Improved Billing and Collection Activities Would Increase District of Columbia's Revenues

GGD-82-68: Published: Aug 6, 1982. Publicly Released: Aug 6, 1982.

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GAO evaluated the District of Columbia's efforts to record, bill, and collect accounts receivable and found that two-thirds of the accounts receivable of three agencies were delinquent.

GAO found that the collection actions taken by the agencies were frequently untimely, inconsistent, and poorly documented. In addition to monies owed, there is a continuing problem of overpayments involving public assistance, personal and home care, day care, and foster care. GAO found that there are individuals currently being paid for providing care under these programs who have been overpaid and that the Department of Human Services (DHS) has not offset against current payments to help collection. Billing delays due to lack of collection criteria and lack of staff have caused accounts to age and made them more difficult to collect. A major problem related to all District collection and billing processes is that there are no District-wide procedures which require specific actions.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: DHS now requests the approval of the D.C. Controller.

    Recommendation: The Mayor of the District of Columbia should direct DHS to change its procedures to require write-off approval by the Inspector General or a high District official.

    Agency Affected: District of Columbia: Executive Office of the Mayor

  2. Status: Closed - Implemented

    Comments: One of the agencies involved has the social security numbers available and includes them on overpayment notifications; the other agency involved does not believe overpayments are a problem and instead relies on an improved monitoring system to control overpayment.

    Recommendation: The Mayor of the District of Columbia should direct DHS to include social security numbers on future overpayment notifications to make identification easier should overpaid individuals leave the programs and return later.

    Agency Affected: District of Columbia: Executive Office of the Mayor

  3. Status: Closed - Implemented

    Comments: DHS now requires each individual to sign a voluntary restitution agreement but there is no assurance that all prior amounts due will be identified, because DHS still does not use social security numbers so identification depends on a tedious review by name and address.

    Recommendation: The Mayor of the District of Columbia should direct DHS to collect overpayments through offset from those individuals who have been overpaid in the past and who are again providing services and receiving pay from the District.

    Agency Affected: District of Columbia: Executive Office of the Mayor

  4. Status: Closed - Not Implemented

    Comments: The collection function has been moved from the Office of Inspection and Compliance to the Controller's Office, in the newly established Division of Billing and Collection.

    Recommendation: The Mayor of the District of Columbia, within the framework of his statutory authority and, as appropriate, should require that DHS implement guidelines to assist the Office of Inspection and Compliance in processing and collecting overpaid public assistance cases.

    Agency Affected: District of Columbia: Executive Office of the Mayor

  5. Status: Closed - Implemented

    Comments: The District has taken some steps to improve collections of overpayments. However, collection action does not include use of collection agencies and some collection actions are limited to overpayments over $1,000.

    Recommendation: The Mayor of the District of Columbia, within the framework of his statutory authority and, as appropriate, should require that DHS attempt to collect all overpaid public assistance cases using collection letters, Corporation Counsel, collection agencies, offset, and other means as applicable.

    Agency Affected: District of Columbia: Executive Office of the Mayor

  6. Status: Closed - Implemented

    Comments: In March 1984, the D.C. Controller issued a District-wide collection manual intended to serve as a basis for, but not requiring, agencies to develop procedures for timely, consistent action to collect all accounts. Agencies' efforts to develop such procedures have been mixed. Some developed procedures before the manual was issued; others have made no changes.

    Recommendation: The Mayor of the District of Columbia should make sure that other agencies not covered by the GAO review take aggressive collection action to collect all outstanding delinquent accounts.

    Agency Affected: District of Columbia: Executive Office of the Mayor

  7. Status: Closed - Implemented

    Comments: In November 1984, DHS issued instructions to revise a recently implemented system. However, DHS, is not emphasizing collection of new accounts, but rather is dealing with accounts on a chronological basis.

    Recommendation: The Mayor of the District of Columbia should require that DHS maximize its collection efforts by collecting new delinquent accounts and continue collection action on those making payments and pursue collection of old delinquent accounts as time permits.

    Agency Affected: District of Columbia: Executive Office of the Mayor

  8. Status: Closed - Implemented

    Comments: DES and DOT operations were significantly changed by a reorganization that combined some of their activities in the new Department of Public Works. A new DHS billing and collection system did not correct the problems. In November 1984, DHS issued instructions to revise the system in an attempt to solve some of the problems. GAO is recommending a follow-up review.

    Recommendation: The Mayor of the District of Columbia should require that DHS, the Department of Environmental Services (DES), and DOT follow up on delinquent accounts by taking aggressive collection actions which include, at a minimum, sending three collection letters at not more than 30-day intervals.

    Agency Affected: District of Columbia: Executive Office of the Mayor

  9. Status: Closed - Implemented

    Comments: Since the report was issued, the D.C. Controller's Office has been increasingly involved with agencies' collection activities, and has issued the aforementioned manual. The Controller's primary focus, however, has been cash-flow-oriented and has not dealt with the billing issue.

    Recommendation: The Mayor of the District of Columbia should require that the D.C. Controller monitor and periodically test agencies' billing and collecting activities to make sure that timely action is being taken.

    Agency Affected: District of Columbia: Executive Office of the Mayor

  10. Status: Closed - Implemented

    Comments: Although the District's 90-day response letter voiced some disagreement with this recommendation, new DHS procedures provide for notifying the credit bureau. However, to date no such notifications have been sent.

    Recommendation: The Mayor of the District of Columbia should require that all agencies notify the credit bureau when accounts become uncollectible.

    Agency Affected: District of Columbia: Executive Office of the Mayor

  11. Status: Closed - Implemented

    Comments: In March 1984, the D.C. Controller issued a District-wide collection manual intended to serve as a basis for, but not requiring, agencies to develop procedures for timely, consistent action to collect all accounts. Agencies' efforts to develop such procedures have been mixed. Some developed procedures before the manual was issued; others have made no changes.

    Recommendation: The Mayor of the District of Columbia should require that all agencies document billing and collection actions taken on each account.

    Agency Affected: District of Columbia: Executive Office of the Mayor

  12. Status: Closed - Implemented

    Comments: DHS reviewed all cases early in calendar year 1985, but did not plan to do periodic reviews because it felt that improved day-to-day monitoring would suffice.

    Recommendation: The Mayor of the District of Columbia should direct DHS to compare now, and periodically thereafter, names and addresses of overpaid individuals with the computer payroll to identify those who left the program and reentered under a different payroll number.

    Agency Affected: District of Columbia: Executive Office of the Mayor

  13. Status: Closed - Implemented

    Comments: DHS said that the two branches involved in the issue would discuss whether exchange of information would be beneficial.

    Recommendation: The Mayor of the District of Columbia should require that the Bureau of Payments and Collections Payroll Branch forward a copy of each overpayment notification it prepares to applicable program officials.

    Agency Affected: District of Columbia: Executive Office of the Mayor

  14. Status: Closed - Implemented

    Comments: The District has taken some steps to improve collections; collection actions do not include use of collection agencies and some collection actions are limited to overpayments over $1,000.

    Recommendation: The Mayor of the District of Columbia should have DHS amend its collection procedures to: (1) provide for at least three collection letters on all overdue accounts; (2) to take timely collection action that starts not more than 30 days after the initial bill is sent and continues at not more than 30-day intervals; (3) to use collection agencies regardless of the amount owed; and (4) to report unpaid amounts to the credit bureau.

    Agency Affected: District of Columbia: Executive Office of the Mayor

  15. Status: Closed - Implemented

    Comments: In March 1984, the D.C. Controller issued a District-wide collection manual intended to serve as a basis for, but not requiring, agencies to develop procedures for timely, consistent action to collect all accounts. Agencies' efforts to develop such procedures have been mixed. Some developed procedures before the manual was issued; others have made no changes.

    Recommendation: The Mayor of the District of Columbia should provide written guidelines requiring agencies to develop internal collection procedures which include aggressive action on a timely basis, with effective follow-up, to collect funds due the District.

    Agency Affected: District of Columbia: Executive Office of the Mayor

  16. Status: Closed - Implemented

    Comments: The District took issue with this recommendation as it relates to DES, citing improved DES collections. DES and DOT were reorganized into the new public work department. To ascertain more specifically the status of this recommendation would require some detailed audit work. For that reason, among several others, GAO has recommended reaudit.

    Recommendation: The Mayor of the District of Columbia should require DES to establish procedures to achieve prompt mailing of bills for water meter repairs.

    Agency Affected: District of Columbia: Executive Office of the Mayor

  17. Status: Closed - Implemented

    Comments: BPC now uses a claim history file, provided by the Office of Health Care Financing, as the basis for billing vendors for current accounts receivable.

    Recommendation: The Mayor of the District of Columbia should require DHS to require the Office of Health Care Financing to forward monthly lists of new vendors to the Delinquent Accounts Section so that collection attempts will be coordinated rather than duplicated.

    Agency Affected: District of Columbia: Executive Office of the Mayor

  18. Status: Closed - Implemented

    Comments: DHS Bureau of Health Care Financing reviewed the overpayments and decided not to attempt to collect the amounts owed because the District has a difficult time keeping medical vendors and collection actions might dissuade currently inactive vendors from reentering the program at a later date. DHS will attempt to offset amounts due, if inactive vendors reenter the program.

    Recommendation: The Mayor of the District of Columbia should require DHS to transfer outstanding balances from the old medical vendor billing system to the new billing system for those vendors already in the new system and for those vendors with outstanding balances that enter the new system at a later date.

    Agency Affected: District of Columbia: Executive Office of the Mayor

  19. Status: Closed - Implemented

    Comments: DHS Bureau of Health Care Financing reviewed the overpayments and decided not to attempt to collect the amounts owed because the District has a difficult time keeping medical vendors, and collection actions might dissuade currently inactive vendors from reentering the program at a later date. DHS will attempt to offset amounts due, if inactive vendors reenter the program.

    Recommendation: The Mayor of the District of Columbia should require DHS to take immediate action to bill and collect inactive medical vendor accounts.

    Agency Affected: District of Columbia: Executive Office of the Mayor

  20. Status: Closed - Implemented

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Mayor of the District of Columbia should require DHS to establish procedures to annually review and adjust the per diem rate charged District residents at St. Elizabeth's Hospital so that the rate would be geared to recover at least the amounts the District pays to St. Elizabeth's.

    Agency Affected: District of Columbia: Executive Office of the Mayor

  21. Status: Closed - Implemented

    Comments: The District has adopted a procedure where the request for reorder serves as authority to transfer funds from the DHS appropriation. While this is an improvement, problems can recur when reorders occur late in the year and originally budgeted printing funds have been reprogrammed for other purposes.

    Recommendation: The Mayor of the District of Columbia should require DHS to transfer DHS printing budget authority to the Department of General Services early in the fiscal year so that reorders will not be delayed.

    Agency Affected: District of Columbia: Executive Office of the Mayor

  22. Status: Closed - Implemented

    Comments: DHS has not yet established a forms management program (the newly appointed D.C. archivist is in the process of developing the program District-wide). In the interim, DHS is manually monitoring the use of, and need for, forms to minimize the possibility of problems.

    Recommendation: The Mayor of the District of Columbia should require DHS to place the reordering of blank bill forms under a forms management program which will include reordering on a systematic basis so that forms will be available when needed.

    Agency Affected: District of Columbia: Executive Office of the Mayor

  23. Status: Closed - Implemented

    Comments: DHS now requires participants in this program to sign a voluntary restitution agreement. It does not flag overpayments as GAO suggested; it records the overpayment on the outside of the case file instead. It does not refer overpayments to a collection agency because it feels the number of overpayments and the amounts involved do not justify such actions.

    Recommendation: The Mayor of the District of Columbia should direct DHS to require officials in personal care services, in-home support, day care services, and foster care to: (1) flag case files of overpaid workers using a color scheme or other system to readily identify those who have received overpayments; (2) execute an agreement to withhold amounts from future pay when overpaid individuals reenter the programs (if they will not sign an agreement, do not let them reenter the program); and (3) notify the collection agents when overpaid individuals reenter the programs.

    Agency Affected: District of Columbia: Executive Office of the Mayor

  24. Status: Closed - Implemented

    Comments: In March 1984, the D.C. Controller issued a District-wide collection manual intended to serve as a basis for, but not requiring, agencies to develop procedures for timely, consistent action to collect all accounts. Agencies' efforts to develop such procedures have been mixed. Some developed procedures before the manual was issued; others have made no changes.

    Recommendation: The Mayor of the District of Columbia should require that all agencies take timely, consistent action to collect all accounts.

    Agency Affected: District of Columbia: Executive Office of the Mayor

 

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