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State Public Records ruling on release of hospital report is a win for the public
In what we see as a win for the public’s right to know, the state’s Supervisor of Public Records has concluded that the Department of Public Health went too far in redacting virtually an entire report on an intellectually disabled man who died in February 2012 after he was reportedly sent home twice by Lowell General Hospital.
The September 21, 2015 decision by Public Records Supervisor Shawn Williams was issued in response to an appeal filed by COFAR after the DPH had sent us a report in May that was virtually unreadable because just about everything in it had been whited out. Williams ordered DPH to provide us with “a new redacted copy” of the report within 10 days, along with a written explanation regarding any portion the Department still considers to be exempt from disclosure.
Last month, the Public Records Division reviewed an unredacted version of the report in camera to determine whether DPH was justified in the wholesale redactions based on a claim that the report contained medical information that might violate the deceased man’s privacy.
Williams stated in his Sept. 21 decision that “generally, medical information will always be of a sufficiently personal nature to warrant exemption” from the Public Records Law. The decision also stated that even though the individual is deceased, “an individual’s privacy interest in medical information survives death.”
However, even given that exemption, Williams said DPH “provided no explanation as to why it could not redact portions (of the report) that specifically identify the individual to whom the medical information relates.” DPH also redacted portions of the report “describing the actions of others who are not the person to whom the medical exemption would apply,” Williams stated.
Williams concluded that “…other than portions of the report that specifically identify a person, the Department (DPH) has failed to satisfy its burden under the law to merit nondisclosure of such significant portions of the narrative.”
The Public Records Supervisor’s decision pointed out that COFAR was willing to accept a redacted version of the report that did not reveal the individual’s name or medical information that might violate his privacy. Williams also noted our complaint that it was impossible to tell from the redacted report whether DPH had examined the hospital’s policies for treating people with developmental disabilities, or whether the report contained any recommendations regarding hospital policies and procedures.
We have previously reported that the 51-year-old man had been having difficulty breathing and was sweating when he was taken to the hospital on both February 6 and 7 in 2012. On both occasions, he was sent back by the hospital to the group home in which he was living with no significant treatment. He died, apparently en route to the hospital, after staff in his group home called an ambulance for the third time on the afternoon of February 7.
The cause of death was listed on the death certificate on file in the City of Lowell as acute respiratory failure and aspiration pneumonia, which can indicate choking. A death report form filed with the Disabled Persons Protection Commission stated that the man died after experiencing cardiac arrest.
The DPPC referred the case of the man’s death to the DPH, apparently because an allegation about improper care in the case involved the hospital and not the man’s group home, which is operated by the Department of Developmental Services. Williams’ ruling still seems to leave some room for DPH to redact anything that they contend could identify the deceased resident; but they will have to include more information in the report than they did in the document they previously provided to us.
Secretary of State Bill Galvin, whose office oversees the Public Records Division, has come in for criticism lately for his allegedly lackluster enforcement of the Public Records Law in Massachusetts. But in this case at least, we have to commend Galvin and his staff for the work they’ve done.
Requirements reduced for ‘Real Lives’ law contractor to DDS
Due to what appears to be an open-ended provision in a bid document in 2008, the Department of Developmental Services dropped contractual work requirements and yet increased administrative fee payments to a private firm to manage “self-directed services” for clients with developmental disabilities in Massachusetts.
Documents received by COFAR under a Public Records law request indicate that several key work requirements listed in the 2008 bid document for two self-directed services contracts were later dropped from those contracts with Public Partnerships, LLC (PPL). Yet, according to information available on an online state contract tracking site, PPL’s administrative fees under the contracts rose from $529,435 to $969,282 between fiscal 2010 and 2014 — an 83 percent increase.
PPL appears to play a major role in managing self-directed services programs around the country. Audited financial statements for the company disclose that PPL and a Colorado affiliate managed more than $1 billion in funding from state, county, and local public agencies for self-directed services in fiscal 2014.
PPL’s website states that the company has been managing self-directed services programs since 1999, and that it is now operating in 21 states and the District of Columbia. PPL is a subsidiary of Public Consulting Group, a Boston-based consulting firm, to which PPL pays millions of dollars in “management fees” each year, according to the audited financial statements.
Self-directed services are billed as an alternative to the traditional method under which public agencies provide services to developmentally disabled clients either directly or via contracts with providers. Under self-directed services, program clients reportedly plan their own services, manage their “individual budgets” for care, and hire support workers of their choosing.
While DDS has been operating self-directed services programs since the late 1990s, the Massachusetts Legislature authorized a major expansion of those programs last year with passage of the “Real Lives” law.
States are required by the federal government to hire private “fiscal intermediaries” to manage self-directed programs on behalf of program participants, according to DDS.
In Massachusetts, there appears to have been little competition in the selection process that led to the PPL contracts in 2008. PPL was one of only two firms that submitted proposals in response to a Request for Response (RFR) issued by DDS that year for fiscal intermediary services. The losing proposer was Non Profit Care Coordination, Inc., a Boston-based nonprofit with zero assets and less than $300,000 in revenues in 2014, according to Guidestar, a financial tracking service for nonprofits.
Federal requirements for fiscal intermediaries for self-directed services appear to be vague. COFAR has reported that PPL’s contracts in Massachusetts essentially require the firm to perform what appear to be check-processing and basic accounting services in connection with three self-directed services programs.
Contract amendments, signed the same year as the RFR was issued, state that PPL would not be required to carry out several services specified in the RFR. Those dropped services included hiring care workers under the self-directed service programs, performing reference checks on the care workers, and managing “support broker” services. Support brokers are employed by participants in self-directed services to help in managing their care.
It is also unclear whether PPL’s contracts require the company to help participants manage their “individual budgets” under the self-directed services programs. Helping participants manage their budgets had been a requirement in the RFR as well.
Meanwhile, a third self-directed services program was added since 2008 to PPL’s contracts, potentially increasing the company’s fees; yet it does not appear that PPL was required to bid to become the fiscal intermediary for that additional program. It also does not appear that the addition of the new program to PPL’s scope of work resulted in a net increase in PPL’s work requirements.
The three self-directed services programs for which PPL is currently contracted to act as fiscal intermediary in Massachusetts include an adult “Participant Directed Program,” an “Autism Waiver Program,” and a “Department of Elementary and Secondary Education Program.” The 2008 RFR had specified that the selected contractor would serve as the fiscal intermediary only for the first two programs.
State regulations prohibit the practice of dropping or adding substantial requirements or costs specified in an RFR; but that prohibition is waived under the regulations if the RFR authorizes such changes (801 CMR 21.07). An open-ended statement in the 2008 RFR appears to have provided that authorization to make major changes to the PPL contract.
The 2008 RFR stated the following:
During the life of these contracts, additional funding may become available; new individuals may enter the POS (Purchase of Services) funding system; existing resources may be reassigned; service needs of individuals funded from the contract may change; or service delivery costs of the provider may change. The contract(s) that result from the RFR may be amended to accommodate any of these needs, subject to the service delivery goals expressed in this RFR. (my emphasis)
In a May 4 letter to COFAR, Marianne Meacham, DDS general counsel, maintained that PPL’s contract requirements “far exceed” basic accounting functions, and that “the functions performed by PPL have expanded, not been reduced, since 2008.”
However, a contract amendment, dated June 15, 2008, explicitly deleted the work requirements noted above in the RFR, which was dated February 2008.
In a June 18, 2015,email to DDS Commissioner Elin Howe, COFAR asked for comment regarding the deletions of the requirements in the contract. As of September 22, no response was forthcoming from the Department to the email request.
In addition to the specified deletions from the RFR, the June 2008 contract amendment stated that PPL would not be required to provide the following services, which had been proposed in the firm’s response to the RFR. PPL’s RFR response was dated March 28, 2008:
- Support brokerage, network development and training for non-DMR staff
- Web-based directory of credentialed providers for ISO (adult) program
- Consumer online budget access
The final version of the Real Lives law dropped a number of provisions in earlier drafts of the legislation that appeared to unduly benefit corporate providers of DDS services. Nevertheless, COFAR continues to have concerns that the new law will transfer decision-making authority from guardians and family members of disabled individuals to private financial management companies.
Virtually no one waiting for DDS care getting into state-run DDS homes
Despite the fact that an unknown number of intellectually disabled people are waiting for residential services in Massachusetts, new data provided by the state appear to show that virtually none of those people are getting into state-operated group homes.
According to the data, provided by the Department of Developmental Services in response to a Public Records Law request, the number of people living in state-operated group homes in Massachusetts increased by a total of 144 between fiscal 2008 and 2015.
Previously, DDS had provided data showing a total of 156 persons had been transferred from state-run developmental centers to state-operated group homes between fiscal 2008 and 2014.
These numbers seem to imply that the entire increase in population in the state-operated homes since 2008 came from the developmental centers. Also, the numbers appear to imply that up to 12 of those transferred residents have either died or been transferred for a second time to some other location since 2008.
We’ve written previously that DDS data appeared to show that the Department was failing to inform people seeking residential care of the option of state-run services. Families and individuals appear to be directed almost exclusively to group homes run by corporate providers to DDS.
In addition to provider-run group homes, DDS maintains a network of group homes that are staffed by departmental employees. State workers have better training on average than do workers in privately run residences, and have lower turnover and higher pay and benefits.
There are an unknown number of people in Massachusetts waiting for residential care and services from DDS. This number is unknown because DDS doesn’t officially acknowledge a waiting list. The Massachusetts Developmental Disabilities Council has cited a 2010 survey indicating that some 600 people were waiting for residential services in the state, and up to 3,000 people were waiting for family support services.
Despite the apparent lack of sufficient housing and services for all of those who need it, DDS appears to be steadily phasing out state-run services and transferring those services to private providers. Yet, the capacity of the provider-based system is clearly inadequate to meet the entire need for services. And as we’ve recently noted, privatization of state services doesn’t automatically result in lower cost or better quality.
Some other highlights of the new DDS numbers:
- There were a total of 266 state-operated homes in Massachusetts as of April 2015, which amounted to a net increase of 40 homes over the total number in 2008. Previous data from DDS indicated that DDS had closed 28 state-operated residences since 2008.
- Virtually all the (97 out of 99) people living in the state-operated homes that were closed were transferred to the new state-operated homes.
Thus, there has been a total of 253 people who have been transferred since 2008 from the developmental centers and the closed state-operated homes, apparently all to the new state-operated homes.
This raises a further question about DDS’s priorities. Given the hundreds waiting for residential care in the state, why did DDS close 28 state-operated group homes in the past eight years?
- DDS has no projections on the number of people who will be living in state-operated homes in the next five to 10 years.
The bottom line is that it appears the state-operated DDS system has been expanded only enough to accommodate people already receiving services.
The situation may violate the federal Medicaid Law, which requires that intellectually disabled individuals and their guardians be informed of the available “feasible alternatives” for care. In addition, the situation appears to violate the federal Rehabilitation Act, which states that no disabled person may be excluded or denied benefits from any program receiving federal funding.
On July 27, I sent an email to DDS, asking for information on the number of people who have been admitted to state-operated group homes who were not transferred there from other state-operated homes or from the developmental centers. I haven’t yet received a response to that question, but I will be very surprised if the answer is more than a handful of people.
As this post attempts to demonstrate, it is virtually impossible for anyone seeking DDS services to be admitted to a state-operated group home. One of the few people who was able to accomplish it in recent years had to file a federal lawsuit to do so.
Both the administration and the Legislature have provided disproportionate increases in funding to the provider-operated residential system in Massachusetts, and have continued to short-change state-operated care. Now that it turns out that the previous fiscal year ended with a $200 million surplus and not the deficit that had been projected, we hope the Legislature will begin to consider restoring some balance to the DDS system, and begin to fund state-run care adequately.
Governor’s MBTA panel provided virtually no support for its recommendation to restrict the Pacheco Law
The Governor’s Special Panel to Review the MBTA earlier this year made some reasonable proposals to better manage the MBTA. But the Panel report’s recommendation to remove the MBTA from the Pacheco Law’s jurisdiction appears to us to have been a misstep; and the report spent less than a sentence in explaining the rationale for its recommendation.
Based in part on the Panel’s recommendation, the Legislature suspended the Pacheco Law’s provisions for three years with regard to the MBTA, thereby removing an important means of ensuring long-term cost-effectiveness in privatizing services at the T.
The Pacheco Law’s stated intent is “to ensure that citizens of the commonwealth receive high quality services at low cost.” The Special Panel’s report asserted, however, that “the MBTA is inhibited by the Pacheco Law from procuring private, cost-effective services…”
That latter statement, which appears to constitute the sum total of the Panel’s discussion of the Pacheco Law, appears to be at odds with the stated purpose of the statute. There is no additional comment in the report about the impact of the law — not even an explanation of what the law does.
Moreover, as discussed below, the Special Panel did not appear to have consulted with state agencies that oversee procurement of supplies and services in Massachusetts, in preparing its report. Possibly as a result, the Special Panel’s report also appears to be incorrect in stating (in that same sentence) that the MBTA is “strictly limited by state law in its use of many procurement processes (e.g., CM at-Risk and Design/Build).” More about that below as well.
The Special Panel has previously run into criticism from CommonWealth magazine for flawed methodology on which it based a separate finding concerning employee absenteeism at the MBTA.
What the Pacheco Law actually requires
As we’ve noted before, the Pacheco Law requires a state agency seeking to privatize services to compare bids from outside contractors with a bid from existing employees based on the cost of providing the services in-house “in the most cost-efficient manner.” The bids from both contractors and existing employees are examined by the state auditor, who must determine whether:
1. the proposed contract cost is lower than the calculated cost of providing in-house services in the most cost-efficient manner; and
2. the quality of the proposed services will be equal to or better than the quality of the services proposed by the existing employees.
What this means is that both parties — the state employees and the outside contractors — can bid to provide the services; and, if the state auditor concurs that the proposed contract is less expensive and equal or better in quality than what existing employees have proposed, the privatization plan will be likely to be approved.
The Special Panel contends that the Pacheco Law “inhibits” privatization. But State Auditor Suzanne Bump has stated that her office has approved 12 out of 15 privatization proposals presented to the office since the Pacheco Law was enacted in 1993.
The Special Panel did not consult key state agencies that regulate procurement of supplies and services in Massachusetts
Among the 38 organizations listed by the Special Panel in its report as having provided the Panel with input, most were special interest groups, ranging from the Mass. Association of Realtors to the Conservation Law Foundation to the Boston Carmen’s Union. But not on the Panel’s list was anyone from the office of the state auditor, which, as noted, administers the Pacheco Law, or either the inspector general or attorney general’s offices, which oversee state procurement laws and regulations.
That may explain why the Special Panel’s report stated, apparently incorrectly, that the MBTA “is strictly limited by state law in its use of many procurement processes (e.g., CM at-Risk and Design/Build).” In fact, this is the second half of the sentence cited above, claiming that the MBTA has been “inhibited” by the Pacheco Law. Once again, a single sentence (or rather half a sentence) constitutes the sum of the report’s discussion of an allegedly serious problem faced by the MBTA — in this case, the alleged limitations on the MBTA’s procurement options.
Construction management at-risk (CM at-risk) and design-build services are alternatives to the traditional design-bid-build approach in managing public projects. Under the traditional approach, construction contractors bid on fully completed designs. The alternative approaches allow for fast-tracking some construction activities before design is complete.
Despite the Special Panel’s assertion, the state’s bidding laws do provide permission to the MBTA and other state agencies to use CM at-risk for building construction projects (MGL C. 149A, Section 4), and design-build for public works projects, estimated in both cases to cost $5 million or more (MGL C. 149A, Section 16).
If the Special Panel’s concern was that the MBTA should be allowed to use CM at-risk and design-build on projects costing less than $5 million, it wasn’t stated in the report.
Email query to Professor Gomez-Ibanez
On January 28, I emailed Jose Gomez-Ibanez, a professor at Harvard’s Kennedy School and a member of the Special Panel, to ask whether he concurred with the Panel’s recommendation on the Pacheco Law.
Gomez-Ibanez has written compellingly about economic and political issues involved in the privatization of governmental functions and services. In a 2004 working paper, “The Future of Private Infrastructure,” he stated that:
…in retrospect it is clear that we severely underestimated the difficulties of privatization. We often failed to appreciate that the challenge of privatization was not primarily technical, but also fundamentally political.
In our view, the Pacheco Law implicitly recognizes those technical and political problems of privatization.
In my email, I stated that:
It is not surprising to us that a conservative think tank such as the Pioneer Institute might draw ideologically based conclusions about privatization. But it was surprising to me that the Governor’s Special Panel, which included faculty of Harvard and Northeastern Universities, including yourself, would support a recommendation that appears to have no written rationale to support it.
To date, I haven’t heard back from Gomez-Ibanez.
Critics of the Pacheco Law overlook the costs of privatization
In its single statement about the Pacheco Law’s impact, the Special Panel contends that privatized services are inherently more cost-effective than in-house services, and implies that even requiring a comparison between in-house and contracted services is unnecessary.
While the Special Panel provides no explanation for its assertion about the Pacheco Law, the Pioneer Institute, one of the chief critics of the law, argues that the major flaw in the cost-competition process under the law is the following: if the state employee bid is found to be lower than the contract bid, there is nothing in the law that requires the state agency to adhere to the state employees’ bid costs going forward.
But this argument overlooks the fact that there is little to prevent contract costs from rising over time as well.
As we pointed out previously, the cost of contracting at the T appears to have risen even faster than in-house services there. The T’s budget history appears to bear this out as well. The budget shows contracted commuter rail expenses rising by 122.5 percent between fiscal 2001 and 2016, compared with a 75.6 percent increase in-house wages during that same period. The budget also shows “purchased (contracted) local service expenses” rising by 336.3 percent between fiscal 2001 and 2016.
One of the reasons that privatization can be expensive is that the private sector tends to pay higher salaries than the public sector for upper-level management positions, and lower wages than the public sector for lower-level positions. So, allowing unfettered privatization of an already quasi-privatized organization such as the T would seem likely to exacerbate the problem of high executive salaries.
The Special Panel appears to have played political games with its report
I would venture to guess that at this point, some members of the Special Panel are wishing they hadn’t signed on to the product that the Panel ultimately delivered. Whenever the final report of a panel or commission is a PowerPoint presentation, as was the case with the Special Panel’s report, it may be a tipoff that the product isn’t first-rate.
I would also venture to guess that the single-sentence (or half-sentence) critique of the Pacheco Law in the Panel’s report may have been stuck in there at the last-minute — maybe at the request of the man who commissioned the report in the first place — Governor Baker — who has made the Pacheco Law a political target of his at least as far back as his first run for governor in 2010. Is it really a coincidence that Baker’s hand-picked commission came up with the very same recommendation about that particular law that Baker has espoused for years?
Politics and public policy obviously go hand in hand, and that’s as it should be. But major policy decisions should not be based solely on politics. Recent developments in the long-running saga of the Pacheco Law show how major policy decisions can, in fact, be based on ideologically biased analyses and unsupported statements from prestigious commissions.
MBTA commuter rail contracts rose by a greater percentage than in-house bus costs
While proponents of privatizing the MBTA point to the rising cost of in-house operations there, the cost to the agency of contracting out appears to have risen even faster.
The annual cost to the MBTA of contracting for commuter rail services has risen by 99.4 percent since 2000, compared with a 74.9 percent increase in the annual cost of the agency’s in-house bus operations, according to cost information we’ve compiled from public online sources (see below).
In our view, the rising cost of the commuter rail contracts since 2000 casts further doubt on the claims by the Pioneer Institute and other privatization proponents that contracting out for services will automatically save hundreds of millions of dollars at the T.
In case you missed it, the Pioneer Institute issued a report earlier this month that compared the actual cost of MBTA bus operations to a proposal based on bids from outside contractors to undertake those functions.
The Pioneer report concluded that had the state auditor allowed the planned privatization of the bus operations to go forward, the MBTA would have saved $450 million between 1997 and 2015. The report claimed those allegedly foregone savings were the fault of the Pacheco Law, which the auditor had cited in objecting to the outside contract proposal.
(As discussed below, the state auditor did not definitively reject the MBTA’s contract proposal, but rather asked the agency to resubmit its proposal after addressing concerns raised by the auditor about its cost calculations. The MBTA never did resubmit its proposal, but instead chose to sue the auditor in state superior court to reverse the auditor’s decision, and lost.)
The Pacheco Law requires state agencies seeking to privatize existing operations to show that bids from private contractors would be lower than a calculated cost of continuing to perform specified work by regular state employees “in the most cost-efficient manner.” The state agencies must submit their calculations to the state auditor, who has the final say as to whether the functions can be privatized.
Largely due to unrelenting political pressure from the Pioneer Institute and other privatization advocates, the Legislature approved a 3-year freeze earlier this month on invoking the Pacheco Law with regard to privatizing MBTA functions.
Last week, we raised a number of concerns about the methodology of the Pioneer report, including criticizing its comparison of actual in-house MBTA costs to bids. We argued that it’s meaningless to compare actual costs to hypothetical costs over a nearly 20-year period.
We think it would make more sense to compare actual in-house costs to actual contract costs over a multi-year period. An obvious candidate for an evaluation of actual contracting costs appears to be commuter rail.
The MBTA has contracted out for commuter rail service since the 1980s, according to a state audit report on the agency. Beginning in 1987, Amtrak began providing commuter rail services to the T under a cost-plus-overhead and profit contract. In 1995, this was changed to a negotiated fixed price contract with a three-year term and two one-year options.
In May 2000, according to the audit report, the MBTA was given permission by the federal government to extend the Amtrak contract without bidding for an additional three years. The total cost of the three-year contract extension, plus additional work that was in included in subsequent contracts, came to $168 million per year.
The Massachusetts Bay Commuter Rail Company (MBCR) subsequently won a competitive RFP process to operate the commuter rail system, starting in 2003. The cost per year of that fixed-price contract was $217.4 million, which amounted to a 29.4 percent increase over the cost of the Amtrak contract three years earlier. In that same period, the in-house cost of MBTA bus operations rose by just 12.8 percent, based on the Pioneer report’s figures (See chart below).
In 2008, the MBTA granted MBCR a three-year contract extension at a cost of $246 million per year, which amounted to a 46.4 percent increase in commuter rail contracting costs to the MBTA since 2000. In that same time, the in-house bus operations cost had risen 40.4 percent.
In 2011, MBCR received a final 2-year commuter-rail contract extension costing $288.5 million a year. By that time, the MBTA’s cost of contracting for commuter rail had risen by 71.7 percent since 2000, whereas the in-house cost of MBTA bus operations had risen by 55.7 percent.
Finally, the MBTA signed an eight-year contract last year with Keolis Commuter Services at an annual cost of $335 million, according to The Boston Globe. (Note: the headline on the linked Globe story appears to be wrong.) As a result, by the time Keolis began operations last July, its annual contract cost was 99.4 percent higher to the MBTA than the Amtrak contract cost had been in 2000. In contrast, the cost of in-house bus operations at the MBTA was only 74.9 percent higher in 2014 than it had been in 2000.
By the way, it may be only a matter of time before the Keolis contract cost rises above the $335 million annual amount, given that the company is reportedly already losing money operating the MBTA commuter system.
The Pioneer report characterized the in-house cost of MBTA bus operations as “inordinately expensive,” and concluded that for that reason, replacing that in-house service with contracted work in 1997 would have saved hundreds of millions of dollars. But the Pioneer report failed to consider the actual experience that the MBTA has had with contracting.
One might argue that you can’t legitimately compare the cost of commuter rail operations to bus operations. But at the same time, we think our comparison shows that entering into contracts for services doesn’t guarantee that the costs won’t rise dramatically. Since 1995, the commuter rail contracts have all been fixed-price contracts.
The Pioneer report misrepresented the state auditor’s objection to the MBTA’s 1997 privatization proposal as a “ban” on the award of the contracts
The Pioneer report referred in different places to the state auditor as having “banned” or “blocked” or “barred” the MBTA’s proposal to privatize the agency’s bus services in 1997. According to the report, this adverse decision, which was based on the Pacheco Law, not only thwarted the MBTA’s attempts to save costs and improve quality of its bus service, but the MBTA never again attempted to privatize that service.
But the actual decision by then State Auditor Joseph DeNucci did not ban or block or bar the MBTA from privatizing its bus services. Instead, DeNucci invited the MBTA to resubmit its proposal after addressing a number of issues raised in his decision letter and in a previous letter regarding the proposal. Among those issues were alleged failures by the MBTA to support specific cost savings in its bid proposal and to provide measurable indicators of service quality as a baseline for comparison, such as information about on-time performance.
It does appear that the MBTA was not happy with the issues and inquiries DeNucci’s staff was raising about the MBTA’s privatization proposal. According to DeNucci’s letter, the MBTA objected at one point to the auditor’s questions about how claimed savings in contracting out functions at garages in Charlestown and Quincy could be achieved since a third facility in Everett was providing services to support the two other garages.
When the auditor inquired as to how costs would be reduced at the Everett facility, the MBTA responded that the auditor’s inquiry was “of no significance,” and “beyond the scope” of the Pacheco Law.
DeNucci’s final letter to the MBTA stated the following:
Recommendation:
We believe that the MBTA should seriously address each of the above substantive issues disclosed
by our review. A carefully considered objective analysis of these matters, such as the Everett and
Arlington facilities, quality of service, changes and extra work, pension costs, 13(c), and bid price
changes, should be undertaken prior to privatization. A hasty, ill-considered, rather than a thorough
analysis, would not well serve the MBTA’s ridership and the taxpaying public.Conclusion:
Therefore, pursuant to Section 55(a) of Chapter 7, MGL, this office hereby notifies the MBTA of
its objection to the awarding of these contracts. In accordance with Section 55(d), this objection is final
and binding on the MBTA, until such time as a revised certificate is submitted and approved by this
office. As always, this office is available to discuss our findings and provide further assistance to the
agency. (my emphasis)
Whatever reasons the MBTA had for not answering the auditor’s questions, the fact that those questions remained unanswered was the reason that the auditor objected to the MBTA’s privatization proposal. Nevertheless, the auditor clearly invited the MBTA to try again and to resubmit a revised privatization plan that addressed the issues in the auditor’s review.
The Pioneer report implies that it is somehow the fault of the Pacheco Law and the state auditor that the MBTA never did revise or resubmit its proposal, and never again attempted to privatize its bus services. That seems to us to overlook the MBTA’s responsibility for failing to comply with the auditor’s reasonable requests for information.
If you want someone in authority to grant a request you’ve made, and they say they may well grant it, but first they would like some more information about it, do you then say “it’s none of your business?” That, in effect, appears to be what the MBTA told the auditor in the the bus privatization case.
It was the MBTA’s choice not to answer the auditor’s questions and subsequently to sue the auditor rather than resubmit its proposal. It was also the MBTA’s choice never to submit another privatization proposal to the auditor for those services.
Now, not only is the Pioneer Institute continuing to complain about the auditor’s 1997 decision, we think the Institute has failed to make the case that the decision cost the taxpayers money over the intervening years.
And one more thing about the Pioneer report’s calculation of the alleged foregone savings
As noted above, the Pioneer report’s figure of $450 million in lost savings from 1997 to the present, due to the Pacheco Law, is based on comparing the T’s actual in-house operating cost for bus service to an outside contract bid. The report stated that as a means of comparison, it escalated the proposed contract bid between the years 2002 and 2013, the last date for which in-house cost data on the MBTA was available. The Pioneer report escalated the contract bid by the same percentage rate that it escalated the in-house cost each year.
But why did the Pioneer report not escalate the contract bid for the first five years of the comparison (from 1997 to 2002)? For no readily apparent reason, the report lists the same hourly contract rate for those first five years of its comparison. Yet, the report shows in-house MBTA costs rising by over 18 percent during that same initial five-year period. Had the report applied the same escalation rate to the contract bid as it did to the actual in-house costs throughout the comparison period (1997 to 2015), it would reduce the alleged $450 million in foregone savings by about $72 million.
If there was a reason that the Pioneer report assumed the bus contract costs would remain flat for the first five years, but would escalate after that, it isn’t stated in the report, as far as I could tell. But even if the report had assumed the same escalation rate throughout the comparison period, we would still reject the entire comparison of actual to proposed numbers.
The Pioneer Institute does acrobatic logical twists re the Pacheco Law
In what has been widely viewed as a setback for state employee unions in Massachusetts, state legislators last week approved a state budget for Fiscal Year 2016 that includes a provision freezing the Pacheco Law for three years with regard to the MBTA.
The Pioneer Institute apparently had a lot of influence on the Legislature in approving the Pacheco Law suspension. The Institute and other long-time opponents of the Pacheco Law claim the suspension, or better yet, an outright repeal of the law, will allow the T to operate without “anti-competitive” restraints on privatization, and thereby improve transit service and save taxpayers millions of dollars.
We have waded through the Pioneer Institute’s report, which is filled with charts and financial analyses. You don’t have to go too deeply into the numbers, though, to see that there are a number of apparent holes in the methodology and logical conclusions drawn in the report.
The Pacheco law basically says you have to prove you will save money before you can privatize state services. The Pioneer Institute has had to twist the numbers, logic, and the facts to persuade legislators and the public to draw the opposite conclusion.
In at least one instance, which I’ll get to below, the Pioneer report appears to have misquoted the actual language of the law. It’s an unusually acrobatic performance even by the standards of the Institute.
(Note: While the Pacheco Law does not appear to have had a role in preventing the past privatization of human services, which we are primarily concerned with, the Baker administration’s next step, with the support of the Pioneer Institute and like-minded organizations, might well be to exempt future privatization of human services from the law.)
Unsupported statement
I’ll begin by noting that the Pioneer report says, without any attribution, that several “anti-competitive elements” in the Pacheco Law “combine to create the nation’s most extreme anti-privatization law.”
What the Pioneer report doesn’t say is that the Pacheco Law is based on a federal Office of Management and Budget (OMB) requirement that federal functions be subjected to a competitive cost analysis before they can be privatized (OMB Circular A-76). As I’ll discuss below, at least two of the top three supposedly anti-competitive requirements in the Pacheco Law are also requirements in Circular A-76, while a third is a requirement of the Defense Department in complying with A-76.
The Pioneer report makes no mention whatsoever of Circular A-76, which has public-private cost-comparison elements that date back to the Reagan administration and even before. That’s not surprising since an analysis of the requirements of A-76 would seem to cast doubt on Pioneer’s claim that the Pacheco Law is the nation’s most extreme anti-privatization law.
Far from complaining that the cost analysis requirements of Circular A-76 would prevent public agencies from saving money through privatization, most of the critics of A-76 have contended that its real purpose has been to encourage privatization of federal functions by introducing cost competitions for what had been publicly provided services. As a result, a moratorium has actually been placed on A-76 cost competitions at the federal level since 2009 as a means of slowing the rate of privatization of federal agency services.
It is apparently only in Massachusetts that a law setting conditions for competitions to privatize services can be seen as an impediment to privatization. We do not view the Pacheco Law as an impediment to privatization if the case has been made that privatization will save money and ensure the quality of services.
The Republican Bush administration maintained in 2003 that the competition provisions in A-76 would save taxpayers money. As an online Bush administration document noted:
At the Defense Department, a survey of the results of hundreds of (A-76 public vs. private service) competitions done since 1994 showed savings averaging 42 percent…It makes sense to periodically evaluate whether or not any organization is organized in the best possible way to accomplish its mission. This self-examination is fundamentally what public-private competition is intended to achieve.
The Pioneer Institute’s apples-to-oranges comparison
The Pacheco Law authorizes the state auditor to compare bids from private contractors to a calculated cost of continuing to perform specified work by regular state employees “in the most cost-efficient manner.” If the auditor determines that the cost of continuing to provide the services in-house would be less than the bids, or if he or she determines that the privatized service would not equal or exceed the in-house service in quality, the auditor can reject the bids and the service will stay in house.
The main complaint raised in the Pioneer report about the Pacheco Law is that the the auditor used the law’s provisions to deny a proposal by the MBTA to sign two contracts in 1997 with private companies to operate 38 percent of its bus and bus maintenance service.
The Pioneer report concludes that had the Pacheco Law not been in effect, the MBTA would have saved $450 million since 1997 through the privatization of those bus services. But in making this claim, the Pioneer report compared bids proposed by the two prospective bus service vendors with actual costs incurred by the MBTA in that and subsequent years, and applied a cost-escalation factor to the bids.
The problem in doing that is that even though the Pioneer Institute claims it is being fair in applying that cost escalation factor, it is still comparing apples to oranges.
Under the Pacheco Law, the state auditor compared the bids from the vendors with a calculated cost of in-house operation at the MBTA based on operation in the most “cost efficient manner.” Based on that comparison, the auditor found that the MBTA operation would be less expensive than the proposed bus contracts.
The Pioneer report takes great exception to the Pacheco Law’s requirement that the cost comparison be made between contractor bids and a projection of the “most cost efficient” state operation. That is a key “anti-competitive element” that the Pioneer Institute cites. But the Pacheco Law is not unique in setting the comparison up that way. Circular A-76 also states that a federal agency can base its costs in a privatization analysis on what is referred to as a “most efficient organization.”
In fact, we think the Pacheco Law and Circular A-76 establish a true apples-to-apples comparison. While calculating costs based on operating in the most efficient manner may not reflect an agency’s actual operating costs, neither do bids necessarily reflect a vendor’s true operating costs. Bids are often lowballed, as we well know. As a result, contracting out for public services can prove to be much more expensive in actuality than it appeared in the plans or bids.
The Project on Government Oversight (POGO) found in 2011 that the federal government was paying billions of dollars more annually to hire contractors than it would to hire federal employees to perform comparable services.
We think that much of the high cost of human services contracting at the state level is due to a hidden layer of bureaucracy consisting of executives of corporate providers to the Department of Developmental Services. Our own survey showed that those executives receive some $85 million a year in taxpayer funding in Massachusetts.
So, in that regard, the Pioneer’s entire calculation of a $450 million in foregone savings in rejecting the MBTA vendor contracts is suspect, in our view.
A second major complaint about the Pacheco Law in the Pioneer report is that the law requires the winning bidder to offer jobs to public agency employees whose jobs are terminated by privatization. But that requirement is also in A-76.
Apparent misquote of the language in the Pacheco Law
The Pioneer report claims that under the cost analysis requirements of the Pacheco Law, any outside bidder must offer to pay the same wage rates and health insurance benefits to its employees as the incumbent state agency. This, according to the report, “neutralizes any potential advantage the outside bidder may have based on cost of labor.”
The Pioneer report, in fact, appears to be quoting from the law verbatim in including the following statement under the heading “Restrictive Elements of the Pacheco Law”:
Every privatization contract must include compensation and health insurance benefits for the contractor’s employees no less than those paid to equivalent employees at the public contracting agency; (my emphasis)
But I could find no such language in the Pacheco Law! Regarding wages, the Pacheco Law states that the outside bidder must offer to pay the lesser of either the average private sector wage rate for the position or step one of the grade of the comparable state employee. That could mean that the bidder could stipulate a lower wage cost in its bid than the state’s wage.
Regarding benefits, the Pacheco law says the bidder must offer a comparable percentage of the cost of health insurance plans as the state agency. This is consistent with the policy of the Defense Department, for instance, which prohibits private bidders in A-76 competitions from offering to pay less for health benefits than the DoD pays for its employees.
Despite his chamber’s action last week to freeze the Pacheco law, Senate President Stanley Rosenberg has appeared to be less than enthusiastic about the efforts to discredit the law and either freeze or repeal it. “There’s an ideological-slash-political component to this,” Rosenberg said. “We ought to be driving policy based on outcomes and data and how things actually work.”
Unfortunately, the latest attacks on the Pacheco Law seem to be more about ideology and politics than about real outcomes and data.
In 2010, I wrote a defense of the Pacheco Law, noting that it was already a major political target of the Pioneer Institute and Charlie Baker, who was making his first bid for governor at the time. If anything, the hyperbole and misrepresentations used to attack the Pacheco Law have only intensified since then.
Family and guardian rights bill gathering momentum
After years of being stalled in the state Legislature, a bill that would boost the guardianship rights of family members of the developmentally disabled appears to have a chance of passage.
The bill (H. 1459), which was given a hearing last week by the Judiciary Committee, states that probate court judges should presume a spouse or parent is the proper person to be the guardian of an incapacitated person.
The Committee also heard testimony in support of a related bill (H. 1469), which would prohibit state or other authorities from charging a parent or legal guardian with abuse or neglect, based on the type of medical care the parent or guardian has chosen for an individual in their care.
While we are primarily concerned with legislation that affects people with developmental disabilities, both bills are about the rights of families to make decisions regarding the care of their loved ones. In a number of cases, family members have been overruled in their decision-making regarding loved ones, and, in some cases, have been removed from virtually all contact with them by state or clinical authorities.
Passage of the medical decision bill, dubbed “Justina’s Law,” is being sought by the family of Justina Pelletier, a teenager who spent nearly a year in a locked ward in Boston Children’s Hospital after doctors there disagreed with the family’s belief that Justina was suffering from mitochondrial disease. Even though the family was relying on a diagnosis of mitochondrial disease from a doctor at Tufts Medical Center, the Children’s Hospital doctors claimed her illness was psychological and accused Justina’s parents of medical child abuse.
Member’s of Justina’s family testified last Wednesday in support of H. 1469.
It was standing room only in last Wednesday’s Judiciary Committee hearing on bills regarding guardianship of persons with developmental and other disabilities (COFAR photo)
The impetus for the H. 1459, the bill promoting family members as guardians of the developmentally disabled, came from Stan McDonald, who has been unable to regain his guardianship of his intellectually disabled son, Andy. Stan has had to watch helplessly as Andy’s emotional needs have been ignored or neglected. Andy McDonald’s current court-appointed guardian has had as many as 100 wards at one time.
H. 1459 would also potentially apply to a case in which a probate court judge dismissed several members of the Duzan family as unsuitable to continue as guardians of Sara Duzan, a young woman with a developmental disability. The judge’s order set the stage for the eventual cutoff of all contact between the family and Sara for months, and forced them into an expensive and still ongoing legal battle over her custody.
A corporate provider executive director initially appointed as guardian of Sara Duzan had 24 other wards at the time, according to court records.
H. 1459 would not prevent a probate judge from removing family members as guardians or denying a family member’s bid to become a guardian, but it states that there must be “competent evidence” to rebut the presumption that a parent, in particular, is the proper person to be the guardian.
This year, H. 1459 has received support for the first time from the Massachusetts Developmental Disabilities Council (MDDC), a state-run organization that identifies priorities for care for people with those disabilities, and from the Arc of Massachusetts. The MDDC has listed the bill as one of its legislative priorities for 2015-2016.
In testimony to the Judiciary Committee last week, the MDDC stated that:
…the person who is chosen to be guardian must be someone who knows the individual well, can truthfully speak to the individual’s desires and has the time to devote to crucial decisions. In many cases, the natural choice for an individual’s guardian is one of the parents.
Testimony in support of H. 1459 was also submitted by COFAR and by a representative from the Institute for Community Inclusion (ICI), which is associated with the University of Massachusetts.
It is unclear when the Judiciary Committee, which has had both H. 1459 and 1469 before it since January, will vote on ether one.
In order to participate in the care of a developmentally disabled person, it is necessary to obtain guardianship of that person when they reach the age of 18. Guardians have legal rights to participate in individual support planning, a key element in the care of developmentally disabled persons, and to make other decisions that affect their wards’ services and well-being.
In some cases, parents and siblings of incapacitated individuals are passed over by probate court judges in considering who to appoint as guardians, and, in some cases, family members are removed as guardians by judges. In many of those cases, judges appoint either attorneys or corporate human services provider organizations as guardians, and those attorneys or providers may have no connection to the persons who need their representation. Some of those court-appointed guardians have large numbers of wards and are unable to advocate for them effectively.
Most court-appointed guardians for the developmentally disabled in Massachusetts appear to be paid for that work by the Department of Developmental Services. The ICI representative’s testimony characterized such payments to court-appointed guardians by state agencies as a “clear conflict of interest.” The testimony noted that guardians paid by state agencies may not always act in the best interest of the ward. This can “result in decisions to remove the family from virtually all decision-making authority in the care of their loved ones,” the testimony noted.
In appointing a guardian, a probate court judge is currently required by law to consider, in order of priority, a spouse, then a parent, and then “anyone else the court deems appropriate.” But a judge is not obligated to give more weight to a parent than to anyone else he or she deems appropriate. In fact, the law currently allows judges to pass over a person having priority and appoint anyone else they wish as guardian. That provision gives probate judges carte blanche to bypass the express wishes of parents and other family members. H. 1459 would remove that bypass provision.
Possible amendments to H. 1459:
COFAR’s testimony in support of H. 1459 suggested some changes that would strengthen it even further. Those positive changes include adding siblings to the list in the bill of suitable guardians. As the bill is currently drafted, it specifies only a spouse and parents of disabled individuals as being considered to be the proper guardian. In the case of developmentally disabled persons who are aging, siblings are often the only family members in a position to become guardians.
COFAR also suggested other reforms to the guardianship system in Massachusetts, either as amendments to H. 1459 or as separate legislation. Those reforms include:
- Limiting the number of wards a court-appointed guardian can have, and requiring court-appointed guardians to devote a certain minimum amount of time to the ward and to visit them a minimum number of times.
- Entitling family members of a developmentally disabled individual to an attorney if the Department of Developmental Services or another agency attempts to remove them as the guardian. In many cases, families are subjected to costly legal battles to retain or regain guardianship when state agencies seek to remove their guardianship rights.
- Placing the legal burden on agencies such as DDS or on court-appointed guardians to prove that restrictions on family contact are in the best interest of the ward.
Both COFAR and the Arc oppose a separate bill that would remove a requirement that individuals with developmental disabilities be clinically evaluated when new guardians are appointed. That bill (H. 1594) appears to be discriminatory in removing the evaluation requirement for people with intellectual disabilities but not for people with mental illness, for instance. We believe that such evaluations are necessary for all incapacitated persons, particularly when new guardians are appointed.
DDS still hasn’t applied for available funding for critical background check program
The Department of Developmental Services is on the hook to create a national background check program that will cost the Department more than $500,000 in the current fiscal year alone and will involve background checks of tens of thousands of current and prospective staff, according to a document posted on the Department’s website.
Yet DDS has continued to balk at applying for up to $3 million in federal grant funds that could help the Department develop the much delayed program. As a result, it appears DDS will have to continue to take money from departmental accounts that have been repeatedly shortchanged in terms of funding in recent years.
The online document states that DDS will be responsible for national background checks of more than 20,400 current human service corporate provider staff in the state, including some 6,500 staff working directly for the Department itself. The document appears to project that DDS will do national background checks on more than 10,600 new provider staff and 1,300 new DDS staff each year.
The document notes that in the current fiscal year, DDS will need a minimum of $510,000 to hire and train staff to be ready for the January 2016 implementation date for the first phase of the program, which involves undertaking background checks of new staff.
COFAR has been urging DDS for the past two years to apply for the federal grant funding, which has been available to states since 2010 under the Affordable Care Act or ObamaCare. In August 2013, a DDS official replied in an email that the state had not applied for the funding because state legislation authorizing national background checks by DDS was not yet in place. Once such legislation was enacted, the official wrote, “we will pursue the federal dollars.”
Even then, it wasn’t necessary to wait to apply for the funding, under the grant rules; but that long-awaited legislation was, in fact, signed into law by then Governor Patrick last August. Yet, on May 1 of this year, some nine months after the bill was signed, DDS was still considering whether to apply for the grant, according to a letter sent to us by the DDS general counsel. As of May 27, the matter was still under consideration, according to a follow-up letter from a DDS assistant general counsel.
This is a year in which DDS Commissioner Elin Howe has said the Department has had to deal with “huge and difficult (budget) reductions.” It would seem that the Department doesn’t have the luxury to spend months thinking about whether to accept federal assistance in paying for the development of a new, required program.
It’s not even a competitive grant, meaning it appears to be practically guaranteed money. A total of 24 states and Puerto Rico have been awarded close to $57 million in this funding. Thus far, Massachusetts is among 26 states that still haven’t applied for the grants.
The state legislation signed in August authorizes DDS to conduct national criminal background checks of persons hired to work in an unsupervised capacity with individuals with developmental disabilities. The law will ultimately require that both current and prospective caregivers in the DDS system submit their fingerprints to a federal database maintained by the FBI. The law applies to DDS employees, employees of corporate service providers to the department, and caregivers over the age of 15 of persons living at home.
Up to now, persons hired to care for clients in the DDS system have had to submit only to an in-state criminal background or CORI check, which identifies only criminal arrests and convictions in Massachusetts. CORI checks do not identify any convictions a job applicant might have from another state.
The new national background check requirements will not fully take effect until January 2019 for current employees, and until January 2016 for new employees. As we have noted a number of times, neither the Legislature nor the administration of then Governor Deval Patrick appeared to place a priority on getting the new program up and running quickly.
That lack of urgency appears to be further reflected in the continued failure by the Baker administration to apply for the available grant funds for the program. As noted, the program will not be a small undertaking.
In response to an information request we submitted in early March, the DDS general counsel stated in early May that the Department was in the process of “developing, designing, and preparing the various systems” needed to implement the new program. Departmental staff were meeting weekly “to plan for the procurement and design of information systems needed to receive and securely store confidential national background information..”
DDS is also planning to establish a unit within the Department of specialists to review both state and federal information in order to determine, apparently on a case-by-case basis, whether each applicant or existing employee is suitable for employment. DDS is currently drafting regulations to govern these processes.
Thus far, no additional funding has been allocated to DDS to implement the program. The 510,000 needed for the current year in implementation money has to come from somewhere. Why not take help when it’s offered?
‘Real Lives’ contract with private firm raises questions
As part of a push toward so-called self-directed services for the developmentally disabled, the state has established a payment system for those services that has exclusively benefited a Boston-based consulting firm.
The Department of Developmental Services is paying Public Partnerships LLC (PPL) close to $1 million a year in fees to perform what appear to be primarily check-processing and basic accounting services in connection with three self-directed services programs, according to records obtained from the Department under a Public Records Law request and to online contracting information. Those programs currently appear to serve less than 1,000 people in the DDS system.
In a written response to us, Marianne Meacham, the DDS general counsel, said it would be “inaccurate” to characterize PPL’s services as check processing and basic accounting, and maintained that “the functions performed by (PPL) far exceed” those services.
However, with the exception of requirements to elicit feedback from participants in one program and to handle customer service calls in another, the tasks or requirements listed in PPL’s contractual Scopes of Work for Fiscal Years 2014 and 2015 all appear to be check processing, accounting, or website management functions. When we had previously asked DDS for records showing or describing “all services provided to DDS by PPL” for fiscal 2014 and 2015, the Department referred us to the contractual Scopes of Work for those fiscal years.
Moreover, there were significantly fewer requirements listed in those Scopes of Work than in a Request for Response (RFR) issued by DDS to prospective bidders for a contract in 2008 for “fiscal intermediary services” for two of the self-directed services programs. PPL was selected in response to that RFR process.
The requirements in the 2008 RFR included helping program participants manage individual budgets for care. Individual budgets are a key feature of self-directed services. That requirement, however, was not included in either the 2014 or 2015 Scopes of Work.
In addition, a third self-directed services program appears to have been added since 2008 to PPL’s contract, potentially increasing the company’s fees; yet it does not appear that PPL was required to bid to become the fiscal intermediary for that additional program. It also does not appear that the addition of the new program to PPL’s Scope of Work resulted in a net increase in PPL’s work requirements.
According to information on file on the state Operational Services Division website at www.mass.gov/ufr, PPL has received administrative fees from DDS that grew from $529,435 in fiscal 2010 to $969,282 in fiscal 2014, an increase of over 80 percent.
Under the three self-directed programs, total state revenues processed by PPL increased by about 14 percent in that same time period. PPL processed about $14 million in state payments in Fiscal 2014, up from about $12.4 million in Fiscal 2010.
Meacham stated in her response that the contract with PPL incorporates all of the requirements in the original 2008 procurement solicitation. She did not address the apparent addition of the new self-directed services program to PPL’s contract without bidding.
Under self-directed or “person-centered” services, participants prepare “individual budgets” for care and services. Fiscal intermediaries are generally private firms that contract with the state to manage and direct payments from those individual budgets to service providers.
The stated goal of self-directed services is to give participants more choice and say in the care they receive. In what appears to have been a key effort to expand those programs, the Legislature passed the ‘Real Lives’ law last year, which appears to formalize the self-directed services process.
We have raised concerns, however, about the level of oversight of self-directed programs and whether the Real Lives law, in particular, will put too much decision-making power over an individual’s funds into the hands of private companies.
Traditionally, DDS itself has paid providers of direct-care and other services, and has managed those services in accordance with each client’s care plan, known as an Individual Support Plan (ISP). While ISPs still govern self-directed services provided in the DDS system, DDS appears to have given up at least some of its traditional control over the funding of those services.
Meacham’s response stated that the federal government has encouraged states to develop self-directed services programs, and requires that payments for those services be made by a private fiscal intermediaries. In 2008, DDS issued an RFR for fiscal intermediary services for two self-directed services programs in Massachusetts: the Adult Participant-Directed Program (PDP) and the Child Autism Spectrum Disorder program (ASD).
Subsequently, a third program, as noted, was added to PPL’s contract: the DDS/Department of Elementary and Secondary Education (DDS/DESE) home-based care program for children.
PPL was awarded the contract for the first two programs in 2008, and the contract has been extended each year since then. Fiscal 2016 may be the last year of the contract before it has to be re-bid through a new RFR.
Under PPL’s latest contractual Scope of Work for the three self-directed services programs for fiscal 2015, PPL is responsible for performing the following functions:
- Processing and sending checks to providers of services to participants in the self-directed services programs.
- Maintaining invoices which document expenditures.
- Maintaining a list of those providers and processing CORI or criminal background checks of providers in the PDP and ASD programs. The Scope of Work states that the DDS/DESE program is excepted from this process.
- Measuring performance of the providers, although the Scope of Work does not specify how that is to be done. The Scope of work referred to an “Appendix A” regarding “the performance measurements and performance measurement process.” However, no such appendix exists, according to a DDS assistant general counsel, who stated to us in an email that the reference to an Appendix A was inadvertent.”
- Eliciting feedback on the PDP program from participants through focus groups and a yearly satisfaction survey.
- Handling what are called “Tier 1” customer service calls and inform families and providers about forms and website processes for the DDS/DESE program.
- Training designated DDS staff on forms and processes for the DDS/DESE program.
The 2008 RFR, which resulted in the ongoing contract with PPL, includes requirements similar to those above, but also has what appears to be a much more extensive list of requirements for the fiscal intermediary. Those additional requirements in the 2008 RFR include “maintaining” individual budgets for participants and “helping participants manage their individual budgets.” This includes monitoring the participant’s spending and assuring that spending is only for approved services.
Other requirements in the 2008 RFR that do not appear in either the 2014 or 2015 contractual Scopes of Work for PPL include the following:
- Protecting program participants from abuse and neglect.
- Hiring service providers and developing their contracts.
- Serving as liaison between participants, their service coordinators, and service providers.
- Assisting providers in qualifying for waivers under the federal Medicaid program for Home and Community Based Services.
- Managing a network of Support Brokers, who are also hired to help participants manage their individual budgets and services.
- Tracking all complaints from participants and reporting quarterly on those complaints to DDS.
In her response, Meacham stated that PPL does track all complaints from participants and does take actions to protect participants from abuse and neglect, although she didn’t specify what those actions are. She also said PPL manages workers compensation policies and withholds state and federal taxes on behalf of program participants who hire caregivers out of their individual budgets.
Whether or not PPL’s contractual requirements have been reduced, it is apparently legal to negotiate a state contract with the winning bidder on an RFP to reduce work requirements; but a state contracting guidelines document states that those reductions must be minor in nature.
In her written response, Meacham also contended that it was not accurate to state that less than 1,000 people currently participate in the three self-directed service programs. However, Meacham’s response stated only that “over 300 families were enrolled as participants” in the ASD program in the last two fiscal years; that the PDP program “serves over 500 individuals” per year, and that the DDS/DESE program “has remained at a low level due to individuals not electing self direction.”
According to DDS information forwarded in March from state Senator Jenifer Flanagan’s office, a total of 784 people were self-directing their services in the DDS system. DDS was projecting that that number would double over the next four years to 1,568.
According to the PPL Scopes of Work for Fiscal 2014 and 2015, PPL gets paid under each of the three programs in different ways:
- PDP program: PPL receives a monthly fee of 6 percent of consumer’s total self-directed budget allocation.
- ASD program: PPL receives $131.25 per member per month.
- DDS/DESE program: PPL receives 8 percent of funds expended under the program.
In the final analysis, PPL may be charging DDS the market rate in fees for the services it performs under its contract. But payments of close to $1 million a year in fees to one firm to process payments under three relatively small programs raise questions for us about the value and price of these fiscal intermediary services.
We think the federal government should re-examine the amounts states such as Massachusetts are paying for fiscal intermediary services and should assess whether those services could be provided more cost-effectively in house.
Redacted state report appears to clear hospital that failed to treat developmentally disabled man
An investigative report by the Department of Public Health appears to have concluded that Lowell General Hospital was not at fault in the case of a developmentally disabled man who died after having been turned away twice by the hospital in 2012 without any significant treatment.
I’m using the word “appears” to describe the report’s finding because virtually all of the text was redacted in the version of the document provided to us last week by the DPH. Even the date of the report could not be determined from the document. We are asking the state Public Records Division to order the DPH to produce a more comprehensible version of the report.
As I previously reported, the 51-year-old man, whose name is being withheld, died in February 2012 after having been taken twice in two days to the Lowell hospital and sent away each time.
The man had been having difficulty breathing and was sweating profusely when he was taken to the hospital on both February 6 and 7. On the morning of February 7, he was sent back by the hospital to the group home in which he was living with a prescription. He died, apparently en route to the hospital, after staff in his group home called an ambulance for the third time on the afternoon of February 7.
The cause of death was listed on the death certificate on file in the City of Lowell as acute respiratory failure and aspiration pneumonia, which can indicate choking. A death report form filed with the Disabled Persons Protection Commission stated that the man died after experiencing cardiac arrest.
The DPPC referred the case of the man’s death to the DPH, apparently because an allegation about improper care in the case involved the hospital and not the man’s group home, which is operated by the Department of Developmental Services.
It seems surprising that state investigators would find no problems with the policies or procedures of a hospital that apparently failed to provide any significant treatment to someone who subsequently died due either to choking or a heart attack. Common sense would imply that something went wrong somewhere in the hospital’s procedures between the time the man first arrived at the hospital exhibiting signs of physical distress and his death the next day. But if the state did find something wrong, it’s not evident in the version of the report we received.
In February of this year, we requested a copy of the DPH’s report on the case, but the Department denied our request, citing the deceased man’s privacy rights. We appealed to the Public Records Division, which last month upheld our appeal, ordering the DPH to produce the report or explain why it was exempt from the Public Records Law.
As we have previously noted here, our interest lies in whether the DPH examined the adequacy of Lowell General Hospital’s policies and procedures for treating persons with developmental disabilities. This case suggests to us that there may have been inadequate training of hospital health care personnel in the treatment of developmentally disabled persons. The lack of such training has become an issue of concern to advocates for the disabled and to many policymakers.
Given the narrow scope of our interest, we indicated prior to the Public Records Supervisor’s ruling that we were open to accepting a redacted version of the DPH report that did not reveal the man’s name or medical information about him that might violate his privacy. We said, however, that we would not accept a report that was redacted to such an extent that we were unable to substantively discern either its findings or the support for its findings.
Unfortunately, that is the case with the document we have received from the DPH. The redactions in this report appear to go far beyond what might be construed to be medical files or information. It is impossible to tell from the document whether the Department investigated the hospital’s policies or procedures for treating individuals with developmental disabilities or whether the DPH examined the training of staff in that regard. It is also impossible to tell whether the report contained any recommendations regarding hospital policies and procedures.
(Again, feel free to review the DPH report yourself at this link.)
The only statements in the DPH report that were not redacted and that appear to be relevant to the investigation of the case are four apparent findings in what is labeled the synopsis on the first page. But even those findings have been at least partially whited out so that they cannot be fully understood. Those apparent findings are that:
1. There was an allegation that hospital emergency staff were “ill-equipped” to deal with something. We don’t know what that something was because the language is redacted. We assume it was the treatment of the developmentally disabled man. However, due to the redaction, it was impossible to determine that with any certainty.
2. Based on a review of medical records and interviews with staff, “the allegation was determined not to be valid,” the report stated. There is no text in the document providing any support or reasoning for the finding. The finding indicated that in addition to medical records, three other things were reviewed as well, but the list of those three things was redacted.
3. Based on a review of something else that was similarly redacted, “appropriate care was rendered.” Again, no further support or information was given for this finding.
4. The hospital’s discharge plans “were appropriate and communicated to”…redacted.
That is the extent of the readable text in the report that appears to be relevant to the investigation. The full report is apparently more than five pages long. However, after a heading labeled “Survey findings” on page 2, the report is entirely blank with the exception of one partial sentence on page 5 that states: “Review of the Medical Screening Examination dated 2/7/12 indicated”… The sentence breaks off at that point and there is nothing further in the document. February 7, 2012 was the date of the disabled man’s death.
In his April 29, 2015 order to the DPH to turn over the report to us, Public Records Supervisor Shawn Williams wrote that the Public Records Law strongly favors disclosure by creating a presumption that all governmental records are public records. In addition, Williams’ order noted that it is the burden of the department that possesses the requested records to demonstrate the application of an exemption in order to withhold any of those documents.
In our view, the DPH has failed to comply with the letter or spirit of the Public Records Law, and has not met its burden of demonstrating that the wholesale redactions of the report were either necessary or complied with the requirements of the records law exemption.
We sent a letter last week to Williams and to another attorney in the Division who handled our case to let them know of the nature of the document the DPH produced. We’re confident Williams will agree with us that the DPH needs to do better that what they have done in providing the requested report.
COFAR blog 