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Waste panel identifies millions in savings

By TODD RICHMOND
Associated Press

MADISON, Wis. (AP) — Wisconsin could save at least $266 million a year by clamping down on fraud in public assistance programs, tweaking overtime policies and implementing efficiency ideas state agencies have been developing, according to a report the governor’s waste and fraud commission released Tuesday.

The panel found a number of problems across state government, including a lack of data that hampered the commission’s research, poor use of information technology, state agencies not sharing information and a lack of performance evaluations for employees, the commission’s chairman wrote in the report.

Gov. Scott Walker issued a statement calling the commission’s work important and promising the study wouldn’t become “just another government report put in a drawer.”

The governor put the seven-member commission together in January and asked it to find $300 million in annual savings for the state. Tuesday’s report is the first of two the commission is expected to compile this year.

The biggest opportunity for savings — $177 million per year — lies in cracking down on fraud in assistance programs such as FoodShare, the state’s food stamp program, and Medicaid, the report said.

Public assistance enrollment has been growing over the past decade, driving up spending, the report said. At the same time spending on fraud prevention has dropped. Between 2004 and 2009, for example, state spending to support local government’s efforts to identify and prevent fraud decreased 76 percent, from $2.3 million to $561,000.

The lack of detection has led to a drop in collection claims against ineligible recipients, which in turn means the state recoups less of its losses.

The report said fraud investigation units need adequate staffing with performance reviews for case workers, and they need to cooperate with each other. Agencies themselves also need to improve their computer systems so they can track recipient eligibility in real time and require photo identification to obtain FoodShare debit cards.

The Legislative Audit Bureau should examine public assistance programs once every three years, the commission recommended.

Kitty Rhoades, deputy secretary of the state Department of Health Services, which administers FoodShare and Medicaid as well as a number of other public assistance programs, said agency officials worked with the commission and will make as many corrections as they can.

The agency announced Tuesday the state will get nearly $1.5 million in bonus payments from the federal government for having one of the best FoodShare accuracy rates in the nation. According to the announcement, a review by the U.S. Department of Agriculture found 98 percent of the benefits issued in Wisconsin were correct last year.

However, the announcement acknowledged the state’s error rate exceeded national rates in 2006, 2007 and 2008. Error rates in 2009 were better than last year, it said. The waste commission report speculated improved error rates may have more to do with changes in defining and reporting errors than an actual decline.

Meanwhile, the state could save another $5 million by revising overtime policies, the report said. The study criticized contracts that allow state employees to collect overtime for shifts beyond 40 hours even if they were out sick or on vacation and didn’t work all those initial 40 hours.

The study raised questions about contracts that require higher-paid senior employees in the Department of Corrections to get first chance at overtime, which the report says inflates costs. It also criticized DOC contracts that lay out a specific process for calling people in for overtime, such as letting the phone ring at least 10 times.

If an employee is passed over for overtime because the process isn’t followed, he or she can still get paid.

Mistakes in the process cost the state $83,175 last year, the report said.

Corrections spokeswoman Linda Eggert didn’t immediately return a message. Marty Beil, executive director of the Wisconsin State Employees Union, which represents 20,000 workers statewide, also didn’t immediately return a message.

The commission recommended overtime rates begin after an employee actually works 40 hours. The panel also suggested the state move to an Internet-based time reporting system, simplify payroll procedures and limit the use of seniority in scheduling overtime. The report notes Walker’s collective bargaining law, which strips almost all public workers of most of their collective bargaining rights, will help achieve those goals

The report goes on to list dozens of efficiency suggestions from across state agencies that could result in nearly $40 million in savings per year, including consolidating information technology services, ending a grant program to help inmates get drivers licenses, consolidating storage space, selling unneeded land and using GPS technology to track salt use in winter.

Other recommendations in the report include:

— Offering low-interest loans to jump-start government consolidation.
— Tighter oversight of state purchasing card use.
— Consolidating emergency dispatch centers to reduce the number of answering points.
— Implementing a private sector efficiency program known as LEAN. Iowa, Connecticut, Minnesota and Indiana all have used elements of LEAN to streamline operations.

The commission is expected to release a final report in January.

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