Arkansas Politics

3 Ways To Respond To An Audit If You’re DHS

AP_transparency-01As tax season approaches, we thought we’d give some some examples of how best to respond (if you’re a state government bureaucrat) to an audit — using examples from a recent Division of Legislative Audit (DLA) of the Department of Human Services’s stewardship of the state “private option” Medicaid Expansion program.
Without further ado, here are a few of DHS’s responses from the recent audit:
3.) Your request adds “an additional level of complexity” to my life, and therefore I won’t respond to it.

From the audit:

“DLA also requested the average monthly per patient costs for recipients categorized as medically frail for the months of January through September 2014.  Supporting documentation was also requested.  According to DHS, an analysis of average days would require data elements from multiple systems and add an additional level of complexity in producing the requested data.”

In layman’s terms, this means: It’s too hard! In fairness, I tried this once with a term paper in college — unsuccessfully. We advise you, the average citizen, not to try this excuse if faced with an audit from the IRS or other government agencies.
2.) Don’t answer specific questions asked except by citing statistics from special-interest groups sympathetic to your cause.

From the audit:

DLA asked if emergency room (ER) visits had increased or decreased since January 1, 2014, and if previously-uninsured individuals are going to the ER or to Primary Care Physicians to receive medical care.  DHS responded that in May 2014, the Arkansas Hospital Association (AHA) released survey data that showed a reduction in ER use and uninsured hospital admissions for the first quarter of 2014. Based on a comparison to data from the first quarter of 2013, AHA reported a 2% decrease in ER visits overall, a 24% reduction in uninsured ER use, and a 30% reduction in uninsured hospital admissions in the first quarter of 2014.  The survey results represented 42 acute care hospitals in Arkansas that responded to the survey.  Among the hospitals not included in the results were Arkansas Children’s Hospital, John L. McClellan Memorial Veterans Hospital, inpatient psychiatric hospitals, and hospitals with fewer than 10 admissions.

This “survey data” from the Arkansas Hospital Association, you’ll remember, was widely panned by members of both political parties as being incomplete and seemingly designed to help out pro-”private option” Republicans struggling in the polls during primary fights in the summer of 2014. Much of the data produced by AHA turned out to be statistical blips that failed to manifest the trends that the study supposedly reported.
This response from DHS would be somewhat akin to me telling the IRS I’m only going to pay 75 percent of my taxes in 2014 and then citing a study from the Heritage Foundation about how taxes are too high. Unlike DHS, I doubt I’d be able to get away with this kind of response.
1.) Make claims about finances but don’t provide documentation when asked.

From the audit (Consultants Utilized By DHS section):

Although DLA requested source documentation to support total expenditure amounts, DHS did not provide documentation.

Once again, we don’t think an average citizen would be able to get away with not providing basic documentation about contract expenses when asked by a government agency.
You can read the rest of the report — and DHS’s justifications of its non-responses —here.

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