, the Red Cross organizations, and other relief agencies, which had worked in Iraq for many years and were very familiar with the existing health and public-health infrastructure,”   Burkle continued.

Haveman, who succeeded him, acknowledges that he made mistakes but remains optimistic.

“The lead for reconstruction should have been Iraqi contractors with funding from NGOs and governmental sources and Iraqi run. I should have advocated early on for a Ministry of Health training academy for refreshing Iraq skills in planning and financial management....and setting benchmarks and measurable objectives,” he wrote to CorpWatch.

“Reconstruction in Iraq, including the health sector, has not progressed as rapidly as hoped but there has been notable progress. It has been slowed by sectarian violence, but still continues today. It’s just a matter of time... ten years from now plus, they will again become the system they desire to be,” he added.

Garfield says that the plans failed for very basic reasons: “We designed beautiful systems, then we had workshops to train them (the Iraqis). Isn’t that great?” he said sarcastically. “And now, we are out of there. That’s not the same as making a system. It did not work because foreigners designed it and the locals didn’t adopt it. And the foreigners weren’t around long enough to help make it part of the regular system.”

…. And Looking Forward


Today, almost four years after the toppling of Saddam Hussein, the country’s healthcare system is still a shambles. While most hospitals lack basic supplies, dozens of incomplete clinics and warehoused high-technology equipment remain as a testament to the U.S. experiment in Iraq. Meanwhile the hospitals are grappling with an unexpected health crisis – the daily toll of bombs and sectarian clashes, which leaves over a hundred dead each day and more seriously injured.

While Abt, Bechtel and Parsons have long left the country, even local non-profit organizations are now confronted by this escalating violence, In mid-December, dozens of workers of the Iraqi Red Crescent, one of the few groups still operating in the country, were kidnapped in broad daylight from its Baghdad offices, forcing the group to shut down operations in the capital city.

“There’s no way to fix the healthcare system now, without security. You’d need half-a-million troops and even then, I’m not sure it’s enough,” says Garfield. A parallel system of emergency care from NGOs that would bypass the current ministry (which is controlled by the Mahdi army) could help, he adds, until order is established, and then the whole system would have to be overhauled.

To contact the author, e-mail pratap@corpwatch.org

This article was made possible in part by a generous grant from the Hurd Foundation.