APPENDIX III APPENDIX III With regard to GAO's recommendation for in-depth assessments of Regional The fourth recommendation, to require states to periodically gather data on earned income available to meet recipient needs in the grant month, has been addressed earlier in the letter. Indiana objects to data gathering when it serves no worthwhile purpose. The next recommendation by GAO, to require the citing of errors less than $5.00 and those occurring because of changes during the administrative period, was also addressed earlier in the letter. DHEW has established such activity is simply not cost-effective and Indiana totally agrees. Another recommendation is to require states to report all causes of payment errors detected during the Quality Control review process. In Indiana, this procedure has been in operation for several years, therefore, the State would not object to this requirement. The last two recommendations are for detailed analyses of Quality Control data at both the Federal and state levels. Again Indiana has, for several years, performed this detailed analyses identifying error causes and developing effective corrective action. Whether or not this activity is also carried on at the Federal level is of no great concern to Indiana as no assistance is needed in identifying problem areas or solutions for reducing errors in Indiana. This State does not recognize the same general problems as the writers of the GAO study to be significant and, therefore, in need of immediate attention. We see absolutely no merit in redefining a Quality Control "error" making the definition more inclusive and thereby inflating the error rates. Identifying, coding, and recording additional but less significant potential error factors is simply a waste of time. And with regard to the part of the report addressing "errors not identified" which occur in states with need standards and/or payment maximums occurring as a result of miscalculations or situation changes which do not call for an award adjustment, we contend that these are not errors and, therefore, there is no need to identify them for Quality Control recording purposes. GAO suggests that error rates are not comparable between states that meet full need and those states that have need standards and/or payment maximums. Indiana would disagree since these changes do not affect the assistance payment and, therefore, cannot be considered as errors, identified or not. GAO is concerned that states meeting full need suffer a higher error rate, however, these states have more liberal constituants and legislators who are less concerned with controlling the expense of the state's welfare cost. They, like all states, were given the opportunity to elect and select optional programs and budgeting procedures. They were aware that their error rates would probably be affected.. As the state is a primary contributor to the program expense, it does and should have some voice in choosing how monies will be spent and how accountable the APPENDIX III APPENDIX III system should be for the expenditure of funds. In Indiana, the legislators and local citizenry require more accountability of welfare funds. Therefore, we contend that since an error occurs only when monies are misspent, error rates are comparable between the liberal and conservative states since error rates in both are actually a measure of misspent monies. Indiana's primary concern with the Quality Control system as it exists today is with the lack of effective communication and the worsening working relationship between State and Federal staff. In the last two years, this State has witnessed an obvious deterioration of that relationship. Federal reviewers are citing errors where no errors exist. They are using entirely different subsample review techniques than were used prior to 1978 with no explanation. Current Federal review staff do not understand Indiana's State Plan, policy, rules, regulations, and laws. Errors are cited with no foundation. The State has provided a wealth of documentation to Federal staff substantiating the correctness of State review findings; however, Federal staff disregard our position and refuse to deal with the real issues involved. They simply cling omnipotently to the error citations and consequently, Indiana's error rate is inflated, review period after review period. A critical need exists for fair and impartial appeal proceedings for states We would, therefore, disagree with GAO's recommendations that the Federal government become more involved in the system, having greater control demonstrated by tightened review requirements and required assessment procedures. It has been our experience to observe the traditional pattern of the Federal government to be uncooperative and unjust. Federal decisions are often arbitrary with officials ignoring the facts and attributing a superior power to themselves. As states provide nearly half the funds for the program, they have a right to participate more fully in establishing the rules and improving the system. In conclusion, we would like to say that we were disappointed in the report submitted by GAO in that this State's concerns were not considered and we do not believe the concerns discussed in the report are significant. If GAO's recommendations are implemented, there will be no improvement in the system. In fact, the affect will be quite the opposite. Hopefully, Indiana's comments contained in this letter will be given more attention than occurred during the interviews conducted by GAO reviewers while in this State. These comments represent not only Indiana but the majority of the states. These same objections have been voiced for several years and by several state welfare representatives at various conferences and Federal meetings with both Regional and Central staff. Should the draft of the proposed report be amended to include any of these comments, Indiana would appreciate receiving a revised copy of that report. Sincerely, Jara Lenn Miss Tara Lenn Assistant Director Public Assistance Division Quality Control Section In response to your letter dated March 21, 1980 and the draft As stated in the report, with some minor exceptions and variations, Thank you for your interest and for the opportunity to review and APPENDIX IV APPENDIX IV REVIEW COMMENTS TO GAO REPORT "OPPORTUNITIES FOR GETTING BETTER MANAGEMENT INFORMATION FROM QUALITY CONTROL IN THE AID TO FAMILIES WITH DEPENDENT CHILDREN PROGRAM" The draft report relating to the above was reviewed by key administrative staff in the Bureau of Social Welfare who are responsible for overall administration of the Aid to Families with Dependent Children program. With some minor exceptions and variations the State of Maine is in agreement with the draft report of the General Accounting Office. The agency is in total agreement that Quality Control findings should not be used as a basis of sanctions imposed upon a State. The agency disagrees that quality control findings are not as effective as they could be in identifying how well recipients needs are being met. Quality Control is one of the ways to identify this factor. Administrative and selective special reviews are another. In addition basic data relating to the cost of living and the actual payment level is continually being compared. When a state meets only 67% of needs in accord with the 1973 cost of living index it becomes obvious that there are gaps in the program's ability to meet a reasonable standard of need on a current basis. The State of Maine disagrees that all payment differentials, including those under $5 per month should be considered errors. It would agree that an agency should tabulate and analyze these figures. Maine's own tabulation indicates that these differences are due to the complexities inherent in projecting on a month to month basis the actual income from wages and work related expenses. A leeway of $5 per month amounts to a variation of slightly over one dollar per week. To predict income closer than this is impossible when it comes to fluctuating wages and expenses. Maine would support a policy of no allowance for fluctuation of fixed income such as Social Security and Veterans Benefits. The report's constant reminder of problems in comparing state programs in 50 states and imposing sanctions based on varied state methods of administering a program is a significant factor that should be considered by the Congress. The example of not calling a payment error when a state miscalculates income but it doesn't effect the grant because the state meets only a proportion of need after income is deducted from the standard is a case in point. Although no payment error is recorded, there is still an error of significance. At one time the State of Maine used this method of budget calculations. Although the agency was making errors in calculations and projections these errors were not recorded. They did not effect payment. Hence, the agency was lulled into a false sense of security. The agency felt it was in fact doing much better in projecting income than it was actually doing. A state with a higher error rate may be doing a better job than those states claiming a lower error rate. The State of Maine disagrees that it is currently possible for the Federal Government to develop a standard format for Quality Control reviews in all 50 states. In addition it has problems with the Social Security Administration's Quality Control staff who want standardization to make it easier for completion of their particular work. No consideration is given to the fact that the State agency, though not following supposed Quality Control guidelines in its policy, is in fact in conformity to program regulations. One of the major problems found since the Social Security Administration took over the monitoring of Quality Control from the Office of Family Assistance is that there is APPENDIX IV APPENDIX IV no communication between Quality Control staff and Program Operation staff. Quality Control should be independent of influence and manipulation whether on the State or Federal level. However, it should not be so independent that there is in actuality no communication with people who develop and interpret overall policy. The inexperience and the rigidity of Federal Quality Control monitors combined with their unwillingness to look at state policy and actual program regulations creates continual problems. The State of Maine has had a Quality Control system since 1955. The State is aware of the possibility that an agency could manipulate the findings of its system to give a more favorable report to Washington. The fact that this possibility may be a reality in some states indicates that the original purpose of Quality Control as a meaningful management tool has been ignored by some states and by the Federal Government. |