🔒Cracking down

DHHS audits worry lawmakers

• School, health payments targeted
• Reimbursements in question

Members of the Legislature’s budget-writing appropriations committee are concerned that several federal audits of the Department of Health and Human Services now under way could cost the state tens of millions of dollars.

“It’s very difficult for the Legislature to have a sense of the timing of when we may be confronting the results of the audits,” said Sen. Richard Rosen, R-Bucksport, co-chairman of the committee.

Two dozen audits of various programs are being conducted, but the two most significant in terms of potential liability to the state are school-based services for children and what are called “private non-medical institutions.”

“The federal government is objecting to how we use PNMIs in our MaineCare system,” DHHS Commissioner Mary Mayhew told the committee. “Mental health agencies, residential mental health services, substance abuse services and nursing facilities, residential care facilities, are all being looked at and we have to respond to their objections.”

Mayhew said there have been several discussions with officials at the Center for Medicaid Services about the federal position that many PNMI services are not eligible for federal reimbursement. “We have been in what I would say have been very good discussions with CMS, but I cannot say whether the inspector general will come in and seek payments retroactively,” she said.

The inspector general also has an audit under way of Medicaid payments for school-based health services, prompting concern that the federal government may seek reimbursement from the state for payments for services that did not meet federal requirements.

Earlier this year, the state had to pay back $29.7 million in overpayments for targeted case management. That spending went back to 2003 and 2004 and the state fought the matter in court, and lost. Last month, the state was told to pay back $783,000 for misapplying Medicaid match rates to staff used to train foster care workers and parents.

Gas stations overcharging

• State checks reveal faulty pumps
• Problem’s scope unclear

In recent weeks, inspectors from the Department of Agriculture’s weights and measures unit have found several gas stations significantly shorting customers at the pumps. But state officials can’t say if it’s a trend because the unit’s database greatly limits their ability to analyze data collected by inspectors.

“We had one large station with 12 nozzles, and six were so far out of tolerance that we ordered them immediately shut down until they could be fixed,” said Hal Prince, director of the Division of Quality Assurance and Regulation. At another station, an inspector found all of the pumps delivering less gasoline than customers paid for. “We usually find that one pump may be over-delivering a little while another is under-delivering a little,” he said. “It often roughly balances out.”

The state has just nine inspectors in the weights and measures unit, which inspects everything from weight scales in grocery stores to fuel delivery trucks, and another 29 local inspectors hired by about 100 cities and towns, with municipalities often sharing an inspector. Prince said the unit also depends on consumer complaints and often does spot inspections.

In a Sept. 9 memo, his staff reports that other states have had cases of deliberate fraud. “Several well-known retailers are knowingly overcharging the public and assuming that any fines that they pay are more than offset by the increased profit,” the memo stated.

Sen. Roger Sherman, R-Houlton, co-chairman of the Legislature’s Agriculture, Conservation and Forestry Committee, said with gasoline prices a dollar a gallon higher than a year ago, consumers deserve to know they are getting what they pay for. “People put their thumb on the scales for a long time,” he said. “This is certainly a new way to put a thumb on the scale.”

Sherman said he is very upset that the weights and measures unit can’t answer the simple question of how widespread the problem is. He said consumers need to be assured that they are getting what they pay for and that lawmakers should look at the issue in the January session.

Aid to schools debated

• Cuts to general purpose funds divide panel
• Up to $125M at risk pending congressional action

Whether local schools should share the burden of budget cuts is splitting the task force charged with finding $25 million in spending reductions to balance the two-year state budget in its second year.

“We are very concerned that we will be cut,” said Maureen King, president of the Maine School Boards Association. “We have been cut several times in recent years in the middle of the school year and that is just devastating.” She said no one would be surprised if the state reduces aid to local schools. “But, I would be disappointed,” she said. “We still are not at the 55% level that was promised years ago.”

The state’s higher education facilities — the University of Maine System, the community colleges and Maine Maritime Academy — are targeted to lose about $6.8 million under a proposal before the governor’s Streamline and Prioritize Core Government Services Task Force.

“I think general purpose aid [to education] has to be part of this discussion,” said Ryan Low, vice chairman of the task force. He serves as vice president for finance at the University of Maine at Farmington and is a former state finance commissioner. “That is 30% of the state budget that is being taken off the table.”

Low proposed the aid be reduced by $4 million in the second year of the budget, with higher education cut by $2.8 million. The motion failed on a six-to-six vote. The panel also delayed a decision on GPA until a later meeting.

“GPA is scheduled to go up by $15 million in the second year, so this is really a reduction in the increase,” said Rep. John Martin, D-Eagle Lake, who also serves on the appropriations committee. He said the GPA appropriation in the second year of the budget is $914 million.

But others on the panel are strongly opposed to any change in aid to local education. Joe Bruno, CEO of Community Pharmacies and a former House GOP floor leader, said a cut in GPA has a broad impact. “GPA affects everyone in this state; every property taxpayer in this state is impacted by a GPA cut and their taxes will have to increase at the local level,” he said. “I would rather have a narrow impact.”

Rep. Dennis Keschl, R-Belgrade, said reducing aid to schools should not be considered as part of the $25 million budget target of the task force, but will likely have to be considered by the Legislature in January because of expected federal cuts. Congress has until just before Christmas to act on whatever proposals the Super Committee recommends next month. Estimates are Maine could lose from $75 million to $125 million in federal funds, depending on congressional action.

Mal Leary runs Capitol News Service in Augusta. He can be reached at editorial@mainebiz.biz. Read more of Mal’s columns here.