New Castle News

Closer Look

March 6, 2013

Botched payroll transfer to be probed

CNHI — The acting secretary of the Pennsylvania Department of Public Welfare said she welcomes a probe of the botched transfer of payroll services.

The move left 20,000 home care workers unpaid in January, and some time sheets are still being rejected nine weeks later.

Auditor General Eugene DePasquale notified the welfare department Friday that his office will begin a review of DPW’s handling of the transfer from 37 providers to PCG Public Partnerships.

Beverly Mackereth, acting welfare secretary, told the Senate appropriations committee that the $46.5 million deal to switch payroll services to PCG, based in Massachusetts, did not save the state any money. The move was intended to simplify a payment system that had been relying on too many vendors.

Most states only use between one and five vendors for payroll services of home care workers, Mackereth said. Consolidating to one vendor had been recommended by the federal government, she said.

The move has been plagued by problems for months.

Donna Kirker Morgan, a welfare department spokeswoman, said that in some cases, companies abruptly stopped handling payroll services months before they were supposed to. In other cases, companies failed to pay workers in the final weeks of their contracts or did not forward documents or all the correct data needed to handle the payroll.

Sen. Shirley Kitchen, the Democratic chairwoman of the Senate public health and welfare committee, said home care workers are getting squeezed because the state and the new agency are being overly cautious about trying to make sure there are no overpayments.

“They are always talking about rooting out waste, fraud and abuse, but they are hurting a lot of people,” Kitchen, a Democrat from Philadelphia, said Tuesday afternoon.

Morgan said the workers should not be paid for their travel time because the Medicaid payments are directed through the client receiving service. If a care worker is helping more than one person, he or she would be getting paid separately by each client.

“Maybe they were getting paid for their travel time in the old days. Maybe that’s something the auditor general will find,” Morgan said.

DePasquale’s audit will examine various points, including what kind of transition plan was in place and whether the $46.5 million contract for PCG Public Partnerships “was reasonable.”

The first hint of problems arose last summer when some home care workers, primarily in western and central Pennsylvania, stopped getting paid.

Then in January, when the contracts with 37 previous providers expired, as many as 20,000 home care workers started having payment problems.

The company is now paying 96 percent of the time sheets submitted by home care workers, which is almost the rate of payment expected once a plan is up and running, which is typically 97 to 98 percent, said Dina Baker, a spokeswoman for PCG Public Partnerships.

(Email: jfinnerty@cnhi.com)

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