Martin 0 IMalley Governor 2011 JCR RESPONSE REPORT ON IMPROVING DEPARTMENT OF JUVENILE SERVICES OPERATIONS FOLLOW UP REPORT APRIL 2012 INTRODUCTION

Transcription

1 Maryland Deportment of Juvenile Services Treating Supporting Protecting One Center Plaza 120 West Fayette street Baltimore, MD Anthony G. Brown Lt. Governor Martin 0 IMalley Governor Sam Abed Secretary 2011 JCR RESPONSE REPORT ON IMPROVING DEPARTMENT OF JUVENILE SERVICES OPERATIONS FOLLOW UP REPORT APRIL 2012 INTRODUCTION In the Report on the State Operating Budget (HB 70) and the State Capital Budget (HB 71) and related Recommendations - Joint Chairmen's Report, 2011 Session, p. 163, the Maryland General Assembly requested that the Department of Juvenile Services (DJS) submit a report on improving the Department of Juvenile Services operations. Specifically, the committees requested that DJS, in coordination with the Department of Budget and Management (DBM) and the Juvenile Justice Monitoring Unit (JJMU), evaluate its operations and organizational structure in order to develop a plan to effectively improve service delivery, utilization of available resources, and recidivism among juvenile offenders. Additionally, DJS should review its organizational structure in order to identify potential areas for improving communication between upper-level management and field staff. The report should also include recommendations for reducing turnover among key staff positions. Finally, the report should provide the committees with an update on the status and progress made towards addressing each finding in the September 2010 OlA audit report. The report shall be submitted by October 1,2011 and a follow up report shall be submitted six months after the initial submission. DJS RESPONSE In consultation with DBM, DJS has focused on improving the organizational structure of the Department to promote effective utilization of resources, improve communication, and increase public safety. DJS has shared these improvements with the JJMU as they have been implemented. DJS continues to implement strategies to reduce turnover among key staff positions. Part I of this report provides an update on the status and progress made towards addressing each finding in the September 2010 OlA audit report. I. DJS update on status and progress made towards addressing each finding in the September 2010 OlA Report. The DJS, in compliance with, of the State Government Article of the Annotated Code of Maryland, provides the Office of legislative Audits (OlA) quarterly status reports on the implementation of the recommendations for the fourteen findings contained in the September 29, 2010 DJS audit report. (Please see Attachment #1.) 1

2 Finding 1. DJS did not maximize federal Medicaid funding for eligible youth placements in residential rehabilitation facilities. We estimated that unreimbursed claims totaled approximately $3 million for the period from June 2008 through August 2009; DJS will be unable to recover most, if not all, of these funds. Finding 1. DBM's Audit Compliance Unit (ACU) is reviewing this resolution for Finding 2. Adequate procedures and controls were to be established to ensure Medicaid claims were accurately submitted and properly reimbursed. The DJS is working with DBMto ensure that the proper corrective actions are in place to address Finding 2. The revised resolution date is June 30, 2012, and was delayed due to staffing issues. Department is in the process of developing and implementing a comprehensive business process for the Medicaid Rehab Program. We are currently working on the tracking process of records after acceptance and claim by the contractor. We estimate that developing necessary staff resources and data tools will be complete by 6/30/12. Upon implementation of corrective actions for this finding, DBM ACU will review the resolutions for effectiveness and consistent performance. DJS's Internal Audit Unit will follow-up quarterly to ensure that corrective action is being taken to address the finding. Finding 3. DJS needs to continue to work with the Judiciary to ensure that individual court decisions contain the requisite language to enable the State to recover Title IV- E funds. The DJS is working with DBMto ensure that the proper corrective actions are in place to address Finding 3. Model Court Orders were issued on July 25, 2011 from the Administrative Office of the Courts to Juvenile Judges and Masters. Since October 2011, the Youth Assistance Unit has forwarded cases to the local DJS jurisdiction supervisors for their follow up with their counterpart at the local court jurisdiction for court orders that did not contain the necessary Title IV-E language. Also, DJS continues to explore opportunities to educate and work with judiciary on this issue. Upon implementation of corrective actions for this finding, DBM ACU will review the resolutions for effectiveness and consistent performance. DJS's Internal Audit Unit will follow-up quarterly to ensure that corrective action is being taken to address the finding.. Finding 4. Significant deficiencies were noted with respect to the procurement and monitoring of purchase of care contracts, including the assessment of liquidated damages. Finding 4. DBM's Audit Compliance Unit (ACU) is reviewing this resolution for 2

3 Finding 5. Procedures to monitor, and perform audits of youth care contractor expenditures were insufficient. Finding 5. DBM's Audit Compliance Unit (ACU) is reviewing this resolution for Finding 6. Pharmaceutical invoices were paid without verifying the propriety of the costs charged. In addition, payments on the pharmaceutical contract exceeded the approved contract amount. Finding 6. DBM's Audit Compliance Unit (ACU) is reviewing this resolution for Finding 7. DJS did not always timely implement or review youth treatment service plans (TSP), did not always document the required number of case manager supervision contacts, and did not adequately document youth progression through the Violence Prevention Initiative (VPI) program. Finding 7. DBM's Audit Compliance Unit (ACU) is reviewing this resolution for Finding 8. Proper internal controls were not established over the processing of purchasing and disbursement transactions. Finding 8. DBM's Audit Compliance Unit (ACU) is reviewing this resolution for Finding 9. Access and monitoring controls over the ASSIST system were inadequate. Finding 9. DBM's Audit Compliance Unit (ACU) is reviewing this resolution for effectiveness and consistent performance. U~on completion of this review, DBM will his consideration. OJS's Internal Audit Unit will continue to monitor quarterly to ensure 3

4 Finding 10. Certain employees improperly received overtime compensation or received duplicate salary payments. Finding 10. DBM's Audit Compliance Unit (ACU) is reviewing this resolution for Finding 11. Employee criminal background checks were not always conducted in a timely manner as required by state law. Finding 11. DBM's Audit Compliance Unit (ACU) is reviewing this resolution for Finding 12. Access to the automated restitution accounts receivable system was not adequately controlled. In addition, adequate internal controls and record keeping procedures had not been established for restitution accounts receivable. The DJS is working with DBMto ensure that the proper corrective actions are in place to address Finding 12, and anticipates satisfactory compliance on or before June 30, DJS has developed a series of reports to resolve this issue; however, upon testing, it found that additional modifications are necessary to address the finding. These modifications are expected to be complete by June 30, Upon implementation of corrective actions for this finding, DBM ACU will review the resolutions for effectiveness and consistent performance. DJS's Internal Audit Unit will follow-up quarterly to ensure that corrective action is being taken to address the finding. Finding 13. Physical inventories of equipment were not conducted at required intervals and record keeping for property was deficient. The DJS is working with DBM to ensure that the proper corrective actions are in place to address Finding 13 and anticipates satisfactory compliance on or before June 30, DJS has entered all equipment into its inventory database and is continuing to reconcile that data to financial records. Once the reconciliation is complete, DJS will report the inventory value to the Department of General Services. Upon implementation of corrective actions for this finding, DBM ACU will review the resolutions for effectiveness and consistent performance. DJS's Internal Audit Unit will follow-up quarterly to ensure that corrective action is being taken to address the finding. Finding 14. An improper disbursement was made from the working fund and DJS did not promptly pursue recovery of unreimbursed employee travel advances. Finding 14. DBM's Audit Compliance Unit (ACU) is reviewing this resolution for 4

5 DEPARTMENT OF LEGISLATIVE SERVICES OFFICE OF LEGISLATIVE AUDITS MARYLAND GENERAL ASSEMBLY KarlS.AIo Executive Director January 26, 2012 Bruce A. Myers. CPA Legislative Auditor Re: Audit of Department of Juvenile Services Report Date: September 29, 2010 The Honorable Sam J. Abed, Secretary Department of Juvenile Services One Center Plaza 120 West Fayette Street Baltimore, Maryland Dear Secretary Abed: Section of the State Government Article of the Annotated Code of Maryland requires every unit of State government that had five or more repeat audit findings in its most recent legislative audit report to report to this Office the corrective actions taken for each finding, or a schedule for when specific corrective actions will be implemented. Each agency must continue to submit reports on a quarterly basis until this Office determines that the reported actions indicate that satisfactory progress has been made to address all agency findings contained in the report. Based on this requirement, the Department of Juvenile Services has been requested to provide quarterly status reports on the implementation of the recommendations for the 14 findings contained in the September 29,2010 audit report on the Department. This letter transmits the results of our assessment of the implementation status for the findings contained in the Department's latest status report, dated January 4, 2012 (a copy of which is enclosed). As requested, the report addressed the status of the four remaining audit findings for which satisfactory progress toward implementing the audit recommendations had not been previously achieved. Our assessment was based on reviewing the status reported for the findings, and contacting the Department to obtain any needed information. Our work did not constitute an audit and our conclusions are based on the Department's representations. The Department's latest status report indicates that corrective actions for the remaining four audit findings (findings 2,3, 12, and 13) are still in progress. 301 West Preston Street : Room Baltimore, Maryland / Fax / Toll Free in Maryland ' Fraud Hotline 877-FRAUD-ll

6 The Honorable Sam J. Abed, Secretary -2- January 26, 2012 Please provide an updated status report by March 29, Your report should include the following information for findings 2, 3, 12, and 13: (1) the actions taken or to be taken to address the audit recommendations, (2) the time frame for resolving the findings, and (3) the name, telephone number, and address of the contact person to whom inquiries should be addressed. We will advise you of the results of our review of your status report, including whether another quarterly report is required to address these findings if satisfactory progress has not been achieved. Please be advised that recommendations that have not been substantially implemented may be considered repeat findings during our next audit. Please provide both a paper copy and an electronic copy of your reports. The electronic reports can be submitted in either Microsoft Word or WordPerfect formats and should be sent to followup@ola.state.md.us. Thank you for your cooperation. If you have any questions, please contact Laura Johnson, Director of Quality Assurance. Sincerely, B~Y~:~ Legislative Auditor cc: Senator James C. Rosapepe, Co-Chair, Joint Audit Committee Delegate Guy J. Guzzone, Co-Chair, Joint Audit Committee Joint Audit Committee Members Peggy J. Watson, Deputy Chief of Staff, Executive Department Joan Peacock, Manager, Audit Compliance Unit, DBM Lynette Holmes, Deputy Secretary, Support Services, DJS Linda S. McWilliams, Deputy Secretary, Operations, DJS Sherie D. Flood, Executive Director, Resource Management, DJS Michael DiBattista, Chief Financial Officer, DJS Roxanne Parson, Executive Director, Office of Quality Assurance and Accountability Sheri S. Sanford, Director, Internal Audit, DJS Karl S. Aro, Executive Director, Department of Legislative Services Karen D. Morgan, Policy Analyst, Department of Legislative Services Lisa J. Simpson, Policy Analyst, Department of Legislative Services