The Minnesota Department of Human Services has uncovered more improper payments, and counties and tribes are on the hook to help pay the money back.
Rice County is responsible for somewhere north of $115,000, according to a letter to Rice County Social Services Director Mark Shaw from DHS Commissioner Jodi Harpstead. The amount, Shaw told the Board of Commissioners Tuesday, is likely “several thousands” higher, though an estimated amount may not be known until weeks’ end.
The payments from DHS total more than $10 million and include improper checks to substance abuse providers, a welfare assistance program and child foster care services. They come on top of the recent discovery of $29 million in overpayments the department made to two state tribes over a span of more than a decade for substance abuse treatments.
Harpstead, who took over the agency in September, said uncovering these issues is part of her mission during her first three months in office.
“The plan for my first 90 days as commissioner includes rooting out billing and payment problems in the Department of Human Services, being transparent about them, and using what we learn to build a new system of process controls that prevents them from happening in the future,” she said.
Counties will have to help pay off $8.8 million in funds the state improperly billed the federal government for substance abuse disorder treatment services that were provided in facilities that were not eligible for federal matching funds. Rice County’s portion for the improper billing is almost $116,000. The funds, he said, were typically for in-patient treatment.
The amount each county owes range from nominal — Dodge County owes less than $47 — to the exorbitant — Hennepin County owes $2.15 million, according to DHS documents.
DHS must also cover $727,000 it improperly clawed back from individuals for overpayments in cash welfare assistance, and counties and tribes will not get reimbursements for more than $600,000 in payments to foster care facilities where some adult staff had yet to get required background checks.
While all the county’s foster care providers have undergone the background checks, a number of other providers haven’t, Shaw said, noting that state law gives them until March to have the checks complete. Because counties were unaware of the overpayments, there was little urgency for providers to have them done.
The amount Rice County will need to send back to the state isn’t yet known. County finance staff is calculating that amount, with an estimate due in the next few days.
While Shaw said he’s working with the Minnesota Association of Counties and the Minnesota Association of County Social Service Administrators to “remedy: the situation, it’s unclear what that will mean for the county’s bottomline.
Gov. Tim Walz said his administration is trying to root out past issues and correct them.
“These are not the last of the issues we are going to surface,” Walz said. “Our goal is to put a plan in place to change the process, to work with the Legislature to find a way to make this agency as effective and efficient as possible.”
But the news, following a string of other controversies, has triggered a discussion in St. Paul about trying to break up the massive agency, the largest in state government with a budget of $18 billion every two years.
State Sen. John Jasinski, who has been critical of DHS and the series of errors that have made news in recent months, and was at Tuesday’s board meeting, agreed with the governor.
“That department is so big, that they’re trying to figure out how they can change that and the (department’s) whole mentality,” he said.
Legislators plan to discuss breaking up the agency when they reconvene in February.