FOR IMMEDIATE RELEASE:
July 14, 2009
THOMPSON TO HRA: DO A BETTER JOB IN OVERSIGHT OF HOME CARE PROVIDERS AND COMPLIANCE WITH CONTRACTING RULES
New York City Comptroller William C. Thompson, Jr. today issued three audits regarding the Human Resources Administration's (HRA) operations. Two of the audits faulted the HRA for its lack of oversight of home care providers for seniors and the disabled and its failure to comply with purchasing rules.
"The Human Resource Administration plays an important role providing New Yorkers financial assistance, food stamps, care for seniors, the disabled and children, among many other support services," Thompson said. "Given its important mandate, it is imperative that HRA follow the appropriate rules and properly use its resources to provide these essential services."
The Human Resources Administration serves more than three million New Yorkers through essential and diverse programs. The services provided include: temporary cash assistance, public health insurance, food stamps, home care for seniors and the disabled, child care, adult protective services, domestic violence support, HIV/AIDS support services, child support enforcement, and other income support services.
Thompson's first audit measured the adequacy of HRA's efforts to monitor the fiscal activities and fiscal contract compliance of personal care service providers. This audit covered Fiscal Year 2008.
HRA's Home Care Services Program provides Medicaid-funded, non-institutional, long-term care options designed to help the elderly or disabled remain at home rather than in a nursing home or other institution. One of the program's options, the Personal Care Program, provides home attendant and/or housekeeping services to Medicaid-eligible clients who are in stable medical condition but have difficulty with daily life activities. In FY 2008, HRA had 93 contracts with various personal care agencies to provide services to approximately 47,000 people at a cost of $2 billion.
"Although HRA has a number of activities in place to monitor the financial affairs of contracted care providers, those activities are nullified by its failure to act decisively and promptly," Thompson said. "As a result, the recovery of contract overpayments made to service providers was delayed for years."
Auditors found severe delinquencies in the completion of independent CPA audits and in HRA closeouts of personal care agencies' annual financial statements. These delinquencies occurred because of HRA delays in contracting for CPA audit services and resulted in significant delays in the annual HRA closeouts and the recovery of overpayments made to service providers. Consequently, the State and City could have lost an estimated $25 million in interest revenue on a total of $203 million in outstanding payments that remained with the agencies.
Further, although the contracts with the personal care providers require them to safeguard government funds, HRA does not expressly require that the agencies maintain cash balances in FDIC accounts or secure them in other ways. On June 30, 2008, providers held $255 million in bank balances, of which $233 million was not secured.
Auditors also found that HRA fiscal managers do not perform field visits on a routine basis, nor make visits to all contracted personal care programs each year. HRA's annual performance evaluations of its contracted personal care programs are not based on complete information or information relevant to the contract year. Also, the Director of the Fiscal Operations unit performed and oversaw several key functions, some of which were not adequately separated.
Thompson's second audit determined whether HRA's Bureau of Eligibility Verification processed and investigated cash assistance applications in a timely and effective manner in accordance with established procedures during FY 2008.
HRA provides cash assistance to families and single adults or couples with children through its cash assistance programs, Family Assistance and Safety Net Assistance. HRA's Bureau of Eligibility Verification (BEV) is responsible for conducting eligibility reviews of applicants to ensure that only eligible persons receive cash assistance.
Auditors found that HRA's BEV is generally processing and investigating cash assistance applications in a timely and effective manner in accordance with established procedures. BEV conducted face-to-face interviews within the required 17-day timeframe. BEV also generally made its recommendations within the 30- or 45- day timeframe in which HRA is required to render cash assistance decisions to applicants. Auditors also found that the final decisions for cash assistance generally corresponded to the recommendations made by BEV.
BEV, however, did not have files for 9 of the 92 sampled cases. Despite several requests for the files over three months, BEV was unable to produce the files.
The third audit determined whether the HRA complied with certain purchasing procedures according to the New York City Charter, Policy Procurement Board (PPB) rules, and the Comptroller's Directive #24 during FY 2007.
The audit revealed that HRA did not comply with the Comptroller's Directive #24, the City Charter, and PPB rules in two major areas. First, HRA did not enter into contracts for purchases of services when required, and instead used purchase orders to process payments for services totaling $145,809,224.
Second, HRA did not register a Memorandum of Understanding (MOU) with the Comptroller's Office. HRA paid $35,734,637 to the New York City Housing Authority (NYCHA) for providing the Job Opportunity Program, community center programs, and summer employment programs without having registered a MOU.
Beyond these two areas, HRA's vouchers were properly approved and authorized; appropriate documentation was maintained; invoices substantiated the amount paid; and files indicated that goods and services were received.
Thompson made a total of 19 recommendations in the three audits. Of those, HRA agreed with twelve and disagreed with seven.
All of the audits can be viewed at www.comptroller.nyc.gov .