The Kansas Department of Corrections (KDOC) plans to rebuild the Lansing correctional facility and is considering both state financing (bonding) and contractor financing (leasing) for the project. We used a Life-Cycle Cost Model to estimate which financing option would be most cost effective. Our analysis found bond financing with contracted maintenance would likely be the most cost-effective option. These two financing options for rebuilding Lansing create some additional risks and benefits for the state, primarily related to contract terms and project costs.
Kansas Public Employees Retirement System: Evaluating Controls to
Detect and Prevent Fraud and Abuse
The Kansas Public Employees Retirement Plan (KPERS) was created in 1962 to provide a financial foundation for Kansas public employees to retire. KPERS has about $16 billion in assets and administers three statewide defined-benefit retirement plans for about 295,000 state and local public employees. Because of the volume of applications, contributions and benefit payments handled on a regular basis, public pension plans are at risk for fraud and abuse, including the risk of making inaccurate benefit payments or that the plans will not collect enough in contributions. However, these risks can be mitigated by implementing controls such as requiring proof of identity, regularly monitoring to ensure that benefits are calculated correctly, and segregating duties. Our test work showed that KPERS had many, but not all, controls to help prevent and detect fraud and abuse. We found that since late 2013, KPERS has not conducted field audits to verify the accuracy of employer-reported information. Further, KPERS could strengthen its efforts to identify disability recipients who may be ineligible for those benefits. In addition, we found seven teachers who were incorrectly awarded KPERS service credits while working for education associations.
We also found that when calculating members’ retirement benefits, KPERS handled final average salary calculations appropriately. Legislation considered during the 2015 Legislative Session would have substantially limited the opportunity for retirees to include unused leave when calculating benefits. Finally, restricting or eliminating the inclusion of unused leave could reduce KPERS’ unfunded liability up to $80 million, but the actual impact likely would be far less.
Kansas State Employee Health Plan: Evaluating the State's Pharmacy Benefits Management System
Since 2006, the Kansas State Employees Health Care Commission has contracted with Caremark to provide pharmacy benefit management services for the prescription drug portion of the Kansas State Employee Health Plan. Because a pharmacy benefit manager controls many aspects of a prescription drug plan, there is a risk that it may not manage the program in the state’s best interest. To mitigate this risk, the commission has negotiated numerous contractual provisions to reduce the risks associated with using a pharmacy benefit manager. However, the Kansas Department of Health and Environment (KDHE) does not routinely take the steps needed to verify that Caremark is complying with the contractual provisions. Specifically, KDHE does not adequately check claims data for spread pricing, does little to ensure it receives its share of drug rebates, and does little to independently verify how the drug formulary is managed. In addition, KDHE does not take steps to ensure it receives all claim recoupments that Caremark collected from pharmacies. We also found that the state’s contract with Caremark includes few controls related to mail-order prescriptions; however state spending for mail-order is minimal. Finally, we found that although specialty drugs comprise 32% of total prescription drug costs for the State Employee Health Plan, we could not verify whether KDHE is proactively monitoring this area.
Larned State Hospital: Reviewing the Operations of the Sexual Predator Treatment Program
The Sexual Predator Treatment Program at Larned State Hospital provides treatment for sex offenders who have completed their prison sentence but who have been determined by the courts to be sexual predators. Overall, the Sexual Predator Treatment Program appears to have done a good job of addressing staff and resident safety and security, although we did identify a few safety and security issues that could affect staff and resident safety. Specifically, the program did not have adequate policies or controls to ensure keys and doors were secure and to prevent and detect prohibited items. Also, despite participating in conflict avoidance training, some staff did not feel adequately prepared for resident altercations. In addition, a significant number of staff positions responsible for ensuring safety, security, and treatment of residents were vacant. Even though program staff worked a significant amount of overtime, the program often failed to meet its internal minimum staffing levels needed to provide safety, security, and treatment.
State Employee Residence: Assessing Potential Increases in Revenues by Requiring State Employees to Reside in Kansas
We estimate that about 3,600 state and school district employees live outside Kansas. Imposing a residency requirement for state employees would only generate new tax revenues if out-of-state employees move to Kansas. If 25% of all out-of-state employees move to Kansas, a residency requirement could generate approximately $2 million a year in state and local tax revenues. This includes $1.4 million in new taxes paid by the employees, and another $650,000 in indirect tax revenues from increased economic activity. However, in order to generate meaningful revenues, a residency requirement would need to be implemented aggressively, which would significantly affect out-of-state employees. If the requirement was put into effect in the near term, employees would have to move or seek new employment. Grandfathering in current out-of-state employees would remove the impact on them, but would essentially eliminate the new tax revenue. Finally, adopting a residency requirement would limit the labor pool for state agencies and could be expensive to administer.
State Agency Information Systems: Reviewing Selected Personnel Security Controls in State Agencies.
Overall, we found that all five agencies we reviewed could improve their personnel-related security policies. Three of five agencies did not conduct adequate background checks before hiring employees and none of the agencies consistently trained employees on security awareness and the acceptable use of information technology resources. All five agencies appropriately removed terminated employees’ computer access rights, but need to make other improvements to the termination process including documenting equipment recovery and conducting exit interviews. We also found that the Information Technology Executive Council (ITEC) does not adequately communicate its security standards to all State agencies and it does not have adequate mechanisms or resources to enforce its security standards.
State Hiring Practices: Determining Whether Requirements Related To Veterans’ Preferences Are Being Met
State law provides that eligible veterans who meet the minimum and preferred qualifications for a State classified job be offered an interview. Of the 426 veterans’ applications reviewed, there were only two instances where a veteran should have been interviewed, but wasn’t—both times because of an oversight acknowledged by agency officials. The reasons most veterans weren’t interviewed were because they didn’t meet minimum and preferred qualifications for the job or submitted incomplete application materials. In addition, we couldn’t conclude whether agencies mailed a certified letter to each veterans’ preference applicant as required by State law and identified several smaller issues that need to be addressed to make the veterans’ preference law more efficient and cost effective. These include considering eliminating the statutory requirement that State agencies have to mail certified letters to veterans not hired, giving guidance to State agencies on what documentation they should keep to show they mailed a certified letter to each veteran applicant, and advising State agencies to wait a certain period of time after a job closes to print a list of applicants to be considered for the job.
Health-Care Related Services: Reviewing Opportunities for Better Coordinating the State's Health-Care Related Programs
By changing Medicaid billing practices, the State could save money spent on inpatient care for Department of Correction’s inmates. Although State agencies could also better coordinate a number of other health-care related programs, service gap issues such as lack of affordable health insurance for low-income single adults can only be addressed through State-level policy decisions. Of more importance is the upcoming federal health care reform, which will greatly affect how health-care related services are provided in Kansas. Its primary goals are to reduce the number of uninsured, slow increases in health care costs, and increase access to health care services and providers. Implementing those reforms will require significant coordination among State agencies. Some State agencies that traditionally have provided health care services will have added responsibilities, while other State agencies—such as the Kansas Insurance Department—will start having a role. At this point, it is too early to know whether State agencies are on track to implement the various provisions of federal health care reform.
Prescription Drugs: Reviewing What the Kansas Health Policy Authority Is Doing To Control Prescription Drug Costs in the Programs It Oversees
The Health Policy Authority already has implemented several strategies to control prescription drug costs in the Medicaid program and the State Employee Health Plan. We identified five additional strategies for the Medicaid program that could save the Authority between $3.8 million and $4.6 million per year. These include joining a purchasing consortium, regulating mental health prescription drugs, reducing dispensing fees paid to pharmacists, implementing a more aggressive step therapy program, and increasing the maximum amount of certain drugs dispensed at one time. We identified four additional strategies for the Employee Health Plan that could save the State up to $3.0 million per year. These include reducing coverage on some or all prescriptions, increasing the maximum amount of certain drugs dispensed at one time, using a starter dose for new prescriptions, and limiting the number of prescriptions beneficiaries an receive each month.
Judicial Districts in Kansas: Determining Whether Boundaries Could Be Redrawn to Increase Efficiency and Reduce Costs
In fiscal year 2008, the district courts spent an estimated $114 million on operating costs, and had more than 1,800 full-time-equivalent staff. Almost $101 million was paid by the State and almost $102 million went for district court personnel salaries and benefits. Since court unification in 1977, the distribution of cases per judge has remained very uneven across judicial districts. On average, caseloads are higher in districts that have a lot of cases. The disparity in cases per judge is caused primarily by the law requiring one judge per county, regardless of the number of cases in that county. We used statistical analyses to help predict the Statewide cost of operating a newly structured district court system that better aligned resources with caseloads, and that wasn’t limited by current statutory requirements. The savings that could be achieved vary based on the assumptions and estimates used. Under one scenario, had the district courts operated in fiscal year 2008 with 13 judicial districts instead of 31, we estimated that court personnel and travel costs combined could have been $6.2 million (5.4%) less for State and local governments combined. Under another scenario, had the courts operated with only seven districts in 2008, those costs could have been approximately $8.1 million (7.1%) less. Additional cost savings likely are possible with increased use of technology. Even without redrawing existing judicial district boundaries, the State could achieve cost savings by eliminating the one-judge-per-county law.
Department of Commerce: A K-GOAL Audit Reviewing the Department’s Management Staffing Levels
The Department of Commerce had more staff in management positions than any of our five comparison agencies. On average, the Department had fewer people reporting to each of its managers, and many of these managers were located at fairly low reporting levels in the Department. The heaviest concentration of management staff--one management position for every 1.2 non-management positions--was in the Employment Services Section of the Department’s Workforce Development Division. In addition, the Department had organized its five workforce development regions with a double layer of management. Overall, we estimated that $61,000 to $99,000 could be saved annually by bringing the Department’s proportion of management more in line with other agencies. Finally, we found that discrepancies between authorized and filled positions, as well as limited access to complete organization charts for some State agencies, hampered good analyses of agency staffing levels.
Department of Health and Environment: Reviewing Issues Related to the Permitting Process in the Bureau of Air and Radiation
Entities that emit specified levels of pollutants into the air must obtain an air-quality permit from the Kansas Department of Health and Environment. The only significant change the Department has made to the air-quality construction permit process in the last year has been the addition of a carbon dioxide emission estimate for every application. This addition has not lengthened the time it takes to approve a construction permit. In recent years, the Department has implemented a number of streamlining activities to reduce permit processing times. These changes have resulted in a decrease in construction permit approval time by 51% (from an average of 63 days in fiscal year 2003 to an average of 31 days in fiscal year 2008). The basic construction permitting process Kansas uses is similar to the process five other states use, although there are a few differences. For example, most of the other states don’t calculate a carbon dioxide estimate for every construction permit application.Calendar year 2008 had more upper-management turnover than any of the past 10 years. As of July 2008, five upper-management positions had turned over in 2008; the next highest number of positions that turned over in any year was four, back in 1999 and 2000. This increase is agency-wide, and much of the increase can be attributed to retirements.
State Hiring Practices: Determining Whether Requirements Related to Veterans’ Preferences Are Being Met
State regulations implementing the Kansas Civil Service Act create a veterans’ preference for classified positions. The regulations require State agencies to interview eligible veterans who apply for a classified position and who meet the minimum requirements of the position. Our review of 144 veterans who applied for 61 classified positions at four State agencies during 2006 found that in all but three cases, the veterans either were given an interview or there was a valid reason the interview didn’t occur. During our review, we saw no evidence that veterans received only “token” interviews. State regulations are silent regarding a veterans’ preference for unclassified positions.
Department of Commerce: Personnel Practices Related to Employees in the Divisions of Business and Workforce Development
At the time of the audit, 217 of the 300 people transferred from the Department of Labor still were working for the Department of Commerce. Of the 83 transferred employees who’ve since left the agency, most voluntarily resigned, retired, or transferred to another State agency. Most replacements for those employees came from outside the Department, had less experience related to workforce development, slightly better education levels, and were hired at the same or lower salaries. Since the transfer, at least 23 fewer direct-service positions were filled, and a number of higher-level positions had been created and filled. Although a number of current employees expressed concerns about leaving direct-service positions unfilled, Department officials said such changes were necessary to reflect different agency needs following the reorganization. For most personnel actions we reviewed, the Department followed statutes, regulations, and best practices. However, we found some problems related to conducting annual performance evaluations, retroactively paying employees, getting approval before downgrading information technology positions, and using reallocated positions to promote employees without competition. When surveyed, Department employees generally rated the Department’s performance appraisal process and general workplace policies and practices fairly high, but they rated the fairness of the hiring and promotion process much lower. As a group, employees transferred from the Department of Labor tended to have more negative assessments of the Department’s personnel practices.
State Prescription Drug Plan: Reviewing the Accuracy of Payments Made Under the Program
In 2003, the State prescription drug plan paid 1.5 million claims totaling $55 million. For the most part, payments made to Kansas' pharmacy benefits manager, AdvancePCS, appeared to be accurate and in accordance with the terms of the contract. However, we identified some problems relating to payments for claims for ineligible people and inaccurate dispensing fees, which may result in AdvancePCS not meeting the accuracy standard of 99.9% required by its contract with the State. The most significant problem (paying claims for ineligible people) also was identified in a 2001 audit as a problem area. Even though we found relatively few problems, we recommend that the State improve its routine oversight and monitoring of the claims payments. Given the amount of money involved, better monitoring reduces the likelihood that the State will lose significant amounts to inappropriate claims payments.
Reviewing the Hiring and Promotion Practices of the Public Safety Agencies: A K-GOAL Audit of the Adjutant General’s Office, Fire Marshal’s Office, Highway Patrol, and the KBI
Many public safety employees are dissatisfied with their agencies' hiring and promotion processes, and survey responses from all 4 agencies indicated the highest level of concern was with promotions. In all, 36 - 54% of survey respondents said their agencies' promotion processes weren't fair or objective. Our review of a random sample of hires and promotions from fiscal year 2003 and of a sample of complaints raised by employee surveys also found problems with agency hiring and promotion practices. For example, both the Fire Marshal's Office and the KBI used reallocation to promote some employees rather than filling positions through a competitive process. The Fire Marshal's Office, the Highway Patrol, and the KBI all hired or promoted some employees who didn't meet minimum job requirements Finally, the Adjutant General's Office, the Highway Patrol, and the KBI didn't have current position descriptions. Overall, the problems we saw generally were caused by agencies not following laws or their own policies, rather than a lack of policies. These problems may be compounded by the fact that the Division of Personnel Services has significantly curtailed its oversight of agency personnel practices.
Department of Transportation: Reviewing Wage Payments to Equipment Operators (100-hour audit)
KDOT equipment operators on 4 of 5 crews in the Topeka area were overpaid when KDOT sent them home early to rest up for night duty on the first day of snowstorms. The overpayments occurred because crew supervisors failed to follow Department policy that specifies when rest time can be compensated, and because the area superintendent didn't ensure the supervisors were recording time properly. While no one knows for sure, these overpayments likely went on for at least 15 years, with about $12,000 in overpayments over the last 5 years. KDOT has decided not to recoup the overpaid wages from the equipment operators, which seems reasonable given the difficulty in determining exactly who was overpaid and by how much. KDOT's efforts to correct the problem have focused on educating its supervisors, but further steps need to be taken to ensure that supervisors are following the correct timekeeping policies.
Reviewing the Projections Presented by the Kansas Public Employees Retirement System Regarding the Need for a Long-Term Funding Plan
In August 2002, the Kansas Public Employees Retirement System issued a report that contained funding projections for the System based on current policies and practices and selected alternatives. This performance audit assesses the reasonableness of those projections and of the underlying assumptions and methodologies used by the Retirement System in developing those projections. The audit notes the limitations inherent in making such long-term projections, but concludes that the assumptions and methodologies used and the resulting projections are reasonable to assist in reviewing the System’s outlook to develop a long-term funding plan.
The State Health Benefits Program, Part 2: Reviewing the Staffing and Structure of the Current Program
Currently the State Health Benefits Program's structure is appropriate since 98% of the Program's members are active or retired State employees. However, considering the program may be expanded to include other public entities, such as cities and counties, the Legislature and Commission should address how the Program is to be managed in the future. Other states we contacted that, like Kansas, serve only or predominately state employees tend to be located in a multi-function state agency, and are equally likely to be governed either by the head of the agency or by a commission. It also appears that given the new positions added for 2002, the Health Benefits Program has enough staff to handle most of its current workload. Commission staff identified several important responsibilities, such as reconciling insurance carriers' bills, they thought they weren't able to adequately address with their existing staffing levels, but the new positions will help fill these needs. Lastly, we found that Kansas already has enough participants in its health insurance plans to benefit from economies of scale, and lower costs would be unlikely if a plan was eliminated. While Kansas is using most of the strategies that experts mentioned are important in controlling the cost of health insurance, the Commission will have to make tough choices if it is to minimize cost increases in the future because it can no longer rely on money in the reserve fund.
The State Health Benefits Program, Part 1: Reviewing Issues Relating to Premium Costs and Management
Premiums for the Kansas employee health care program are somewhat higher than average when compared to the surrounding states and Iowa, Sedgwick and Shawnee counties, and the Topeka and Wichita school districts, but usually fell well within the middle of the range. Kansas' premiums may be higher than average because Kansas employees pay far less out of pocket for their health care costs than employees in most of those other groups surveyed. No problems were found stemming from specific concerns that the State's self-funded program isn't being properly managed and overseen. The most recent Health Benefits Administrator appeared to be well qualified for the job; the Program's funds are being properly deposited into the State Treasury and the interest being earned on them stays with the Program; and the use of the @incurred cost@" method when projecting future program costs is reasonable. In addition
Centralized Administrative Hearings: Reviewing the Advantages and Disadvantages
Transferring the Department of Social and Rehabilitation Services' administrative hearings to the newly created Office of Administrative Hearings in the Department of Administration eliminated the conflict of interest that existed when the hearing officers worked for and were answerable to the Secretary of SRS. Hearings are being conducted in a timely manner, and most people we surveyed had a favorable opinion of the Office. The transfer has not resulted in any cost savings, but the Office needs to improve its budgeting and billing practices. Centralizing more agencies' hearings is the best way for the State to eliminate the inherent conflict of interest that occurs when the agencies select their own hearing officers. Officials in 8 states with centralized hearing agencies said eliminating conflict of interest was the primary benefit of centralizing, but they also cited time and cost efficiencies, as well as increased professionalism of hearing officers. If the Legislature wants to increase centralization of administrative hearings, it will need to consider such issues as which agencies and which types of hearings to bring under the Office, and how best to fund the centralized function.
Evaluating Certain Personnel and Financial Practices at the Kansas Department of Health and Environment (100-hour audit)
For a sample of bills paid in May 1999, about a fourth were paid late, but in many cases the delays were caused by the vendor, not the Department. Based on the same sample, the Department appeared to be purchasing from State contracts when appropriate. In awarding employee bonuses under three different bonus programs, the Department complied with applicable State laws and regulations. However, in the case of the Kansas Savings Incentive Program it didn't follow good management practices in making the awards. Hires and transfers of classified administrative personnel in the last two years were done in accordance with State laws and regulations. Although unclassified positions aren't required to have formal job descriptions, and although qualifications necessary to hold an unclassified job aren't spelled out in State law, unclassified administrative employees hired in the last two years appeared to be qualified for the positions they held.
Reviewing the Kansas Public Employees’ Deferred Compensation Program
The State exercises limited oversight of the Deferred Compensation Program, with essentially no monitoring of Aetna Investment Services. This level of oversight is significantly less than that provided by other states we contacted. However, our reviews showed that customer services were adequate, that investment performance was comparable to the general market, and that costs were comparable to other similar programs we reviewed. Also, State employees we surveyed generally were satisfied with the services provided under the Program and the performance of their investments, but need more information about the Program’s fees, limitations, and restrictions. Finally, according to State law, the State isn’t liable for any loss incurred by an employee under the Program, including losses from insolvency or mismanagement of funds. However, we think State law is unclear as to whether participants’ moneys in fixed-return accounts are covered by the Kansas Life and Health Insurance Guaranty Association if Aetna were to become insolvent. Aetna operates in a highly regulated industry with controls in place to monitor its operations, which should minimize the likelihood of insolvency or mismanagement.
Reviewing the Compensation of Executives of the State’s Economic Development Agencies
The compensation for economic development executives is set by the boards or officials they report to, and their compensation usually is based on studies of salaries for similar positions. Most economic development executives in Kansas receive compensation that’s comparable to what officials in other states receive. We identified relationships between economic development agency staff and 13 of the 61 technology-based companies we reviewed. Some of those relationships appeared to represent a conflict of interest. State law is unclear about whether some employees are subject to the State’s ethics laws. Also, most economic development agencies don’t have written policies and procedures in this area, and university conflict-of-interest forms don’t require full disclosure. Unlike in some other states, Kansas’ economic development employees aren’t prohibited from having an interest in companies that receive assistance from the agencies they work for.
Reviewing the Progress of the Statewide Human Resource and Payroll System Project (SHARP) (100-hour audit)
The Statewide Human Resource and Payroll System Project is scheduled to go on-line for the October 1995 benefit enrollment period, and it is scheduled to produce State paychecks on January 12, 1996. The current Project budget is $11.5 million, which includes the direct costs of modifying the software and making it operational. We found that the Project is essentially on schedule and on budget. However, the Project budget excludes such other costs as the cost of State employees working with the consultants to develop the system, and microcomputers agencies will need to buy to access the system. The Division of the Budget currently estimates this latter figure will total about $362,000 in fiscal years 1995 and 1996. This figure will increase after the Department of Social and Rehabilitation Services’ needs are defined.
Reviewing Personnel Services for Kansas’ State Employees: A K-GOAL Audit of the Department of Administration
To fulfill the requirements of the Kansas Governmental Accountability Law, we reviewed the operations of the Division of Personnel Services to determine whether its activities were carried out in an efficient and effective manner. In general, we found that many personnel functions provided by the Division of Personnel Services and personnel staff in State agencies were carried out efficiently and effectively. However, we found that the hiring process, the performance evaluation system, and the pay plan used by the State were not serving all of the State’s needs. We also found that the Division of Personnel Services approves several fairly routine personnel actions performed by the agencies. This means that such routine actions require more effort and involve more processing than should be necessary. Finally, the State pays its employees more overtime pay than required by law. The Division of Personnel Services estimates that the State spends about $2 million a year more than it needs to on overtime pay. While this estimate may be overstated, the amount involved still is likely to be substantial. We recommended that the State’s personnel practices could be made more efficient by increasing the flexibility and authority of the State agencies to take appropriate actions.
Reviewing the Process for Providing Health Insurance Benefits for State Employees
Premiums for State employee health insurance in Kansas were generally higher than in nearby states we reviewed. Variations in deductibles and co-insurance amounts employees must pay make it difficult to make blanket statements about how our benefits compare, but generally Kansas' benefits compare favorably. Also, Kansas had the lowest annual maximum out-of-pocket costs for employees who use health insurance a lot. Steps the State Employees Health Care Commission has taken to obtain benefits at the lowest cost include things like soliciting multi-year bids and negotiating rates before signing health insurance contracts. All State employees do not have equal access to the same insurance plans across the State. But employees covered under the State's conventional health insurance plan have access to most general practice doctors, dentists and hospitals in their cities. Finally, if the Regents' employees had been a separate group within the 1993 State employee health insurance plan, that group's claims experience would have resulted in 18 percent lower premiums for that group and 14 percent higher premiums for other employees. When such differences have occurred in the past the Health Care Commission has acted to equalize premiums for all employees.
Reviewing Selected Issues Related to Workers’ Compensation
For the most part, Kansas’ workers’ compensation benefits are neither high nor low when compared with other states. Based on available information, Kansas’ premiums also were slightly below the median for other states and increased at about the same rate as premiums nationally. Over the past few years, laws have been enacted that increased maximum payments for disabilities and death benefits, and required vocational rehabilitation to be provided for many workers’ compensation cases. No information exists to determine their exact cost impact. Other states have enacted a number of measures aimed at reducing litigation, controlling medical costs, reducing fraud and improving workplace safety. Those measures include using arbitration services, implementing medical fee schedules, performing utilization and bill reviews, creating fraud hotlines and investigation units, and overseeing workplace safety. Finally, we found that workers’ compensation agencies in some states have developed extensive data collection systems that allow them to answer basic questions about workers’ compensation, such as which injuries are most frequent or most expensive.
Examining Selected Activities of the Board of Agriculture’s Marketing Division (100-hour audit)
No specific statute authorizes the Division to conduct international marketing, but such activities are not prohibited under the broad authority given the Division. The Division’s travel expenditures generally conformed to State travel regulations, and travel appeared to be done in a reasonable manner. Hospitality expenses also generally conformed to State policies, and given the type of work the Division does, none of these expenditures appeared to be inappropriate. The Division estimates that since the beginning of fiscal year 1990, its international marketing activities have benefited Kansas companies and producers by a total of $14.7 million or about 67 times the amount the Division spent on international marketing. But the Division has not systematically documented those benefits, and we were unable to verify all the amounts claimed as benefits.
Examining Increases in Expenditures from the State Workers’ Compensation Fund
Between fiscal years 1983 and 1992, expenditures from the Fund more than quadrupled to nearly $33 million. The Fund’s expenditures increased primarily because more claims were opened than closed each year, creating an ever-growing pool of active claims for which expenses are being incurred. In addition, medical costs have skyrocketed, and amounts that can be paid in compensation for lost wages have increased over the years. Because of legislative actions and judicial decisions, Kansas currently has one of the most liberal second-injury funds of all the states we contacted. Limiting the Fund’s coverage would not reduce workers’ compensation costs. It would simply shift those costs from the Fund back to the insurance companies and employers. Other states have implemented a number of alternatives to control workers’ compensation costs, but Kansas does not have the basic management information needed to take similar measures. Although administrative costs have increased more slowly than benefit-related costs, the Department could do more to control attorney costs.
Reviewing How the State Supervises Potentially Violent Mental Patients at Topeka State Hospital
The audit found Hospital and Department officials thought that closing the Awl Unit would allow them to reduce patient populations and staff, accommodate budget cuts, and maintain the level of patient care needed to keep the Hospital's federal certification and funding. In fact, anticipated reductions in patient population never materialized because few Awl patients were transferred to Larned State Hospital as originally intended. Instead, most Awl patients were placed in other wards at Topeka State Hospital according to a transfer list prepared by clinical staff. Even though the introduction of these potentially dangerous patients into other wards represented an increased level of risk to Hospital staff and patients, Hospital officials took no immediate actions to lessen that risk. After the murder of a Hospital employee in February 1992, officials sought and received funding for additional security guards, lighting, and equipment. However, critical issues of low staffing, inconsistent compliance with security-related procedures, and an inability to segregate dangerous patients remain to be addressed.
Reviewing Staffing in the Division of Property Valuation (100-hour audit)
The Division currently employs 73 people, two-thirds of whom are classified as property appraisers. In both 1988 and 1992, nearly all employees met the minimum qualifications for their jobs. Because of a position reallocation, the one employee who did not meet minimum qualifications in 1992 was not required to do so. Most of the Division's staff provide technical assistance and support to counties, but some staff are responsible for determining values for motor carriers and utilities. In Cherokee County, as in other counties, the Division's staff provides supervision of the reappraisal effort, but is not responsible for determining countywide property values.
Examining Problems Implementing the Kansas Financial Information Systems (KFIS)
The Department of Administration did not determine what it needed before it bought ready-made software for the State's new centralized accounting, personnel/payroll, and purchasing systems. As a result, it underestimated the software modifications that would be needed or called for, and overestimated the amount of work its own staff could do. When in-house infighting broke out over the need to modify those software packages, the Department was unable to stop it. The Department also did not require the consulting firm to provide a finished product. The procurement negotiating process was not of benefit in this case because the Department did not follow the steps required by that process. Options for completing the System include finishing the new personnel/payroll system or fixing the problems with the current system. Before any course of action is chosen, a full needs assessment must be done. In the future, the State needs to make one person or agency responsible for ensuring that agencies conduct proper planning, provide strong project management, and commit sufficient resources to major computer projects.
Examining Universities’ Use of Margin of Excellence Moneys
The Board of Regents provided only general instructions to its institutions for budgeting Margin of Excellence moneys, but it approved all Margin budget requests before those requests were submitted to the Legislature. Individual institutions' plans for spending their Margin money appeared to comply with their mission statements. Except for Wichita State University, all the Regents' institutions pooled their Margin salary parity and merit pay moneys before distributing any salary increases in fiscal years 1989 and 1990. Tenured or tenure-track faculty at Wichita State and Kansas State Universities received average salary increases of 8-10 percent for 1989 and 1990; University administrators received average raises that were comparable to or less than faculty pay raises. Finally, both Wichita State and Kansas State used their Margin of Excellence program enhancement moneys for a variety of items such as hiring unclassified staff and purchasing library materials and equipment.
Kansas’ Foster Care Program, Part III: Staffing and Funding Levels
The number of social workers assigned to foster care has not kept pace with the growing number of children in the Department's custody. Although the Department could not provide information showing changes in caseloads over time, we estimated that average foster care caseloads were more than double the standard proposed by the Child Welfare League of America. It did not appear that funding affected placement and service decisions. The actual limiting factor appeared to be the lack of appropriate placements and services. Most foster care providers we surveyed thought the reimbursements they received from the State did not cover their costs, but this did not appear to be a major reason for them leaving the system.
Examining the Costs of Providing Staff Resources for the Kansas Silver-Haired Legislature (100-hour audit)
The direct cost to the State for the 1989 session of the Silver-Haired Legislature was about $12,300 in staff time and other expenditures. Of that total, about $11,000 was for time spent by personnel in the Department on Aging, the Legislative Research Department, the Revisor of Statutes' Office, and other legislative staff. The State may also incur some indirect costs related to the Silver-Haired Legislature, but agencies' involvement with the group appears to be declining. Finally, a number of legislative staff said that the November Silver-Haired Legislature session sometimes conflicts with their primary responsibilities.
Wichita School District: Personnel Practices and Management of Resources
Wichita's overall costs and staffing levels did not appear to be out-of-line compared with the four other large districts in Kansas and similarly sized districts in the Midwest. Wichita appeared to have fewer teachers and more support personnel per student than the average in the other school districts in Kansas. In addition, the district appeared to have a number of elementary schools that could potentially be consolidated. The district documented most of its personnel actions, although documentation was sometimes insufficient for teacher transfers, evaluations, and informal Affirmative Action complaints. The district's personnel practices appeared to be in compliance with most federal and State laws, but did not always comply with certification requirements or with its written procedures for carrying out Board of Education policies.
Faculty Salaries in Kansas and the Resources Committed to Pay Them
On a per-credit-hour basis, both the University of Kansas and Kansas State University had less money than the average of their peer schools to spend on faculty salaries during fiscal year 1987. Kansas schools receive more of their funding from the State General Fund than the average of the peer schools. Factors that may impact on the amount of money available for faculty salaries in Kansas include a somewhat lower tax effort, a large postsecondary student population, and a somewhat smaller portion of the State budget going to support higher education. If adjusted for the cost of living, faculty salaries in Kansas appear to provide comparable or better purchasing power than in most of the peer states.
Reviewing the Health Care Plan for State Employees, Part II: Controls and Use
State employees covered by the traditional plan had higher use rates than all Blue Cross subscribers State wide, but when all State employees were recombined into one group (to include those covered by both the traditional plan and a health maintenance organization), their use rate was about the same as all Blue Cross subscribers Statewide. Blue Cross and Blue Shield’s 1987 controls were adequate to ensure that employee claims were processed and paid accurately.
Federal Staffing Requirements for Registered Nurses Applicable to Larned State Hospital (100-hour audit)
Federal regulations require adequate nursing staff to provide necessary services to Larned State Hospital patients, but do not specify minimum staffing ratios. The Hospital had been cited for staffing deficiencies in the past, but had not lost its Medicare certification. Following two 1987 federal reviews that threatened the Hospital with decertification, Hospital officials concentrated nursing staff in some units and received certification for those units. Because of this uneven distribution of staff, however, federal funds are now in further jeopardy.
Reviewing the Health Care Plan for State Employees, Part I
Because Blue Cross and Blue Shield’s initial bid for the State employees’ health care plan would have increased the traditional Blue Cross premiums by 40 percent, the Health Care Commission negotiated a different type of plan with Blue Cross. The new Blue Select plan requires employees to choose a primary care physician to coordinate their health care needs. For the first time, State employees will also be required to pay for a portion of their health care coverage. A monthly smoker’s charge was also instituted. The Blue Select primary care physicians, selected by Blue Cross, were initially required to serve in HMO Kansas, but that requirement has been dropped. They must still meet the same criteria as HMO Kansas doctors, however. Kansas’ State employee health benefits will cost more in 1988 than in 1986, and will cost more than other employers’ health benefits.
New faculty members generally have less experience and lower rank than the faculty members they replace, but are paid nearly as much. Universities have some difficulties recruiting qualified applicants for positions; about one-fourth the job offers made were declined. Comparisons show that percentage increases in Regents’ faculty salaries between 1974 and 1985 generally kept up with inflation, but actual salaries and fringe benefits are generally lower than at the Regents’ peer institutions.
Kansas Police and Firemen’s Retirement System: Part II
Statutory changes proposed or enacted over the past 10 years relating to the Police and Firemen’s Retirement System are summarized. The audit also compares benefits available to school and non-school members of the Public Employees Retirement System, and describes the differences in the disability experiences of surrounding states.
Entry Into Retirement Annuity Plans at the Regents’ Institutions
Most employees who were signed up immediately for a retirement annuity plan either had a valid contract or the required experience when they started work. But many of those employees got their contract just before they started; they had not been enrolled in a valid plan at another school. The State incurs a cost of about $250,000 a year to pick up these employee’ retirement contributions. The Legislature will need to determine if it intended for these contibutions to be picked up.
Personnel Policies and Practices at Kansas State Penitentiary
The Penitentiary’s written policies and most of the 210 personnel actions reviewed complied with applicable laws, regulations, policies, and requirements. The Penitentiary failed to fully comply in several areas. Many employees surveyed said that morale was low. They cited poor communication, understaffing, and perceived favoritism in promotion and job assignments.
Kansas Police and Firemen’s Retirement System: Part I
Benefits available to members of the Kansas Police and Firemen’s Retirement System are more generous than the benefits available to public employees covered by KPERS, but they are similar to benefits provided to public safety personnel in other states and Kansas localities. Any change in benefits would require a change in the public policy of encouraging an experienced but relatively young public safety workforce.
Student Wage Expenditures at the Regents’ Institutions
Universities’ actual expenditures for student wages may differ significantly from the amount authorized by the General Fund line-item appropriation for student salaries and wages because student wages can be paid from other funds. Controls on student wage expenditures also vary between the universities and have different purposes. The audit presents options for increasing legislative control and oversight in this area.
Teacher and Administrator Salaries in Kansas School Districts
This audit provides salary figures and background data for every Kansas school district. Over the past four years, teachers’ average salaries rose 26.6 percent, a slightly higher percentage than the 25 percent increases experienced by principals and superintendents. Fiscal year 1985 average salaries were $21,121 for teachers, $33,596 for principals, and $41,839 for superintendents. The average salaries for principals and superintendents varied greatly according to the size of the district, while teacher salaries were relatively constant regardless of district enrollment.
This report lists average classes taught and average hours spent each week in class for all levels of instructor, by school and by department. Graduate teaching assistants served as primary instructors for two-thirds of the 768 courses they were assigned to, mostly in math and English.
Kansas’ patrol coverage has declined since 1980, and it is generally lower than in other states. Some of the reasons why include fewer troopers dedicated to road patrol, a recent federal court ruling, and requests for the State to patrol interstates and highways within city limits. The Highway Patrol must decide what highways it will patrol and what level of coverage it will provide before it can assess staffing needs.
Reorganization had a significant effect on the staffing and organization of the bureaus within the Division. The Department generally tried to minimize any negative impact on persons displaced from their positions, and most actions were handled according to applicable personnel requirements. Although management thinks the reorganization goals have largely been achieved, most employees do not share this perception.
The number and dollar amount of claimed losses have increased rapidly since 1981, primarily at the universities. Improvements by State agencies to tighten controls should help minimize losses, if those controls are consistently followed. The audit presents alternatives for controlling escalating surety bond premium costs.
Examining Faculty Workloads
Published: APRIL, 1985
This audit reviews the workloads of full-time faculty at four State colleges and universities. One result of the study was that full-time faculty reported an average of nearly 54 hours of work during the surveyed week. The audit showed that there is no formal policy Statewide to ensure that faculty members can communicate effectively in English. The audit also examined the extent to which graduate teaching assistants share the teaching load with full-time faculty members.
Administrative Office Procedures at the Department of Economic Development
Published: MARCH, 1985
The department is not fully in compliance with affirmative action requirements or with State regulation relating to posting position vacancies, completing performance evaluations and reviewing position descriptions. The audit recommends changes to address these issues.
Personnel Policies and Practices of the Department of Human Resources
Published: NOVEMBER, 1984
Some department actions--particularly those related to filling positions--were either not in compliance with State and federal requirements or there was insufficient documentation to tell. In addition, such actions as non-competitive appointments, reclassifications, and employee grievances are not consistently handled or help create employee dissatisfaction. The report recommends needed change in the Department’s personnel practices.
Analyzing the Performance Evaluation System in Kansas
The system is well designed, but performance standards often are not written so they can be objectively measured, ratings often are not adequately justified, performance improvement goals are rarely used, and the system is not always uniformaly applied. The evaluation system is addressing problems of poor performers , but without the merit pay incentive, its effectiveness at reinforcing good performers has deminished.
Declassifying Management Positions in the Civil Service
Published: AUGUST, 1983
Agency officials indicate a reluctance to dismiss poor-performing professional or managerial employees in the classified service because of the difficulities involved. At the management level, there are inconsistencies between agencies as to whether positions are classified or unclassified.
Unclassified Personnel Positions at the University of Kansas Medical Center
Published: JANUARY, 1975
This audit comes as a direct request from the Legislative Coordinating Council. The request directed Legislative Post Audit to study why there are 2,200 unclassified positions at the University of Kansas Medical Center. Based on the initial study it was decided to concentrate detailed analysis on research associates and assistant positions.
Housing and Other Maintenance Support Provided to State Employees
The purpose of this audit represents the status of individual agencies as to their arrangements for providing employee maintenance. To obtain an analysis of the varying procedures among agencies and to then submit recommendations for updating and standardizing procedures on a state-wide basis. The primary focus will be given to family-type housing maintenance as this is the most significant area of maintenance in terms of varying procedures and cost factors involved. Observations concerning dormitory housing and food service support will also be included in this audit.