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OIG Annual Report 2018: Bureau of Program Integrity

Part V of the Office of the Inspector General's 2018 Annual Report

Table of Contents


The Bureau of Program Integrity (“Bureau”) monitors the quality, efficiency and integrity of programs administered by the Executive Office of Health and Human Services (“EOHHS”). The Bureau’s enabling statute, M.G.L. c. 6A, § 16V, directs the Bureau to prevent and detect fraud, waste and abuse and to make recommendations to improve the business processes that support benefits programs. The Legislature specifically directed the Bureau to review eligibility processes, to assist with data sharing among state agencies and to consult with the Program Integrity Division at the Department of Transitional Assistance (“DTA”). These mandates allow the Bureau to take a collaborative approach to its oversight work, and the Bureau often collaborates with EOHHS agencies on projects aimed at addressing business and fraud risks.

In addition, the Bureau conducts investigations in response to complaints that the Office receives regarding EOHHS agencies and programs. Often, the Bureau collaborates with the Audit, Oversight and Investigations Division (“AOI Division”) on complaints received through the Office’s hotline. The Bureau assisted the AOI Division in responding to 13 complaints in 2018.

Two of the Bureau’s investigations involved former Department of Developmental Services (“DDS”) employees, which led to the following law enforcement action:

  • The indictment of a former DDS employee for overtime fraud. The employee allegedly stole more than $42,000 by obtaining unauthorized access to the DDS timekeeping system and entering hours that she did not work. For this investigation, the Bureau collaborated with the AOI Division, and the Attorney General’s Office is prosecuting the matter. (See AOI section, Section II, Part A).
  • The indictment of a former DDS employee for theft of groceries and misappropriation of DDS funds to purchase groceries for her personal use. The employee allegedly submitted fraudulent invoices totaling over $15,000 over a 5-year period. The Northwestern District Attorney’s Office is prosecuting this matter.

Notably, these investigations emanated from hotline complaints by public employees who were concerned about fraud and waste of state resources and turned to the Office for help. While working on these investigations, the Bureau identified significant systemic issues and recommended that DDS build a new internal control infrastructure for state-operated group homes.

Throughout 2018, the Bureau continued to work with DTA on improving the administration of the Supplemental Nutrition Assistance Program (“SNAP”) and the Transitional Aid to Families with Dependent Children (“TAFDC”) program. The Bureau conducted a series of reviews to determine the extent to which DTA had implemented key recommendations from the Bureau’s past reports and advisory letters. The Bureau also collaborated with DTA’s Program Integrity Division on improving its fraud detection capabilities and data-matching capacity.

The Bureau expanded its scope of work in 2018 by engaging with the Department of Mental Health (“DMH”) as part of a broader project aimed at improving the administration of SNAP benefits to residents of DMH-operated group homes. In addition, the Bureau collaborated with the Department of Children and Families (“DCF”) to present an initial training module on contract administration for DCF’s contract managers.

The following is a more detailed summary of the Bureau’s work.

    I. Department of Developmental Services

    In 2017 and 2018, the Bureau found that DDS lacked fundamental controls in its management and operation of group homes. State-operated group homes are small, community-based residences administered directly by DDS for individuals with developmental disabilities. DDS operates approximately 200 group homes, and in 2017 and 2018, the annual budget appropriation for them was over $200 million. The Bureau found vulnerabilities in the decentralized approach to management that DDS had implemented. The Bureau summarized its observations and recommendations in advisory letters addressed to DDS and EOHHS. The Bureau recommended fundamental changes in the management infrastructure for state-operated group homes and a new agency-wide “tone at the top” supporting internal controls.

    Throughout 2018, the Bureau worked collaboratively with DDS to oversee the agency’s response to the Bureau’s recommendations. The Bureau partnered with the Risk Management Team at the Office of the State Comptroller to leverage their subject matter expertise as the Bureau conducted risk assessment and made recommendations.

    A. Creating New Management Infrastructure

    The Bureau met with DDS management on a monthly basis throughout 2018 to track DDS’s responses to the Bureau’s recommendations and to provide guidance and collaboration in particular areas. The Bureau also coordinated with EOHHS to ensure that DDS had additional support and resources to implement changes to its management infrastructure and internal control plan. In response to the Bureau’s recommendations, DDS created and implemented a new internal program integrity unit and enhanced its internal controls.

    1. Program Integrity Leadership

    DDS created its own internal Bureau of Program Integrity (“DDS BPI”). Modeled after the Bureau, the purpose of the DDS BPI is to incorporate the values of transparency, oversight and partnership across the agency and implement effective statewide agency risk management. The managers in the DDS BPI lead the agency’s risk management efforts. They operate an internal fraud hotline, conduct internal reviews, draft procedures and set up monitoring processes.

    In implementing an internal fraud hotline and by following up on complaints, DDS adopted many practices from the Office’s fraud hotline and took a significant step towards creating a culture of intolerance for fraud and waste. The DDS BPI raised awareness about the hotline through agency-wide training sessions and by posting flyers in regional offices. DDS defined theft and fraud broadly and informed staff that they were required to make a complaint “when money, services or goods are misappropriated, stolen or misused.” In addition, with guidance from the Bureau, the DDS BPI managers drafted and implemented procedures for documenting and following up on hotline complaints with investigations and reviews. In fiscal year 2017, the DDS BPI received 12 hotline complaints; thus far, in fiscal year 2018, the DDS BPI received 16 complaints. The Bureau collaborated with the DDS BPI on responding to some of these complaints.

    2. Internal Controls

    With input from the Bureau, the DDS BPI developed a training curriculum to raise awareness about fraud risks and to inform staff of their obligations to prevent fraud, waste and abuse. The training materials included several options for DDS staff to report fraud, waste and abuse, including the internal hotline at DDS and the Office’s fraud hotline.

    In addition, for the first time, DDS issued statewide procedures for state-operated group homes. These procedures reflected an important shift away from regionally based practices of operating group homes to a more centralized system of internal controls and monitoring. The procedures focused on areas of identified risk, including payroll practices, time reporting, food purchasing and the utilization of SNAP benefits. The Bureau provided feedback as DDS drafted and disseminated these procedures; it also recommended that DDS enhance its communication systems for state-operated group homes in order for DDS staff to have immediate digital access to all standard procedures. DDS partnered with the Executive Office of Technology Services and Security (“EOTSS”) to upgrade its communication systems.

    B. Implementing Systemic Reforms to Payroll Practices and Food Purchasing

    In addition, the Bureau worked collaboratively with DDS to address concerns that arose during the course of its investigations.

    1. Payroll Practices

    The Bureau found vulnerabilities in time reporting from state-operated group homes and recommended that DDS revamp its time validation practices and its system controls on the state’s time reporting database called Self-Service Time and Attendance (“SSTA”). In partnership with the Comptroller’s Office, DDS attempted to implement pilot testing of electronic timekeeping devices; however, DDS found that the business technology infrastructure for group homes would not support the timekeeping devices. DDS delayed its pilot testing of the devices in order to work with EOTSS on upgrading the technology infrastructure for group homes. While the pilot testing of timekeeping devices remained on hold, DDS reviewed its timekeeping documentation and data entry processes. The Bureau joined a working group dedicated to this effort and provides ongoing risk assessment and feedback to the group.

    2. Food Purchasing

    The Bureau conducted a broad review of the policies, procedures and processes that DDS had in place regarding purchasing food, processing invoices and utilizing SNAP benefits. The Bureau learned that DDS “pooled” the SNAP benefits of group home residents and found that DDS utilized these benefits, in addition to other sources of funding, to pay invoices for food purchases. The Bureau found that DDS had not established adequate rules for this “pooling” approach and had not monitored the business processes related to pooling. In response, DDS issued statewide procedures for food purchasing and the utilization of SNAP benefits. The Bureau is overseeing DDS’s efforts to monitor compliance with these procedures. In addition, the Bureau initiated a joint working group with DDS and DTA to assess and improve the administration of SNAP benefits to residents of state-operated group homes.

    II. Department of Transitional Assistance

    A. Improving the Administration of SNAP Benefits to Residents of State-Operated Group Homes

    Having identified business and fraud risks related to the utilization of SNAP benefits on behalf of residents of DDS-operated group homes, the Bureau recognized that DTA, as the agency with the primary responsibility for overseeing and administering the SNAP program, should play a significant role in problem solving. The Bureau approached DTA about facilitating a working group comprised of lead staff from DTA, DDS and the Bureau. The Bureau’s goals for DTA and DDS were to develop and implement new approaches to interagency communication, overlapping case management functions and data-sharing. Both DDS and DTA committed program development, business analytics and legal resources to the working group.

    After meeting with the Bureau on a regular basis over several months, the working group produced a new plan for the administration of SNAP benefits for residents of state-operated group homes, laid out in a data-sharing agreement and a memorandum of understanding. DTA and DDS have identified lead staff to communicate regularly and have started to implement an integrated approach to case management. DTA and DDS are exchanging data on a monthly basis to ensure that they are managing the SNAP benefits of shared clients with accurate and reliable information. The working group still meets periodically to discuss ongoing efforts aimed at data clean-up and SNAP case management.

    Later in 2018, DTA initiated a working group with representatives from DMH to review and improve the administration of SNAP benefits to residents of DMH-operated group homes. DTA and DMH invited the Bureau to participate in the working group. The group is still in the initial stages of assessing DMH’s current business practices for SNAP administration. DMH has acknowledged that group homes vary in their approaches to SNAP benefits, that their procedures are not well-defined or well-documented and that their internal controls are lacking.

    The Bureau has spearheaded efforts to improve the administration of SNAP benefits across the Secretariat. EOHHS has agreed to partner with the Bureau and provide leadership and guidance to all of the agencies that operate group homes and administer SNAP benefits on behalf of residents.

    B. Following up on the Bureau's Previous Recommendations

    In 2018, the Bureau continued to work collaboratively with DTA to improve the administration of DTA’s benefit programs. One specific improvement that DTA made was creating the Budget and Policy Analytics Unit (“BPA”), a coordinated group of analysts who support budget building, program development and continuous improvement. DTA acknowledged that the Bureau’s recommendations were a driving force behind the creation of BPA. The Bureau regularly collaborates with the analysts from BPA on identifying methodologies and tools to use DTA’s data effectively.

    The Bureau also conducted reviews in order to track and follow up on other recommendations. The following are some highlights of that work.

    1. Intake and Eligibility Determination Processes

    In January 2013, the Office issued a public report responding to a specific mandate from the Legislature to evaluate the process by which DTA verified eligibility for TAFDC benefits. In the wake of that report, the Bureau was created, and the Legislature mandated a second report on the management and operations of DTA. The Bureau issued a report in response to that mandate in February 2014. In both reports, the Bureau identified concerns about the documents that DTA considered to verify financial and non-financial eligibility, as well as the recordkeeping practices for retaining those documents. The recommendations provided in both reports were extensive, and the Bureau has been monitoring DTA’s response to them on a regular basis since 2014.

    In 2018, in order to conduct a closer evaluation of DTA’s current eligibility processes, the Bureau conducted a follow-up review of a randomly selected sample of recipients’ eligibility records. The Bureau found that DTA had significantly improved its eligibility verification processes and that DTA staff generally complied with eligibility procedures. However, the Bureau recommended further improvements, including:

    • revisiting certain procedures, particularly the procedures related to scanning and retaining birth certificates;
    • pursuing system enhancements to organize scanned documents and make them more accessible to TAFDC case managers; and
    • leveraging TAFDC supervisors and other internal resources for more rigorous quality assurance and self-assessment.

    DTA assisted the Bureau with this review and responded positively to these recommendations. DTA created a new working group to implement the recommendations and to continue to improve TAFDC eligibility processes, and invited the Bureau to join it.

    2. Employment Support

    Throughout the past two years, the Bureau has been overseeing DTA’s implementation of the Work Innovation and Opportunity Act (“WIOA”). WIOA is a federal law that provides funding for workforce development and requires that human services agencies collaborate with one-stop career centers, with the goal of increasing access to employment opportunities for benefit recipients. The Department of Career Services (“DCS”), which falls under the Executive Office of Labor and Workforce Development, oversees one-stop career centers. In June 2017, the Bureau made several recommendations to support collaboration between DTA and DCS. For example, the Bureau recommended that DTA should continuously evaluate its implementation of WIOA – and potential impacts on benefit recipients -- through quantitative and qualitative methods.

    From June to August 2018, the Bureau followed up on its recommendations. The Bureau reviewed the steps that DTA had taken to obtain relevant data, evaluate its new client-referral processes and track impacts on clients shared by DTA and DCS. The Bureau found that, while DTA and DCS were sharing data, they had not developed targeted methods for evaluating their joint work. The Bureau made additional recommendations, including that DTA identify staff to develop a more effective approach to data sharing and evaluation. In response to this recommendation, DTA worked with DCS to improve data sharing, and DTA recently hired a program manager to lead its WIOA-related initiatives.

    C. Consulting with DTA's Program Integrity Division

    In accordance with its statutory mandate, the Bureau continued to consult with DTA’s Program Integrity Division on fraud detection and data sharing with other agencies. The Bureau met with DTA’s Program Integrity managers on a regular basis as DTA implemented a new approach to utilizing employment and wage data collected by the Department of Unemployment Assistance (“DUA”), consistent with recommendations that the Bureau made in 2017. For example, the Bureau recommended that DTA validate the employment and wage data through a manual process before using it to evaluate any recipient’s eligibility. In addition, the Bureau recommended that DTA address a back-log of wage data that had accrued while DTA developed new procedures for validation. Through pilot testing, conducted under the Bureau’s oversight, DTA determined that the most efficient and effective method for validating the data was to contact employers directly and verify recipients’ income and period of employment. The Bureau urged DTA to continue to take a cautious, incremental approach to implementing new procedures.

    To further support DTA’s utilization of the DUA’s wage data, the Bureau provided DTA with an advisory letter in August 2018 that included the following recommendations.

    1. Focus on cases with a high risk of fraud and re-define "high risk" on an ongoing basis

    Because the validation of the wage data requires manual work, DTA must prioritize cases with a high risk of fraud. The definition of high risk will change based on a variety of factors, including the amount of potential overpayment and the recipient’s history of compliance with program rules. DTA must also ensure that it has the operational capacity to timely address cases that present a high risk of fraud.

    2. Improve the workflow for fraud referrals and investigations

    While working with DTA on fraud referrals involving wage data, the Bureau identified opportunities to streamline the operations and systems that support fraud referrals and investigations. The Bureau recommended that the Program Integrity Division should focus on high-priority referrals and ensure that they move expeditiously through the screening and investigation process. In addition, the Bureau recommended that DTA enhance data collection and analysis regarding the risk indicators for its fraud referrals.

    3. Utilize the wage data to inform further development of the TAFDC and SNAP programs

    The wage data provides valuable information about work opportunities for recipients. The Bureau recommended that DTA develop methods for tracking individual recipients or cohorts of recipients and evaluating the potential impact of DTA’s employment programs and supports.



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    Date published: April 30, 2019