Report raises questions about handling of welfare fraud tips

Nov 8, 2014

Chris Ingalls, KING 5 News
A Department Social and Health Services internal report raises new questions about how effective the agency’s fraud unit is responding to tips about welfare fraud.

The May 2014 Focused Accuracy Review, obtained by the KING 5 Investigators through a public records request, examined 200 tips sent to DSHS fraud investigators.

“200 of 200 cases (100%) were considered invalid,” according to the report, because investigators did not respond to the tips in a timely or accurate manner.

The analysis revealed that only nine cases resulted in completed investigative reports. (Read the full report below.)

DSHS’s Office of Fraud and Accountability (OFA) is the same unit that purged more than 4,000 employee generated tips about welfare fraud. When questioned about that in February, OFA Director Steve Lowe said the tips were wiped off the books because DSHS employees were sending his investigators poor quality tips.

“Well, they would just shove that work over to us. It would sit in a pool and it was junk,” Lowe said in February.

However, the new report says 95 percent of the Fraud Early Detection (FRED) tips reviewed were made accurately. The problem, the report found, is in the follow-up investigation conducted by the fraud unit.

The tips typically come from DSHS financial and eligibility workers, who deal face-to-face with clients. The Washington Federation of State employees, which represents thousands of those workers, says the new report shows that its employees are working hard to root out fraud in Washington State’s social safety net.

“We get a lot of complaints that people are fraudulently receiving benefits. Our role is to screen them out during that application process,” said Patricia Loving, a shop steward and DSHS financial services worker in Vancouver, Washington.

“It’s very insulting,” said Loving of Lowe’s comments that she and her fellow workers are sending “junk” tips to fraud investigators.

Through a spokesperson, DSHS Secretary Kevin Quigley declined an on-camera interview with KING 5.

In a written statement, DSHS said it has made many strides in the last few years in reducing fraud in taxpayer supported programs. However: “OFA continues to suffer from cuts in the mid-2000 when the Legislature reduced investigators by more than half,” the statement said, adding that DSHS inspectors are more efficient than ever but “that at the current level of investigators it is not possible to meet our timeliness goals.” (Read the full statement below.)

DSHS said the highest priority tips from the 200 cases were acted upon, but they did not meet the deadlines for timeliness. In other words, investigations may have been completed outside of the review period.

OFA was formed in 2011 under then-Gov. Christine Gregoire in the wake of KING 5’s “Their Crime, Your Dime” investigation that exposed widespread fraud in the food stamp program.

DSHS said it still doesn’t have enough fraud investigators and requested more in its most recent budget request.

Gov. Jay Inslee’s office declined to respond to a KING 5 request for comment on this story.

DSHS Statement:

DSHS response to KING 5 questions on Focused Accuracy Review

September 19, 2014

It is important to understand that Washington state is running one of the strongest food benefit and welfare programs in the nation. In fact, for the first half of federal fiscal year 2014, Washington’s basic food payment accuracy rate was 99.8 percent, ranking it first in the nation. Further, by comparison to California, for example, DSHS is saving state taxpayers $337 million annually in administrative costs.

The Focused Accuracy Review is an internal DSHS review requested by the Office of Fraud and Accountability (OFA). The report confirmed that OFA-instigated changes within DSHS in the referral process have greatly enhanced the quality of referrals to the point that 95-plus percent of referrals are now considered “accurate.” This is a huge advance in investigation efficiency.

The report also confirmed what OFA has previously highlighted, that at the current level of investigators it is not possible to meet our timeliness goals. OFA continues to suffer from cuts in the mid-2000 when the Legislature reduced investigators by more than half. At the same time OFA inspectors have become more efficient than ever thanks to a new case management system and multiple LEAN streamlining projects. OFA also is recognized as a national leader in data analytics.

OFA has requested additional investigators as part of the coming budget process.

As a side note OFA continues to object to the hyperbole in the media that suggests OFA “purges” cases. As OFA has said repeatedly, we lack the resources to pursue every tip and each year thousands of low-level tips go uninvestigated. We prioritize early detection tips so the highest priority cases are investigated first. Further, repeat tips are prioritized higher.