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Policy change to boost Montgomery County's DSS coffers by $1.5 million

Saturday, May 24, 2014 - Updated: 4:08 AM


FONDA -- A change in how the Montgomery County Department of Social Services does its health care reimbursements will mean an extra $1.5 million coming to the county from federal and state programs, officials announced Thursday.

County Executive Matthew Ossenfort said after the dissolution of the health trust on Tuesday, the county was able to switch to the process of claiming actual health care expenses instead of estimates, which resulted in more funding.

"It is an improved process," Ossenfort said. "Anything we can do to bring in state and federal dollars to offset the burden on local property tax owner is huge and critically important, which is why I think it's a good move forward."

Ossenfort said the additional revenue will help the county as it begins its budget process.

"What this means for the everyday taxpayer is a boost in federal and state revenue which alleviates the burden on property tax owners and that is what we are trying to do."

Prior to the trust's dissolution, DSS changed the way it claims for county employees' health care expenses. In the past, DSS has paid a flat rate for employees insurance into the trust, while also claiming this flat rate for reimbursement from federal and state programs. By claiming for actual health care expenses the county will maximize reimbursements and generate additional revenue.

The accounting staff at DSS was able to go back two years and adjust reimbursement claims for 2011 through 2013, generating $1.2 million in federal revenue, and $360,000 in state revenue to the county.

"With the savings we have seen with the reimbursements, we realized there was a better way of doing things," DSS Commissioner Michael McMahon said. "We realized $1.5 million in revenues which wouldn't have been there before with the old trust."

Ossenfort said the county decided to dissolve the trust because it has been the source of "political infighting" and has been the source of several lawsuits.

"The wisest path was to dissolve the entity and move forward to a new process that can be efficient and effective."

In December, Montgomery County was among seven counties to be audited for social practices determine whether state and federal reimbursements are maximized.

The state comptroller's office said at the time that Montgomery County could have missed out on $101,775 for its $27 million social services budget.

"These foregone amounts were the result of errors and the lack of a formal, consistent billing process used by the various county departments for interdepartmental billing," stated a separate audit specific to Montgomery County.

In New York, social services programs are funded by a combination of federal, state and county money. Generally, the federal share is 50 percent, and the state and county split the remainder, though it depends on special or legislated funding mechanisms for individual programs.

The federal government generally reimburses counties for half of "indirect" costs to administer social services programs, such as accounting, budgeting and personnel departments. In order to receive the reimbursements, counties must prepare plans to list the indirect costs.

Other expenses can also be reimbursed, such as costs incurred by other county departments for the benefit of the social services department.

In 2013, Montgomery County received $527,000 of the additional revenue and the balance should be received during the current calendar year.

"We are in better shape now," McMahon said. "It is better for the county and the tax payers to be realizing this revenue."


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