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 Don't Shoot the Messenger (Auditor)
by Tom Campbell
April 15, 2004
State Auditor Ralph Campbell released what he termed …” the most damaging audit that we’ve ever had to release” in making a report on the state’s Medicaid program. Medicaid, especially the disproportionate share hospital reimbursements, is complicated and not easily explained in thirty-second sound bites or abbreviated news stories, but the spin being put on this story by the Department of Health and Human Services (the agency charged with administering Medicaid) and the Easley administration is almost laughable. Let’s talk facts.
Our State Auditor is charged with ensuring that agencies receiving public funding administer and spend those funds as dictated by statute. Auditor Campbell is elected, rather than being appointed, by either the Governor or legislature, so as to ensure no loyalty or dependence on any party or politician. This past week’s news stories reinforce why the framers of our Constitution were wise in making this an elective office.
In addition to conducting audits of state funds, the federal Single Audit Act, requires each of the various state auditors to conduct audits of programs involving federal funds. The federal government pays for these services, amounting to roughly fifty percent of the North Carolina Auditor’s annual budget.
From time to time the Government Accounting Office sends a “high risk update” of programs in which federal funds may be misspent. In January 2003, the GAO (for the first time) alerted auditors to possible fraud or mismanagement of Medicaid funds, specifically of the reimbursements to hospitals of disproportionate share monies. In previous audits, Campbell’s office examined the Medicaid claims payments, since this is where approximately 90 percent of Medicaid money is spent. The disproportionate share funding amounts to only five percent of Medicaid spending, but after the GAO alert, Campbell’s office determined to investigate these areas.
Prior to every audit an entrance conference is held to alert the agency to the scope of the audit. In roughly July 2003, Campbell’s audit team conducted such a conference with officials at the Department of Health and Human Services. One of the questions asked was whether there way anything going on within the program to be audited that the auditor’s office should know about in advance…any unusual or troublesome activities. The team was told there was nothing. The department either didn’t know of any problems or didn’t report them.
The agency’s claim that the Auditor’s findings were “old news” doesn’t hold water. Some news stories had been written, likely leaked by an insider from DHHS, as a result of the audit. Neither does the assertion that the problems have been fixed. In fact, the auditor notes that changes were not instituted until the last quarter of calendar year 2003, after the auditor’s team was at work uncovering problems. Secretary Carmen Hooker Odom’s ill-advised quote regarding Campbell, “Where has he been all the time?” appears to imply that it is the Auditor’s responsibility to manage the Medicaid program. Nothing could be further from the truth. In fact, one could ask why the departments own auditors had not uncovered and reported these abuses.
The problems may have started in another administration, but the Audit clearly shows that this administration either didn’t know about the abuses or didn’t move to correct them until last year, two years into the Easley administration. Rather than try to deny problems or place blame, officials are always well advised to own their problems and tell the public what is being or has been done to correct them.
Auditor Ralph Campbell was doing his job without regard to politics, personalities, or party. That is what we elected him to do. Rather than trying to shoot the messenger, the Governor and Secretary should be applauding him. So should the people of North Carolina.
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