Federal authorities tried to replace the lead medical contractor for US Customs and Border Protection before an 8-year-old girl died in the agency’s custody in May 2023. But almost two years later, the company is set to receive a contract extension estimated to be worth more than $100 million — even after employees voiced new concerns and staffing continued to violate US requirements. 

Florida-based Loyal Source Government Services has already earned more than $500 million since CBP first sought to replace it. Thanks to multiple protests, the company has so far successfully blocked the government from awarding a new contract to competitor Vighter, the Texas-based company that the agency selected in 2022. 

And Loyal Source’s strategy may soon pay off again: While a US Court of Federal Claims judge weighs the company’s latest lawsuit against the government, CBP is preparing to award a so-called bridge contract to avoid a disruption in services. 

“Loyal Source’s medical care contract with CBP has become too big to fail executives, but too easy to fail vulnerable migrants,” Dick Durbin, a Democratic senator from Illinois and ranking member of the Senate Judiciary Committee, said in an email to Bloomberg News. “Even when CBP gives Loyal Source poor performance ratings, Loyal Source manages to hold on to a contract worth hundreds of millions of dollars.” 

Loyal Source’s work for CBP started in 2015, initially covering only some sites in Texas. Following the deaths of children in CBP custody elsewhere, the agency awarded Loyal Source a more expansive contract in 2020 that made it the chief medical provider at border facilities across the Southwest. 

It wasn’t long before cracks started to show in Loyal Source’s performance. In late summer 2021, a contracting officer at CBP named Troy Hendrickson started raising concerns based on reports from agents and staff, according to a whistleblower disclosure he later filed to Congress. Over the next several months, Hendrickson raised repeated concerns about inadequate staffing, improper credentials and other issues with Loyal Source. In August 2022, with Loyal Source’s contract set to expire, CBP requested bids for a new medical contract. The next month, it selected Vighter. 

Loyal Source and other competitors protested the decision, delaying the start of the new contract and enabling the company to maintain its role as CBP’s chief medical contractor. Then in May 2023, 8-year-old Anadith Danay Reyes Álvarez died while in CBP custody in Harlingen, Texas, after contracting the flu. Initial probes into her death revealed that a Loyal Source nurse practitioner had ignored repeated pleas from the girl’s mother to take her to the hospital. They also cited widespread issues with medical recordkeeping and found that none of the staff seemed to be aware that she had sickle cell anemia and a history of congenital heart disease. 

In November that year, Hendrickson went public with his concerns, calling the girl’s death “tragic and preventable.” He also flagged what he called “severe understaffing,” employees working without proper clearances or licenses, and failure to properly maintain medical records. 

Medical Care Review 

Staffing concerns persisted, according to interviews with current and former employees as well as a second whistleblower disclosure submitted to Congress and two recently published federal investigations. 

In a statement, CBP said it will continue to work with contractors, including Loyal Source, “to provide comprehensive medical support to illegal aliens and individuals under our custody.” The agency “remains prepared to scale our medical services up or down as needed.” CBP did not respond to specific questions about the contract. Loyal Source said its contract with CBP prohibited it from responding to media inquiries, “even where those requests threaten to publish or disseminate false and misleading information.” Vighter did not respond to requests for comment. 

As any federal contractor would, Loyal Source has the right to appeal a bid process it doesn’t agree with. Companies often file protests over deals they lose, and procurement law lays out guidelines for how they can do so, a process meant to ensure contracting is competitive and fair. Loyal Source’s challenges have led CBP to make certain administrative changes, though it’s difficult to know just what they were because agencies aren’t required to spell them out. 

The companies are now awaiting the decision of the federal claims judge, Edward Meyers, who was nominated by President Trump during his first term. 

Workforce Cuts 

Recently, the company sent an email to employees detailing cuts to its workforce in response to a drop in border crossings. CBP confirmed the change in an email, saying it was decreasing the number of contracted medical service providers and child caregivers “as responsible stewards of taxpayer funds.” 

Loyal Source has previously told employees they can’t work for competitors on a future contract, leaving them confused about whether they’d be able to continue working for CBP if the contract changes hands, according to interviews with current and former employees. Preventing or discouraging medical workers from taking jobs with a new contractor would strain an already limited pool of healthcare professionals willing to travel to remote locations and work in difficult environments. 

In January, Homeland Security’s inspector general published the results of unannounced inspections of CBP facilities in Arizona conducted in May 2024. Inspectors found Loyal Source’s medical staffing was below the requirements laid out in its contract at all five sites they visited. One had just 14.3% of the advanced providers that the contract required to be onsite. 

A recent report by Democratic staff of the Senate Judiciary Committee also found chronic understaffing. “Under the current administration, the provision of adequate medical care in CBP facilities will be an urgent issue,” the report stated. 

Staffing Concerns 

In interviews with Bloomberg, several current and former Loyal Source employees said shifts weren’t always staffed with nurse practitioners or physician assistants who can diagnose medical conditions and prescribe medications. 

When NPs were available, they frequently lacked experience providing emergency care, and physicians typically were available only by phone, according to the employees, who asked that their names not be used because they feared retaliation by Loyal Source. 

The workers also described confusion and frustration over the company’s insistence that they couldn’t work for another contractor. Some said they had been approached by Vighter after it was announced in the fall of 2022 that the company would be the new medical contractor for CBP. 

Loyal Source then sued Vighter in December 2022, arguing that its employees were its “lifeblood.” 

“What we are going to be asking at the end of this presentation is that you acknowledge that you’ve gone through this presentation and that you are exclusive to Loyal Source for employment on the current and future contract,” Loyal Source CEO Brian Moore said in an internal webcast the following summer, adding that employees who didn’t check the acknowledgment were still bound by its requirements. 

It’s unclear if such employment restrictions would survive a court challenge. Loyal Source has dismissed its suit against Vighter.