Oklahoma Health Department is making progress after scandal, officials say
Oklahoma City — Less than a year the Oklahoma State Department of Health appeared to be on the edge of financial collapse, its interim head says it is taking steps to prevent another scandal and strengthen core services.
Whether it will be enough to rebuild trust among lawmakers and the public is an open question, and not solely an academic one. As part of a corrective action plan required when the Legislature passed a $30 million bailout for the Health Department in November, the department pledged to cut its state-provided budget by 15 percent in the fiscal year that will start next July.
Interim Commissioner Tom Bates said the department is meeting public needs with the $54 million it received from the state this year, but an $8.1 million budget reduction would mean cuts to core services.
“If they're wanting to have that discussion, we're going to have to talk about what the Legislature thinks we should cut,” he said.
Bates told The Oklahoman that he hopes to convince lawmakers that the department is making good-faith efforts not only to repair problems identified by the state auditor and attorney general, but also to run a leaner operation. Staff are looking for efficiencies, like streamlining their mailing and getting rid of unnecessary copy machines, he said.
The Health Department has been in a state of flux since at least October, when then-Commissioner Terry Cline and other top officials resigned in the face of reports the department had overspent by $30 million. Lawmakers provided an emergency cash infusion, but Preston Doerflinger, then interim commissioner, proceeded with layoffs. A total of 198 people lost their jobs, and about 231 others departed voluntarily during the chaos, said Bates, who took over in late March after Doerflinger resigned.
The combined departures left the epidemiology and health facility inspection programs understaffed, Bates said. The newborn screening program, which follows up with parents after their babies are tested for cystic fibrosis, sickle-cell anemia and more than a dozen metabolic conditions, was in particularly bad shape, he said.
“That was very short-staffed and hanging by a thread,” he said.
The Health Department can't immediately replace the jobs it eliminated through layoffs, though it is refilling some of the jobs that opened when employees quit, Bates said. Laid-off workers get the right of first refusal, and 18 have accepted jobs so far.
Revamping the accounting system
The changes would have been painful under any circumstances, but they became galling after the state auditor and attorney general reported in May that the Health Department actually had never been in financial danger. Some apparently well-meaning officials hadn't understood the department's accounting system, which had allowed it to accumulate slush funds while making it appear that bankruptcy was imminent.
Getting rid of that accounting system is one of the Health Department's top priorities, Bates said. It's going to take at least a year to transition to another system, but staff have cleaned up the finances enough to ensure that payroll is coming out of the right accounts, he said. Employees shouldn't notice any difference in their paychecks.
“That sounds like a basic idea, but it's been a very heavy lift,” he said.
The department announced Wednesday that it had hired Gloria Hudson, the director of general accounting at the Oklahoma Health Care Authority, to oversee its finances. Hudson will be in charge of cleaning up the department's purchasing and contracting, and ensure that it follows all state and federal laws, Bates said. The Health Department had used some money from the Ryan White program, which was limited by federal rules to covering insurance payments for low-income patients with HIV, to make payroll.
“It's about making sure what happened with Ryan White doesn't happen again,” he said.
Several federal agencies want more information about how their grants have been used. None have demanded repayment so far, but it's too early to say they're satisfied with the Health Department's corrections, Bates said. If they do seek reimbursement, the department may have to dip into unused funds from the special appropriation lawmakers made last year, he said.
“I won't breathe that sigh of relief until they actually say that,” he said.