Department of Human Services in disarray

The Office of the Auditor General (OAG) just released its latest financial audit of DHS for the period October, 2004 through September, 2006. This is the second consecutive audit that asks DHS fix problems with numerous federally financed programs. Of 14 federal programs used by DHS, nine of them are out of compliance with federal laws, regulations and contracts.

We are talking about real money here. The OAG found over $500 million in likely "questionable" costs. DHS stands to lose over $90 million in federal funding if these issues are not fixed. This is essentially what the OAG told the department in their last audit in 2004. This year's edition states that over 70% of the issues cited in 2004 have not been addressed. "For the second consecutive audit, we recommend that DHS implement internal controls to ensure federal program compliance," the OAG wrote.

You have to love the response to MIRS from Marianne Udow, director of DHS. "In some cases we don't agree with the recommendation. In some cases we've agreed and made changes. In some cases we need to make more changes and in some cases we would like to make changes, but have constraints on the budget side and the technological side." Well, that clears it up.

In an unrelated note, Marianne Udow has tendered her resignation. She is going to lead a new joint venture between Blue Cross Blue Shield and the University of Michigan Health Care System. If you can't stand the heat, get out of the kitchen...

Thanks to MIRS for this story. You can read the audit online at: http://audgen.michigan.gov/comprpt/docs/r431010007.pdf