We assessed DCF’s compliance with applicable state and federal laws governing the foster care system. We found that DCF has to meet many state and federal requirements for the foster care program. However, DCF had not followed some of the safety and living condition requirements we reviewed in Part 1 of the audit. Additionally, according to the 2014 and 2015 statewide single audits, DCF materially complied with most, but not all federal requirements. Further, DCF self-reported data shows Kansas met or exceeded about half of the federal outcome requirements for fiscal year 2016, but did not meet the others. Finally, we found DCF must implement a program improvement plan to address issues identified by a 2015 federal review.
Foster Care and Adoption in Kansas: Reviewing Various Issues Related to the State’s Foster Care and Adoption System, Part 1
We reviewed components of the foster care system, including safety of children during the removal and placement process. We found that DCF does not always follow adequate policies to ensure the safety of children during the removal and placement process. DCF has not yet implemented several recommendations from a 2013 evaluation of its child protective services function and has not responded to all report center calls in a timely manner. We also found that DCF does not ensure that required background checks of individuals in foster homes happen as often or as thoroughly as they should. In addition, DCF does not always take steps to ensure that monthly in-person visits happen for children in foster care, adoptive homes, or for children reintegrated with their family. Results from our survey of case-management staff and guardians ad litem also indicate that monthly in-person visits do not always happen. Finally, survey respondents also expressed concerns with staff turnover, morale and training.
As for placement of children, we found DCF’s child placement process does not ensure that children are placed in foster care homes with sufficient living and sleeping space and financial resources. That is because DCF allows nearly all requests for exceptions, which results in inadequate sleeping space for some foster children. Our review showed that DCF does not have an adequate process to ensure that licensed foster homes have sufficient financial resources. We also found that despite the lack of DCF requirements related to capacity, living space or financial sources for adoptive placements, few stakeholders had concerns. Finally, we found that child placing agencies both sponsor and regulate foster homes which may create a conflict of interest.
We also found several aspects of the foster care and adoption system are designed to keep family members together. Federal law requires that states’ foster care and adoption programs have a formal preference to keep families together. The majority of stakeholders responding to our survey indicated there was appropriate emphasis placed on keeping families together, with a small portion responding that there was too much emphasis.
Federal Funds: Evaluating State Spending Required by Federally Funded Programs
In recent years, Kansas agencies spent about $5 billion annually in monetary and nonmonetary support from federally funded programs. Federally funded programs will require Kansas agencies to spend an estimated $2 billion on cost-sharing obligations in fiscal year 2016. Beyond that, we did not identify any significant unfunded mandates, although there are restrictions tied to the use of federal funds. Federally funded programs typically impose administrative requirements on state agencies, although most of these costs can be paid for with program funds. They also often include conditions on how state agencies can spend federal funds. Most programs have penalty or repayment clauses if state agencies fail to meet these conditions or program requirements. In addition, we found examples where the federal government has tied some national policy objectives to federal funds and states’ efforts to challenge those policies have had mixed results.
The Kansas Eligibility Enforcement System:
Evaluating Delays in the System’s Implementation
In August 2011, Kansas signed a contract with Accenture to design a new eligibility determination system for medical and social service benefits. Known as the Kansas Eligibility Enforcement System (KEES), the project was originally estimated to take about two years to complete and cost about $138 million to build and $50 million to maintain for five years. Although it appears the main functionality of the KEES project will work as planned, the project has suffered from significant delays, additional costs, and reductions in both savings and functionality. Specifically, as of November 2015, the core of the KEES project was approximately two and a half years behind the original schedule. Further, if completed by August 2016 (as is currently expected), KEES will likely have exceeded the original budget to build, maintain, and operate the system by at least $46 million. In addition, although it appears the main functionality of KEES will work as planned, some important components have been significantly postponed or reduced. The state is also unlikely to realize all the estimated savings expected from KEES because the original estimates of those savings were based on faulty assumptions. It appears that project management issues early in the KEES project and other changes led to many of the current problems we identified. Finally, state oversight bodies do not always receive complete information about IT projects like KEES.
State of Kansas: OMB Circular A-133 Audit of Fiscal Year 2014
State law calls for an annual financial-compliance audit of the general purpose financial statements and “the financial affairs and transactions of a state agency required to comply with federal government audit requirements…” CliftonLarsonAllen, under contract with Legislative Post Audit, conducted this two-part audit. The first part was the report on the state’s Comprehensive Annual Financial Report (report R-14-018, released in December 2014). This second part, the Report on Federal Awards in Accordance with OMB Circular A-133, reports on compliance with laws, regulations, and provisions of contracts and grant agreements.
The auditors concluded that, except for the Foster Care program, the state complied, in all material respects, with the requirements applicable to each of the federal programs audited. The auditors found material non-compliance in the requirements regarding subrecipient monitoring in the Foster Care program. The auditors reported 27 deficiencies in internal control, including five material weaknesses. The auditors also identified questioned costs for a number of programs. Five of the findings were repeated from prior years.
State Agency Information Systems: Sensitive Datasets and IT Security Resources
Overall, we identified most state agencies maintain computer systems which hold a variety of sensitive data or process payments that must be protected. Although the state is responsible for these sensitive data or payment systems, it lacks an enterprise-level approach to IT security. We also found that 17 of 45 agencies (38%) that process payments or maintain large amounts of highly sensitive data have not had an independent evaluation of their security measures in the past three years. In addition, we learned the state lacks a complete set of three-year IT Plans as required by law, and that agencies’ submitted plans have been made public despite containing sensitive security information.
We also reviewed IT security resources at 10 selected agencies. As part of that review, we found the reporting structures at seven agencies created a risk that important security issues may not be communicated to top management. Additionally, three agencies’ lead IT security positions were not filled with sufficiently qualified staff, and two agencies lacked enough staff to perform necessary IT security tasks. Lastly, IT security software products agencies reported using in five security categories appeared to be adequate except for one agency, which lacked software to back up its system databases and electronic files stored on its network since November 2013.
State of Kansas: OMB Circular A-133 Audit of Fiscal Year 2013
State law calls for an annual financial-compliance audit of the general purpose financial statements and “the financial affairs and transactions of a state agency required to comply with federal government audit requirements…” RubinBrown, under contract with Legislative Post Audit, conducted this two-part audit. The first part was the report on the state’s Comprehensive Annual Financial Report (report R-13-016, released in December 2013). This second part, the Report on Federal Awards in Accordance with OMB Circular A-133, reports on compliance with laws, regulations, and provisions of contracts and grant agreements.
The auditors concluded that the state complied, in all material respects, with the requirements applicable to each of the federal programs audited. However, the auditors reported 26 deficiencies in internal control. The auditors also identified questioned costs for a number of programs. Six of the findings were repeated from prior years.
State Agency Information Systems: Reviewing Security Controls in Selected State Agencies (CY2013)
Agency staff continue to struggle with two key areas we have audited before: ensuring servers and workstations are patched to prevent vulnerabilities, and having an adequate plan in place to be able to continue operations in the event of an emergency. Overall, we reviewed seven IT security processes across eight agencies and saw that some agencies are more committed to IT security than others. While all agencies could make improvements to their processes to help ensure confidential information is protected, agencies most committed to IT security were the agencies more likely to have strong IT security processes in place protect their confidential information.
State of Kansas: OMB Circular A-133 Audit of Fiscal Year 2012
State law calls for an annual financial-compliance audit of the general purpose financial statements and “the financial affairs and transactions of a state agency required to comply with federal government audit requirements…” RubinBrown, under contract with Legislative Post Audit, conducted this two-part audit. The first part was the report on the state’s Comprehensive Annual Financial Report (report R-13-005, released in March 2013). This second part, the Report on Federal Awards in Accordance with OMB Circular A-133, reports on compliance with laws, regulations, and provisions of contracts and grant agreements.
The auditors concluded that, except for the Unemployment Insurance program, the state complied, in all material respects, with the requirements applicable to each of the federal programs audited. However, the auditors reported 28 deficiencies in internal control, two of which were material weaknesses. The auditors also projected up to $73.4 million in questioned costs ($65,000 in known questioned costs). Six of the findings were repeated from prior years.
State Asset Management: Evaluating the Possibility of Cost Savings and Revenue Enhancements through Property Sales.
Our targeted review identified eight surplus properties that could be sold for an estimated $1.5 million to $2.2 million. We found that identifying surplus real property is a subjective, lengthy, and sometimes difficult process. That is because property use must be periodically evaluated, the owner and boundaries of land are not always clear, and lease agreements can make it more difficult to determine whether land or buildings are surplus. Additionally, the Department of Administration has not proactively identified surplus real property as required by law and lacks the authority to independently designate what properties are surplus. Moreover, the process for selling surplus real property includes several disincentives for state agencies. Finally, delays in selling the Atchison Juvenile Correctional Facility highlight problems with the surplus real property disposal process. We also found that the State Surplus Property program is not an efficient way of disposing of surplus personal property. In each of the past two years, the program operated at a net loss of approximately $50,000. Further, the state’s contractor for online auctions is better equipped to maximize agencies’ revenues from selling surplus items and several state agencies prefer to use the state’s contractor instead of the state’s program. Finally, agencies do not want to sell surplus vehicles because they are hard to replace once sold, and agencies have few negative consequences for holding onto surplus personal property.
Foster Care Decisions: Reviewing Decisions To Remove Children from Their Homes
The Department for Children and Families (formerly SRS) serves about 5,200 children a day through foster care. Based on complaints made by foster care families, legislators wanted an independent review of several cases to determine if state officials acted appropriately. For the cases we reviewed, department, law enforcement and court officials had sufficient and convincing reasons for removing children from their parents and not reuniting them. Although our conclusions are based solely on our review of nine cases and cannot be projected to the foster care system as a whole, they are consistent with the findings of a recent internal audit conducted by the department. Although families alleged their cases were mishandled, the allegations we could evaluate were contradicted by the evidence we reviewed, and did not adversely affect case outcomes. In addition, family members consistently expressed concerns about the foster care program for several reasons. Sometimes, parents may not have fully understood all the aspects of their child’s case and therefore felt like they had been treated unfairly. Also, parents and relatives often disagreed with key decisions affecting where their child was placed. Lastly, parents’ actions or personal circumstances can further delay or prevent reunification with their children.
Kansas Neurological Institute: Evaluating the Efficiency of the Institute's Operations and the Cost and Safety Implications of Moving Its Residents into Local Communities
This audit evaluated both the operational efficiency of the Kansas Neurological Institute, as well as the potential cost and safety implications of moving its residents into a community setting. Our analysis of KNI’s operations identified about $550,000 in one-time revenues and almost $270,000 in potential annual cost savings with little or no effect on KNI residents or services. We also identified about $680,000 in unduplicated potential cost savings annually that would change aspects of KNI’s service model and could affect the quality of life or safety of KNI residents. We found that the cost and safety implications of closing KNI and serving its residents in a community setting are both complex and far-reaching. Although both settings provide similar core services to individuals with developmental disabilities, they differ in terms of the funding they receive and the specialized medical services they are able to provide. These differences create the potential for about $5 million in annual State savings after all KNI residents were relocated into a community setting. They also raise concerns about the safety and quality of life those individuals would receive in a community setting, specifically the adequacy and availability of medical care, and KNI residents’ ability to adapt to a new environment.
State Benefit Programs: Identifying Disincentives for Marriage
Most of the benefit programs we reviewed have income-based eligibility criteria that could discourage marriage in some situations, or have no effect at all. That’s because programs vary in how household income is defined. Some programs don’t distinguish between the income of married and cohabitating couples. Other programs may consider two unmarried people living together to be two separate households. Very few of the frontline program staff we interviewed think program eligibility rules have a significant effect on clients’ decision to marry. Further, the majority of clients we spoke with told us eligibility criteria have little to no effect on their decision to marry. Lastly, literature acknowledges that programs with income-based eligibility rules have built-in disincentives, but there’s little information about whether those disincentives actually cause people to avoid getting married.
State Agency Information Systems: Reviewing Selected Personnel Security Controls in State Agencies.
Overall, we found that all five agencies we reviewed could improve their personnel-related security policies. Three of five agencies did not conduct adequate background checks before hiring employees and none of the agencies consistently trained employees on security awareness and the acceptable use of information technology resources. All five agencies appropriately removed terminated employees’ computer access rights, but need to make other improvements to the termination process including documenting equipment recovery and conducting exit interviews. We also found that the Information Technology Executive Council (ITEC) does not adequately communicate its security standards to all State agencies and it does not have adequate mechanisms or resources to enforce its security standards.
Foster Care: Reviewing Selected Issues Related to Compensation and Oversight of Foster Care Contractors
In December 2007, the Department of Social and Rehabilitation Services (SRS) changed the way it structured foster care contracts to provide more financial stability to contractors. In general, each month, foster care contractors’ costs are less than the monthly payments they receive. However, the payment structure doesn’t appear to have affected children’s length of stay in foster care. We identified many other factors that do seem to affect the length of stay including, judicial discretion and the mental health and behavior problems of the child or the child’s family. We also found that increasing the adoption subsidy rate potentially could increase the number of children adopted. Overall, SRS has established a good structure that can help it oversee foster care contractors. However, staff don’t always act to correct the problems found while monitoring because the agency has a hands-off approach to overseeing contractors. We also noted that, regardless of SRS’ oversight efforts, hundreds of children remain in foster care for a long time. Nevertheless, in taking a hands-off approach following up on problems, SRS increases the risk that children could unnecessarily languish in foster care. Finally, we noted that Kansas’ performance on national standards related to length of stay in foster care appears to be about average.
State Hiring Practices: Determining Whether Requirements Related To Veterans’ Preferences Are Being Met
State law provides that eligible veterans who meet the minimum and preferred qualifications for a State classified job be offered an interview. Of the 426 veterans’ applications reviewed, there were only two instances where a veteran should have been interviewed, but wasn’t—both times because of an oversight acknowledged by agency officials. The reasons most veterans weren’t interviewed were because they didn’t meet minimum and preferred qualifications for the job or submitted incomplete application materials. In addition, we couldn’t conclude whether agencies mailed a certified letter to each veterans’ preference applicant as required by State law and identified several smaller issues that need to be addressed to make the veterans’ preference law more efficient and cost effective. These include considering eliminating the statutory requirement that State agencies have to mail certified letters to veterans not hired, giving guidance to State agencies on what documentation they should keep to show they mailed a certified letter to each veteran applicant, and advising State agencies to wait a certain period of time after a job closes to print a list of applicants to be considered for the job.
Health-Care Related Services: Reviewing Opportunities for Better Coordinating the State's Health-Care Related Programs
By changing Medicaid billing practices, the State could save money spent on inpatient care for Department of Correction’s inmates. Although State agencies could also better coordinate a number of other health-care related programs, service gap issues such as lack of affordable health insurance for low-income single adults can only be addressed through State-level policy decisions. Of more importance is the upcoming federal health care reform, which will greatly affect how health-care related services are provided in Kansas. Its primary goals are to reduce the number of uninsured, slow increases in health care costs, and increase access to health care services and providers. Implementing those reforms will require significant coordination among State agencies. Some State agencies that traditionally have provided health care services will have added responsibilities, while other State agencies—such as the Kansas Insurance Department—will start having a role. At this point, it is too early to know whether State agencies are on track to implement the various provisions of federal health care reform.
American Recovery and Reinvestment Act: A Preliminary Assessment of the Risk That Recovery Act Moneys Won’t Be Appropriately Accounted for or Spent
The $787 billion American Recovery and Reinvestment Act of 2009 (ARRA) requires unprecedented accountability and oversight of federal moneys being spent at the State and local levels. State agencies in Kansas will receive more than $2 billion in formula grants under the Act through 2011. The 2008 Statewide Single Audit had identified procedural or control weaknesses in four State programs that will be receiving ARRA moneys. Correction of those weaknesses, which related to things like reconciling records, improving eligibility determinations, and implementing computer edits to prevent improper payments, will be checked during the 2009 Single Audit. In eight other programs reviewed for this audit, the risk that agencies won’t comply with the requirements of ARRA appears to be relatively small. We found no weaknesses in the way that agencies are accounting for the ARRA moneys. However, in areas of monitoring and quarterly reporting, we found that officials from several of the programs needed to commit their procedures to writing to ensure consistency and, in a few cases, needed to further develop procedures or hire additional staff to ensure that monitoring or reporting functions could be carried out effectively. In separate work, we found that the Department of Transportation’s process for selecting highway projects to fund appears to comply with Recovery Act requirements.
Children In Need Of Care: Reviewing Selected Issues Related to Handling Their Cases
Statewide, about 80% of social workers responding to our survey said they’ve never felt unduly pressured by county or district attorneys to include or exclude facts in documents they prepare for attorneys that they felt could distort the circumstances of a case. However, at least one social worker in all six SRS regions told us they had felt unduly pressured at some point to include or exclude information. Responses from social workers in Wichita were more negative, and interviews with social workers and judges revealed several past issues may be largely to blame. Filing a petition to remove a child from the home is decided by the county or district attorney’s office. However, social workers across the State clearly feel frustrated that attorneys don’t always respect or follow their recommendations. All SRS social workers we reviewed met the licensure requirements of the State. However, initial and ongoing training social workers receive on writing legal documents, working with attorneys and the courts is sparse and insufficient. On average, social workers were responsible for about 35 open cases during fiscal year 2009. Average caseloads Statewide have remained relatively stable over the last three years, but vary quite a bit among the six SRS regions. Caseloads are somewhat higher than they otherwise would be because of a large number of vacancies that currently exist.
Child-Care Assistance: Determining Whether SRS’ Procedures Limit the Risk of Improper Payments
Overall, SRS has reasonable procedures in place to reduce improper payments in the Child-Care Assistance Program, and those procedures caught most of the potentially improper payments we identified. However, we identified a few cases that SRS hadn’t found involving clients using their benefits cards to pay themselves. We also identified ten instances in which clients were paying each other to watch each other’s children--something SRS doesn’t routinely check for. We also noted some accuracy problems with the data contained in the databases used to manage the program, such as the same social security number being assigned to more than one person, or wrong birth dates. Finally, we noted that 571 families whose incomes appeared to significantly exceed the Program’s basic guidelines received $1.8 million in child-care assistance in 2007. Among those 571 were 30 families whose income exceeded $100,000. Certain exceptions in SRS’ current eligibility guidelines allowed these families to participate in the Program.
Business Procurement Cards: Expanding Their Use To Increase Cash Rebates to the State
For fiscal year 2008, we estimated that $27 million of the non-procurement-card purchases agencies made from the 37 highest-volume vendors potentially could have been charged to a procurement card. Charging all those purchases would have generated more than $380,000 in cash-back rebates. Agencies also made $327 million of similar non-procurement-card purchases from the thousands of other vendors we didn’t analyze. If just 20% of these purchases could have been charged, agencies would have generated $940,000 in additional cash-back rebates, for a total of $1.3 million. Among other things, agency officials told us they didn’t always use their procurement cards when they could because of concerns about the complexity of tracking such purchases, and the perceived lack of thorough controls over procurement card purchases.
Statewide Medical Expenditures: Reviewing Medicaid Expenditures for Fraud and Abuse
Using data-mining techniques we found almost $13 million in suspicious Medicaid claims for federal fiscal year 2006 (the most recent year for which complete data were available to analyze). The suspicious claims included: more than $10 million in claims for more than 10,000 clients whose income appeared to exceed program limits; almost $700,000 in claims for clients who didn’t provide a valid Social Security number, almost $600,000 in potential “upcoding” by doctors for office and emergency room visits, and almost $500,000 in other suspicious claims such as claims filed for deceased individuals and charges for non-hospital services when a client was hospitalized. In addition, we identified 519 clients who received prescriptions for controlled substances, such as heavy painkillers and powerful stimulants, from five or more doctors in one year, which may be indicative of potential abuse.
Foster Care: Reviewing Selected Issues Related to State Contracts for Foster Care and Family Preservation Services
SRS and the Division of Purchases didn’t follow appropriate procedures during the latest foster care and family preservation contract negotiations in 2004. Late in the negotiations, an SRS employee appears to have inadvertently disclosed information to The Farm Inc., which allowed that organization to raise its bids. That disclosure ended up costing the State an additional $2.9 million during the first two years of the contract. With a few minor exceptions, SRS and the Division of Purchases officials handled other aspects of the negotiated procurement process appropriately.The Farm’s outcomes were similar to other contractors in 2006 and 2007. The money the Farm spent from the $23.5 million it received in fiscal year 2007 generally went for items that that seemed reasonably related to providing foster care and family preservation services. In accordance with best practices for non-profits, The Farm didn’t directly compensate its board members, its management compensation was in line with other contractors, and we didn’t see any extravagant travel expenses. We did identify two issues related to a board member that represent a potential conflict of interest. In addition, The Farm donated $500,000 of its fiscal year 2007 net revenues to one of its affiliates. It reported that donation to SRS as an expense rather than a transfer, which made its financial position appear less positive than it was.
Disability Waiver Programs: Reviewing the Use of Appropriations Intended To Upgrade the Wages of Certain Caregivers
Direct caregivers provide services that help people with developmental and physical disabilities stay in their homes. These services include help with typical life functions such as dressing, feeding, bathing, and shopping. For fiscal years 2007 and 2008, the Legislature provided a combined total of more than $50 million in additional funding to SRS to increase reimbursement rates and decrease the waiting lists for both the developmental and physical disability waivers. The 2007 additional funding was expressly intended for increasing caregiver wages. The 2008 additional funding had no such expressed intent. For developmental disability services, SRS used the additional funding to increase reimbursement rates by about 4% in fiscal year 2007 and by almost 9% in fiscal year 2008. All five developmental disability service providers we sampled increased their direct caregivers’ average hourly wages in fiscal years 2007 and 2008. For physical disability services, SRS didn’t use the additional funding it received in fiscal year 2007 to increase reimbursement rates. Instead, SRS used the additional funding to eliminate the waiting list. In fiscal year 2008, SRS did use the additional funding to increase the self-directed services reimbursement rate by 3%. For that year, only two of the five physical disability service providers we sampled increased the average hourly wage rate they paid to their direct caregivers. Under both waivers, even when the average hourly rate increased, not all caregivers received an increase.
Children’s Programs: Reviewing Whether They Are Coordinated To Avoid Duplication and Maximize the Use of Resources
Out of about 220 children’s programs in Kansas, 20 State-funded and three federally administered programs focus primarily on serving children age five and under. Those 23 programs reported serving more than 500,000 children and spending almost $310 million in fiscal year 2006. At the State level, the risk of duplication comes from having multiple programs offering similar types of services. This risk appears highest in three categories–preschool services for children, home-based education services to parents of young children, and child-care services to low-income clients. Having multiple agencies involved in administering programs can create administrative duplication. We identified six education-related programs administered by agencies other than the Department of Education and three social services/child safety programs administered by agencies other than SRS. At the local level, where most services actually are provided, the same types of administrative duplication can exist when multiple local agencies administer programs. Efforts to coordinate children’s programs at both the State and local levels primarily consist of coordinating groups and interagency agreements. A primary example is the Kansas Early Childhood Comprehensive Systems Plan Stakeholders Group, which has worked to develop Statewide strategies for serving young children. Legislation passed in 2007 mandated a plan to bring early childhood education services under a single office in the future, which could have a number of benefits, but issues involving funding and the definition of “education” will be need to resolved. At the local level, issues such as community size and competition for funding can affect the extent of coordination that occurs. Finally, consolidating Kansas’ programs won’t increase federal funding coming into the State because most federal funding is either fixed or based on formulas.
Health-Care Related Programs in Kansas: Determining What Funding Kansas Receives and Who Administers It
Our inventory focused on three types of government-funded health-care related programs in Kansas--State administered, federally administered, and research--and on programs that were clearly medical in nature or related to substance abuse and mental health. Health-care related programs administered by seven State agencies accounted for about $2.5 billion of the nearly $6 billion in spending we identified for 2006, including $1.6 billion on health care programs and $.8 billion on long-term care. Federally administered health-care related programs accounted for $3.3 billion in spending, nearly all of which was for Medicare. Health-care related research spending totaled about $131 million, with most of that being spent by the University of Kansas.
Foster Care: Reviewing Decisions To Remove Children From Their Homes
Legislators have heard numerous complaints from families who thought there wasn’t sufficient reason to remove their children and place them in foster care, or to keep them away once removed. In our review of a small sample of those cases, we concluded that removal and reunification decisions generally were handled reasonably. We did find some problems with other aspects of the cases. Some examples include SRS’s contractors not following court orders to obtain drug tests for family members, and not always documenting the results of those tests. Also, in two cases SRS didn’t interview individuals who may have been able to provide relevant information about a case. Within the court system, we found several problems or potential problems with the handling of cases in Montgomery County, including the appearance of potential bias in one case, faulty recording devices in a courtroom, and adoption being used as a case goal far more frequently than for all foster care cases Statewide. Finally, we found several instances where there appeared to be deficiencies in the level or quality of legal representation provided to parents. Given everything else that was going on in these cases, for the most part we think it is unlikely that any of these individual problems would have affected the removal and reunification decisions made about these children.
Medicaid Waivers: Reviewing Differences in Rates and Hours of Service for Clients Receiving Self-Directed and Agency-Directed Care, Part II: SRS’s Physical Disability Waiver
Physically disabled clients with self-directed care cost about $82 per month (7%) more than their counterparts with agency-directed care. That difference is significantly less than the $272 per month difference (41%) we saw in Part I between frail elderly clients with self-directed care and those with agency-directed care. Physically disabled clients who self-direct their care tend to be slightly more disabled and poorer, and to use more of the services (81%) they are authorized than clients with agency-directed service (77%). However, the differences between these two groups aren’t great, and likely aren’t anything the State can control for. Clients with self-directed care received only about 1 hour less per month in volunteer services than clients with agency-directed care. Had they received the same number of volunteer hours, we estimate the State would have saved about $128,000 in Medicaid costs. In this audit, we saw the same variability in authorized hours of care for physically disabled clients with the same assessed need for service as we did in Part I for frail elderly clients. For example, clients with the same assessed level of need for ‘hygiene and grooming’ were authorized anywhere from 2.5 hours to 35 hours per month of assistance. Finally, we found SRS doesn’t have readily available basic management information about the waiver, and some existing data are inaccurate and incomplete.
SRS: Reviewing the Recent Restructuring of Area Offices and Its Impact on Employees and Clients
In general, SRS followed a logical and consistent process for reorganizing service areas and determining which local offices should be closed. Some of the conditions staff have reported as leading to low morale have some basis in fact. For example, the process for filling new or vacated positions wasn’t always consistent across regions, the reorganization resulted in more management positions and fewer staff who directly serve clients, caseloads have increased significantly in some programs while the number of caseworkers in those programs has been relatively static, the Department has done away with many of the workers who helped caseworkers by filing documents and answering telephones, some job descriptions apparently weren’t always finalized before vacancies were posted, and some employees were downgraded or received pay cuts.SRS staff expressed many concerns about the reorganization’s impact on clients, including difficulties accessing services and delays in processing applications for service. Clients responding to a telephone survey SRS commissioned from Fort Hays State University expressed less dissatisfaction. Still, 9 of 13 high-needs clients we spoke with complained about the difficulty in obtaining services. Also, officials from a sample of the new “access points” across the State reported clients didn’t seem to be having much trouble getting materials, but expressed concerns about other access issues related to transportation and clients’ ability to use the computers or fax lines or get their questions answered. We didn’t find any evidence of widespread or significant delays in processing applications. Finally, because other budget reductions were happening at the same time, savings from the reorganization are difficult to pinpoint. But they’re likely to be less than $1.4 million to-date.
Foster Care: Determining Whether Adoptions Are Being Finalized As Quickly As Possible, Once An Adoptive Family Is Located
Most children adopted in fiscal year 2004 already had a potential adoptive family identified by the time they were referred to KCSL. On average, these adoptions took the shortest time to complete, but they still took more than a year to finalize. Two-thirds of the adoption cases we reviewed experienced at least one delay in the adoption process that seemed to be unreasonable or unexplained. Adoptive parents appear to have caused most of the unreasonable or unexplained delays. 50% of the unnecessary delays financially benefitted the party that caused the delay. Under the current system, adoptive parents and KCSL can benefit financially from delays in the adoption process. New contracts for adoption and foster care services will reduce contractors’ financial incentives to delay adoptions.
Regulation of Child Care Facilities and Foster Homes: Determining Whether KDHE Is Providing Effective Oversight and Whether KDHE and SRS Provide Duplicate Regulation of These Facilities
Since our 1997 audit, KDHE has made some improvements regarding its oversight of child care providers, but many of the same types of problems persist. This audit identified a number of issues, including: the Department hasn't performed all required background checks, some inspections and complaint investigations weren't conducted in a timely and thorough manner, and it failed to oversee the inspection work performed by child-placing agencies. Also, the Department isn't taking stronger enforcement actions partly because of limitations it perceives in the State's child-care laws and its high threshold for evidence of non-compliance. Kansas generally regulates the same types of child care facilities as the comparison states. Ways that KDHE could increase the efficiency of its regulation include implementing a risk-based inspection system, extending its annual license renewal cycle, and reducing the frequency of background checks. Duplication of regulatory responsibilities is occurring in three areas–initial inspections of family foster homes, investigation of child abuse and neglect complaints at child care facilities, and inspections of community mental health centers that provide child care services. SRS and KDHE have formed a working group to reduce the number of conflicting and duplicate regulations affecting mental health centers. Duplication in the other two areas could be eliminated by having KDHE rely on the inspections conducted by child-placing agencies, and by cross-training SRS inspectors to inspect child care facilities.
Medicaid: Reviewing Factors That Affect the Amount of Attendant Care Services Certain Medicaid Clients Receive
Although the opportunity exists for independent living centers and some home health agencies to benefit financially by authorizing more hours of attendant care services for their clients when they also serve as the payroll agent, we found no evidence that was occurring. These agencies actually authorized fewer hours of service for clients in these situations. These clients were more likely to live with someone or have friends or family who could help them out, which could explain why fewer hours of paid services were needed.
CDDOs: Reviewing Issues Related to the Funding of Community Services
Public funding for the State's developmental disabilities system has increased 15% over the last 4 years, 82% of which is distributed based on client severity. Over the last 4 years, community service providers' share of the Medicaid waiver increased from 61% to 64%, and the amount of "discretionary" funds CDDOs pass on to them has increased from 21% to 28%. The 2001 Legislature directed SRS to maximize the amount of new federal funds that could be drawn down to help fund direct services. In 2002, 91% of these new moneys were distributed based on client severity; under a new method for 2003, that figure was 22%. CDDOs also got a larger share of these new funds in 2003, mostly because the distribution plans they designed were more favorable to them.Over the last 4 years, CDDO Administration costs have increased by about 17%, and the majority of the funding has shifted from State to federal sources. Although CDDO Administration expenditures have grown faster than spending on direct services, that's due at least in part to CDDOs categorizing more of their expenditures as CDDO Administration, and to the fact that reimbursement rates for Medicaid services weren't increased. CDDO Administration costs vary widely by client. The structure of the current CDDO system creates an inherent conflict of interest for the 22 CDDOs that provide services in competition with the community service providers they contract with. Potential conflicts can arise in the areas of client referrals, contract terms, funding distributions, and quality assurance. Prohibiting CDDOs from providing direct services would address most of these issues. In addition, the discretionary State aid CDDOs receive could be distributed on a different basis, and CDDOs could be made sole providers of targeted case management services. All 3 areas would need further study.
Low-Birthweight and Premature Babies: Reviewing Programs Aimed at Reducing Their Incidence and Associated Costs
Low-birthweight babies cost the State's Medicaid Program about 5 times as much as normal-birthweight babies during their first year of life—$16,704 compared with just $3,180. They account for only about 10% of all births, but more than one-third of all payments made. Lack of prenatal care is one of many risk factors that can increase the chance of having a low-birthweight or premature baby. Overall, 72% of Medicaid mothers reported getting adequate or better medical prenatal care. Those who reported getting no or inadequate care generally had a much higher incidence of low-birthweight babies than women who got adequate care. The research on the effectiveness of prenatal care is mixed, but babies whose mothers had no such care cost Medicaid significantly more than those babies whose mothers got even minimal care. Women who had low-birthweight babies also had a higher prevalence of many of the other risk factors associated with poor birth outcomes— including smoking, substance abuse, and low weight gain during pregnancy. Outside of Medicaid, the State spends very little on prenatal care programs. The State's share of the cost for funding prenatal services through Medicaid was almost $15 million in fiscal year 2002. The State also spent $1.4 million on KDHE's Maternal and Infant Program, the State's only program focused primarily on prenatal care. Local health departments cited financial barriers as the primary reason why low-income women don't get prenatal care services, and pointed to a critical gap in the availability of medical services for these women. Neither KDHE nor SRS is doing all it can to educate women about the benefits and availability of prenatal care. KDHE also doesn't collect any information that would allow it to connect the services clients receive with their birth outcomes, but more could be done with existing data.
Federal Funds: Determining Whether Opportunities May Exist To Leverage State Spending To Draw Down More Federal Funds
This audit involved a fairly high-level review of opportunities that may exist for the State to draw down additional federal funds. We identified 6 opportunities that appeared to have a high potential for generating as much as $20 million in additional federal revenues. Most of these opportunities involved federal reimbursements through the Medicaid program that could be claimed by school districts or community developmental disability organizations. We also identified 8 additional opportunities in social services areas (such as increasing targeted Medicaid rates and auditing agencies' cost allocation plans) that warrant further investigation to determine whether additional federal revenues could be generated. Finally, we observed that Kansas could benefit from a more coordinated effort to identify and secure more federal funds. One possibility would be a centralized office to coordinate federal funding and develop an overall strategy to maximize federal moneys.
Medicaid: Assessing the Cost-Effectiveness of Current Procedures for Transporting Medicaid Consumers to the Services They Need (100-hour audit)
SRS' transportation program for Medicaid consumers isn't structured to effectively control costs. For example, there's no incentive for consumers to use lower-cost methods of transportation, providers have an inherent financial conflict of interest when screening consumers' eligibility and determining the necessity of trips, and claims are processed with few controls in place. Kansas has a number of options for setting up a more cost-effective program, including making changes to address the problems identified and carefully considering a different structure to deliver Medicaid-paid transportation, such as a brokerage system adopted by neighboring states. Finally, SRS's new reporting requirements for commercial transportation providers do duplicate information required by the KCC, but only 3 of the 106 commercial transportation providers SRS uses are certified by the KCC and are faced with providing the same information to both agencies.
Medicaid: Reviewing the Compensation of Payroll Agents for Home and Community-Based Waiver Programs (100-hour audit)
Medicaid clients who choose to direct their own attendant care services under the home and community-based service waivers must select a payroll agent (a home health agency or a center for independent living) to process their Medicaid claims. Records reviewed at 5 payroll agents in Kansas showed that they retained an average of $2.14 per hour of service billed, or 18% of the total amounts they bill to Medicaid on the clients behalf. Other states reviewed appear to obtain these services at significantly less cost. In the small sample of other states reviewed, the highest percentage retained by a payroll agent was 12%. A representative from a private company that provides Medicaid billing services in 11 states said that generally 6-10% of the amount billed could be considered a reasonable fee for payroll-related services. Two factors appear to be contributing to Kansas' higher costs. Kansas requires the payroll agents to assume some responsibilities other states don't require and it doesn't solicit competitive bids for these services.
Verifying Information Provided by the SRS on Its Compliance with the Terms of the Foster Care Lawsuit Settlement Agreement: Monitoring Report #15
For the 6-month period generally covered by this audit (January-June 2001), 22 requirements were monitored. Of those, SRS was in compliance with 5 (23%), and wasn't in compliance with 17 (77%). SRS met about one-third of the requirements specifically related to investigating reports of abuse and neglect and managing foster care cases. However, it continued to be out of compliance with 3 requirements related to maintaining data and systems that contribute to the good management of the foster care system. This audit is the last in a series of audits we've conducted since 1993 looking at SRS' compliance with the settlement agreement. The parties have agreed that SRS was in substantial compliance with the agreement, and the agreement expired June 30, 2002. As part of a new quality assurance effort within SRS, the parties have agreed SRS will continue to review any outstanding areas of the agreement that weren't in compliance as of June 30, and will provide an annual report to the Legislature on the results of this monitoring effort.
Medicaid Cost Containment: Controlling Costs of Long-Term Care
Kansas' spending on Medicaid-funded long-term care rose by $157 million between 1998 and 2001, or about 33%. Rising reimbursement rates for nursing facilities-primarily driven by higher direct-care salary costs-accounted for almost $47 million of that increase. Spending for "waiver" services provided in the home or community-primarily driven by significantly more people receiving services-accounted for $110 million of the increase. Factors driving up waiver costs to a lesser extent: relatively small increases in reimbursement rates and in the average amounts of services clients received. Among the reasons why so many more people are getting services in the community: the "woodwork" effect, a change in financial eligibility requirements, the closing of several long-term care institutions for the developmentally disabled, additional funds being provided to serve more people, and a new program for severely emotionally disturbed children.SRS and the Department on Aging need to analyze data already available to them to identify and manage areas where costs need to be controlled. Cost control measures we identified include serving only the neediest by raising the minimum scores required to qualify for the program, tightening financial eligibility requirements, and taking better steps to ensure that people haven't purposefully sheltered assets in order to qualify for Medicaid. The Departments also could limit the number of eligible people who can receive services by using waiting lists, paying less for services by limiting the amount spent per consumer, and stepping-up their efforts to identify and recoup payments that shouldn't have been made. Also, they could roll back or delay nursing home rate increases scheduled to go into effect for fiscal year 2003. Finally, the Departments could work with the Legislature to develop ways to encourage people to pay for their own long-term care.
Medicaid Cost Containment: Controlling Costs of Medical Services - A K-GOAL Audit of the Department of Social and Rehabilitation Services
Costs have increased for regular medical services in the Medicaid Program because of a combination of factors involving the number of people enrolled, the amount of services they use, and the amount paid for those services. More clients who are disabled, aged, or children are enrolled in Medicaid now than in the past, and more of the clients enrolled are receiving services, including costly inpatient services for the disabled and aged. On average, each disabled or aged client uses many more services now than before—primarily in the areas of home health services, certain alcohol and drug therapies or treatments, and special education services. Also, children in State custody (particularly juvenile offenders) now receive many more Medicaid-covered residential and treatment services on average for behavioral, mental health, or alcohol and drug problems. Rates for many services were increased, but the decision to raise rates for physician and outpatient services has cost far more than originally anticipated, largely because of increases in the number of people using those services and increases in the number of services used per person. In some cases, we also saw a number of shifts to using more expensive services once rates were increased or new higher-cost services were offered. Many increases have been the result of legislative or agency decisions to broaden the safety net for low-income adults and children, but some decisions have had unexpected consequences. To control costs in the short run, Kansas could quit serving "optional" populations, reduce the length of time certain groups can use benefits, or reduce or limit coverage for non-mandatory services like dental care and hospice. Over the longer term, SRS needs to reduce errors in the amounts paid to providers, systematically monitor and compare expenditure and usage information against expected outcomes, provide managed care for people with extensive medical needs, and ensure other agencies are claiming all possible federal matching moneys.
Medicaid Cost Containment: Controlling Fraud and Abuse
This audit, conducted by Bland & Associates under contract with Legislative Post Audit, looked at the State's system for controlling Medicaid fraud and abuse. The report noted several positive aspects of that system, but also found a number of serious problems. The part of the system dealing with identification of potential fraud and abuse involves the surveillance and review function, which the Department of Social and Rehabilitation Services has contracted out to Blue Cross/Blue Shield. The effectiveness of that effort is questionable because generally there's no follow-up on information generated by that effort that could point to problems, the focus of the work isn't on the highest risk or most lucrative areas, and there's not much additional analysis outside the standard reports. At least in part, that's because the Department hasn't provided sufficient guidance and direction to that effort, and hasn't followed good contract-management practices. The part of the system dealing with investigation and prosecution of fraud and abuse is handled by the Attorney General's Medicaid Fraud and Abuse Division. Limited to responding only to referrals it gets, that Division is significantly underutilized. This audit didn't attempt to assess the extent to which fraud and abuse is occurring in Kansas. Such an assessment would involve significant effort, but the auditors think that effort would be worth it.
Compliance and Control Audit: Department of Social and Rehabilitation Services
For the six-month period generally covered by this audit (July-December 2000), 25 requirements were monitored. Of those, SRS was in compliance with 6 (24%), and wasn't in compliance with 19 (76%). SRS met about one-third of the requirements specifically related to investigating reports of abuse and neglect and managing foster care cases. However, it continued to be out of compliance with 6 requirements related to maintaining data and systems that contribute to the good management of the foster care system.
Verifying Information Provided by the Department of Social and Rehabilitation Services on Its Compliance With the Terms of the Foster Care Lawsuit Settlement Agreement, Monitoring Report #13
For the six-month period generally covered by this audit (January-June 2000), 42 requirements were monitored. Of those, SRS was in compliance with 25 (60%), and wasn't in compliance with 17 (40%). SRS met about two-thirds of the requirements specifically related to investigating reports of abuse and neglect, managing foster care cases, and handling adoptions. In addition, SRS was in compliance with 1 of 2 requirements related to ensuring the safety of children. However, it continued to be out of compliance with 5 requirements related to maintaining data and systems that contribute to the good management of the foster care system. We'll follow-up on these requirements next period.
Medicaid for Long-Term Care: Reviewing the Department of Social and Rehabilitation Services’ Efforts to Identify Inappropriate Means of Sheltering Assets to Qualify for Medicaid
Kansas' eligibility requirements fall within federal guidelines, but give applicants more opportunities to shelter their assets than neighboring states do. As a result, Kansas applicants could become eligible for Medicaid sooner, and the State could end up paying more for their care. In addition, federal regulations have generous provisions which allow applicants to transfer assets to others without incurring meaningful penalties. These same regulations also would allow an applicant's surviving spouse to permanently shelter certain assets. Finally, although SRS follows a number of best practices to ensure that applicants are eligible, the agency could be doing more to ensure that applicants haven't inappropriately sheltered assets before applying for assistance.
The State’s Adoption and Foster Care Contracts: Reviewing Selected Financial and Service Issues
The size of the State's adoption program and the number of children adopted grew significantly after the program was privatized, but the percent of available children who were adopted decreased from 37% to 26%. Overall, the State has funded a greater portion of agencies' foster care and adoption costs since privatization, but individual agencies' experiences have been very different: some had a greater portion of their costs paid by the State while others had less. On the whole, contractors fared better than subcontractors–the percentage of costs funded by the State for the 4 contractors increased from an average of 79% to 92%, while the percentage for a sample of 6 subcontractors increased from an average of 76% to 83%. For fiscal year 2001, 5 of 6 contractors were projecting that State funding would cover at least 95% of their costs for providing foster care or adoption services. In general, SRS had well-designed procedures for monitoring the financial viability of its contractors, and it also had good procedures for monitoring how well its contractors provide services.
State-Held-Lands: Reviewing the Management and Use of Those Lands in Kansas
Kansas lacked a good centralized system for inventorying and managing State-owned and leased land. Through direct surveys of all State agencies we learned that they owned more than 335,600 acres and leased another 256,000 acres for State use. Most of that land was used for highway right-of-way and for parks and wildlife habitat. About 4,800 acres worth $6.9 million was potentially surplus. Nothing would prevent the State from selling this land, but conditions, like toxic waste on some parcels, may make it difficult to sell. State agencies will continue to have little incentive to identify surplus lands, despite a new law requiring that guidelines and criteria for identifying and selling surplus land be put into place. The new law didn't set up an independent authority to make the decision about whether potentially surplus land should be sold, and it lacked a financial incentive for agencies to sell land. When agencies lease out State-owned land, they usually do it on a competitive-bid basis; only 4 agencies weren't using competitive bids to let their leases or didn't rebid the leases frequently enough. Finally, we found a few cases where agencies weren't paying property taxes on land when they should have been, and at least one case where an agency was paying taxes it shouldn't have been paying.
HealthWave: Reviewing the Program’s Services and Finances
Horizon Health Plan, Inc., one of the initial contractors for HealthWave, originally was created to operate the State's Medicaid PrimeCare Program. The State's low Medicaid rates, compounded by Horizon's reliance on its Medicaid PrimeCare contract as its sole source of revenue, resulted in the company's severe financial losses. Despite Horizon's financial problems and uncertain future, the Department awarded Horizon the contract for HealthWave because it was the only bidder in 2 of the State's 3 regions, and because Horizon was about to be taken over by a financially secure company. Horizon subsequently was liquidated by the Kansas Insurance Department, and the State has paid nearly $10 million over and above the contract rate since that time. However, only $1 million is directly related to Horizon's liquidation. The current contractors and the HealthWave Program now appear to be financially sound. The Program has been very successful in identifying and insuring previously uninsured children, and in making health care coverage available Statewide. Although information about the number and types of services children have gotten through HealthWave isn't available yet, participants and doctors generally appear to be happy with the Program. To adequately carry out its oversight responsibility, the Department of Social and Rehabilitation Services needs to strengthen its efforts to gather, verify, and analyze data about Program and contractor performance.
Verifying Information Provided by the Department of Social and Rehabilitation Services on Its Compliance With the Terms of the Foster Care Lawsuit Settlement Agreement, Monitoring Report #12
For the six-month period generally covered by this audit (July-December 1999), 49 requirements were monitored. Of those, the Department was in compliance with 7 (14%), and wasn't in compliance with 42 (86%). Monitoring of 5 requirements will stop because the Department demonstrated compliance with them for 2 consecutive monitoring periods. The Department met the requirements specifically related to investigating reports of abuse and neglect, managing foster care cases, and handling adoptions only 18% of the time. In addition, the Department wasn't in compliance with 2 important requirements related to ensuring the safety of children, and it continued to be out of compliance with many requirements related to maintaining data and systems that contribute to the good management of the foster care system. We'll follow-up on these requirements next period.
Reviewing the Medicaid Program’s Use of Generic Drugs
The Kansas Medicaid Program spent about $141 million in fiscal year 1999, and about a quarter of that was for prescription drugs. When both name brand and generic versions of drugs were available, Medicaid paid for the generic version 82% of the time, saving $2.2 million. However, drugs available from only one source took 76% of the Medicaid pharmacy dollars in fiscal year 1999. The Department of Social and Rehabilitation Services relies on federal and State caps to limit how much the Program spends for drugs that have generic versions. The Department also has a number of practices to control costs for drugs available from only one source, such as limiting how often it will pay for refills and lowering the reimbursement for specific drugs. Several cost-saving ideas we heard about from other states and from Kansas pharmacists and physicians merit additional research. Some, such as requiring a patient to fail on a generic drug before getting a name brand, would require changes in Kansas law. Others, such as splitting expensive tablets, expanding coverage of over-the-counter drugs and doing more counseling of clients with chronic diseases or conditions, might require only a change in policy.
Reviewing the Implementation of the Mental Health Reform Act
In general, the Department has taken steps to implement the Mental Health Reform Act, but it needs to focus on long-term planning, prioritize needs and goals, and improve monitoring to ensure that centers comply with established standards and definitions. Above all, it needs to improve its information systems to be able to know whether appropriate services are being provided and at what cost. Based on the limited information available, it appears that mental health clients aren't getting all the services they need. Further, case managers and mental health center officials identified specific shortages of services like attendant care, respite care, and case management services – often citing a lack of funding or inadequate Medicaid reimbursement rates as the reason. Overall, funding appears to have shifted from State hospitals to the communities. State General Fund spending on hospitals declined by $31 million from fiscal year 1992 to 2000, while spending on community mental health services increased by $34 million. However, about two-thirds of the money mental health centers get through the State is given in the form of grants that aren't necessarily tied to particular services, and those moneys are very unevenly distributed across the State. Significantly more federal money could be made available to fund mental health services at relatively low cost to the State if the Medicaid reimbursement rates were raised. The State currently provides enough funding to match about $73 million in federal Medicaid dollars, but it currently only bills for enough services to draw down about $25 million.
Verifying Information Provided by the Department of Social and Rehabilitation Services on Its Compliance With the Terms of the Foster Care Lawsuit Settlement Agreement: Monitoring Report #11
For the six-month period generally covered by this audit (January-June 1999), only 16 requirements could be monitored. For those 16 requirements, the Department was in compliance with 1 (6%), and wasn't in compliance with 15 (94%). The Department met th
Verifying Information Provided by the Department of Social and Rehabilitation Services on Its Compliance with the Terms of the Foster Care Lawsuit Settlement Agreement, Monitoring Report #10
In all, 49 of the 67 requirements due for assessment were monitored this period. For those 49 requirements, the Department was in compliance with 17 (35%), and wasn't in compliance with 32 (65%). The Department met the requirements specifically related to investigating reports of abuse and neglect, managing foster care cases, and handling adoptions only 41% of the time. In addition, the Department wasn't in compliance with two important requirements related to ensuring the safety of children, and it continued to be out of compliance with many requirements related to maintaining data and systems that contribute to the good management of the foster care system. We'll follow-up on these requirements next period. Finally, of the 18 requirements that weren't monitored this period, the parties removed two from the settlement agreement, and agreed to suspend monitoring of the other 16 while they negotiated issues related to them.
Reviewing the Quality of Care and Personnel Management at Kansas Neurological Institute
This audit showed mixed results regarding the quality of care at KNI. On the one hand, recent federally required reviews of KNI's operations show the level of care has improved, surveyed parents generally were satisfied with the level of care being provided, and the number of incidents and injuries at KNI has declined over the past five years. On the other hand, the number of deaths, hospitalizations, and reported instances of abuse or neglect at KNI has increased. Also, many direct-care and medical staff we surveyed thought the level of care had declined. Some direct-care staff think KNI is understaffed because they now must work with clients each day doing shopping, cooking, and laundry–things other KNI employees used to do. KNI didn't appear to be understaffed compared to other facilities for the mentally retarded, but at least one Kansas facility we looked at distributes its work among staff somewhat differently. We found that KNI officials generally met all the requirements for handling the personnel transactions we reviewed, but it was clear from survey responses and staff interviews that KNI has a serious morale problem related to perceived unfairness in hiring and promotions. We also found that oversight of time worked by employees is weak and has resulted in some abuses, and a lack of good records in other areas has sometimes hampered abuse investigations. Finally, during this audit we reviewed a number of allegations of mismanagement, misdeeds, and potential conflicts of interest. While some allegations appeared to be basically true, others appeared to be based on a lack of information or misinformation.
Verifying Information Provided by the Department of Social and Rehabilitation Services on its Compliance With the Terms of the Foster Care Lawsuit Settlement Agreement, Monitoring Report #9
Overall, the Department complied with 21 of the 31 requirements assessed this 9th monitoring period, and didn’t comply with 10. Monitoring of an additional 33 requirements related to Case Review #2 (covering the management of foster care cases) was delayed because the Department’s new information system wasn’t accurate enough to identify the cases applicable to these requirements. The Department complied with most requirements related to investigating reports of abuse and neglect and adoption. It also was in compliance with nine long-outstanding requirements related to worker caseloads, the use of paraprofessional staff, and the development and implementation of needed services. However, the Department wasn’t in compliance with two important requirements related to ensuring the safety of children, and it continued to be out of compliance with many requirements related to maintaining data and systems that contribute to the good management of the foster care system. A follow-up will be done on these requirements in the next period. In addition, the parties to the settlement agreement agreed to drop formal monitoring for 13 other long-outstanding requirements related to staffing levels, assessments of placement and service needs, case planning, and records of visitation.
Assessing How Well the Foster Care Program in Kansas is Working, Part II: Funding, Staffing, and Monitoring Issues
Original rates paid to the foster care contractors were insufficient because they were based on incomplete information about costs and unrealistic estimates about how long children would remain in foster care. The rates also didn’t provide for start-up and ongoing monitoring costs. Since foster care was privatized the Department has provided the contractors with an additional $45.2 million to address funding shortfalls. Limited funding has caused contractors to look for more economical ways to provide services, and has restricted the rates they can pay service providers, which could affect the availability of those services. Some survey respondents complained that services were withheld to save money and that the quality of services provided by the contractors’ staff weren’t as good as those provided in the community. Staff weren’t able to assess the quality of services, but didn’t find any evidence of services being withheld purely for financial reasons. Limited funding also can affect conditions in residential facilities where foster children are placed, and could result in some homes going out of business or refusing to serve foster care clients. Also, there’s a severe shortage of foster homes, and many foster parents complained that the reimbursements they received weren’t sufficient to cover their costs. Contractor staff shortages and turnover appear to have stabilized, but those shortages likely were the reasons for delays in services, poor documentation, and other problems noted in the first part of this audit. The Department has designed a comprehensive system to monitor foster care. However, some of the internal reports it produces to assess contractor’s achievement of outcomes aren’t reliable. Also, it needs to do more to ensure that it doesn’t miss out on several million dollars worth of federal reimbursements for services provided to children in foster care. Finally, we found that both the Departments of Social and Rehabilitation Services and Health and Environment needed to better document actions facilities take to address complaints and regulatory violations.
Assessing How Well the Foster Care Program in Kansas is Working, Part I: Services and Placements
Most foster children and their families in our sample were receiving adequate and timely assessments of their needs. Initially the timeliness of assessments was poor, but it has dramatically improved since the early months of privatization. We found that about 10% of the initial assessments didn’t include recommendations for needed services for children or their families, such as sex abuse counseling or parenting training. In addition, the people responsible for making decisions about foster children weren’t always involved to the extent they needed to be, and didn’t always receive or provide the information they needed. Children received most services recommended for them, but there often were delays in these services starting. Families received only about half the services recommended, generally because they refused to participate. Survey respondents had mixed opinions about the quality of services provided. Children in our sample didn’t have a lot of stability. On average, they had been moved every 2-3 months, and had been in 3-4 different placements. Often they were moved because of their behavior. In addition, they sometimes weren’t placed in the type of facility they needed to be in, mainly because the right type of facility wasn’t available. Few of the children in our sample were abused while in custody, but we did find some safety issues with the system that need to be addressed.
Reviewing Substance Abuse Programs in Kansas, Part II: Assessing the Department of Social and Rehabilitation Services’ Contracted Managed-Care Program for Substance Abuse Treatment and Prevention
The Commission hasn’t adequately monitored substance abuse programs since it implemented managed care for alcohol and drug abuse services. That’s partly because of bitter disagreements with the management organization it selected to implement the program. Some of those disagreements might have been avoided if the grant agreement had been more carefully reviewed and had clearly spelled out each party’s responsibilities. The Commission planned to resume some monitoring in July 1998, but it has done little to evaluate the success of the program on a Statewide basis, and hasn’t used available information to identify areas where additional services are needed. The Commission generally has established adequate procedures for monitoring the program’s finances, but it hasn’t always made timely payments to the management organization. There’s little objective data available to assess the effectiveness of managed care because the Commission doesn’t have consistent and comparable information about the program’s effects on clients. Based on the limited information available, it appears that expenditures for client services are down while administrative costs are up. Fewer clients are being treated on an inpatient basis, and they’re receiving treatment for shorter periods of time. Also, the number of providers and treatment beds has increased. Treatment providers had mixed views about the system. Some praised it for its accountability, while others didn’t think patients were receiving services for long enough periods of time. In addition, treatment providers complained about a poorly functioning computer system, and told us there were shortages of treatment services for adolescents and for mentally ill clients with substance abuse problems.
Verifying Information Provided by the Department of Social and Rehabilitation Serviceson its Compliance With the Terms of the Foster Care Lawsuit Settlement Agreement, Monitoring Report #8
Overall, the Department complied with 8 of the 85 requirements due for assessment this 8th monitoring period, and didn’t comply with 61. For the 16 remaining requirements, the parties to the settlement agreement suspended monitoring until a future period because they haven’t yet agreed on what the Department must do to comply. More specifically, the Department conceded noncompliance again this period with all requirements related to determining the safety and status of children who reportedly have been abused or neglected, and to appropriately managing the cases of children in its custody. The Department complied with most requirements related to adoption, but inappropriately screened out some bona fide reports of abuse and neglect, which meant those allegations weren't investigated as required. It also was out of compliance with several training requirements, and continued to be out of compliance with many requirements related to maintaining data and systems that contribute to the good management of the foster care system. We'll follow up on these areas in our next report.
Verifying Information Provided by the Department of Social and Rehabilitation Services on its Compliance With the Terms of the Foster Care Lawsuit Settlement Agreement: Report #7
We concluded the Department had complied with 12 of the 82 requirements reviewed during this 7th monitoring period, and hadn’t complied with 66. For the 4 remaining requirements, we couldn’t assess the Department’s compliance because the parties involved in the settlement agreement were still negotiating issues related to these requirements. This period, the Department conceded noncompliance with all the requirements related to determining the safety and status of children who reportedly have been abused or neglected (Case Review 1), and to appropriately managing the cases of children in its custody (Case Review 2). The Department was in compliance with most of the requirements related to adoption (Case Review 3). The Department screened out some bona fide reports of abuse and neglect, which meant those allegations weren’t investigated as required. It also continues to be out of compliance with many requirements related to maintaining data and systems that contribute to the good management of the foster care system. We’ll follow up on all these areas in our next report.
Verifying Information Provided by the Department of Social and Rehabilitation Services on its Compliance with the Terms of the Foster Care Lawsuit Settlement Agreement, Monitoring Report #6
We concluded the Department had complied with 11 of the 78 requirements reviewed during this sixth monitoring period, and hadn’t complied with 60. For the remaining 7 requirements, we couldn’t assess the Department’s compliance because the parties involved in the settlement agreement were still negotiating issues related to these requirements, or the Department’s Monitoring Unit hadn’t completed its work. This period, the Department conceded noncompliance with all the requirements related to determining the safety and status of children who reportedly have been abused or neglected (Case Review 1), and to appropriately managing the cases of children in its custody (Case Review 2). The Department was in compliance with most of the requirements related to adoption (Case Review 3), but it continues to be out of compliance with many requirements related to maintaining information and systems that contribute to the good management of the foster care system. A follow-up on all these areas will be done in the seventh monitoring period.
Reviewing the Department of Social and Rehabilitation Services’ Efforts to Privatize Government Services (100-hour audit)
State law allows agencies to deny contracts to bidders who have certain criminal convictions. However, federal and State laws and regulations generally only provide an agency with access to in-State conviction information. The Department hasn’t established any agency wide procedures for conducting criminal history checks on potential contractors. Although it took reasonable steps to learn about criminal convictions for three or four major contract areas we reviewed, additional steps could have been taken. We also noted that the Division of Purchases needs to issue guidance to agencies regarding what to do to check criminal histories.
Verifying Information Provided by the Department of Social and Rehabilitation Services on its Compliance with the Terms of the Foster Care Lawsuit Settlement Agreement Monitoring Report #5
We concluded the Department had complied with only 8 of the 81 requirements reviewed during this fifth monitoring period, and hadn’t complied with 24. For the remaining 49 requirements, we couldn’t assess the Department’s compliance because the parties involved in the settlement agreement generally hadn’t resolved their ongoing disagreements about interpretations of the settlement language, or hadn’t decided how compliance should be measured. When we looked back at the Department’s compliance rate over time, we noted it has now complied with most administrative types of requirements, but the Department continues to be out of compliance with almost all requirements related to determining the safety and status of children who reportedly have been abused or neglected. It also continues to be out of compliance with almost all “foundational” requirements related to foster care placement and service needs, staffing, and information needs. Finally, because of the problems described earlier, we don’t yet know whether the Department has complied with the nearly 40 requirements relating to appropriately managing the cases of children in its custody. We’ll follow up on all these areas in the sixth monitoring period.
Assessing the Propriety of Certain Actions Related to the Privatization of Kansas Industries for the Blind (100-hour audit)
Kansas Industries for the Blind was scheduled for privatization on July 1, 1996, but that didn’t happen for a number of reasons. Recent allegations have been made that, to keep the scheduled privatization from going smoothly, certain equipment and records of the operation had been discarded. Our interviews and corroborating testwork generally didn’t substantiate these allegations. We found that employees disposed of some old, broken equipment stored at the workshop, discarded blank State forms, and purged their files of records and documents more than two years old. However, we found nothing to indicate that these actions weren’t logical or well intentioned. Rather, these things seemed to have been done to facilitate the scheduled change to private sector operation. Further, once privatization didn’t take place, we saw no significant adverse impact of these actions on the ongoing operations of Kansas Industries for the Blind.
Verifying Information Provided by the Department of Social and Rehabilitation Services On Its Compliance With the Terms of the Foster Care Lawsuit Settlement Agreement, Monitoring Report #4
We concluded the Department had complied with 17 of the 47 requirements reviewed during this monitoring period, and had not complied with 23 of those requirements. The areas of noncompliance related to protective services, the assessment of needs for services and placements, information on placement providers, staffing, and information systems. We couldn’t determine whether the Department was in compliance with seven additional requirements, related to protective services, assessment of needs for services and placements, information on placement providers, and staffing, because the Department and Children’s Rights, Inc., haven’t yet agreed on what the Department can do in future monitoring periods to resolve the parties’ ongoing disagreement regarding compliance. All of these areas will be followed up during the next monitoring report.
Verifying Information Provided by the Department of Social and Rehabilitation Services on Its Compliance with the Terms of the Foster Care Settlement Agreement: Monitoring Report #3
We concluded the Department had complied with 16 of the 45 areas reviewed during this monitoring period, and had not complied with 18 of those requirements. The areas of non-compliance related to protective services, the assessment of needs for services and placements, staffing, training, and information systems. In addition, the Monitoring Unit reported that the Department wasn’t in compliance with six other requirements. However, we concluded the Unit’s assessment couldn’t be relied on because the reading of case files wasn’t accurate enough to determine whether the Department was in compliance or not. Finally, we identified five areas, related to protective/medical services, the revised Family Emergency Assistance Program, Flexible Fund Dollars, equitable workload distribution, and maintaining staffing levels, where we weren’t able to determine whether the Department was in compliance, primarily because the Department and Children’s Rights, Inc., hadn’t yet agreed on what the Department was required to do to comply. All of these areas will be followed up during the next monitoring report.
Determining Whether Kansas’ Medicaid Program Makes Maximum Use of Third-Party Insurers
The Medicaid computer system has a number of good edits built into the system. Out of about $875 million in claims processed during calendar year 1995, those edits reportedly identified more than $69 million worth of claims that needed to be billed first to other insurance. We looked at a sample of claim where the Medicaid client had other insurance, but the other insurance didn’t pay any of the claim. We found a significant number of cases were the health-care providers didn’t bill other insurance companies because they weren’t aware other coverage existed. In other cases, the providers didn’t handle claims according to program regulations. Based on our sample, if other insurance paid only 5% of the estimated number of problem claims, Medicaid might save $10,000-$460,000 during fiscal year 1996. One reason so many claims hadn’t been billed to other insurance was that the Department didn’t have adequate procedures to identify when Medicaid recipients have other insurance, and didn’t always enter insurance information onto the computer system on a timely basis. We also found that EDS hadn’t done some of the reviews it was required to do to make sure claims were handled appropriately, and that EDS and the Department haven’t aggressively followed up to collect potential overpayments. Finally, we found that Blue Cross and Blue Shield could have a conflict of interest when it takes over as the Department’s fiscal agent later in 1996.
Reviewing State Contracting for Consultants and Other Professional and Technical Services
In fiscal year 1995, the State spent about $221 million on contracted professional services--an increase of 56% from fiscal year 1991. Nine agencies accounted for 75% of recent spending on professional services. We found that Kansas has no written procedures on acquiring professional services, and no policies to guide State agencies on monitoring contracts or on handling problems with vendors’ performance. In the absence of centralized guidance, there’s a significant risk agencies won’t get the services they need, or will pay too much for the services they get. Lastly, while many agencies say they assess the need for the programs and services they offer, we found those assessments often aren’t systematic or designed specifically to determine whether these activities should be continued. Many agencies also say they assess whether the programs and services they offer could be provided more cost effectively by contracting with private entities, but we found those assessments often don’t include all costs. Some privatization efforts currently under way may increase State costs.
Examining Child Support Enforcement Activities in Kansas
In fiscal year 1994, Kansas collected about 55% of the current child support owed, about the same as the national average. However, within SRS area offices, this rate varies from 41% to 67%. Shortcomings were identified in about 1 in 5 cases we reviewed, including six that simply “fell through the cracks.” The report identified factors that hamper collection efforts in Kansas, such as high caseloads, lack of equipment, the lack of access to information to locate absent parents, difficulty in getting management information from the Department’s computer system, and conflicts between the courts and the Department.Kansas spends more than the national average and nearby states for each dollar of child support collected. No comparisons on the cost-efficiency of the various area offices could be made because no data were available. The Department spent about the same per dollar of child support collected as the court trustees on enforcement services, but what it costs the Department to have court trustees handle enforcement services varies significantly. Except for some duplication between the Department and the district court clerks, no inherent inefficiencies in the Program’s structure were apparent. Other states contract with private agencies for a more extensive range of child support services than Kansas. It appears Kansas may be able to reduce its expenditures for enforcement services in certain areas of the State where those services aren’t being provided as efficiently as they could be.
Verifying Information Provided by the Department of Social and Rehabilitation Services On Its Compliance with the Terms of the Foster Care Lawsuit Settlement Agreement--Monitoring Report #2
We concluded the Department had complied with 17 of the 26 areas reviewed during this monitoring period, and with all four areas we followed-up on from the first monitoring period. The areas of noncompliance included not addressing the effectiveness of the Family Preservation unit, the statewide and regional placement needs, or identifying strategies to assist in the development of resources in the needs assessments for preventive services, placements, and services; not developing caseload guidelines; not evaluating the effectiveness of paraprofessional staff; not maintaining accurate and reliable information on the FAME computer system; and not requesting certain minimum financial resources. We also identified two areas, the maintenance of flexible fund dollars and the determination of youth service workers’ caseloads, where we were unable to determine whether the Department was in compliance. All of these areas will be followed-up on in the next monitoring report.
Examining Contract Oversight by the Department of Social and Rehabilitation Services
Most procedures for ensuring that vendors are providing agreed-upon services have been established by individual commissions and divisions, and they vary from one to another. For nearly one-fourth of the 62 contracts and grants we reviewed, it appeared the Department didn’t get the services it expected, or it was not possible to tell. Procedural weaknesses we noted that can allow grantees to be paid even though services haven’t been provided include the failure to require vendors to submit documentation of the services provided, failure to use that information when it is provided, and failure to make payments contingent on providing a certain level of service for some grants. We also noted that grant expenditures often didn’t receive a final review until long after the grants were over, which could make it more difficult to recover moneys that grantees owed the Department.
Reviewing the Department of Social and Rehabilitation Services’ Efforts To Computerize Alcohol and Drug Abuse Treatment Information (100-hour audit)
In 1992, the Department of Social and Rehabilitation Services set out to modernize an existing computer system designed to collect treatment information about alcohol and drug abuse patients. By 1994, the project was not complete, in large part because it was poorly managed. Upper-level management underestimated the complexity of the project, assigned staff to the project on a part-time basis, allowed the project to proceed without an adequate plan or time budget, and exercised little project oversight. The manager assigned to the project was not well organized, did not develop an adequate workplan, and neglected to hire all the staff the Department had authorized. The Department did not violate any purchasing laws in January 1994 when it hired an outside firm to evaluate the project, nor did we find any evidence of favoritism in hiring the same firm to complete the project.
Reviewing Security and Management Issues at the Youth Center at Topeka
Officials in the Department of Social and Rehabilitation Services have made strides in correcting the numerous, major deficiencies identified in our 1989 audit of the Youth Center at Topeka. However, many of those same issues remain as problems in 1994. The existence of a perimeter fence has significantly reduced the number of escapes from the Youth Center, but many other security weaknesses (including staffing shortages) continue to present risks of harm to the staff and students. The Youth Center has given violent offenders various kinds of off-campus passes, a practice that presents undue risks to the public. Our survey of Youth Center staff indicated little confidence in the upper management of the Center. Management officials need to correct problems with criminal record checks on new employees, evaluations of employees, and recordkeeping. We found the Department has not adequately managed a four-year federal grant to ensure that federal moneys were spent properly and that the grant’s objectives would be met. Finally, other states have tried various new programs for rehabilitating juvenile offenders, but their effectiveness has not yet been proven.
Verifying Information Provided by the Department of Social and Rehabilitation Services On Its Compliance with the Terms of the Foster Care Lawsuit Settlement Agreement--Monitoring Report #1
We concluded the Department had complied with 13 of the 17 areas reviewed during this monitoring period. The areas of non-compliance included maintaining specified levels of funding for an emergency shelter grant program, for a flexible dollars fund, and for various family services. In these cases, the documentation the Department provided either was insufficient to determine whether these programs and services were being maintained at the levels required by the settlement agreement, or it showed the Department had fallen short of meeting those specified minimums. The Department also was not in compliance with the case-handling requirements related to one of the plaintiffs named in the lawsuit. All of these areas will be followed up on in the next monitoring report.
Reviewing the Department of Social and Rehabilitation Services’ Procedures for Handling Complaints Against Foster Homes
The Department has not established adequate checks to ensure that licenses are not issued to applicants with past criminal records or other problems that might present risks to foster children. Nearly 20% of the licensing files we reviewed did not contain required assessments of the applicant and his or her family, and many had inadequate character reference checks. About 30% of the abuse and neglect complaints against foster homes we reviewed were not adequately investigated. The most common shortcomings were delays in getting investigations started and failure to interview all appropriate persons. The Department did not always follow up to ensure that foster parents completed additional training or made corrections they agreed to make following an abuse investigation. In nearly half the cases we reviewed, the Department did not take adequate steps to determine whether foster parents’ natural or adopted children were safe. The problems we found stemmed from inadequate Department policies, failure to follow existing policies, and failure to document some actions.
Reviewing the Transfer of Mentally Retarded Patients from State Institutions to Community Living Facilities
The State has established goals to reduce mental retardation hospital resident populations and staffing levels. Although the State has limited admissions and transferred more than 250 hospitals residents to community settings since fiscal year 1991, hospital populations remain higher than planned. One reason is that the State’s placement approach depends on developing individualized community services and placements, many of which are not readily available. Community centers primarily cite resource inadequacies as the reason why services and placements are not being developed rapidly. Finally, per-person costs for community placements appear to be less than per-person hospital costs. However, even though people are being transferred from hospitals to community settings, total State hospital costs are not going down. In fact, the State will not realize any significant cost savings from transferring individuals to community settings until a hospital is closed.
Reviewing the Contract for the Medicaid Management Information System (100-hour audit)
The Department’s contract with EDS Federal does not attempt to define specific program modifications that are included within the price of the contract and those that will require additional payment. Any changes that were not agreed to at the time the contract was signed, or that could not be completed in the time available from the 11 on-site systems engineers, have been handled as contract amendments at an additional cost to the Department. The 22 amendments to the current contract have contributed $9.3 million of the total $53 million cost. Because the Department does not have good information about how the systems engineers spend their time, it cannot ensure it is getting what it pays for. Other states we contacted generally carry out more monitoring of their systems than Kansas does.
Examining Potential Duplication and Overlap in Programs for Kansas’ Aging Population
The Department on Aging and the Department of Social and Rehabilitation Services fund or provide essentially the same long-term-care services, but offer their programs to different groups of elderly individuals. When more than one agency provides or funds essentially the same services, there is considerable duplication of administrative effort, which can result in client confusion, clients falling through the cracks if coordination is inadequate, and in money being spent for administrative activities that otherwise could be spent for direct services. The State might gain some cost efficiencies from consolidating all its long-term-care programs in one agency, as two comparison states have done, but some disadvantages also would result. For an individual client, the State generally can provide home and community-based long-term-care services at a lower cost than nursing home services. However, the total cost to the State of providing those services may not decrease significantly, particularly in the short-run, because states’ new long-term-care programs tend to expand the number of people eligible for services, and because the Medicaid-Waiver Programs may be serving elderly individuals who would not be getting services in the absence of such Programs.
Reviewing the Accuracy of Job Placement Information the Department of Human Resources Is Reporting About the Kan Work Program (100-hour audit)
Although the Department of Human Resources records some information about clients’ employment status after-the-fact, it does not appear that those actions were intended to be misleading. In most cases we reviewed, the Department could not have conducted follow-up activities when required because client referrals from the Department of Social and Rehabilitation Services were late. Nevertheless, conducting follow ups late may affect the interpretation of program information, client employment assistance, and program effectiveness. In addition, the Department of Human Resources has job placement follow-up information that the Department of Social and Rehabilitation Services could use to track job-retention rates and provide the Legislature with meaningful program information. However, the Department of Social and Rehabilitation Services does not ask for this information.
Examining the Effectiveness of the Kan Work Program
Clients in the KanWork Program got more jobs and earned more money than clients who were not participating in the Program, but still did not earn enough to stay off welfare. Over the two-year period we reviewed, KanWork did not appear to make a significant difference in the number of people getting off welfare. However, the Program may need to be viewed over a longer time period to show results. Coordination between the Departments of Social and Rehabilitation Services and Human Resources staff who work with clients is good, but coordination and cooperation between upper-level management of the agencies is poor. The KanWork Program generally conforms to all major federal regulations and State laws. However, Department of Social and Rehabilitation Services staff have not followed all procedures for operating the Program.
Reviewing the Capacity and Use of the State’s Mainframe Computers
Four of the nine mainframes reviewed were operating at or near capacity. The five remaining computers, which generally were in the early to middle years of their life expectancy, appeared underused at this time. In those cases, agency officials generally indicated that planned applications would increase mainframe use in the future or that federal funding used to acquire and operate their computers limited the possible uses. Finally, available data storage for several main frames was full or nearly full, and the affected agencies may need to take some action to acquire more storage capacity soon.
Reviewing Procedures and Staffing for Child Abuse Cases in Douglas County (100-hour audit)
Child abuse and neglect cases handled by the Department of Social and Rehabilitation Services' Douglas County office have increased in recent years, but with the addition of several new social worker positions, individual caseloads have generally remained stable or declined. Douglas County officials told us that the social worker and a supervisor would make the initial decision about removing a child from home, based on a factors such as the child's safety and the parents' ability to protect and care for the child. When families are at-risk of abusing or neglecting their children, social workers in Douglas County assess the specific factors (such as a parent's substance abuse or inappropriate disciplinary methods) that may be contributing to mistreatment of a child, then try to provide services that will help the family address its problems. We did not find any indication that the procedures in place in Douglas County were in conflict with the Department's procedures or with State law.
Kansas’ Foster Care Program, Part IV: Summary Report
This report summarizes the findings and recommendations from the series of audits the Division conducted of the State's foster care program, plus an audit of the handling of reports of child abuse and neglect. The latter report was included because children can be placed in the State's custody if there is evidence they have been abused or neglected. This summary report discusses the need to place greater emphasis on preventing children from coming into the overburdened foster care system.
Kansas’ Foster Care Program, Part III: Staffing and Funding Levels
The number of social workers assigned to foster care has not kept pace with the growing number of children in the Department's custody. Although the Department could not provide information showing changes in caseloads over time, we estimated that average foster care caseloads were more than double the standard proposed by the Child Welfare League of America. It did not appear that funding affected placement and service decisions. The actual limiting factor appeared to be the lack of appropriate placements and services. Most foster care providers we surveyed thought the reimbursements they received from the State did not cover their costs, but this did not appear to be a major reason for them leaving the system.
Kansas’ Foster Care Program, Part II: Placements and Delivery of Services
On average, the 200 children in our sample were in the Department's custody for two years and had 4-5 placements each. The majority of these placements lasted six months or less, and were in foster homes or parents' homes. About one-fifth of all placements were not made as recommended, apparently because recommended facilities often were not available. Two-thirds of the children eventually were reunited with their families. Most children and families received services--such as individual or family counseling or clinical evaluations--but the Department did not always recommend services for those who needed them. Also, recommended services often were not started or completed. Many controls and procedures for the foster care system seemed to be adequate, but the Department lacked basic program management information.
Assessing How Effectively the Department of Social and Rehablilitation Services Handles Reports of Child Abuse and Neglect
The number of child abuse or neglect reports investigated by the Department of Social and Rehabilitation Services increased by about 34 percent between fiscal years 1980 and 1990, although the number confirmed declined. Most Department investigations reviewed appeared to be timely and adequate, but about 20 percent were not. Some reports were not investigated at all. Many families that were at risk of abusing or neglecting their children did not receive preventive family services from the Department. Family services were not always successful in preventing out-of-home placements, or in reducing the risk of subsequent abuse or neglect, but in many cases the participating families were uncooperative. Department procedures and management controls were not always effective nor followed. Finally, Department staff surveyed indicated they do not always have adequate resources to do their jobs, which could have contributed to problems noted during the audit.
Kansas’ Foster Care Program, Part I: An Overview of the Program
Over the past 10 years, the law has emphasized providing family services to prevent foster care placements rather than maintain children in foster care indefinitely. The number of children in the Department of Social and Rehabilitation Services' custody has risen by more than 20 percent the last three fiscal years. Although the number of people licensed to provide foster care generally has kept up with this increase in children, the number of social workers has not increased correspondingly.The total cost of the foster care program is unknown because the Department's budgeting and accounting system counts only direct payments to foster care providers; it excludes the salaries of social workers who manage the cases. We also noted problems with the accuracy of figures reported by the Department, and cautioned readers accordingly. During the last three years, the amount spent on direct payments to foster care providers increased by about 56 percent (35.2 percent when adjusted for inflation). The amount the Department spends per child varies considerably across the State.
Review of the Department of Social and Rehabilitation Services’ Grant to Court Appointed Special Advocate of Shawnee County, Inc. (100-hour audit)
The Department of Social and Rehabilitation Services made a grant to Court Appointed Special Advocate of Shawnee County, Inc., to pay travel costs for members of the Permanency Planning Task Force. By making this grant instead of using the normal State expenditure processes, the Department of Social and Rehabilitation Services made State financial information inaccurate and increased the risk of improper use of State moneys in return for questionable savings in processing time. Because the Department did not conduct certain grant oversight procedures, about half of the grant moneys were not handled in accordance with the grant requirements.
Examining Increases in Expenditures for Adult Care Homes
Between 1982 and 1988, Medicaid reimbursements to all adult care homes increased by 46 percent, noticeably less than the 65 percent increase in total reported costs for those homes. The Medicaid reimbursement system has changed in ways that have both increased and decreased State costs. The removal of the limit on total costs by the Department of Social and Rehabilitation Services caused State costs to increase, and a change in the way property costs were reimbursed led to a decrease in State costs. For adult care homes in our sample, increases in health care costs--primarily because of increases in salaries and benefits for nurses and aides--had the largest impact on cost increases.
Comparing Budgeted and Actual Expenditures for Funerals and Burials for Public Assistance Recipients
During the first half of fiscal year 1990, the Department of Social and Rehabilitation Services reduced about one-fourth of its burial assistance payments because the decedent's estate had assets available to help reduce the Department's contribution or because the decedent's family had resources that exceeded the limits established by the Department for full burial assistance. It appears that funeral home and cemetery reimbursements are handled in about the same way as the Department's reimbursements for doctors and similar providers, although other providers may not have to attempt to collect funds from estates as often as funeral homes. The burial assistance program's actual expenditures have exceeded its appropriations each year since fiscal year 1986, and these deficits were always met by transferring funds from other assistance programs to the burial program.
Department of Social and Rehabilitation Services’ Provision of Alcohol and Drug Abuse Treatment Services
Most facilities provided all or substantially all the alcohol and drug abuse treatment services they proposed to provide with the grant moneys supplied by the Department of Social and Rehabilitation Services' Division of Alcohol and Drug Abuse Services. For five of 27 grants we reviewed, the grantees failed to provide the levels of service they proposed, although each provided some portion of those services. Of those five, the Valley Hope program provided the least service in proportion to its grant objectives. Outpatient programs at these five facilities received only about eight percent of the total funds for the 27 grants. All five facilities have had their grants renewed for the current fiscal year.
Caseload Increases That May Be Attributable to the Department of Social and Rehabilitation Services’ New Comprehensive Automated Eligibility and Child Support Enforcement System (100-hour audit)
The Department's revised fiscal year 1990 caseload figures for the Aid to Dependent Children Program were primarily based on projected expenditure data, not on caseload information accumulated by the new computer system. Although Department officials initially thought the old and new computer systems may have counted caseloads differently, they later concluded there were no differences between how the two systems accumulated per-month caseload figures. As a result, it appears that the new computer system does not account for any of the increase in caseloads that the Department recently projected for fiscal year 1990.
Comprehensive Automated Eligibility and Child Support Enforcement System (CAECSES)
The Comprehensive Automated Eligibility and Child Support Enforcement System was initially expected to be completed in two years at a cost of $11 - $13 million. The System took an additional year to complete, primarily because the Department of Social and Rehabilitation Services underestimated the amount of time needed to add the medical benefits component to the System. The System cost more than twice as much as expected because early estimates did not include all costs of developing such a system, and underestimated the hardware requirements and the number of State staff involved in the System's development. The State's share of System costs rose because of unanticipated financing costs and the lack of a federally approved link with the judicial branch. The ongoing cost of operating the System will be substantial. Some problems remain with its operation, although the Department is working to resolve them.
Drug Acquisitions Under the Medical Assistance Program
The Department of Social and Rehabilitation Services' contract system for acquiring drugs for the Medical Assistance Program appears to be cost-effective. For seven drugs under the contract system or other limitations during fiscal year 1989, we estimated that drug costs between September 1988 and February 1989 were approximately $230,000 less than they would have been without the system. Three of the seven drugs accounted for about 97 percent of these savings. Medical assistance recipients who had taken the seven drugs, as well as physicians who had prescribed the drugs, generally reported that the drugs were adequate to treat the appropriate medical condition. Finally, pharmacists who dispensed the drugs to recipients generally did not like the system. The pharmacists' concerns, however, were business-related and generally did not involve the quality of patient care.
In general, the audit showed that the Youth Center at Topeka is not equipped to provide the level of security needed for the individuals being placed there. The lack of a fence around the campus as well as weaknesses in the physical facilities and staffing levels may have allowed students to escape rather easily. Also, Youth Center officials do not take into account all available information such as a student’s runaway history when determining the level of supervision a student needs. More importantly, a lack of strong management at the facility has created an atmosphere where poor performance is tolerated, staff morale is low, and overall security is not as strong as it should be.
Improving the System for Providing Mental Health Programs and Services in Kansas
The system in Kansas for providing mental health services anticipates that mentally ill people will be served in the communities when warranted. However, gaps and insufficiencies in community services prevent the system from working as intended. To provide comprehensive, integrated mental health services that minimize use of the State mental health hospitals, the Legislature will need to consider options in the areas of providing additional funding for community services for the seriously mentally ill, shifting resources from the State mental hospitals to community services, and establishing a single authority over the system. The report also makes recommendation to the Department of Social and Rehabilitation Services to improve its screening and aftercare services.
Reviewing the Way State Agencies Collect Delinquent Accounts
Statewide requirements for collecting, reporting, and writing off amounts owed to the State have improved somewhat in the past 11 years, but complete information about agencies’ accounts receivable is just beginning to be collected. Most of the six agency programs reviewed are required to follow additional collection procedures that go beyond the State’s minimum requirements, and all of them use the State’s set-off program as part of their collection procedures. Statewide procedures for the management of delinquent accounts and specific agencies’ collection procedures can both be improved.
Public Transportation Services for the Elderly and Handicapped in Kansas
Because State agencies do not require local transportation providers to take any specific coordination actions, the current Kansas system results in significant overlap and inefficiency at the local level. All parts of the State apparently have unmet needs for transportation services for the elderly and handicapped. Some Department of Transportation policies are more restrictive than federal requirements, and may limit local agencies’ flexibility to meet the transportation needs of their clients.
Client Abuse Reporting Systems, Part III: Reviewing Implementation of Previous Audit Recommendations (100-hour audit)
The Department of Social and Rehabilitation Services has fully implemented only two of the 11 recommendations made to it in the September 1987 audit report, Client Abuse Reporting Systems, Part II: Parsons and Norton State Hospitals and Neurological Institute. As of January 25, 1988, implementation was planned or had been partially achieved for all but one of the remaining nine recommendations.
Client Abuse Reporting Systems, Part II: Parsons and Norton State Hospitals and Kansas Neurological Institute
Several cases of client neglect were handled outside the established reporting system, staff members accused of abuse or neglect were not always removed from duty, and parents and others were often not properly notified of reported abuse or neglect incidents. In addition, many of the changes the Department has planned or made will still not result in independent and adequate abuse investigations or improved monitoring of the institutions, nor will they address other recommendations made in the March 1987 audit of Winfield State Hospital.
Regulation and Operation of Cowley County Developmental Services
The Department of Social and Rehabilitation Services generally enforced its regulations consistently at the six agencies visited. Cowley County Developmental Services’ handling of client funds was similar to other agencies’, but the auditors did find several weaknesses. The agency also charged significantly more for vocational services than other agencies. Cowley County Developmental Services had several problems with its financial management procedures, including violations of agency policies and failure to report all unpaid bills. Finally, the auditors investigated numerous complaints concerning the agency; some were apparently true, while others were not substantiated.
Client Abuse Reporting System at Winfield State Hospital
The client abuse reporting system failed to ensure that suspected abuse or neglect of Hospital residents was promptly reported and investigated, and that employees who abused or neglected residents were disciplined appropriately. A number of improvements have been made, but the report contains additional recommendations to address remaining problems.
Between 1980 and 1986, the number of abused or neglected children in the Department of Social and Rehabilitation Services’ custody declined almost 21 percent. The Department established procedures to ensure that children are placed in the least restrictive setting possible, but did not always follow those procedures or document compliance. The Department needs to improve its foster care allocation formula, compliance, and documentation.
Blind Industries has cost money in recent years because product prices were based on outdated cost estimates. Blind Industries will likely continue to lose money because recently adjusted prices for some products do not cover the actual cost to produce the goods in the most recent year. Blind Industries needs to improve the frequency and quality of accounting reports produced for management, and management needs to make better use of some of the information that is already available.
Cowley County Developmental Services, Inc.(100-hour audit)
Cowley County Development Services is a community-based agency that serves mentally retarded adults. This special audit showed that the agency was serving the required number of clients and was billing correctly for vocational services. However, there was evidence of incorrect payment to client employees, and the agency may not be follwoing accepted practices in determining client pay rates.
The State’s three major training programs are well coordinated, but the audit raises administrative concerns about each one. The Job Training Partnership Act, which primarily serves economically disadvantaged people or those who have other barriers to employment, is being administered in compliance with federal requirements. But funding inmate programs with Job Training Partnership Act funds may create a potential liability for the State if the Department of Labor disallows the expenditure of those funds for inmates who are not released within a reasonable period of time.
In 1985, residents in 170 adult care homes who footed their own bill paid an average of $35. 76 per day for their care, or $6 more per day than Medicaid residents. Data available for 217 homes showed that the average private-pay rate increased by 14.2 percent between 1983 and 1985; Medicaid rates increased by 13.6 percent. The audit examines private-pay rates and rate increases for different types of homes. Chain-owned homes had the highest daily rates. Homes that changed ownership or management had the largest rate increases.
Most of the audited localities’ expenditures for alcohol and drug abuse programs complied with State law. A few used liquor tax funds to pay administrative costs, which is not specifically allowed by law. Others funded such activities as teenage hotlines and domestic violence programs, which did not have substance abuse as their primary concern. Statutory changes made in 1986 may prohibit such expenditures in the future.
Controls over cash are adequate, but reducing the cash on hand would minimize the potential for loss. Controls over prescription drugs need to be strengthened, but it is difficult to control illegal drugs coming from the outside. Controls to protect staff depend on the staff’s ability to monitor youths physically or electronically. Other youth centers have more staff for monitoring students.
This report pulls together the main findings in this series of three audits covering property costs, administrative costs, and quality of care. It summarizes recommendations for administrative improvements relating to property and administrative costs. It also presents alternatives for changing the reimbursement system, and outlines the steps needed to bring about these changes.
Little relationship was found between the amount being spent for residents and the quality of care they receive in such areas as staffing, services, food, and the like. Alternatives examined in the report for improving the quality of care are 24-hour licensed nursing care and reimbursement systems that explicitly address residents’ needs.
The current system for controlling administrative costs has not kept pace with changes in the industry. It unintentionally offers strong financial incentives for chain ownership--primarily in the area of owner’s compensation. Ambiguity in the present system also makes it more difficult to monitor, evaluate, and control administrative office costs, and makes it possible for providers to take advantage of the system.
Court-Ordered Mental Evaluations at State Hospitals
If local funding were available, most competency and presentence evaluations now being done at State hospitals could be performed at much less cost in community mental health centers. Other benefits include faster processing of crimimal cases in district courts, treatment in a less restrictive environment, and better use of State facilities.
The property report shows that changes of ownership have affected the composition of the industry in Kansas and have placed increasing pressure on property-related costs. The current reimbursement structure for property costs may encourage people to sell adult care homes rather than retain them.
Average charges are more than the average reimbursement rate for medicaid patients in all the categories of homes. They also follow the pattern established with historical costs and reimbursement rates in that they are higher for non-profit homes than for profit homes and higher for homes owned out-of-State than for those owned in-State.
A Preliminary Analysis of Costs and Charges at Kansas Adult Care Homes
The audit disclosed some problems with the way that State mental health and retardation hospitals are carrying out the policies and procedures related to the rights and treatment of institutionalized patients. For example, four of the five hospitals reviewed were not following established policies regarding compensation for patient employees. The auditors also found that the mental health hospitals were using seclusion and restraint measures to excess, and that a number of factors were causing delays in getting mentally retarded patients placed in community facilities when they no longer need institutionalized care and treatment.Recommendations call for the Department to review and reduce the hospitals’ use of seclusion and restraint measures. Also the Department is to ensure that hospital staff refer patients who are ready for community-based treatment to area office social workers for placement on a more timely basis. Other recommendations are intended to ensure that standard patient rights policies are adopted and that patients are treated uniformly and consistently.
Mental Health and Retardation Services: Part I: System-Wide Management
Two sunset performance audits examining the Department of Social and Rehabilitation Services’ program for providing mental health and retardation services to Kansans were done. Part I addresses concerns about potential duplication and lack of coordination of the programs and services offered at State institutions and at community-based facilities.The audit stated that the Department has not taken an actice enough role in planning, managing, and coordinating the State’s mental health and retardation system to avoid duplication and to ensure the program is operated efficiently. A number of other findings also illustrate the need for more effective and efficient management.
Controlling Medical Assistance Costs in Kansas, Part III: Improving Controls Over Fraud and Abuse
This performance audit examines the fraud and abuse in the State’s medical assistance program and assesses the adequacy of efforts to identify and control such fraud and abuse.To detect instances of fraud and abuse, auditors designed computer tests and examined case histories and went through records in physicians’ offices, hospitals, and nursing homes. They found a number of problems. For example, the system often pays medical assistance claims that probably should be paid by third parties such as insurance companies. Also, two payments are sometimes made for the same claim, payments are made for unauthorized services, and providers of medical services are paid for services that are not actually provided.The report makes a number of recommendations to correct the problems that were found and to improve the system.
Nearly one-third of those receiving general assistance were either ineligible for the program altogether or were receiving incorrect payments, generally overpayments. In fiscal year 1977, these errors cost the State an estimated $2 million, or 17.6 percent of all program expenditures. Errors causing approximately $1.7 million of this amount went undetected. The audit recommended that more strenuous review procedures be applied to the program.
Controlling Medical Assistance Costs in Kansas, Part II: Options for Containing Costs
Between fiscal years 1973 and 1977, total medical assistance expenditures increased from $70.6 million to $146.6 million, an increase of $76 million. The auditors found that the increase was caused by the following: higher medical care prices (49.1 percent of the increase), more people in the program (41.4 percent of the increase), and more services used by those in the program (9.5 percent of the increase). Kansas’ efforts to limit services, such as limiting the number of visits to a dentist, address less than 10 percent of increased expenditures. And higher medical care prices, the cause of nearly half the increase, and difficult to contain, especially on a short-term basis. The most significant action appeared to be steps to contain enrollment in medical assistance programs. When the Department of Social and Rehabilitation Services changed the eligibility standards for two State-funded medical assistance programs in 1977, for example, it reduced expenditures for those programs from $35.5 million to $19.6 million.The audit recommended ways to address all three reasons for cost increases.
Controlling Medical Assistance Costs in Kansas, Part I: Improved Accountability Through Better Program Information and More Effective Budget Review
Auditors attempted to determine the reasons for rising costs in medical assistance programs, and particularly the reasons for a supplemental appropriation of $14.5 million in State funds for fiscal year 1977. They found that certain actions in the budget process, and not unforeseen medical assistance costs, led to the need for the supplemental appropriation. The analysis showed that when budget cuts have been made at the start of the budget process, they have not been accompanied by corresponding cuts in the kinds or levels of service. This finding led to recommendations to help ensure that the Legislature receives more accurate and reliable medical assistance budget estimates, to encourage better documentation for what is intended by changes in the level of funding for medical assistance programs, to clarify the intent of the Legislature when it makes appropriations for these programs, and to provide more meaningful legislative oversight of medical assistance programs. Auditors also found that information about particular medical assistance programs was inadequate for determining precislely why medical assistance costs rose. The report recommends that the Department of Social and Rehabilitation Services establish a system that will provide more useful information about the programs. This system will allow the Department to identify expenditures and services by program, to identify the reasons for cost increases, and to assess the impact of possible changes in medical assistance programs.