The Illinois Department of Human Services and the Illinois Department of Healthcare and Family Services, agencies that administer a range of programs meant to assist some of the state' most vulnerable families, continue to struggle with cash flow issues, department officials said late last week.
As a result, many providers and vendors the state hires to carry out front-line work aren't getting paid on time.
Michelle Saddler, secretary of the human services department, said during testimony before a House Appropriations committee that convened Friday in Chicago that late payments can force some providers into a "downward spiral" where they miss making payroll and can't achieve their contracted objectives.
"Our providers ... have suffered because of the cash flow issue. We have providers who are unable to deliver on the services they promised us. And what it's impacting is their performance, which is in an interesting fact, because we're moving toward performance-based budgeting, budgeting for results, budgeting for outcomes," she said. "The problem with delayed payments is that providers are understaffed--they're not able at all times to keep up with performance standards."
Both Saddler and Julia Hamos, who heads Healthcare and Family Services, said their departments had set up "expedited" payment processes to get some bills paid.
The pace of the expedited payments, however, is starting to slow, at least in human services. According to Saddler's testimony on Friday, human services had been sending out approximately $12 million per week in expedited payments, but the department was recently instructed to lower that number to $2.5 million per week.
The bill backlog for the Department of Healthcare and Family Services currently stands at between $1.6 billion and $1.7 billion, all dollars related to the Medicaid program, while the state owes human services providers $125.3 million in bills from the last fiscal year and $140.5 million for the current fiscal year, said Januari Smith Trader, a spokeswoman for both departments.
Across all agencies, Illinois Comptroller Judy Baar Topinka reported this summer there was some improvement in paying down the bill backlog compared with the previous summer. But the problem remained substantial.
"[A]t the end of June, the backlog of unpaid bills and fund transfers in the Comptroller’s office ... totaled $3.798 billion, compared to $4.712 billion last year," the comptroller's July quarterly report states. "Payment delays once again persisted throughout fiscal year 2011, with some vouchers at the end of the year dating back to January 2011, and transfers back to August 2010."
Jo Ann Dollard, a spokeswoman for Lutheran Social Services of Illinois, said at present the state owes the organization $8 million, forcing them to submit "hardship requests" for expedited payments.
© Community Renewal Society 2011