Posted on Fri, Jun 10, 2011 : 1:56 p.m.
Ineligible dependents cost Ann Arbor schools more than $700,000 in 2010
By Cindy Heflin
The Ann Arbor Public Schools paid $766,800 to carry 200 ineligible dependents on its health care plan in 2010, Michigan Capitol Confidential reported.
The figure came from documents the school district provided in fulfilling a Freedom of Information Act request, the article said.
The district immediately removed the ineligible dependents after they were discovered by a private contractor hired to review the district's dependent coverage, spokeswoman Liz Margolis said previously. The district paid the contractor $82,778 for the audit, Michigan Capitol Confidential, an editorial arm of the Midland-based Mackinac Center for Public Policy, reported today.
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Comments
sandy schopbach
Sun, Jun 12, 2011 : 8:57 a.m.
"The district paid the contractor $82,778 for the audit" And how much was paid out to these ineligible dependents? More or less? I'm always appalled at how much audits and studies cost. It often seems the money would have been put to better use doing what it was initially intended for, whatever that is.
PLGreen
Sun, Jun 12, 2011 : 12:46 a.m.
Plain and simple this is Insurance Fraud. Go after the Employee/Teacher for repayment of funds. Give them a choice; repay the funds or termination.
skigrl50
Sat, Jun 11, 2011 : 1:31 p.m.
I find this very interesting... The very day my divorce was final and my former spouse was no longer eligible for health insurance I removed him from my policy. When the audit came out over a year later, he was still listed as being insured by AAPS. HR claimed that they had removed him and that the insurance company was at fault. As an employee of AAPS, this bothered me a lot because I had done my job in a timely basis but someone else dropped the ball whether it was HR or BCN I don't really know. I think it was a very good idea for the district to do this audit.
Jeff Gaynor
Sat, Jun 11, 2011 : 1:07 p.m.
My daughter was one of the 200 dependents removed after the audit. However, she was still eligible, yet decided on another option for insurance. Likely this was true for others as well - those who were removed after the audit, but not necessarily ineligible. We really don't have data here, just conclusions. And, deja vu perhaps, but I thought I read this article some time ago. Why a reposting?
Carole
Sat, Jun 11, 2011 : 12:22 p.m.
Wow. Quite some conversations. None the less, hopefully AAPS will be better prepared to audit all departments to insure that proper policies are being followed so this does not occur in the future.. And, I hope all departments are audited to insure that proper procedures are being followed.. To those who apparently took the issue even further with corporation, indeed there is a lot to be concerned about and we all should be looking at what is happening in our country. My biggest concern, is that all of the smaller companies, banks, etc. are being purchased by larger corporations thus doing away with competition. Not a good idea.
sh1
Sat, Jun 11, 2011 : 12:19 p.m.
Egads! The money saved could have paid for almost three superintendents!
Tony Dearing
Sat, Jun 11, 2011 : 11:21 a.m.
A comment was removed because it violated our conversation guidelines. Commenters are welcome to challenge each other vigorously, but we ask you to direct your comments to the issues you are debating, and not to go after another commenter on a personal level.
snapshot
Sat, Jun 11, 2011 : 5:37 a.m.
Northside seeks to divert and distract attention away from fiscal incompetance by pointing to bigger and more emotional issues involving life and death rather than mere mismangement or fraudulent use of taxpayer funds. Nice try MEA.
David Briegel
Sat, Jun 11, 2011 : 4:41 a.m.
It certainly is a class warfare issue. A civilized society would find a way to provide health care for it's citizens instead of finding ways to deny. Why doesn't Mackinac Center sue the Banksters for the trillions they just stole? And the fake bonuses that were paid to the criminals? No, they get to pick apart the middle class to achieve the "ig-noble" goals of their masters! See a common theme here?
Michele
Wed, Jun 15, 2011 : 4:20 p.m.
Tax payers would rather pay for teachers, than inelligible dependents. Their rightful parent/guardian should be the the one paying for their health care (or THEIR employer). It's not that we don't want them to have healthcare, but who should pay for it.
Gorc
Sat, Jun 11, 2011 : 2:30 p.m.
As it relates to the "Banksters" - 573 billion dollars in TARP was given out to the financial industry and auto makers. - 331 billion has been paid back (270 billion in principle payments and 61 billion in dividends, interest, warrants, sale of government owned equities, and government fees charged to the receipants). So far the tax payers of the United States has earned over a 10% return on the 573 billion giving out in TARP. And, we, the tax payer continue to earn a return on the remaining 303 billion dollars in outstanding loans through the bailout.
sh1
Sat, Jun 11, 2011 : 12:17 p.m.
Gorc, the point is why pick on the little guy and let the big guy get away with much more egregious sins.
Gorc
Sat, Jun 11, 2011 : 9:25 a.m.
I don't want to put words in your mouth or miss construe what you are conveying. Are you in support of these 200 ineligible people to collect a benefit they are not entitled to have?
Gorc
Sat, Jun 11, 2011 : 12:31 a.m.
I work for a very fiscally conservative company and that has good expense controls. We just conducted a similar audit to verify eligible family members as well. I'm not sure what the outcome of our audit was, but it has me thinking that this is a common issue with both public and private employers in our country. Think about how many people are uninsured in our society and how prevalent it may be for large numbers of folks to get their insurance coverage illegally. I bet you this is more common than we know.
Carole
Sat, Jun 11, 2011 : 12:16 p.m.
I agree completely with your comments. What is needed for all companies are good audits to insure that folks abide by the policies. Your company did exactly what was needed to insure that there, hopefully, will be no issues.
sh1
Sat, Jun 11, 2011 : 1:38 a.m.
Yours is the most sensible comment I've read here, which means you should probably expect the deluge of criticism coming your way.
aataxpayer
Fri, Jun 10, 2011 : 10:15 p.m.
Thank you AAPS for finding and correcting the problem, but also please take appropriate action against those that failed to properly manage employee benefits and those persons, if any, that knowingly received benefits for which they were not eligible.
Halima
Fri, Jun 10, 2011 : 9:59 p.m.
The probable reason that Margolis could not discern how long these ineligible dependents were on the policies is this: People likely put their children on their policies when the children were born. If they do not enroll in a college or university on a full-time basis, they are to be removed at the age of 19. If they do enroll in college, they can be covered until they are 26. There could be some people who dropped from full to part time status or who left school altogether but were continued to be carried on the parents' policies. Likely, there were a few parents who were unaware of the dependents' school status, but the majority were probably hoping no one would notice, and their child could still be covered. I remember when my family decided that it was cheaper for me to enroll in graduate school and remain covered by my parents' policy than it was to just pay for a policy: tuition was cheaper than health insurance!
ViSHa
Fri, Jun 10, 2011 : 9:48 p.m.
according to the linked article: "In the June 8 response to the FOIA request, Margolis stated that the school district could not determine the amount of time the ineligible dependents had been covered by the district benefits policy." how can it not be determined? wouldn't the ineligible dependents be named on each annual policy or do they not renew annually?
AMOC
Sat, Jun 11, 2011 : 2:50 p.m.
What Liz Margolis really means is that AAPS does not choose to go back in the records more than the current and immediately prior year. Those records are probably archived remotely, and retrieving them comes with a cost.
northside
Fri, Jun 10, 2011 : 8:58 p.m.
This is a prime example of why the wealthy fund organizations like the Mackinaw Center. The Center shines a light on every slip-up made by government institutions like public education. It keeps attention away from the the big picture, that the entire economy is being restructured in favor of the wealthy and corporations. Could the A2 schools have used this 700K? Sure. But far bigger concerns face us, such as two endless wars that cost hundreds of millions a week. Or the growing gap not just between rich and poor, but between rich and middle class.
Mike Martin
Fri, Jun 10, 2011 : 9:22 p.m.
Great spin on a story about significant waste found in the school system. As DonBee pointed out, that is roughly 9 teacher positions paid in full without that waste. Spinning it into a "class war" issue is pretty out there.
blahblahblah
Fri, Jun 10, 2011 : 8:49 p.m.
So all these years, the district did not request documentation when employees signed up their "dependents"? To make matters worse, the district could not even determine how long these 200 ineligible dependents were covered! Given human nature, the $766,800 bill could easily represent previous year's annual costs as well. Who knows how many years this has been going on?? Thank you to the whistleblower, former employee, hopefully that person is rewarded somehow. As for the administrators and employees gaming the system, I wish there were some sort of consequences or responsibility taken for such a large financial oversight, but I am not going to hold my breathe on that happening.
Mr. Incredible
Sat, Jun 11, 2011 : 2:04 a.m.
Hopefully, that person will be rewarded monetarily, so we can waste even more money with this issue. Where are the whistleblowers on Wall Street? Way too much money at stake there, billions upon billions at stake. "I wish there were some sort of consequences or responsibility taken for such a large financial oversight, but I am not going to hold my breathe on that happening." Apply that statement to our no bid contracts in Iraq and Afghanistan and the Wall Street/Big Business criminals that created this disaster. Do you continue to apply the same amount of criticism to what put us here in the first place? Are you willing to look into that mirror? If you do, you are a rare fiscal conservative. I hope so. Seriously, why aren't you walking on State Street with a sandwich board making the same criticisms about MUCH, MUCH greater military and financial crimes!!! Or is it only when it fits into your political party's lockstep?
Mr. Incredible
Fri, Jun 10, 2011 : 7:42 p.m.
So the district suspected a problem, took action, had their health care plan audited, and have eliminated the ineligible dependents. The audacity of AAPS for trying to correct a problem!! Attack!!! This is the reason for our economic downturn!!! More Walmarts, no unions!! Less pay for the working class!!!! Thank you Mackinac Center for Fair and Balanced Public Policy for getting to the bottom of this. Collective bargaining bad. School of Walmart good!!! Don't buy local!! Buy China!!! Yes, this is a costly error. Obviously, it should have been caught a long time ago. But where does this stand in comparison to the crimes of the "too big to fail" banks and corporations? Or do they get a pass because "fair and balanced" propagandists will never bite the hand that feeds them? And they are banking on the likely fact that you won't either. Be careful what you wish for Union Haters and Teacher Bashers, if you think our country is in the toilet now... continue to vote with a "cutting off your nose to spite your face" mentality, it may be too late by the time you realize you've been bamboozled, and where all the big money comes from to support these attacks....and your house is worth even less, and your salary continues to get cut, and your kid writes essays in "texting" shorthand.
Mike Martin
Fri, Jun 10, 2011 : 9:39 p.m.
Does the abomination that occurred on Wall St. mean we should just brush off this sort of thing? To me that what it sounds like you are implying. Wall St. is a huge issue, basically criminal. But, locally, funding for 9 teachers is a big deal too in these difficult times.
Mr. Incredible
Fri, Jun 10, 2011 : 8:47 p.m.
"The fact that controls weren't in place to prevent fraud is a serious problem." Absolutely. Now, apply that statement to the Wall Street firms and banks and insurance companies who nearly destroyed our economy and our great nation as we know it. Perspective, folks.
AfterDark
Fri, Jun 10, 2011 : 8:28 p.m.
The fact that controls weren't in place to prevent the fraud is a serious problem. Who knows how much more funding is being lost due to lack of such controls?
smokeblwr
Fri, Jun 10, 2011 : 7:22 p.m.
Did the offending employees get fired? As a taxpayer I demand satisfaction!!!
AMOC
Sat, Jun 11, 2011 : 2:47 p.m.
That would take even more investigation, which it appears AAPS HR department is not competent to carry out for itself, since they hired an auditing firm for most of the annual cost of an HR clerk to do what most HR departments I've worked with do internally. The fault could lie with insurance companies not changing coverage from one to another, generating double charges for the same dependent. Or it could be that the HR department never polled employees to update their dependents, just carried people over from year to year, and only ever added or removed dependents when the employee took initiative to file the change. It isn't necessarily the employees whose ineligible dependents were covered who are at fault. And it isn't necessarily the HR people at fault. But how many more tensd of thousands of dollars is it worth to get sufficient evidence to fire people working in a system with extremely robust due-process? Stopping the big drain of coverage for ineligible dependents paid out almost 9 to 1. I don't think a deep dive to determine guilt would save as much as it costs.
skigrl50
Sat, Jun 11, 2011 : 1:41 p.m.
Perhaps you should find out who is at fault here... In my case I dropped my ex-husband from my policy the day my divorce was final. Over a year later when the audit was done, he was still listed as being covered. You don't think I wasn't upset by this??? HR claimed that they had dropped him but BlueCare Network was at fault. I don't really know for sure, but perhape you shouldn't be so fast to fire employees until you really know the background information!
dading dont delete me bro
Fri, Jun 10, 2011 : 7:05 p.m.
seems to me, maybe i'm just hallucinating, that you could pay someone's salary with these savings check eligible/ineligible dependents... again, it maybe silly thinking...
5c0++ H4d13y
Fri, Jun 10, 2011 : 7:03 p.m.
Shouldn't it be straight forward to get the money back?
DonBee
Sun, Jun 12, 2011 : 4:57 a.m.
You know Mr. Incredible - This is a local issue. If I were to take your tact on everything, it would mean no local issue would matter. 7 teacher positions that can not be funded because 200 people who did not belong on the school health care system were there. There are national issues, this is not one of them.
Mr. Incredible
Sat, Jun 11, 2011 : 3:20 a.m.
You guys really hate that. Obama got Osama. W didn't get him because Osama did more for his cause by being a living threat. Take away Osama, now what do we do? Take away Obama....why do these names sound so similar? How could someone be elected with such a name???? There is hope. For intelligent people who want to help the "greater good."
Mr. Incredible
Sat, Jun 11, 2011 : 1:16 a.m.
Shouldn't it be straightforward for the millions of people who were granted mortgages by PREDATORY lenders to be able to get their homes back? Why do we bail out the "too big to fail" corporations but not the average joe, who was taken advantage of by some idiot hack mortgage associate who was told to to do just that by their superiors. Yes, take the money back from these thieves (and we do not know all of the facts yet) and let the drug lords of mortgage lending continue to operate without any penalty. As they sit on a huge pile of money that is not being lent. The American way. We used to be the good guys. And by the way, Obama got Osama. Obama 1 W. 0
theodynus
Fri, Jun 10, 2011 : 6:21 p.m.
Thank God those people were stripped of their healthcare benefits. Problem solved!
DonBee
Sun, Jun 12, 2011 : 4:55 a.m.
So David - It is OK to remove 7 teachers from the classroom to fund someone else's health care?
David Briegel
Sat, Jun 11, 2011 : 4:37 a.m.
No Mike, we support a more civilized society. Unlike most posters here!
Mike Martin
Fri, Jun 10, 2011 : 9:27 p.m.
I guess that means you support ineligible people on public health plans?
DonBee
Fri, Jun 10, 2011 : 6:12 p.m.
That amount is roughly 7 teacher positions. Obviously if the article is correct, the controls in the Ann Arbor Public Schools are lacking even though they outspend on a per-student basis almost every district in the state on administration. I wonder if the BOE will continue to TRUST the administration to wisely spend money? Since the administration unilaterally decided not to follow BOE direction and stopped posting financial information, only the Administration has any idea what is going on. AAPS has the financial transparency of a brick.
Craig Lounsbury
Sat, Jun 11, 2011 : 11:14 a.m.
I side with DonBee in that what he is asking for is not "obsessive scrutiny" but information the public should have....we own and pay for the school system.
northside
Fri, Jun 10, 2011 : 10:21 p.m.
Wow! That level of obsessive scrutiny makes annarbor.com, by comparison, seem downright disinterested in the public schools.
DonBee
Fri, Jun 10, 2011 : 9:40 p.m.
northside - Information I have asked for has been turned down for "privacy" reasons. e.g. the number of members in the various unions (not the names, just members), organization charts without names. Monthly checkbooks are supposed (BOE resolution) be posted on the website, quarterly financials too (again BOE resolution). Both are missing or months old. Budgets that are posted are out of date, with information the pre-dates cuts or addtions to revenue. Audit reports show only that sinking fund money was "spent properly". Actually you are right, a brick is not a good analogy - bricks are more transparent.
northside
Fri, Jun 10, 2011 : 9:13 p.m.
Financial transparency of a brick? Quite the opposite, the books of schools are by and large wide open for the public to analyze. Budgets are published online. A FOIA request can get just about any information. I'd say the Ann Arbor Public Schools are the most closely scrutinized organization on this site and nothing comes a close second. When was the last day there wasn't a school-related article? It's even more amazing when you consider the site's small number of reporters. Despite that thin staff one reporter is assigned entirely to K-12. The end result is that every slip-up like this gets magnified into something far larger than it is. There's a near-total lack of balance and perspective.
mgnfcntb
Fri, Jun 10, 2011 : 8:10 p.m.
AAPS pays 100,000 a year per teacher, that estimate seems a bit high.