Analysis of Four States' Administration of the AFDC Program:

Management Improving but More Needs To Be Done

HRD-82-20: Published: Feb 22, 1982. Publicly Released: Feb 22, 1982.

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GAO was asked to evaluate the Aid to Families With Dependent Children (AFDC) program management in California, Illinois, Massachusetts, and New York in terms of differences in management practices, agency organization, and employee accountability as they related to administrative costs and the level of erroneous payments.

Each State is required to have an AFDC operational plan which is deemed to be proper and efficient by the Department of Health and Human Services (HHS). However, HHS officials have defined their management role as an advisor to the States and have not asked State and local managers to develop any cost performance data by which they and the States can measure the cost effectiveness of program operations. This approach has been ineffective. HHS cannot evaluate the cost effectiveness of State operations, and State and local managers have only limited data to establish budgetary and performance goals, maximize their use of resources, and measure the cost effectiveness of day-to-day operations. California implemented a comprehensive management system that generated administrative cost savings of $18.8 million in its first year of operation. AFDC management has been improving; however, in one or more States, further attention needs to be paid to administrative problems which contribute to high error rates and erroneous payments. HHS and the States are currently working to implement AFDC program changes mandated by the Omnibus Budget Reconciliation Act. In addition, the President has announced his intention to turn the AFDC program over to the States, a transfer which would demand a high degree of HHS-State cooperation. Under the circumstances, altering the Federal-State relationship might not be appropriate at this time.

Recommendations for Executive Action

  1. 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 Secretary, HHS, should work in the interim, within his current capacity, with Massachusetts to: (1) expand the prescreener concept to all district offices; (2) improve the accuracy and quality of reports generated from the redetermination control system; (3) hold workers accountable for following the priorities established by the system; (4) justify the cost effectiveness of doing home visits in the income maintenance process; (5) continue its efforts to place greater emphasis on the quality of the work produced by its income maintenance staff; and (6) implement a planned system by which it can hold its workers accountable for quality.

    Agency Affected: Department of Health and Human Services

  2. 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 Secretary, HHS, should work in the interim, within his current capacity, with Illinois to: (1) have sufficient staff to cover its entire caseload; and (2) properly implement the controls in its centralized filing system to determine whether the system can be effective as designed. If the centralized system is found to be ineffective, HHS should work with Illinois to pilot test a decentralized filing system to determine a better way of controlling client documentation. HHS should work with Illinois and New York to improve their personnel systems to more fully develop a cadre of qualified personnel.

    Agency Affected: Department of Health and Human Services

  3. Status: Closed - Not Implemented

    Comments: HHS is providing technical assistance to the States to improve administrative efficiency, but does not intend to require State plans to contain income maintenance worker efficiency goals or to require administrative budgets based on such goals. It believes that these activities are State reponsibilities. Because no action will be taken, this recommendation should be dropped.

    Recommendation: The Secretary, HHS, should require that all State plans contain statewide income maintenance worker goals of administrative efficiency. These goals should be based on appropriate work measurement and operational analysis of specific work processes. HHS should begin working with the States to develop these performance goals and administrative budgets based on them to assist AFDC managers to increase worker productivity and improve cost control.

    Agency Affected: Department of Health and Human Services

  4. Status: Closed - Not Implemented

    Comments: HHS does not intend to issue such regulations because it believes that the States themselves are in a better position than SSA to decide what information they need to best manage their own resources. Because no action will be taken, this recommendation should be dropped.

    Recommendation: The Secretary, HHS, should issue regulations which would require all States participating in the AFDC program to have in their respective plans systems to enable: (1) accurate and timely verification of a client's eligibility; (2) tracking of client status on a continuing basis; (3) proper control of client documentation; (4) workers to be held accountable for the quality of their work; and (5) placement of qualified people in income maintenance positions.

    Agency Affected: Department of Health and Human Services

 

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