Disabilities agency rated unsatisfactory Mismanagement resulted in loss of millions, report says

Payments called unjustified

State unit serves 20,000 and has 5,300 on its waiting list

August 13, 1998|By Michael Dresser | Michael Dresser,SUN STAFF

An article in yesterday's Maryland section about a legislative audit of the Developmental Disabilities Administration incorrectly reported that state Budget Secretary Frederick W. Puddester said it was a shame auditors focused on only the negative aspects of the agency's performance. In fact, Puddester said it a shame news media focus on only negative aspects of the agency's record.

The Sun regrets the errors.

The state agency that cares for developmentally disabled Marylanders lost millions of dollars through mismanagement at a time when thousands of its highly vulnerable clients were languishing on a waiting list for want of money to provide services, legislative auditors have concluded.

In an unusually harsh report, the state Department of Legislative Services gave the Developmental Disabilities Administration a rating of "unsatisfactory" for its compliance with procedures. Only two other agencies, out of more than 200, have such a rating, according to chief legislative auditor Bruce A. Myers.


Auditors concluded that since 1994, the agency made unjustified payments to care providers of more than $2 million, while losing another $1.8 million in interest income because of slow debt collections. The examiners also found that the agency failed to properly monitor care providers and violated state procurement law by awarding two bids without competitive bidding.

The report calls into question the performance of a long-troubled agency that Gov. Parris N. Glendening has been trying to turn around since he took office in 1995.

Glendening, who has received considerable support from advocates for the disabled for his efforts on their behalf, expressed concern about the report through a spokesman. Press secretary Ray Feldmann said the governor has directed state Health Secretary Dr. Martin P. Wasserman to resolve the outstanding issues identified by the auditors.

"This administration has made unprecedented commitments to developmentally disabled individuals throughout the state and we will continue to honor those commitments, operating within the letter of the law," Feldmann said.

The disabilities administration, a unit of the Department of Health and Mental Hygiene, serves an estimated 20,000 people -- about 85 percent of whom are mentally retarded -- through community-based services and state institutions.

The agency received a 10 percent budget increase this year -- to $378 million -- as Glendening pledged to eliminate the state's waiting list for services to the disabled, which by late last year had grown to about 5,300.

One of the key findings in the report was that in fiscal 1997 the agency did not promptly record $21 million owed by the federal government on its closing statement for fiscal 1997. That decision, which forced the state to rely on its general funds that year, apparently delayed efforts to reduce the waiting list.

Dr. Georges C. Benjamin, the state's deputy health secretary, defended the decision to hold the federal funds out of the agency's budget. He said the money was used this year to help ensure a steady revenue stream for the five-year, $68.4 million initiative launched by Glendening to improve services for the developmentally disabled.

One lawmaker said the money should have been used more quickly.

"Now the waiting list is being addressed, but it could have been one or two years earlier," said State Sen. Patrick J. Hogan, a Montgomery County Republican who sits on the committee that oversees legislative audits.

The audit notes that the agency closed its fiscal 1997 books with more than $1.6 million in a fund set up to pare the waiting list, but spent $74,603 of it that year.

But the chief executive of a leading organization for the disabled said it was not clear that money spent more quickly would have been spent efficiently.

"We're actually pleased that it's being done in a more thoughtful, deliberate way under a comprehensive policy initiative," said Christine Marchand, executive director of the ARC of Maryland, known at one time as the Association for Retarded Citizens.

The audit covers a period from September 1994 to June 1997 -- a period that includes the final months of the Schaefer administration and the first 2 1/2 years Glendening was in office.

Marchand said many of the backlogs addressed in the report date to the Schaefer administration. She said the new management team brought in by Glendening has improved the agency's performance.

Marchand said the finding that disturbed her was that the state has not kept up with its audits of care providers. Legislative auditors found that at its current pace, it would take 10 years for the agency to audit each of 114 care providers with contracts worth more than $100,000.

In his June 23 letter replying to the audit, Wasserman said some of the deficiencies have been corrected. But he provided few explanations for the lapses.

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