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DCF Faulted For Oversight Of Privatized Agencies

Two reports presented to lawmakers last week criticized the Florida Department of Children and Families for poor oversight of the privatized agencies that deliver child-welfare, substance-abuse and mental-health services statewide.

The reports arrived as the Legislature is considering further changes to all those services.

The Florida Office of the Auditor General published its findings last month and reviewed them Thursday with members of the Senate Children, Families and Elder Affairs Committee.

One report faulted the state's oversight of what are known as managing entities, which oversee the delivery of substance-abuse and mental-health services. With lawmakers focused on improving those services this year, the managing entities could be revamped under a bill (SB 7068) ready for a vote by the full Senate possibly as soon as Wednesday. The House version (HB 7119) is ready to go to the full House.

The other report criticized the state's oversight of community-based care organizations, known as CBCs, which provide foster care, adoption and family-support services. The agencies have been under legislative scrutiny in recent years for a series of child deaths from abuse and neglect. Now, lawmakers are revisiting a child-welfare reform law passed last year --- and the possibility of more funding for the CBCs to provide mental-health and substance-abuse treatment, among other services.

Together, the reports point to shortcomings in the Department of Children and Families' monitoring of the privatized agencies, which receive hundreds of millions of dollars a year to coordinate and deliver services in their regions.

"The department did not always adequately conduct, document, review, and report the results of (community based care agencies) monitoring," noted the report on the foster-care services.

"The department could not provide documentation supporting the conclusions reached on cost analyses performed for (managing entity) contracts awarded on a noncompetitive basis," said the report on mental-health and substance-abuse services. "The department had not always documented that employees involved in the contractor evaluation and selection process attested in writing that they were independent of, and had no conflict of interest in, the MEs (managing entities) evaluated and selected."

What's more, department monitoring of the managing entities "did not ensure that all key assessment factors and performance measures were included in the scope of its monitoring activities. Additionally, the department did not always appropriately document that proper follow-up on ME actions was taken to correct deficiencies identified through monitoring."

Department of Children and Families Secretary Mike Carroll, in a response to both reports, wrote, "The department generally concurs with the findings."

The criticism comes as the House and Senate prepare to vote on whether to alter the way the seven statewide managing entities bid on Department of Children and Families contracts. The House and Senate bills would require those contracts to be performance-based and to include consequences for failing to comply. What's more, the House proposal would require that at least two managing entities bid on each contract --- or the bidding process could be opened to for-profit companies and Medicaid managed-care organizations.

Members of the Senate Children, Families and Elder Affairs Committee questioned Lisa Norman, an audit manager with the Auditor General's Office, on the reports, and some of the individual agencies objected to specific findings.

For instance, the report faulted Our Kids, the community-based care agency serving Miami-Dade and Monroe counties, for expenditures related to a $28,000 graduation event for young adults in the Independent Living program. The costs included $6,684 for food for 250 guests, which the Auditor General's report found an inappropriate expenditure under state law.

"We recommend that Our Kids, in consultation with the department, make appropriate funding source adjustments for the unallowable costs related to the graduation event," said the report.

But in her written response to the report, Our Kids president and CEO Jackie Gonzalez said that the event helps young people in foster care build their self-esteem.

"Our Kids has received approval from DCF for this event since we began acknowledging the success of our students in a ceremony in 2009 and did not think it necessary to receive approval each year," the response said. "We believe that (the Auditor General) is taking an overly narrow view."

Committee Chairwoman Eleanor Sobel, D-Hollywood, asked Norman how Our Kids could have done the event differently.

"Use private funds," Norman replied.

Christina Spudeas, executive director of the advocacy group Florida's Children First, reminded lawmakers that under former DCF Secretary David Wilkins, the department had slashed most of its quality-assurance positions --- which had performed some of the monitoring.

"They went down 70 positions," Spudeas said. "Two years ago, you gave funding, but only reinstituted one-half of those. We need the rest of those positions to do full quality assurance, quality improvement, for the programs around the state. It's very important for the children in care."

As to the managing entities, the chief executive officer of one of them, Linda McKenna of the Central Florida Behavioral Health Network, said that the four selected for the Auditor General's scrutiny "were the newest managing entities in the state and had all recently come up and were developing their procedures."

Mark Fontaine, executive director of the Florida Alcohol and Drug Abuse Association, agreed, but said it was clear that lawmakers were "redefining their expectations" for the managing entities and their coordination of the services they provide.

"The expectations on the MEs are going to be greater," Fontaine said. "It's more like shifting to health-care management: 'Let's look at the people we're serving and figure out how to do better services for those people.' "