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Paul Davis

Latest DHS Problems Call for Major Changes
By Senator Paul Davis
Sep 19, 2003 - 12:08:00 PM

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There appears to be a recurring theme in Augusta in recent months. It seems that hardly a month passes without a new revelation about some accounting or appropriation problem at Maineís Department of Human Services(DHS). While some of the stateís financial problems over the past year or two are directly related to the economic downturn and a governmentís penchant for spending more of your tax money than it should, many of our stateís recurring financial problems center around DHS. In fact, the fiscal mismanagement at DHS has reached epic proportions lately. The problems are so severe that the Governor hired an independent auditor, PricewaterhouseCoopers, a few months ago to examine the departmentís finances and accounting practices.

In the past 2 fiscal quarters, the state has been saddled with 2 substantial accounting gaffes at DHS. In May, it was discovered that $18.9 million was received from the federal government and spent by DHS without being properly recorded. That amount grew to $32 million in misspent or undocumented funding. It was later determined by the independent auditor that the money was spent appropriately but was merely taken from the wrong accounts.

Now, we have learned that there is another huge budget problem at DHS. A $37 million dollar problem, the start of which can be traced back to 1996! And, while some dismiss this $37 million hole as a minor problem given that the department takes in over a billion dollars a year from the federal government, I have to strenuously object. We have been told that the new budget problem at the department is not the result of any wrongdoing. How reassuring. Obviously, there are a whole host of organizational problems at DHS, and these problems need to be corrected immediately.

To the Governorís credit, the auditor has identified a number of outdated, faulty and ineffective accounting policies within the department. They have recommended a number of corrective measures and the Governorís office has taken a keen interest in ensuring that things get rectified. The Governor has even dedicated some members from his own administration to help insure that things get corrected.

However, the department still lacks a Commissioner, and the lack of leadership is apparent! It is not reasonable to expect the acting Commissioner to deal with the kind of sweeping changes that are called for. I am not optimistic that things will change institutionally until a new Commissioner is in place.

The financial mismanagement at DHS can no longer be tolerated. This department is a huge segment of state government and deals with matters too vital to be handled in this way. Financially, the sloppy work by the department has already cost the state $3.2 million in Medicaid payments from the federal government lost because claims were not filed on time.

The financial audit conducted by PricewaterhouseCoopers is estimated to cost the state over $100,000 when all is said and done. While it is clear that this independent financial audit was long overdue, many people may not be aware that the Legislature formed its own auditing committee last session. The Office of Program Evaluation and Government Accountability (OPEGA) was formed to take a nonpartisan look at departmental functions to identify inefficiencies and issue recommendations to the Legislature regarding programmatic changes within departments. While OPEGAís auditing role is not generally a financial one by nature, it will undoubtedly prove valuable when looking at the effectiveness of existing state programs and services. The Legislature has not traditionally done a very good job assessing whether or not specific programs are working well. DHS is one department that is in serious need of an examination by OPEGA.

Aside from the financial management issues at DHS, many other concerns about the departmentís operations also exist. We have all heard a horror story or two about the departmentís child protective service unit -- the Logan Marr case immediately comes to mind -- and many other concerns come to my attention on a daily basis as constituents regularly call to complain about treatment they received from DHS bureaucrats regarding child support, elder care and MaineCare coverage. If the problems associated with DHSís financial division are any indication, then every division within the department is in dire need of examination and scrutiny. An up close and personal look by OPEGA may be just the thing. I am sure that the new Commissioner -- when appointed -- will welcome the results of such scrutiny. There are many efficient and dedicated people working for DHS. They deserve a better working environment and a chance at a better reputation. And Maine people deserve a better use of their money.

Senator Paul Davis is the Republican Leader in the Maine Senate.


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