Federal agency wants Pennsylvania to repay $220 million Go Pennsylvania!!!

Federal agency wants Pennsylvania to repay $220 million - Pittsburgh Tribune-Review

The state budget hole could get $220 million deeper if Gov. Tom Corbett's administration can't persuade a federal agency to ignore its own investigators.

A federal audit of child welfare spending in Allegheny County from 1997 to 2002 found that at least $1 of every $5 reimbursed through the Title IV-E program to foster care providers shouldn't have been reimbursed. If that's true, and if other counties received similar overpayments, it would mean Pennsylvania got hundreds of millions of dollars more from the federal government than it should have.

The agency that paid reimbursements -- the Administration for Children and Families within the U.S. Department of Health and Human Services -- wants $220 million back. The state faces a $4 billion deficit next year.

Pennsylvania is trying to settle with Health and Human Services for a lower amount. State lawyers argued in a 30-page letter sent in September to auditors that their audit, conducted by the department's Office of Inspector General, is a "capricious," "oppressive" and "unlawful" use of government power. The audit began in November 2003.

"They're very old claims, and the threat of a penalty has been around for a very long time," said Cathleen Palm, executive director of the Protect Our Children Committee, a Berks-based coalition of child advocates and welfare providers. "It's hundreds of millions of dollars, potentially, taken out of the state's ability to protect children."

Corbett's transition team warned him about the problem in a report. His spokesman, Kevin Harley, said it is "under review."

On Dec. 30, the inspector general's office sent its final report to the Administration for Children and Families. The state has until early February to give the agency its side of the story.

Settling the federal claim "is going to require some degree of politics, some degree of pain, some degree of commitment that whatever we face, it harms kids on the ground as little as possible," Palm said.

A Department of Health spokesman said the state is formulating its response to the audit report. The alleged improper payments are to have taken place starting a year after Allegheny County Department of Human Services Director Marc Cherna took over the department.

"Frankly, when we first took over here, it was a mess," Cherna said. "It's taken awhile for us to put things in place that maximize efficiencies. ... We've got a really good system."

Because of the way federal child welfare money is spent, auditors never contacted Cherna's department, even though that's where the payments originated. The county spends the money, then sends a reimbursement request to the state. The state then sends a reimbursement request to the federal government. When the government pays the state, the state pays the county.

Auditors examined 100 claims passed along from Allegheny County through the state to the federal government. They found 23 shouldn't have been reimbursed. The records for 15 others weren't detailed enough to determine whether they fit federal law, auditors said. The remaining 62 were fine. Auditors used that sample to estimate how much was spent erroneously during the entire audit period.

Alleged improper reimbursements to Allegheny County total $28.3 million. The reimbursements for which records were too vague total $27.9 million, auditors said.



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