In an effort to reduce administrative costs, verify eligibility more efficiently, and better serve their clients, more states and counties are turning to private firms to manage and operate their welfare programs. Yet, as these government functions are being outsourced, problems will only grow. In fact, there seems to be more systematic problems now than when these programs were exclusively run by the states. Is privatizing government functions just an attempt to get out of paying for services?
Approximately 500 area residents showed up at a town hall meeting on Tuesday to discuss the Indiana's new privatized welfare delivery system, which has caused a lot of ruckus among the supporters and non-supporters of welfare recipients. The new system, administered through the Indiana Family and Social Services Administration (FSSA), was initially intended to reduce welfare fraud and improve service to clients, but instead, it is inundated with problems and is actually costing aid recipients their benefits.
The welfare recipient community believes that the new changes in processing Medicaid eligibility and eligibility redetermination are poorly managed by FSSA and its private partners, IBM Corp and Affiliated Computer Services (ACS). Furthermore, there are not enough case workers available to assist Medicaid clients and applicants. Additionally, the rollout of the system, which began last fall, is failing senior citizens, people with disabilities, and other low-income clients who have had difficulty phoning into a centralized call center operated by IBM and ACS, and navigating the website created to process applications for food stamps, Medicaid, and other benefits.
During Tuesday's meeting, the debate over the effectiveness of the new system only intensified as the panelists faced a host of complaints from welfare recipients claiming that their children and families were wrongfully denied health insurance or other benefits. One woman for example, said that she cannot get food stamps for her 10-month-old daughter who was born premature and is battling cancer. As a result, she has to beg her family to borrow food. Another woman and her children lost their health care and food stamp benefits after the state told her that their records indicate that her husband has three jobs, when in reality, he didn't!
Complaints regarding the flaws in the new system put FSSA Secretary Mitch Roob on the defensive as he dismissed the criticisms, arguing that those who attended the meeting did not represent the majority of welfare recipients receiving benefits without complaints. The heated discussion also triggered harsh comments by others who are in favor of these privatization efforts, suggesting that beggars can't be choosers and insisting that the aid recipients have created their own dilemma. The consensus among those who do not support welfare recipients is that they are "lazy" and just sit around collecting checks.
Unfortunately, while there are people on welfare who do take advantage of the system, not everyone wants something for nothing. Contrary to what the non-supporters of the welfare community may believe, there are people who really need help but can't get it. A number of citizens expressed their pains and frustrations during Tuesday's meeting, along with posting messages online afterward in response to the numerous negative comments targeting the welfare community. A lot of these individuals indicated that they do work, but that either their jobs do not offer insurance for the family or that they do not provide them with the healthcare coverage that they need. One woman pointed out that even though she does want to work, no one will hire her because she is either overqualified or she does not have enough experience for the position. Moreover, she has eight children, six of whom are adopted, and is without health insurance due to pre-existing conditions. In addition to having jobs, some of attendees also argued that they do have an education, but that an education cannot prevent an illness or predict a life-threatening illness that may hit by surprise, creating an enormous medical bill.
Also in attendance were many representatives from nursing homes who expressed the difficulty in trying to get assistance for their residents. So are the senior citizens who are in nursing homes supposed to go out there and look for jobs too? Do they fall into the "lazy" category? As far as the elderly are concerned, in most cases, their social security benefits are often not enough to cover their rent, gas, medical bills, medications, and food. Then again, the cost of living nowadays is establishing a barrier for the average American, especially with the gas prices averaging four dollars a gallon and the steady rise in food prices.
Despite the glitches, privatization is here to stay. The legislative leaders who are championing these efforts will not go back to the old ways of determining eligibility and running programs. Yet, the use of competitive outsourcing appears to be deteriorating the objective of the measure to improve human services. In Indiana for example, the new privatized welfare system has been exposed as a failure due to a lack of service quality. In part, it can also be due to the fact that private contractors are not directly accountable to the citizens. Whereas each county in Indiana previously had its own welfare office and clients had individual caseworkers assigned to them, now welfare recipients cannot even get through the privately run call center, which is operated by IBM and ACS, because the lines are always busy. Additionally, there are more incidents of application documents getting lost.
So are the outcomes of having a privatized welfare system below what they were under the old system? Necessary changes need to be made by Governors in order to address the flaws in the welfare system. Also, human services officials need to place a higher degree of accountability when entering into contracts with the private companies that will be managing their programs. As government functions are being outsourced and private employees are assuming a lot more of the state workers' duties, there is a need for more staff to handle the volume of calls, reduce the waiting time, and make sure paperwork gets to where it needs to.
They weren't wrong to see that the local office structure created a lot of unhelpful redundancy & low-value services in each county; and they weren't wrong to try to use the potential savings that those inefficiencies represented to finance the creation of a new, more efficient infrastructure. (and that's basically what this outsourcing deal is about - in that way it's a lot like the Daniels Admin's privatization of the turnpike & using the proceeds to fund other major road improvements. Whether they can make it work or not, whether they've actually struck good deals, is debatable - but on the face of it, it's a plausible strategy.)
Where FSSA messed up was in hiring a contractor take over the whole client-services / case management business area. What they should have done was hired a contractor to create the infrastructure, and then connect the vast existing network of voluntary, faith-based and community organizations to that new infrastructure. FSSA should've recruited, trained and supported those folks to do outreach to needy families, provide case management & be advocates for FSSA's clients (something that Texas said they would do, but never followed through). They should've given those folks the tools, and reimbursed them for the service (it beats paying a group of multi-national companies that sure aren't going to reinvesting all of the proceeds back into Indiana's economy the way local non-profits would).
A lot of those organizations were ready & eager to step up to that responsibility when FSSA first put this idea out there. And while some transitional problems are going to occur in any big change like this, FSSA would've come at those problems with a greater reserve of trust & support in the community, because they'd have built-in allies who'd feel like they were included & shared the commitment to make it work. Instead, FSSA may have a rebellion on its hands at the community level.
Florida's the only state i know of that's made any significant effort at the state level to partner with these community organizations, and even there the state's commitment to it has been less than whole-hearted (although there have been some interesting developments at the local level in places like Massachusetts, Pennsylvania & Chicago). The first state to really try this kind of partnership & show that it can work will leave a much longer-lasting mark on the field of social services than the privatizers of today.