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Texans Need Help with Benefits

People living in the Austin-San Marcos area having trouble applying for CHIP, Medicaid, food stamps and other public benefits can get help Saturday at the Austin Convention Center, Exhibit Hall One, at the corner of Trinity and Cesar Chavez Street in downtown Austin.

State employees will be on hand to assist people between 10 A.M. and 4: P.M. Free parking is available at 2nd and Brazos.

According to the Austin American Statesman, the event "is a response to problems some residents of Hays and Travis counties have had since the state turned over public assistance enrollment for those counties to a private contractor in January."

Similar events have been held in Houston, San Antonio, and the Rio Grande Valley. Those events, however, concentrated on helping people apply for CHIP benefits. This one will help people who have had trouble applying for all benefits.

This event and the similar ones that have taken place across the state are unprecedented and an omen of what can be expected in the future if HHSC continues with its call center plan.

HHSC is trying to put its best face forward on its call center plan, but continues to have multiple problems getting it to work right.

Many calls to the call centers are still going unanswered. In an August 17 email, the Austin TAA call center operations manager told her supervisors that

Supervisors are expected to monitor that your staff are logged on to the soft phone and are in “ready” status. We continue to get reports showing a high number of dropped calls, etc. (My emphasis). This should not be the case with an average at 40-50 people logged on to the phones at any given time.

Callers lucky enough to get through may find that their struggles to obtain much needed benefits are just beginning. Those attending a CHIP Coalition meeting last Friday were told that HHSC conducted an audit of CHIP cases pending eligibility determination and found that 40 percent had errors that were holding up eligibility determination.

People are having problems applying for benefits because the call center plan is based on two faulty assumptions:

Faulty Assumption #1: Low-wage call center operators whose main job qualification is data entry experience can provide the level of assistance that most applicants for benefits need.

This business model may work for a private business that sells specific and limited services, but providing aid to people in need is much different.

Most applicants seeking public assistance don't know about the specific program they need or for which they may be eligible. What they do know is that they're about to run out of food, or their child is sick, or their elderly parent cannot take care of herself or himself anymore, or any one of a thousand variations of these basic crises that Texas families face every day.

A person facing such a crisis needs to speak with a worker with extensive knowledge about the complex rules and regulations that govern each program to help them navigate the eligibility application process. Funneling applicants through lightly trained and inexperienced call center operators means that the number of people falling through the holes in our social safety net will grow.

Incorrect Assumption 2: Call center technology can replace the judgment and expertise of experienced eligibility workers.

The complicated nature of the eligibility determination rules require the kind of expert human judgment that, at this time, is impossible to program into a computer and maintain the kind of flexibility that you need to provide compassionate service to those in need. Technology improvements will make the delivery of health and human services more efficient only if the improvements complement rather than replace eligibility workers.

Business technology does not always transfer neatly to government services. A good example took place recently in Indiana. According to this article in the Fort Wayne Journal Gazette about 3700 recipients had their benefits incorrectly terminated because of an overloaded at acall center operated by a private contractor. State employees had to bail them out.

Privatizing welfare

Consulting company offers sample of problems to come

Fort Wayne, Indiana Journal Gazette

August 20, 2006

By Julie Creek

Until late January, caseworkers in the offices of the Indiana Division of Family Resources had never even heard of the Lucas Group.

The memos came first. They announced that the Lucas Group would take responsibility for “alerts,” information employers file with federal and state government when aid recipients are hired or get a raise. Caseworkers regularly check alerts against their records to ensure that those receiving aid aren’t hiding income.

A few weeks later, the frantic phone calls began from welfare recipients who depend on the $300 or so a month they receive in benefits. They had received letters from the state saying that there were “discrepancies” in their files that must be rectified within 10 days or they would lose their benefits.

They were instructed to call an 800 number. But because the line was jammed with calls, they couldn’t get through. By the time the “Special Alerts Project” ended a little more than two months later, state employees had been called in to help handle the overload.

Some 3,700 Indiana families had their benefits abruptly cut off or reduced. But nobody bothered to keep track of how many of those families were actually ineligible for welfare – and nobody knows how many people were too confused, overwhelmed or intimidated to respond to the letters.

The Family and Social Services Administration had commissioned the job to get ineligible families off the welfare rolls in anticipation of a broader plan to turn the entire aid eligibility system over to a private company. The jammed phone lines and other problems seem to have been a blessing for state officials because the Lucas Group achieved far more than they thought possible, kicking more families off the aid rolls than originally estimated.

The project was even structured much the same as FSSA’s senior staff envisions the agency will look after the private company takes over – centralized call centers that obliterate personal relationships between welfare recipients and individual caseworkers.

The Lucas Group’s brief experiment in running just a small portion of the state’s massive eligibility system created havoc for the poor citizens who depend on welfare payments, food stamps or Medicaid for their basic needs.

And it raises the central question in the whole debate over privatization at FSSA: How much will billion cash cow for a aid recipients suffer when the entire system becomes a $1 private company? It also raises troubling questions about the motives of elected and appointed government officials who push privatization as a miracle cure for all that ails government. They appear to view hassling poor people until they stop asking for help as the way to make government more efficient.

Even as they worry about hanging on to their jobs after the transition to a private company, welfare caseworkers fear most for their most vulnerable clients.

“I had a woman who called me, and they said she was working at the exact time she was having a baby,” said Jane Gresham, an officer of the American Federation of State, County and Municipal Employees 3736 and an Allen County caseworker. “And she had other children at home. It turned out she had gone to a one-hour job-training session and realized it wasn’t the job for her. Fortunately, I was able to get her benefits restored fairly quickly.”

Privatization blues

When FSSA Secretary Mitch Roob announced last fall that his department planned to privatize the eligibility process for Temporary Assistance to Needy Families, food stamps and Medicaid, a whole cadre of outside consultants and experts sprang into action.

KSM, an Indianapolis firm, was hired to help FSSA officials write a request for proposals inviting interested companies to bid on the privatization project. KSM hired the Lucas Group as a subcontractor, but it quickly became clear that the Boston-based Lucas Group had the kind of expertise the agency needed, said Jim Robertson, director of the FSSA’s Division of Family Resources. FSSA signed Lucas Group to a million contract that made the firm the lead consultant in the $3.78 privatization preparations.

When state officials announced they were seeking bidders billion privatization scheme, for the $1 just two companies – Accenture and a consortium of companies led by IBM – expressed interest. Accenture later dropped out of the Indiana race after a virtual meltdown in the welfare privatization program the company designed in Texas last year. That left the IBM group, but one of the company’s partners, ACS, is Roob’s former employer, raising the specter of a conflict of interest. And ACS, a computer consulting firm, is also dealing with some unhappy government customers elsewhere.

billion Arguing that the $1 10-year contract was so big it needed his personal attention, Gov. Mitch Daniels jumped into the fray and handed the privatization decision off to a task force led by his deputy chief of staff, Earl Goode. The task force is expected to make a recommendation to Daniels in late September.

As FSSA officials awaited a decision, the Lucas Group’s task expanded to include examining existing welfare policies, writing the proposal request and, as Robertson explained: “doing some housecleaning.”


It was obvious from the outset, Robertson said, that the agency needed to come up with a way to clear the rolls of anyone who wasn’t eligible to receive benefits without piling more tasks on overworked caseworkers.

“We needed to do that before we outsource,” he said, “because the vendor will charge us based on the size of our caseload.”

The Lucas Group had used an alerts-type project successfully before, so the “Special Alerts Project” was designed to include a call center in Indianapolis.

But neither the Lucas Group nor FSSA officials anticipated such a large volume of calls, Robertson said. Problems with the call center began almost immediately as staffers became swamped. Gresham said clients who couldn’t get through began calling their caseworkers, who could only advise them to keep trying the 800 number.

When it was all over just more than two months later – after the bailout by FSSA staffers – almost 11,000 discrepancy letters had been mailed to FSSA clients, Robertson said.

Not all got there, though. According to an e-mail exchange among Allen County caseworkers, one worker, despite her misgivings, was instructed to close the cases of clients whose discrepancy letters had been returned to the department by the post office.

Robertson argued that it was safe to assume that the intended recipients of the letters had moved without notifying the department – a violation of department rules that would cause clients to lose benefits anyway.

An FSSA employee in southern Indiana, who asked not to be identified for fear of losing her job, said Lucas Group staffers found many discrepancies because they didn’t know local employers.

For example, she said, a paycheck from a local Arby’s franchise would be issued by the franchise company, although the file would say, correctly, that the client was working at Arby’s. The discrepancy led Lucas Group workers to assume the aid recipient had a second job that had not been reported. As a general rule, local caseworkers know where their clients are working and what company issues their checks, the employee said.

Of the 3,700 families who ended up losing benefits, Robertson said he has no idea how many cases were closed in error. He said some caseworkers complained about the additional work they had to do to reinstate those who lost benefits in error, but he argued that none of the clients suffered.

“They may have lost a month’s worth of benefits,” Robertson said, “but mostly it was a workload issue for the state.”

What Robertson didn’t say is families that lose a month of welfare benefits also lose food on the table and often the roofs over their heads.

Not surprisingly, the Lucas Group was rewarded, as required by the contract with the state – for percent of the 11,000 cases that had discrepancies – a closing more than 20 million lump sum payment in lieu of the employees’ hourly $1.1 rates.

FSSA officials don’t worry that a financial incentive might encourage a company to find a way to turn away eligible recipients or cut off benefits to avert the possibility of errors.

“We have checks and balances in the approach,” said Dennis Rosebrough, communications director for FSSA. “It’s not like brain surgery with a chain saw. These people have expertise.”

He has a point

--Wil Rogers, Texas State Employees Union

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