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Audit Assigns Blame in Pennsylvania Home Care Payroll Fiasco

November 22, 2013

Thousands of Pennsylvania home care workers who are paid through Medicaid waivers went months without seeing a paycheck earlier this year due to a “chaotic and disastrous” payroll-services transition, according to a recent state audit (pdf).

On January 1, payroll services for those workers shifted from a network of 36 local nonprofit and for-profit organizations to a single financial-management company, Public Partnerships LLC (PPL), which is based in Boston.

At the time, the move was touted by both Department of Public Welfare (DPW) Secretary Gary Alexander — who authorized the transition — and Gov. Tom Corbett (R) as a necessary cost-cutting maneuver.

But in practice, the consolidation of payroll services caused thousands of Pennsylvania home care workers to miss paychecks. Some worked as long as four months without being paid.

Crucial Indicators Ignored

The audit, released on November 14, found that DPW ignored “crucial indicators” that PPL would not be able to pay workers in a timely fashion.

DPW even ignored its own internal “readiness review” of PPL, conducted in September 2012, the audit states. That review highlighted “numerous areas of concern related to providing customer service, enrolling direct-care workers, and processing and distributing direct-care workers’ payroll.”

Additionally, far from saving the state money, the transition to a single payroll-services company will end up costing Pennsylvania an additional $7 million by the end of the year.

“DPW did not achieve the expected efficiencies because the transition to PPL was problematic, even confusing, and left many waiver participants frustrated and overwhelmed,” the audit says.

“Not only did thousands of home-care workers — who make an average of $10 an hour — not receive a paycheck for months at a time, those they care for endured the added stress of not knowing if their care would continue,” Leslie Haber, executive director of United Home Care Workers of Pennsylvania, told the Philadelphia Inquirer.

— by Matthew Ozga

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