Ex-felons as care providers

JUNE 15, 2010

By TROY ANDERSON

Not long after the Sacramento County Grand Jury described In-Home Supportive Services as an “employment program for ex-felons,” prosecutors learned a number of IHSS providers taking care of aged, blind and disabled people were parolees – including dozens of registered sex offenders.

Assistant Chief Deputy District Attorney Lori Greene and Deputy District Attorney Laura West say law enforcement officials have repeatedly told them parolees and other people with criminal convictions work as IHSS providers.

West, who oversees the Sacramento County District Attorney’s IHSS Fraud Task Force, was further stunned to learn the only convictions that would bar someone from working as an IHSS provider are elder abuse, child abuse and fraud against a government health care or supportive services program.

“People who have serious criminal backgrounds and are on parole have a very hard time getting a job because most employers will want to know about previous felony convictions,” West says. “If you were on parole for armed robbery, rape or child molestation, you probably wouldn’t be able to get a job at McDonald’s, but you can get a job as an IHSS provider.”

The authors of a recent Sacramento County Grand Jury report – “IHSS: For the Needy Not the Greedy” – wrote witnesses told them fraud in the program is “out-of-control” and individuals with a criminal past constituted most of the providers who committed a “documented fraud.”

“Almost every person who was interviewed, and there were many, spoke of rampant abuses of the IHSS system,” Grand Jury Foreman Donald Prange Sr. wrote in the report. “At best, it is a dysfunctional system plagued by upper management who refuse to make meaningful changes or even to look into matters that will be beneficial to the truly needy people it is pledged to help”

The revelations come as Gov. Arnold Schwarzenegger, looking for ways to close a $20 billion budget shortfall, has proposed to cut $750 million from the IHSS program that provides in-home care services to 460,000 low-income seniors and disabled people. The cut, if ultimately approved, would bring total IHSS expenditures for 2010-11 down to $5.2 billion. The state also could lose $1.5 to $2 billion in federal matching funds.

While home-care worker union officials and others say hundreds of thousands of Californians could lose vital services and end up in nursing homes, critics say there is so much fraud in the program that the proposed cuts wouldn’t necessarily result in a loss of services to people who truly need help.

Schwarzenegger also claims fraud is “rampant” in the program – estimated by some to be as much as 25 percent of all dollars expended.

“Fraud in this program is real,” Schwarzenegger’s spokesman Aaron McLear says. “We have and will continue to reform the social programs in this state and with a $20 billion deficit we simply can’t afford these programs at the same level we have in the past. That’s why it’s important to reform the program so resources can be used as effectively as possible.”

In the last few years, grand juries and prosecutors statewide have uncovered fraud and a lack of oversight within IHSS.

“I think the whole program is one that needs to be carefully examined,” state Sen. George Runner, R-Lancaster, says. “This is a very unique program, most states don’t have a program like this and given the economic conditions we have today we need to look very closely at IHSS.”

But Laphonza Butler, president of Service Employees International Union United Long-Term Care, which represents 180,000 long-term care workers, disputes the 25 percent estimate, citing a 2008 report that found only 1 percent of IHSS cases involved fraud. Butler says the $750 million budget reduction will cut services to hundreds of thousands of people and eliminate jobs or reduce hours for more than 100,000 IHSS workers. As judges have blocked similar cuts in the past, Butler says the union is perplexed why the governor continues to push for IHSS cuts, especially when for every $1 the state spends on the program it brings in $2.70 in federal and county funds.

“While this proposed cut is much less than what was originally proposed, it’s still not acceptable and not humane,” Butler says. “When you are talking about frail Californians, vulnerable seniors and people with disabilities, any cut can be the cut that puts someone’s life at risk.”

Deborah Doctor, a legislative advocate for Disability Rights California, also disputes the governor’s contention that fraud is “rampant” in the program, arguing there is no proof for that assertion. Doctor says prosecutors who claim the program is rife with fraud have ulterior motives because their funding is based on making the “representation that the IHSS program is full of fraud.”

“It may be true that there are some people who have some history of a criminal conviction from some years ago who are working as providers,” Doctor says. “It may be that’s because their family members know about that and want them to work as their providers. I think the question would be is what is the nexus between a conviction – when we are talking about sexual offenders from some years ago – and taking care of someone on IHSS? Why would we make a blanket prohibition? We don’t want people who work as IHSS providers who are a danger to IHSS consumers, but our philosophy is that the consumers gets to make a choice.”

The state’s fastest-growing social services program, IHSS pays in-home caregivers – often family members and relatives – to provide services such as cleaning, meal preparation, bathing and grooming. Once someone qualifies, county social workers do an assessment and authorize the number of hours and type of services. The recipient is responsible for hiring the provider. The program operates on an “honor system.” Twice each month, more than 400,000 paper time cards are submitted to the government. Based on those time sheets, IHSS workers are paid $8 to $12.10 an hour with benefits.

“You have people who potentially have serious criminal backgrounds working in an honor system,” West says. “There is no independent verification of the hours worked. It’s an incredible opportunity for those who want to exploit the system.”

Created in 1979 to help people avoid costly nursing care, the number of people receiving IHSS services has more than doubled since 1998-99, increasing from 208,400 to 460,000 now. During that time, the IHSS annual cost per case increased from $6,300 to $13,000 – a cost driven largely by rising wages for IHSS workers and an increase in the average number of authorized IHSS hours per case.

This explosive growth in IHSS caseloads comes as the largest generation in history – baby boomers – starts turning 65 next year. In California, the number of people age 65 and older is expected to increase 90 percent in the next two decades from 4.6 million now to 8.8 million by 2030.

“There is already a great deal of pressure on the service delivery system in the state and the aging of the population will only put more pressure on the system,” says Sarah S. Steenhausen, senior policy fellow at The SCAN Foundation, testified in March at a Little Hoover Commission hearing regarding the system of care for state’s aging and disabled population. “The current (long-term care) system is broken. The system needs reforming, not reversing.”

The calls to reform the IHSS system come as the counties of Sacramento, Los Angeles, San Diego, Ventura, Contra Costa and San Luis Obispo in the last few years have launched grand jury investigations into IHSS fraud. The grand juries have found a variety of abuses, including IHSS recipients acting as their own “providers” and keeping the funds, providers claiming to “work” and receiving funds while the recipient is in a hospital and incarcerated providers collecting payments. The grand juries also found recipients and providers conspiring to increase hours, which were not worked, and split the pay, providers claiming hours when the recipient is dead and the use of fictitious Social Security numbers to create more than one IHSS case for payment.

From August 2009 through May, the Department of Health Care Services received 1,854 IHSS fraud complaints. However, that number doesn’t encompass all IHSS fraud reports throughout the state. For instance, Sacramento County alone received 1,158 IHSS fraud reports from July 2009 through May.

“We’re finding (IHSS fraud) all over the state,” DHCS Deputy Director of Audits and Investigations Bob O’Neill says.

In 2007, the Los Angeles County Grand Jury found scam artists were “embedded” in the program. In the last three years, the county’s Department of Public Social Services has referred about 900 IHSS fraud cases to the state for investigation. Prosecutors say many of those involved in IHSS scams are involved in abuse of programs to help the needy with child care, Section 8 housing and food stamps, as well as assistance through federal and state welfare and SSI programs. By defrauding various programs, prosecutors say welfare cheats can make up to $100,000 a year tax-free.

In a recent case, a Downey couple applied for Medi-Cal and IHSS, but on their application omitted the fact they owned a limousine business, travel agency and satellite installation firm, prosecutors allege. The couple was charged with operating a limousine business while receiving more than $68,000 in medical and welfare benefits, according to prosecutors. In February, the couple pleaded guilty to a felony count of aid by misrepresentation and were placed on five years of probation and ordered to perform 500 hours of community service, prosecutors say.

In her work on the Sacramento County District Attorney’s IHSS Fraud Task Force, West says detectives told her a number of parolees and registered sex offenders they monitor are employed as IHSS providers.

“They wanted to know if they could do that,” West says. “I confirmed they could and they were surprised to hear that. I’ve spoken to a number of people who work in law enforcement who when they are booking a parolee into jail list their job as an IHSS provider. I’ve also spoken to law enforcement officers who go to parole revocation hearings where the parolee says their job is taking care of a family member (as an IHSS provider). They argue that is a mitigating factor why they should not go back to prison.”

Sacramento County Sheriff’s Sgt. Mike Jones, who supervises the Sexual Assault Felony Enforcement Task Force, says SAFE monitors dozens of high-risk sex offenders who are employed as IHSS providers and are “getting paid to take care of people under some very suspicious circumstances.” Oftentimes, sex offenders will get jobs as IHSS providers for relatives who are “barely in need of assistance” and get $900 or more deposited into their bank accounts on a monthly basis, Jones says.

“I have spoken with many of them who are IHSS providers and are receiving funds from the program who can barely even tell me where they are providing in-home care at,” Jones says. “Not to impugn the program, but it’s wrought with fraud to quite an extent.”

In a recent report on the costs and benefits of the IHSS program, the Legislative Analyst’s Office found the program saves the state money for many recipients by keeping them out of nursing homes. A significant portion of IHSS recipients, however, would not face institutionalization in the absence the services, the authors wrote.

“After accounting for both costs and savings to the state and counties, IHSS probably results in net costs,” the authors wrote.

In a further effort to reduce costs, the governor included anti-fraud proposals in the 2009-10 budget to reduce and prevent fraud in the fast-growing program, including background checks and fingerprinting of IHSS workers and recipients. The reforms also called for speeding up the process to match death records with IHSS program records to prevent fraudulent payments after the death of a recipient or provider.

Late last month, the Assembly Budget Committee on Health and Human Services rejected Schwarzenegger’s proposed IHSS cuts. Meanwhile, the governor recently convened a stakeholders group to make specific recommendations on how the $750 million in cuts should be made.

West says none of reforms proposed so far address the fact that parolees and other people with criminal convictions can work as IHSS providers.

“One of our concerns is that we want to make sure people are not unwittingly hiring as providers someone who has a criminal record,” Greene says. “When you work in the criminal justice system, you realize that most people who have accumulated a record over the years of theft and violence can very easily continue along that path. So that’s a concern, but it’s not something we can do anything about based on the current status of the law.”