Former Gov. Mitch Daniels' Newsroom

Contact: Jane Jankowski
Phone: 317-232-1622

For Immediate Release: Aug 18, 2006
Report states case for welfare system change

INDIANAPOLIS (August 18, 2006) ? Governor Mitch Daniels today released a report titled Eligibility Modernization: The Need for Change, which outlines the problems in the state?s current system of welfare delivery and describes how a new eligibility system would better serve recipients.

An interagency review committee appointed by the governor in May is in the final stages of preparing a recommendation for the governor about how to proceed with modernizing the state?s welfare delivery system. Specifically, the group is reviewing the request for services issued by the Family and Social Services Administration (FSSA) seeking a vendor to assist the agency in modernizing the eligibility system. Earl Goode, the governor?s deputy chief of staff, who is heading the team, has said his group will present the governor with either a negotiated proposed agreement or an alternate recommendation.

?The status quo is simply not acceptable. Indiana has the worst record of welfare reform in the entire country,? said Daniels. ?We have dedicated employees, but our welfare system is slow, cumbersome, inaccurate, inconsistent, and conducive to waste and fraud. It continually fails recipients and taxpayers alike and must be changed.?

As the discussion about the best way for the state to provide welfare services to the state?s most vulnerable population continues, the governor issued the report publicly to help interested Hoosiers better understand the history of welfare assistance in Indiana, current operations, FSSA?s goals for customer service, efficiency and accuracy, and the attributes of a modernized system.

The lead researcher on the 30-page report was Erin Linville, a policy analyst on the FSSA staff who recently left the agency to attend the Northwestern University Kellogg School of Business. The report was prepared separately from the work of the committee headed by Goode.

The report describes how FSSA currently delivers welfare services and the shortcomings of the present system that have led to system failure. Among key welfare delivery problems:

  • Indiana?s welfare caseload decreased by 6 percent in the past decade, last in the nation. The average reduction was 58 percent (Health and Human Services).
  • Thirty-five percent of the Medicaid long-term care applications approved by FSSA contained errors, either approving applicants who did not qualify or providing too little or too much assistance for those who did qualify (FSSA Eligibility Review and Asset Sheltering Study, October 2004).
  • There was a backlog of more than 13,000 people waiting to learn if they were eligible for Medicaid disability because of a failure of Medicaid to process applications within the allotted 90-day period.
  • More than 15 employees have been arrested since 2003 for fraud-related activities with the average caseload costing taxpayers $50,000.

The report goes on to present a customer case study, describing the steps a person typically goes through to apply and receive public assistance. It then outlines how modernization of the system would improve services for clients and efficiencies for staff members.

The report also points out that 92 percent of FSSA?s $6.55 billion budget is already allocated to outside vendors and providers.

Copies of the report have been sent to social service and welfare reform advocacy organizations in Indiana. The full report is available at this link: Modernization 081706 445 pm.pdf.