12 Actions to Improve Product and Lower Costs of State Programs
In the current political climate the question I am always asked is: What programs would you cut to balance the budget? I am never asked: What changes in management would you make to improve efficiency so programs are more effective, dollars can be saved, and more people can be served?
It is that second question we should be asking even though it is the more difficult one to answer, since it requires attention to details and a motivation to get things right.
Details matter. Details like $2 billion really matter, which is the amount Medicaid expenditures that auditors couldn’t link to any specific program.
Almost a million people rely on Medicaid for vital health services. At $7.5 billion it is the costliest program funded by the state and the fastest growing. Yet, it is poorly run. It is a lot easier for those in charge to save money by cutting people off health care than to change their own management practices.
A recent audit of Medicaid shows that we don’t know what money is spent on. Much of the administration is done by private contractors under broadly written contracts. There are more contract employees running the program than there are state employees. Contract amendments are not tracked, do not specify the sources of money used to pay for them, are not competitively bid, and the accounting, procurement and budgeting offices do not even know about them. Expensive contractors were used to do routine state work using state resources – even answering the phone of administrators. Loose oversight led to a $2.7 million fine by the federal government.
Medicaid is not the only program that needs fixing. We need a new way of governing in Wisconsin, a way of governing that pays attention to detail and cares about performance and results.
As Governor I will make these management changes that cumulatively will improve “product” and reduce costs. None of them are sexy or will grab headlines, but it is time we had a Governor more interested in running the state well than in grabbing headlines.
- Management, budgeting and accounting systems will connect dollars with specific programs and outcomes.
- Responsibility and authority over spending, contracting, hiring and rulemaking will be returned to individual agencies. Directors and agencies will have the tools to do their jobs and will be held responsible for results.
- All positions now subject to political appointment will be reviewed and all except top management positions will be returned to civil service.
- All contracts and major contract amendments will be bid. Contract deliverables, performance standards and deadlines for completion will be included in all contracts. These will be monitored and enforced.
- All requests for bids and proposals will be posted on the state website.
- Details of all contracts entered into will be posted on the state website before contractors can be paid. Results and performance measures will be posted upon completion of contracts.
- Before soliciting bids, the cost effectiveness of contracting out state services will be evaluated.
- A system that encourages, facilitates and rewards suggestions from employees about ways to improve outcomes or lower costs will be put in place.
- Budget documents and the budget process will be made more transparent, easier to understand, and will include all funds and expenditures. State spending that is not now reported in the budget (like unemployment insurance, the Injured Patient Compensation Fund, Food and Dairy Safety Programs, the Fish and Wildlife Fund and State Fair Park program revenues) will be brought back into the budget so citizens know the real extent of state spending.
- The budget will provide a more accurate and complete representation of the state’s financial health. Attention will be paid to critical indicators of the financial health of the state including financial statements prepared following generally accepted accounting principles. Analysis will focus on both long and short term fiscal measures. The accounting and financial gimmicks that occur all too often in the waning days of the budget debate will be ended.
- Systems will be established to better monitor waste, fraud and abuse and more actively recover improper payments.
- An Office of Program Evaluation will be established under the Governor to evaluate agency processes and results with the goal of finding better, more effective ways of getting the job done. The office will analyze state programs and publically report on the goals, objectives and results. Performance metrics will be established and monitored. Information systems to continually monitor programs and deliver data to evaluators and the public.