Gov. Mitch Daniels likes to say that he inherited “the worst welfare system in the nation.” But two extensive reviews of data by The Journal Gazette suggest it has grown worse under his watch.
The latest shows staggering increases in Medicaid application backlogs in the counties where the Indiana Family and Social Services Administration turned eligibility processing over to IBM Corp. Angela Mapes Turner’s report on Page 1A finds that counties under the new system had tardiness rates more than double that of counties operating under the system the governor criticized.
Turner’s April investigation found that almost a third of the state’s food stamp applications were not processed within two months, missing federally required deadlines for timeliness and leaving struggling families to seek help elsewhere.
After The Journal Gazette requested Medicaid timeliness figures, FSSA Secretary Anne Murphy announced that the state might have to cancel the $1.16 billion contract with IBM and its subsidiary, Affiliated Computer Services. They have been asked to submit a “corrective action plan” to address problems. If there are no improvements by the end of September, the state could take steps to cancel the 10-year contract, she told The Associated Press last week.
The move is welcome but long overdue. Social service advocates warned state officials before the contract was awarded in 2006 that it was being pushed through too quickly, with no opportunity for public input and no cost-benefit analysis to determine whether it would produce savings or improvements. Their concerns were based on a botched welfare privatization deal in Texas.
Then-FSSA Secretary Mitch Roob pushed ahead. The “eligibility modernization project” contract was signed and rolled out in October 2007 in a 12-county area. By the following spring, hundreds of people were showing up at meetings to complain about problems with the system, which replaced most state caseworkers with a Web site and call center. The situation grew worse when northeast and southwest Indiana counties went online in the spring of 2008.
A Wall Street Journal report last month found that, predictably, welfare rolls in 23 of the 30 most populous states climbed along with the worsening recession.
In seven states, however, they declined.
The report pointed to “strict front-end requirements” as the reason for a caseload decrease in Michigan. It didn’t examine Indiana’s baffling decline, but if it had, the problem-plagued welfare modernization project would be the primary suspect.
The state’s contract with IBM and ACS, Roob’s former employer, specifies that “services to be performed under this agreement are vital to the state and its citizens who currently are and in the future will be legally eligible for and reliant” on assistance.
With unemployment nearing 11 percent statewide, those services are even more important in protecting the most vulnerable Hoosiers.
Enough time has passed in testing this business-model approach to administering vital public services. The results are not encouraging by any corporate measure and uncompassionate by any humane measure.
Repairing the system after it has been dismantled and converted to a profit-driven operation won’t be easy, but it might well be the best course.
