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North Carolina’s food stamps program continues to face major problems in how it operates and monitors federal funds for low-income families struggling to get food on their tables, according to a recent report by federal officials.

NC FAST logoA strongly worded management evaluation by the U.S. Department of Agriculture of the state’s Supplemental Nutrition Assistance Program  listed more than 38 faults with North Carolina’s system, ranging from “critical findings” regarding a lack of oversight at the state level to regulatory violations about what is included on applications for food assistance.

“There are critical findings in the Claims/TOP area that are related to a lack of State oversight and monitoring,” read one finding in the 19-page report. (Scroll down to read the report itself.)

The major findings also included a “lack of State oversight in Recipient Integrity” that led to instances of potential fraud not being referred to for prosecution and “serious findings” in the state’s employment and training program.

The Sept. 10 management evaluation rested on visits that officials from the USDA’s Food and Nutrition Service office made in May and June where operations were observed at the state level, as well as in social services offices in Guilford, Pitt and Wake counties.

It requires DHHS to provide a corrective action plan within the next 60 days.

The report came on the heels of a major breakdwon in North Carolina’s food stamps delivery system last year that left thousands of low-income families without access to food assistance for weeks or months. The problems were attributed to glitches in a new technology system, N.C. FAST (Families Assessing Services through Technology) and issues that county-level workers had in accessing the new system while struggling under heavy caseloads.

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North Carolina’s Health and Human Service Secretary Aldona Wos will be at the state legislature today, rolling out her plan to restructure the $18 billion state agency as well the state Medicaid program that provides healthcare for more than 1.5 million North Carolinians.

DHHS Sec. Aldona Wos

DHHS Sec. Aldona Wos

Wos, in a 14-page letter addressed to the heads of the Joint Legislative Program Evaluation Oversight Committee, reiterated to lawmakers that she came into her $1-a-year job to find the state’s largest agency in disarray.

“As you know, I inherited a department with a well-documented history of serious and chronic problems,” she wrote. “We have been on a path toward a sustainable department over the last 20 months and we have built the foundation for a stronger Medicaid program.”

She hopes the restructuring of Medicaid program will to fend off proposals in the legislature by Senate Republicans to move Medicaid, the massive $13 billion program that provides health care to low-income children, seniors and disabled residents – to its own standalone agency.

Wos, a wealthy Greensboro physician and prominent Republican fundraiser appointed by Gov. Pat McCrory in January 2013, has had a rocky tenure as the head of the DHHS, with controversies swirling over her granting big salaries and contracts to associates and McCrory campaign workers. Her first year on the job also saw botched rollouts of two technology projects that led to lengthy delays in medical providers getting paid for Medicaid services and in thousands of low-income families accessing food stamps

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Wos-and-Nichol

DHHS Secretary Dr. Aldona Wos (left), and Gene Nichol of the UNC School of Law (right)

If you missed it over the weekend, there are two-must read stories on where North Carolina stands in expanding Medicaid.

The Winston Salem Journal’s Richard Craver had a sit down interview with state DHHS Secretary Dr. Aldona Wos, in which Wos said she would “soon” be recommending expanding the state Medicaid program to Gov. Pat McCrory.

So, how soon is soon? Craver writes:

“Everyone needs to know that Medicaid expansion is complicated,” Wos said, slowing down to pronounce each syllable in “complicated.” “There is no flipping of a switch.”

She said physical and behavioral health care system expansion must come first so the system is able to absorb additional participants.

“Our state has to have industry adapt to providing enough health-care providers, and that is a process,” Wos said.

Wos said a key element of building DHHS’ foundation is “getting new skills in finance, economists and actuaries, that are absolutely critical to our organization.”

“If I am allowed to continue on this path, I guarantee you we will have that foundation. The rest of the process is building upon that foundation with standards, with flexibility built in.”

“We’re not too far away. Soon.”

Gene Nichol,  director of the UNC Center on Poverty, Work and Opportunity,  – who does not speak for UNC – wrote in Saturday’s Raleigh News & Observer that the longer the state goes without expanding Medicaid, the more lives are lost.

Here’s an excerpt from Nichol’s opinion piece:

‘The consequences for poor people of being excluded from health care coverage are real and dramatic. Losses in health, losses in emotional well-being, losses in financial capacity, losses in opportunity. And, for some, it’s worse.

A recent Harvard study indicates a significant number of our sisters and brothers will experience premature and preventable deaths as a result of the General Assembly’s rejection of Medicaid expansion. Many “low-income women will forgo breast and cervical cancer screenings, diabetics will (fail to receive) necessary medications,” blood pressure pills and other preventative measures will be denied, “diagnosis and treatment of depression” will be diminished.

As a result, the scholars estimate, the number of Tar Heels who will perish at the hand of our politics may well exceed a thousand a year. The wound inflicted by the Medicaid vote is grievous, deep and sometimes mortal.

I’ve wondered how it feels to cast a vote that means thousands might needlessly die. I can’t get my arms around it. Looking in the mirror must become tougher duty. I can see not wanting to dwell on it.

But when you make a decision that means people may lose their lives, surely you have to do more than offer empty slogans and nonsense-laden talking points to defend it. Surely you have to show you’ve done something more than merely taken instruction, more than mindlessly repeated what you’ve been told – like some malfunctioning teleprompter.

At least you ought to show that you’ve thought it through for yourself. That you’re not just siding with one gang or the other or proving your antipathy for various adversaries.

When politics becomes lethal, responsibility ascends.’

Read the full story in the Winston-Salem Journal here, and the full Point of View column by Nichol here in the News & Observer.

(Note: Nichol is a board member of the N.C. Justice Center, the larger anti-poverty non-profit that N.C. Policy Watch is a part of).
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The head of North Carolina’s troubled health and human services department told lawmakers Tuesday that moving the Medicaid program out from under her purview to a stand-alone agency would “be against common sense.”

“Absolutely not,” said N.C. Health and Human Services Secretary Aldona Wos in a response to a question about whether moving the $13 billion Medicaid outside of her domain would make things easier on the agency.

“To separate parts of [DHHS functions] out to the department will actually go backwards,” she said.

DHHS Sec. Aldona Wos

DHHS Sec. Aldona Wos

Wos made her comments Tuesday at a legislative oversight committee hearing. It also comes as lawmakers consider whether to embark next year on an ambitious plan by Senate Republicans to move the state’s Medicaid program to a standalone agency reporting jointly to the governor and state lawmakers.

A special program evaluation committee recently formed to consider different scenarios for Medicaid, an entitlement program that provides health care for the poor seniors, children and disabled residents, is funded through a mix of federal and state dollars.

Lawmakers have for years voiced frustration with faulty budget forecasts and unexpected cost overruns within the Medicaid program. Several Republican politicians — including legislative leaders and Gov. Pat McCrory — have held up the forecasting roblems as reason why North Carolina should not expand its Medicaid program, a move that would tap federal money to provide healthcare for an estimated 400,000 North Carolinians unable to afford their own insurance.

Wos, a Greensboro physician and wealthy Republican fundraiser appointed by McCrory to lead the state’s largest agency in January 2013, had plenty of other tough topics to cover with Tuesday’s legislative oversight committee. The tense reception has become a routine scenario for Wos as she’s grappled with negative coverage over high-dollar personal contracts and raises for close associates, as well as major disruptions in the state’s Medicaid billing and food stamp dispersal systems.

On Tuesday, Wos and her staff faced questions about a $6.8 million no-bid contract given to a consulting firm Alvarez & Marshal to advise and manage the Medicaid program.

Wos told lawmakers that she needed to hire the firm because she didn’t have any staff able to manage the program properly as she and other agency staff were developing a comprehensive Medicaid reform plan.

“We had an emergency,” Wos said. “We had to figure out how to get our daily work done.”

State law requires most contracts to go through a bidding process, in order to keep costs down and to allow for competition in lucrative contracts. Wos credited the consulting firm’s work with allowing the Medicaid program to meet its budget this year, and return $63 million to the state’s general fund.

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The N.C. Department of Health and Human Services announced this afternoon that an architect of a stalled Medicaid reform plan is leaving the state agency.

Margaret “Mardy” Peal, 43, was hired in August 2013 by Health and Human Services Secretary Aldona Wos despite having been out of the work force for more than a decade, according to a News & Observer article published shortly after Peal’s hire.

The job was not posted, and was a newly created position to look at privatizing the state’s complex $13 billion Medicaid program, which is funded with a mix of state and federal dollars and provides health care for low-income children and their parents, seniors and disabled residents.

Peal, who has a master’s in health education and lectured at East Carolina University’s medical school on patient care in the late 1990s, had donated $1,250 to Gov. Pat McCrory’s campaign, according to the N&O article. She also organized the Eastern North Carolina chapter of the Tea Party.

She made $95,000 a year in her DHHS position to help the agency develop a reform proposal for the state’s $13 billion Medicaid program. Peal’s hire last year came while Wos was facing criticism for giving big raises to several inexperienced McCrory campaign staffers.

The agency, at the urging of doctor and other medical provider groups, ultimately proposed parceling out Medicaid health care responsibilities to accountable care organizations (ACOs) around the state but the agency plan failed to get the backing of leading Senate Republicans who wanted to take Medicaid out from under DHHS and open it up to bids from managed care companies.

In a statement, state Medicaid Director Dr. Robin Cummings thanked Peal for her work and emphasized that the state agency planned on pursuing its approach to Medicaid reform.

“Working with doctors, hospitals and other healthcare providers and stakeholders across the state, DHHS will continue to pursue our Medicaid Reform plan,” Cummings said, according to a written statement.

In her Aug. 25 resignation letter (click here to read), Peal wrote that she was grateful for the experience working at DHHS but an unspecified opportunity in the private sector would allow her to spend more time with family.

“At this point in my family’s life, it is necessary that I spend a greater percentage of my time with them,” Peal wrote. “An opportunity presented itself that would allow me more time at home, and I have chose to pursue it.”