text:
Report to the Arizona Legislature
By the Auditor General
Division of Developmental Disabilities
March 30, 1993
Members of the Arizona Legislature
The Honorable Fife Symington, Governor
Mr. Charles E. Cowan, Director
Department of Economic Security
Transmitted herewith is a report of the Auditor General, A Performance
Audit of the Department of Economic Security, Division of Developmental
Disabilities. This report is in response to a December 13, 1991,
resolution of the Joint Legislative Oversight Committee.
This is the second in a series of reports to be issued on the Department
of Economic Security. We found the Division of Developmental
Disabilities has made significant improvements in its fiscal and program
management. Our report offers additional recommendations to strengthen
client assessment, case management, facility licensing, contract
management, and protection of clients.
My staff and I will be pleased to discuss or clarify items in the report.
This report will be released to the public on March 31, 1993.
~ o u w sR. Norton
Auditor General
2700 NORTH CENTRAL AVENUE - SUITE 700 1 PHOENIX, ARIZONA 85004 l ( 6 0 2 ) 255- 4385 1 FAX ( 6 0 2 ) 255- 1251
The Office of the Auditor General has conducted a performance audit of
the Arizona Department of Economic Security, Division of Developmental
Disabi l ities pursuant to a December 13, 1991 resolution of the Joint
Legislative Oversight Committee. This performance audit, the second in a
series on the Department of Economic Security ( DES), was conducted as
part of the Sunset Review set forth in Arizona Revised Statutes ( A. R. S.)
0941- 2951 through 41- 2957.
The Division of Developmental Disabi l it ies ( DDD) provides services and
programs to individuals with developmental disabilities and to their
families. Individuals with severe, chronic disabilities caused by mental
retardat ion, cerebral palsy, epi lepsy, or autism may qua1 i fy for Division
services. Approximately 11,400 clients are currently participating in
the Division's service system. To the extent possible, services are
provided at home or in community- based settings rather than in
institutions. Both State and Federal monies ( received through the Title
XIX- funded Arizona Long- Term Care System) support Division programs.
lrn~ lernent Its Policies
For Assessina And Plannina Individual
Client Services ( See pages 9 through 15)
Consultants hired to assist us in evaluating the Division's services
concluded that the assessment and service planning process was not
functioning properly. Due in large part to poor case management, the
Division has not conducted al l necessary assessments for some
individuals, a process vitally important for both understanding clients'
abilities and meeting their individual needs. In 18 of the 30 case files
reviewed by the consultants, additional assessments were needed but had
not been conducted. For example, a young man living at home had
difficulty communicating, and was experiencing medical problems,
including seizures. Despite these problems and the challenges his
behavior presented to his family, case records indicated he had not
received a neurological examination, nor had his communication,
psychological, vocational, or educational needs been assessed.
The Division's Case Manaaement
Svstem Cannot Effectively
Service Clients
( See pages 17 through 25)
Although good case management is crucial to the success of i t s service
system, the Division's case management system is overburdened and unable
to perform effectively. Both clients and case managers expressed
significant dissatisfaction with the current system. Families reported
that case managers are often inexperienced, poorly trained, d i f f i c u l t to
contact, and have l i t t l e knowledge of clients. Case managers we surveyed
complained that because of excessive demands and high case loads, they
are often unable to effectively service their clients. Some case
managers told us they see clients as infrequently as once a year.
Due in part to Federal funding requirements, case managers are buried in
paperwork. We identified over 100 forms and reports that case managers
at any given time are responsible for. These paperwork requirements can
be streamlined to allow case managers more time with clients.
In addition, case manager case loads should be reduced. Case managers
average 47 cases each, with some having case loads of 70 clients or
more. However, experts in the f i e l d and practices in other states
suggest that case loads should average about 30 cases per worker. High
case loads make i t d i f f i c u l t for case managers to adequately f u l f i l l a l l
assigned responsibilities, and also contribute to high turnover, which
further weakens the Division's case management system.
The Division Can lm~ rove
Its Svstem For lnvestiaatinq
Client Abuse And Nealect
( See pages 27 through 33)
The Division's system for investigating allegations of client abuse and
neglect can be strengthened. The Division's clients are particularly
vulnerable due to their d i s a b i l i t i e s and must rely on the Division's
incident reporting system for protection. However, this system exhibits
several weaknesses. Some incidents that warrant investigation are not
reported or are reported too late. Reported incidents are not always
investigated adequately or by the appropriate authorities. Final ly,
response to some incidents has not been adequate.
The Division is taking several steps to improve i t s reporting and
investigations system. For example, a new policy with investigation
guidelines has been developed, and a new computer tracking system is
being piloted. The Division should also consider strengthening Central
Office oversight over incidents of a more serious nature, reassigning the
s t a f f t o the oversight function, and improving staff training.
Licensina Inspections Need
To Be More Timelv And
Enforcement Should Be St ren~ thened
( See pages 35 through 42)
Severaj operational deficiencies within the Division's licensing function
need to be addressed. The Division is routinely late in conducting both
i n i t i a l inspections and i t s relicensing inspections. In addition,
six- month monitoring v i s i t s have not been timely, and fol low- up actions
in response to violations have been inadequate. As a result, licensing
inspections have identified numerous repeat violations at some
f a c i l i t i e s . For example, six inspections since 1986 at one group home
found numerous health and safety hazards, many of which were repeat
violations from previous inspections. Three inspections found that toxic
substances were not properly locked up.
The Division Needs To Continue And Extend
Efforts To Strenathen Its
Contract ina Process
( See pages 43 through 50)
The Division should continue efforts to improve i t s contracting process.
Since most of the Division's services are contracted out to private
providers, a sound procurement process i s v i t a l . The Division has
strengthened the Central Office's role in negotiating and overseeing
contracts; however, we found that more oversight over d i s t r i c t
procurement practices is needed. A limited review of contract f i l e s
disclosed several weaknesses, such as limited review of provider
financial information and questionable evaluations of provider proposals.
Inadequate review of provider financial information and insufficient
auditing have been particularly costly to the Division and i t s clients.
A recent set of nine financial reviews ordered by the Division's
assistant director identified over $ 2.1 million in questionable or
excessive costs that had not been previously identified. For example,
auditors found several instances in which compensation paid to executive
staff was excessive. The president of one provider agency received over
$ 417,000 in bonuses between June 1990 and June 1991.
The Service Planning Process . . . . . . . . . . . . . . . .
A l l Necessary Assessments
AreNot BeingDone. . . . . . . . . . . . . . . . . . . . .
Procedures For Conducting Planning
Meetings AreNot Always Followed . . . . . . . . . . . . . .
Breakdowns Occur Within
The Case Management System . . . . . . . . . . . . . . . . .
Recommendations. . . . . . . . . . . . . . . . . . . . . . .
Case Management Is Essential,
But Inadequate A t DDD. . . . . . . . . . . . . . . . . . . .
Various Factors Hamper DDD's
A b i l i t y To Provide Good
CaseManagement. . . . . . . . . . . . . . . . . . . . . . .
Changes Are Needed . . . . . . . . . . . . . . . . . . . . .
Recommendations. . . . . . . . . . . . . . . . . . . . . . .
FINDING I l l : THE DIVISION CAN
Reports, Investigation Required For
Protection Of Vulnerable Clients . . . . . . . . . . . . . .
The Division Has Not Adequately
Resolved Some Incidents. . . . . . . . . . . . . . . . . . .
Several Factors Contribute
ToFailures . . . . . . . . . . . . . . . . . . . . . . . . .
Division Is Trying To Improve
But NeedsToDoMore. . . . . . . . . . . . . . . . . . . .
Recommendations. . . . . . . . . . . . . . . . . . . . . . .
TABLE OF CONTENTS ( Con ' t )
BE YORE TlYELY AND ENFWEENT SHOUU) BE
The Division's Licensing Process Has
Been Inconsistent and Inefficient. . . . . . . . . . . . . . 36
Licensing Process Could Be Streamlined
And Administered More Consistently . . . . . . . . . . . . . 39
Recommendation . . . . . . . . . . . . . . . . . . . . . . . 42
Most Division Services
AreContractedOut . . . . . . . . . . . . . . . . . . . . . 43
Central Office Role
HasBeenLimited . . . . . . . . . . . . . . . . . . . . . . 44
Weak Financial Review And
Oversight Has Been Costly. . . . . . . . . . . . . . . . . . 46
The Division Needs To Continue I t s Efforts
To Strengthen The Contracting Process. . . . . . . . . . . . 48
Recommendations. . . . . . . . . . . . . . . . . . . . . . . 50
TABLE 1 Department Of Economic Security
Long- Te rm Care System Budget ( ALTCS)
Statement Of FTEs And Actual And Budgeted Expenditures
Fiscal Years 1990- 91, 1991- 92, And 1992- 93
( unaudited) . . . . . . . . . . . . . . . . . . . . . . 4
TABLE 2 Department Of Economic Security
Developmental Disabi l i t ies Budget ( State Funded Only)
Statement Of FTEs And Actual And Budgeted Expenditures
Fiscal Years 1990- 91, 1991- 92, And 1992- 93
( unaudi ted) . . . . . . . . . . . . . . . . . . . . . . 5
TABLE 3 Sufficiency Ratings Of Currently Delivered Services
Reported By Clients, Families, Service Providers
And Case Managers
( For Services Rated Least Sufficient) . . . . . . . . . 52
The Office of the Auditor General has conducted a performance audit of
the Arizona Department of Economic Security, Division of Developmental
D i s a b i l i t i e s , pursuant to a December 13, 1991 resolution of the Joint
Legislative Oversight Committee. This performance audit, the second in a
series on the Department of Economic Security, was conducted as part of
the Sunset Review set forth in Arizona Revised Statutes ( A. R. S.)
§ § 41- 2951 through 41- 2957.
The Division o f Developmental D i s a b i l i t i e s i s one of nine divisions
within DES. The Division's purpose is to provide services and programs
to individuals with developmental d i s a b i l i t i e s and to t h e i r families.
Approximately 11,400 persons with developmental d i s a b i l i t i e s are
currently receiving services through the Division. As defined in statute
( A. R. S. $ 36- 5511, developmental d i s a b i l i t y means either
... a strongly demonstrated potential that a chi Id under the age
of six years is developmentally disabled or w i l l become
developmentally disabled as determined by a test performed
pursuant to A. R. S. $ 36- 694 or by other appropriate tests, or a
severe chronic d i s a b i l i t y which: ( a) i s a t t r i b u t a b l e to mental
retardation, cerebral palsy, epilepsy, or autism, ( b) i s
manifest before age eighteen, ( c) is l i k e l y t o continue
i n d e f i n i t e l y , ( d l results in substantial functional I imitation
in three or more of the following areas of major l i f e a c t i v i t y
( self- care, learning, mobility, receptive/ expressive language,
self- direction, economic self- sufficiency, or capacity for
independent l i v i n g ) , ( e l reflects the need for a combination and
sequence o f i n d i v i d u a l l y planned or coordinated special,
interdisciplinary or generic care, treatment, or other services
which are of l i f e l o n g or extended duration.
Division philosophy focuses on providing services to meet an i n d i v i d u a l ' s
needs at home or in other community- based settings rather than in
i n s t i t u t i o n s . To accomplish i t s mission, the Division d i r e c t l y provides,
and also contracts with, individuals and agencies. Services are provided
to e l i g i b l e individuals based on the person's needs, State and Federal
guidelines, and available funding. Examples of services provided include:
Case management
Residential room and board
Foster care for children
Early intervention f o r children
Recreation/ socialization programs
Vocational- related assistance
Non- emergency transportation
H a b i l i t a t i o n
Acute care
Personal care
Respite care
Day care
Home health aide
Physician visits/ nursing
The State's a b i l i t y to provide services for persons with developmental
d i s a b i l i t i e s was greatly expanded with the implementation of the Federal
Medicaid ( T i t l e XIX) program in Arizona. Until 1989, essentially a l l
services provided to individuals by DDD were funded solely with State
appropriations. In late 1988, DDD entered into an agreement with the
Arizona Health Care Cost Containment System ( AHCCCS) to provide both
acute and long- term care to persons with developmental d i s a b i l i t i e s . For
t h i s to occur, AHCCCS negotiated with the Federal Health Care Financing
Administration ( HCFA) for a five- year demonstration ( research) project to
allow the State to provide long- term care, medical services, and case
management to AHCCCS- eligible developmentally disabled persons. The
program i s referred to as the Arizona Long- Term Care System ( ALTCS) and
is funded by Federal Medicaid monies and matching State appropriations.
Individuals who are e l i g i b l e for services through the Division may also
be e l i g i b l e for services through ALTCS i f they are determined to be at
r i s k of i n s t i t u t i o n a l i z a t i o n . ALTCS provides both acute medical services
and medically necessary home- and community- based services. As a result
of new Federal funding, approximately 6,000 more persons are receiving
some services.
Oraanization And Staffinq
Headed by an assistant director, the Division is composed of six regional
d i s t r i c t s , approximately 46 local offices, and a Central Office located
in Phoenix. Services are coordinated through, and in some areas d i r e c t l y
provided by, DDD s t a f f located in the d i s t r i c t s ( e. g., State- operated
group homes). Each d i s t r i c t has a d i s t r i c t program manager, area program
managers, case managers, and various other program and operations s t a f f .
The Central Office provides for administration, business operations,
program functions ( di rects the T i t l e XIX Long Term- Care and State- funded
programs and manages comp l i ance w i th Federal fund i ng and program
requirements), and managed care operations ( directs the administration of
a l l medical and long- term care services with an emphasis on cost
containment). In total, the Division has an authorized ful I- time
employee staffing level of 1,468 for Fiscal Year 1992- 93 ( see Tables 1
and 2, pages 4 and 5).
Funding is provided primarily through State appropriations and T i t l e XIX
of the Social Security Act ( Medicaid). With the implementation of the
ALTCS program, the Federal government funds approximately 62 percent of
the expenses for persons qualifying for that program, with the State
paying the balance. As a result of this new program, developmental
d i s a b i l i t y resources were s p l i t into two program budgets. Clients
e l i g i b l e for Federal assistance are primarily funded from the Long- Term
Care System budget program ( see Table 1, page 4). All other clients
receiving assistance are funded through the 100 percent " State- funded"
program, referred to as Developmental Disabilities program budget ( see
Table 2, page 5). For Fiscal Year 1992- 93, DDDts total budget is over
$ 184 million.
STATEMENT OF FTEs AND ACTUAL AND BUDGETED EXPENDITURES
( unaudited)
FTE Positions
Personal Services
Employee Related
A l l Other Operating
Special Line Items:
Acute Care
Fee for Service
Foster Care
Purchase of Care
Stipends 81 Allowances
1990- 91 1991- 92 1992- 93
( Actual 1 ( Actual 1 ( A~~ roved)
( a) O f these t o t a l expenditures, amounts funded by T i t l e X I X ( and t o a s i g n i f i c a n t l y
lesser e x t e n t , o t h e r funding sources) and State appropriations t o t a l e d the f o l l o w i n g :
( Actual ) ( Actual) ( Approved)
State Appropriations $ 45,954,900 $ 57,025,900 $ 56,186,900
T i t l e X I X & Other 69,223,600 78,767,300 86,293,400
$ 115,178,500 $ 135,793.200 $ 142,480.300
Source: Department of Economic Security, Office of Budget, Financial
Management and Control System Reports for Fiscal Years 1990- 91
and 1991- 92 and the State of Arizona, Appropriations Report
for Fiscal Year 1992- 93.
STATEMENT OF FTEs AND ACTUAL AND BUDGETED EXPENDITURES
( unaudited)
1990- 91 1991- 92 1992- 93
( Actual ( Actual ) ( Ap~ roved)
FTE Positions 702 545 489
Personal Services $ 14,237,100 $ 11,650,600 $ 10,600,700
Employee Related 3,713,900 3,259,600 2,923,600
A l l Other Operating 3,397,200 2,535,200 2.115.800
Special Line Item:
ASH Community Placement
Assistance to Families
Foster Care
Housekeeping Payments
Out- of- District
P l acemen t
Purchase of Care
Stipends and Allowances
Voc Rehab Contracts
Source: Department of Economic Security, Office of Budget, Financial
Management and Control System Reports f o r Fiscal Years 1990- 91
and 1991- 92 and the State of Arizona, Appropriations Report
for Fiscal Year 1992- 93.
Audit Scope
I n l a t e 1991 when t h i s audit was authorized and i n i t i a t e d , there were
numerous l e g i s l a t i v e concerns about the Division's operations. However,
during our audit, a new assistant director was appointed who has
aggressively pursued changes in both fiscal and programmatic areas.
Throughout t h i s report, our findings and recommendations acknowledge and
bu i l d upon the many changes that have been spearheaded by the ass i s tan t
di rector.
Our report presents findings and recommendations in f i v e areas:
The extent to which individual needs are being adequately assessed
and services properly planned
The need for changes in the Division's case management system to
better enable case managers to provide effective case management to
c l ients
The adequacy of the Division's system of investigating c l i e n t abuse
and neglect
The efficiency and effectiveness of the Division's licensing process
The need for DDD to continue and expand i t s e f f o r t s at improving i t s
contracting process
To help us determine how well DDD has assisted persons with developmental
d i s a b i l i t i e s , we contracted with the consulting firm of Conroy &
Feinstein Associates ( CFA) of Wynnewood, Pennsylvania, noted experts in
the f i e l d of developmental d i s a b i l i t i e s . We asked them to assess the
Division's performance in three main areas: ( 1) determination of
e l i g i b i l i t y for services and assessment of individual needs, ( 2) e f f o r t s
at planning appropriate services for meeting i d e n t i f i e d needs, and ( 3)
a b i l i t y to secure adequate and quality services. The consultant's
research consisted mainly of completing in- person surveys with c l i e n t s
and their fami lies/ caregivers, and phone interviews with case managers
for 219 randomly selected persons; conducting 30 detailed case f i l e
reviews; c l i n i c a l l y analyzing 10 cases; holding focus group meetings with
Division administrators and case managers, family members, and services
providers; and reviewing and evaluating DDD policies and procedures. Due
to funding limitations, only ALTCS- eligible consumers were studied; those
e l i g i b l e for State- funded services only were not.
Finding I summarizes their concIusions regarding the Division's
performance in assessing needs and planning services f o r individuals. A
summary of the consultant's conclusions regarding the overall q u a l i t y and
a v a i l a b i l i t y of services can be found on page 51.
The audit was conducted in accordance with government auditing standards.
The Auditor General and s t a f f express appreciation to the Director and
s t a f f of the Arizona Department of Economic Security, and the Assistant
Director and s t a f f of the Division of Developmental D i s a b i l i t i e s for
their cooperation and assistance during the audit.
The Division is not consistently following established procedures in
assessing needs and planning individual c l i e n t services. Our consultants
found that appropriate c l i e n t assessments are not always completed prior
to the development of written service plans required for a l l c l i e n t s . I n
addition, planning meetings are not always appropriately conducted and
monitoring and adjustment of plans i s sometimes lacking. While Division
policies and procedures for assessing c l i e n t needs and developing plans
were found to be state of the a r t by our consultants, they are not being
consistently followed by Division case managers.
The Service Planninq Process
A l l services provided to Division c l i e n t s are developed and authorized
through a formal planning process. This process begins a f t e r c l i e n t s are
determined e l i g i b l e for Division services. F i r s t , c l i e n t needs are
assessed by case managers and, as appropriate, by outside professional
specialists. After assessments are completed, an interdisciplinary team
meets, often with c l i e n t s and family members p a r t i c i p a t i n g , to formally
plan c l i e n t goals and services. Additional assessments may be requested
by the team. A written Individual Program Plan ( IPP) i s prepared
following these meetings. Plans are updated annually, or more frequently
i f necessary. For example, a formal review of service plans for most
T i t l e XIX clients must take place every 90 days. These reviews can
result in changes or modifications to the c l i e n t ' s IPP.
All Necessarv Assessments
Are Not Beina Done
Our consultants found that a l l assessments that should be completed on
some clients are not being done prior to the IPP meetings. General
assessments of c l i e n t functioning that are routinely done for a l l c l i e n t s
are not always completed by the time the team meets, and some special
assessments needed are not being done at al I . As a resu l t , many of the
services and goals established at the IPP meetings are not based on
formal, documented assessments of client needs.
Tvpes of assessmentg - The first critical step in assisting a person with
developmental disabilities in obtaining needed services and supports
involves the assessment of the person's abilities and disabilities, and
strengths and weaknesses. Assessment results are crucial to developing
appropriate plans to assist individuals in achieving more independence
and a better quality of life. Two primary categories of assessments are
typically administered:
General functional ability - The Division uses an assessment package,
the Inventory for Client and Agency Planning ( ICAP) to evaluate the
client's overall functional level. The ICAP is generally completed
on an annual basis by the Division's case managers with the
assistance of individuals who know the client well. ICAP results
provide a basic overview of functional abilities in such areas as
eating, dressing, and grooming. Results also help identify levels of
supervision the cl ient may require, chal lenging behaviors ( such as
agg ress i veness ) , and the need for add i t i ona l assessments , se rv i ces ,
and supports. According to our consultants, the Division's ICAP is a
valid and appropriate package for use in assessing general functional
abilities, and is especially appropriate for adults. It is not
necessarily appropriate, however, for assessing the abilities and
needs of infants and young chi ldren.(')
S~ ecial assessments - Additional assessments may be required to
determine an individual's special needs. For example, the ICAP
cannot reveal the extent to which a client may need physical or
occupational therapy. Separate assessments by appropriate
professionals need to be administered, and are essential to
developing a comprehensive understanding of individual abilities and
needs. Typically, these additional assessments are requested by case
managers .
( 1) The consultants found 6 children, ages 5 years and younger, f o r whom an ICAP was
i nappropri ate1 y administered by the Division. Because of t h i s , the consultants
recomnended a l t e r n a t i v e assessments more appropriate f o r young children, such as the
Denver Developmental Screening Instrument, the Sl osson I n t e l 1 i gence Test, and the
Bayley Scales of I n f a n t Development. According to the Division, however, a l l of i t s
d i s t r i c t s have been u t i 1 i zing various standardized and national 1 y recognized
assessments f o r young children f o r several years, such as the Denver and the Bayley.
ICAPs not timely - Although the ICAP is a valid and appropriate
instrument, i t is not always administrated in a timely manner. Our
consultants found that, in some cases, the ICAP was not completed u n t i l
after the IPP team had met. When this occurs, important information
which should be considered by the team in developing goals is not
available since a service plan has not been completed. The team needs
ICAP results to help i t s members understand an individual's functional
needs. It is unlikely this information would be available elsewhere.
S~ ecial assessments - Moreover, the Division has not ensured that a l l
necessary additional assessments of individuals have been conducted. Our
consultants f e l t that additional assessments were necessary for 18 of the
30 individuals whose Division maintained case f i l e s they reviewed. While
the consultants realize that a l l types of assessments are not always
necessary, some circumstances dictate that formal assessments be
conducted. For example, some f i l e s contained a reference that a
particular service, such as physical therapy, was needed; however, there
was no indication that an assessment was done. The consultants further
commented that the failure to conduct necessary assessments is
unacceptable and inconsistent with practices in other states that they
have reviewed. In these states, they found that the assessment process
was clear, routine, and " practically never misses any important area."
In Pennsylvania, for example, formal written plans cannot be developed
without evidence that a l l essential assessments have been conducted.
Because assessments were not always done, some clients have not received
services and supports they may need . ( ' I For examp l e:
A medically fragi le 2- year- old g i r l had worn hearing aids for a
period of time. According to the consultantts review of her case
f i l e , her hearing was somehow determined adequate for speech, and the
hearing aids were discontinued. However, a speech evaluation was not
completed u n t i l over one year after the decision was made to
discontinue use of the hearing aids.
( 1) The case examples cited here are based on the consultant's review of Division case
f i l e s , c l i e n t v i s i t s , and case manager interviews. The consultants strong1 y be1 ieve
that a l l important information about a c l i e n t should be documented i n Division records
and available to the case manager, who i s responsible f o r the c l i e n t s ' day- to- day
A young man l i v i n g with his family has d i f f i c u l t y communicating and
presents behavioral problems that are challenging to them. He also
experiences medical problems, including seizures. Although he
receives some services, the consultants found no current neurological
assessments or physician's notes in the Division's case f i l e . In
addition, he has not had his communication, psychological,
vocational, or educational needs assessed. The consultants concluded
that the young man has not received comprehensive functional
assessments i n a l l needed areas, and when assessments have been
completed, they have not been conducted in a timely or coordinated
manner .
Plans not S U D D O ~- ~ B~ e~ ca use a1 1 necessary assessments are not always
done p r i o r t o the IPP meeting, goals have been established and services
authorized that are not based on an assessed need. This can result in
the delivery of costly services that may be unnecessary or excessive.
During their review of case f i l e s , our consultants found no evidence of
an assessed need for approximately 43 percent of goals contained in
planning documents. During the IPP meetings, goals are established for
c l i e n t s , such as learning how to eat or dress, or increasing social
interaction. Services are then developed to help meet these goals.
However, our consultants often could not determine how or why many goals
were set. They stress that accurately determining a c l i e n t ' s needs is
paramount for ensuring an effective and e f f i c i e n t service system.
Procedures For Conducting
Plannina Meetinas Are Not
Always Followed
Some planning meetings are not conducted according to established
procedures, and follow up between annual planning meetings is sometimes
lacking. Teams do not always include a l l appropriate individuals who
should be involved and some c r i t i c a l information, in addition to
assessment results, is lacking when the IPP team meets. Monitoring of
c l i e n t progress is also weak in some cases and plan revisions are not
always made when appropriate.
Team com~ osition - According to our consultants, professional personnel
and others who should be involved in the IPP team meeting are often l e f t
out. In fact, in their review of 30 case f i l e s , the consultants found
only one case in which there was a properly constituted interdisciplinary
team present during the c l i e n t ' s annual IPP review. In most cases the
teams consisted of the c l i e n t , case manager, and family members. In a
few cases, residential and day program providers were involved. However,
the consultants believe that residential and day program representatives
should be more involved in the planning process. Furthermore, i f
important assessments w i l l not be available for the planning meeting,
various other professionals who interact with the c l i e n t should at least
be ava i lab l e , given the complex needs of many i nd i v i dua l s who have
developmental d i s a b i l i t i e s . According to the consultants, these
individuals, including medical specialists, physical and occupational
therapists, teachers, and speech/ language professionals, were rarely
involved in planning in the cases they reviewed.
Information lacking - In addition to assessment results, other c r i t i c a l
information is also not available when some IPP teams meet. I n t h e i r
case f i l e review, the consultants found that medical records, laboratory
test results, and c l i e n t plans developed by other agencies were sometimes
lacking. They noted that this makes i t impossible for appropriate
planning to occur.
The consultants also did not find any comprehensive lPPs that encompassed
assessment results from other agencies working with the c l i e n t ,
especially for clients over f i v e years of age. For example, local school
d i s t r i c t s develop Individual Educational Plans ( IEPs) for developmental ly
disabled youth who reside in their d i s t r i c t s . In addition, adult c l i e n t s
may have an employment- related plan developed through the DES, Division
of Vocational Rehabilitation ( DVR). When plans are not integrated, the
result is often poor coordination of service delivery and inconsistency
in e f f o r t s to address service needs.
Monitorina and ~ l a n adjustment - The consultants also i d e n t i f i e d
weaknesses in the monitoring of c l i e n t progress and adjusting of c l i e n t
plans. Although the ICAPs are completed, results are not used to
benchmark functional a b i l i t i e s and measure progress over time. According
to the consultants, ICAPs appear to be completed " simply because they are
required,'' and are often forgotten once completed.
In addition, teams often do not reconvene when appropriate to adjust
c l i e n t plans. Plans may need to change between annual IPP meetings i f no
progress i s being made, or i f new problems or other needs arise. For
example, in one case reviewed, an individual had experienced 14
behavioral episodes between July and October 1992. The team did not meet
to examine the possible causes for the increased number of behavioral
incidents nor to discuss a plan of action. The consultants f e l t that the
c l i e n t would have benefited greatly had the IPP team reconvened to
address the c l i e n t ' s problems. In only one of 30 cases reviewed did the
IPP team reconvene between annual meetings.
Breakdowns Occur Within
The Case Management System
Weaknesses in the Division's case management system appear to be the
principal cause of problems with the assessment and planning process.
The consultants found Division policies and procedures were appropriate.
However, because of poor communication and lack of training, case
managers were not uniformly fol lowing these policies and procedures in
the f i e l d . For example, the consultants learned that assessments were
often not requested because the case manager believed the assessments
were not e l i g i b l e for T i t l e X I X funding. In fact, one case manager
admitted that none of the 44 c l i e n t s in the case manager's case load has
had any assessments other than the ICAP. The case manager saw no point
in requesting assessments that would not be funded. Division
administrators explained, however, that such assessments could be funded
with T i t l e X I X monies. Our consultants concluded that Division policies
have not been f u l l y explained to case managers, and as a result are
simply not being consistently followed.
Finding I I ( page 17) addresses in more detail other problems, such as
excessive paperwork, high case loads, and s t a f f turnover, which may also
adversely impact the Division's a b i l i t y to adequately assess needs and
create effective service plans.
1. The Division should adequately t r a i n case managers and others
involved in the assessment process in proper procedures for
conducting assessments, and should i n s t i l l a clear understanding of
the importance of f u l l and consistent implementation of i t s policies
and procedures.
2. The Division should ensure that a more appropriate tool is
consistently used for assessing the functional a b i l i t i e s of young
chi ldren.
3. The Division should ensure that comprehensive assessment information
is available to planning teams when goals are set and services are
author i zed.
4. The Division should ensure that case managers involve a l l appropriate
personnel in the IPP planning process.
5. To strengthen i t s planning a b i l i t y , the Division should take steps to
ensure that a l l information essential to the planning process, such
as medical examination and laboratory test results, assessments, and
information prepared by other agencies, i s contained in c l i e n t case
f i l e s .
6. In cases involving multiple agencies, the Division should attempt to
develop integrated plans that are comprehensive and consistent with
plans developed by these other agencies.
The Division's case management system i s overburdened and poorly
administered. This i s p a r t i c u l a r l y disturbing because case management i s
a c r i t i c a l element in the system that delivers services to persons with
developmental d i s a b i l i t i e s . However, excessive paperwork, high case
loads, and other factors make i t d i f f i c u l t for DDD's case managers to
carry out t h e i r r e s p o n s i b i l i t i e s . Although the Division recognizes that
problems exist and some improvements are planned, further e f f o r t s are
Case Manaaement Is Essential,
But lnadeauate At DDD
Quality case management i s important to successful c l i e n t development,
yet the case management system at DDD i s lacking. Case managers perform
many important functions, and fostering strong personal relationships
through frequent contact with clients and their families is among the
most crucial. However, both DDD case managers and c l i e n t s feel that
DDD's case management is not responsive to c l i e n t s ' needs.
Good case manaqement i s necessary - DDD's case managers are the key
contact within the system for persons wanting to access services.
Specifically, case managers are responsible for determining whether a
person is e l i g i b l e for Division- funded services, and i f so, ensuring
necessary assessments are conducted to determine the individual's needs.
For example, the case manager may need to address issues such as which
type o f residential placement would most benefit a c l i e n t , which
therapies are needed, and which programs could assist the individual in
developing new s k i l l s and a b i l i t i e s . Case managers also determine
whether the c l i e n t ' s family has any special needs. Based on these
assessments, the case manager, along with others involved with the
c l ient , plans and coordinates the del ivery of services through a network
of providers. The case manager also monitors services received by the
c l i e n t and assesses the c l i e n t ' s progress in achieving goals.
In addition to accurately assessing a person's needs and coordinating
services, case managers need to develop close personal relationships with
c l i e n t s and their families. Building such a relationship i s often
accomplished by frequently v i s i t i n g and talking with c l i e n t s and their
families. By doing t h i s , case managers can increase their opportunities
for ensuring the c l i e n t ' s needs have been accurately determined and that
services are reaching and benefiting the c l i e n t . Furthermore, many
persons with developmental d i s a b i l i t i e s have severe physical
limitations. Some c l i e n t s are non- verbal, or cannot walk or even stand.
Others may be dependent on ventilators for breathing. Many c l i e n t s are
also vulnerable to such things as s e l f - i n f l i c t e d injury, physical neglect
or abuse, or exploitation. Frequent case manager contact w i t h c l i e n t s
helps to ensure their safety and may help reduce c r i s i s situations.
Effective case manaqement ham~ ered - Although case management i s v i t a l l y
important to successful c l i e n t development, neither case managers nor
clients are satisfied with the current system. We surveyed, by mail, a l l
246 case managers employed by DDD during July 1992; 130 responded to our
survey. Those who responded estimated they currently spend about ten
percent o f t h e i r time in direct contact with c l i e n t s , but f e l t , on
average, that they should spend nearly one- quarter o f t h e i r time in this
manner. Many reported that excessive demands on their time have greatly
impacted their a b i l i t y to know their c l i e n t s and perform their jobs
e f f e c t i v e l y . Several case managers we spoke with see some of their
clients as l i t t l e as once a year.
Families of persons with developmental d i s a b i l i t i e s have also expressed
dissatisfaction with the case management services their family members
are receiving. More than two dozen parents voiced their concerns during
a Joint Legislative Committee hearing in November 1991. Some parents
stated that case managers are generally inexperienced, poorly trained,
d i f f i c u l t to contact, and have l i t t l e knowledge of the individual for
whom they are coordinating services. Parents questioned whether case
managers were properly prepared to identify and meet the needs of their
children. In addition, some family members surveyed by our consultants,
or who contacted Auditor General s t a f f d i r e c t l y during the audit, also
expressed their unhappiness with DDD's case management system. Problems
they noted include high case manager turnover, lack of case management
services, and unknowledgeable and uninformed case managers.
Various Factors Hamper DDD's
Abilitv To Provide Good
Case Manaaement
Several aspects of DDD's current system have rendered case managers
unable to provide clients with quality case management. Excessive
paperwork requirements demand much of the case managers' time. Adding to
this is high client- to- case manager ratios. High turnover and poor
training also make i t d i f f i c u l t , i f not impossible, for case managers to
f u l f i l l their responsibilities.
Considerable paperwork required - Case managers responding to our survey
noted that a reduction in paperwork would be the one change that would
most improve their jobs. In some cases, the problem i s that case
managers have to complete various types of reviews and complete paperwork
on those reviews too often, while in other instances, the paperwork they
complete i s often duplicative.
We i d e n t i f i e d over 100 forms and reports which case managers may have to
f i l l out, depending on Division requirements and c l i e n t needs. Some of
these forms, and the type and amount of information contained within them
may not be necessary, at least to some degree. Recently, for instance,
two internal studies both concluded that the forms and paperwork required
for most case management functions contain duplicative information and
that the tasks expected of case managers are excessive and redundant.
Both reports recommended that procedures and paperwork need to be
simplified. Consultants hired by the Auditor General also noted that
case managers seem to be burdened with an inordinate amount of
paperwork. They recommend that duplicative tasks be reduced, and that
case aides or other s t a f f be responsible for some of the paperwork.
To i l l u s t r a t e one impact of high paperwork requirements, we found that
whi le accompanying a case manager to a group home where several of her
c l i e n t s lived, she spent only a few minutes with each of her c l i e n t s
during the 2- and 1/ 2- hour v i s i t . She spent the remaining time s o l i c i t i n g
information from the group home administrator and completing paperwork.
Hiah case loads - Case managers have d i f f i c u l t y finding enough time to
adequately service a l l c l i e n t s on their case loads. We found that in
June 1992, DDD case managers were assigned an average of 47 c l i e n t s each,
with some having upwards of 70 c l i e n t s or more. High case loads can
l i m i t a case manager's abi l i t y t o perform e f f e c t i v e l y , as we1 l as his or
her opportunity to v i s i t clients and personally monitor their progress.
It has also forced some case managers into " p r i o r i t i z i n g " individuals in
their case loads, causing a disparity in the equitable provision o f case
management among c l i e n t s .
Nearly everyone involved with case management at DDD agrees that case
loads are too high. Case managers and case manager supervisors we
surveyed indicated that the average case load size should be reduced to a
maximum of 33 c l i e n t s .
Case managers average about 50 percent more c l i e n t s than experts say
should be assigned t o t h e i r case loads. Our consultants explained that
current best practice dictates that one case manager be involved in
supporting about 30 individuals. We also spoke with several other
consultants who specialize in the f i e l d . They told us that a case load
size of 20 to 30 is generally reasonable to ensure quality case
management. In addition, Michigan and New Hampshire, two states
i d e n t i f i e d to us as having model DD programs, reported average case load
sizes of 24 and 25 c l i e n t s , respectively, per case manager.
Because of system requi rements and the compl icated needs of many
individuals with developmental d i s a b i l i t i e s , a reasonable case load size
is c r u c i a l . E f f e c t i v e l y servicing even one c l i e n t can take a
considerable amount of time and e f f o r t . To i l l u s t r a t e t h i s point, case
managers are required to ensure that, for many c l i e n t s , w r i t t e n plans
outlining the c l i e n t ' s services are reviewed quarterly and that other,
more formal reviews occur once or twice a year. This process alone can
necessitate discussions with parents, guardians, and others involved with
the individual, and arranging and preparing for meetings with medical
specialists, therapists, and other professionals. The case manager must
also document the results both manually and on the Division's computer
system. I f changes in services or other supports are determined to be
needed, the case manager i s then responsible for coordinating these
changes for the c l i e n t . In addition, case managers with c l i e n t s in
foster care must prepare a variety of reports for the foster care review
board and the courts, as well as participate in court hearings. Also
absorbing part of a typical case manager's work week i s travel time to
and from c l i e n t planning meetings, meetings with providers, and v i s i t s
with c l i e n t s .
The Division has realized i t s need for more case managers in an e f f o r t to
handle both new c l i e n t growth and reduce high case loads. Division
o f f i c i a l s told us they have requested additional case manager positions
in recent years. Although some case manager and related support
positions were added as a result o f these requests, mostly f o r servicing
Long- Term Care System ( ALTCS) c l i e n t s , DDD management acknowledges more
case managers are needed to allow for manageable case loads.
While i t i s clear that smaller case loads should be the norm at DDD,
various factors, such as c l i e n t type and the intensity of the person's
needs, would need to be considered to most e f f e c t i v e l y determine
appropriate case loads for individual case managers.
Other factors also im~ act - Case manager knowledge of c l ients and thei r
a b i l i t y to ensure c l i e n t needs are met is further impacted by high
turnover and inadequate training.
Turnover - Although we were unable to accurately calculate DDD's
turnover rate for case managers, Central Office case management s t a f f
estimate i t to be between 25 and 35 percent, approximately double the
average turnover rate for several states i d e n t i f i e d as having model
DD programs and s i g n i f i c a n t l y greater than the 10 percent turnover
rate for case managers employed by Child Protective Services. High
turnover negatively impacts case management in several ways.
According to experts in the f i e l d of developmental d i s a b i l i t i e s , the
case manager's value grows with experience, often taking years for
the case manager to develop necessary s k i l l s . We found, however,
that more than 50 percent of DDD's case managers have worked in the
Division fewer than two years.
Turnover also reduces the c l i e n t ' s opportunities to develop a
continuing relationship with his or her case manager. Turnover also
adds to al ready high case loads for remaining case management s t a f f ,
including case manager supervisors. F i n a l l y , training and
recruitment a c t i v i t i e s are costly.
Accord i ng to case managers and superv i sors we surveyed , as we l l as some
we interviewed, the high rate of turnover among DDD case managers i s due
in large part to r e l a t i v e l y low salaries. Currently, DDD's entry- level
case manager earns an annual salary of $ 17,755. The base salary for case
managers working for Maricopa County Long- term Care i s about 25 percent
more, while case managers in Child Protective Services earn about 20
percent more and those contracting with the Office f o r the Seriously
Mentally I l l earn nearly 10 percent more. According to a Division
representative, in an e f f o r t to make i t s case managers' salaries more
competitive, DDD contacted the Department of Administration to conduct a
Classification Maintenance Review ( a position/ salary reclassification
analysis) for Fiscal Year 1992- 93. However, DOA declined to perform such
a review because the Division had no funding allocation i d e n t i f i e d to
support any resulting reclassification. S t i l l , the Division should
continue i t s e f f o r t s to improve case manager salaries, when possible to
do so.
Training - DDD i s not providing case managers with adequate
training. According to the results of our case manager survey, 40
percent of the case managers responded that DDD training was
i n s u f f i c i e n t and nearly 20 percent believe i t has not been
beneficial. Further, according to a recent study commissioned by the
Division, consultants found that only 12 of 181 case managers
included in the analysis have had training on a l l topics necessary to
perform their jobs e f f e c t i v e l y . We also found that DDD has f a i l e d to
provide t r a i n i n g t o new case managers on a timely basis.
The training program is not s u f f i c i e n t l y standardized or properly
monitored. The absence of written standards or guidelines on how to
develop a training course has resulted in more than 100 d i f f e r e n t
training packages in use statewide. Also, the adequacy of case manager
training i s affected by poor monitoring. For example, though DDD spent
more than $ 130,000 for the development of a competency- based training
system in 1990, which was designed to guarantee case managers received
appropriate training and periodic monitoring by Central Office, i t never
f u l l y implemented the system.
During their review, our consultants also expressed concern about case
manager training. They concluded that DDD's training curriculum has not
been implemented. As a result, and as evidenced through the records
review and other work they performed, they feel strongly that key areas
of competence have not been clearly achieved.
Changes Are Needed
Much needs to be done to develop an effective case management system.
DDD is taking some steps to improve the system, such as strengthening
Central Office's role and redesigning the case manager training program.
However, a number of critical issues, including case load size, have yet
to be addressed in any significant way.
DDD workina toward improvement - DDD management recognizes that
deficiencies exist and appears to be committed to improving its case
management system. Recently, the assistant director selected a group of
DDD managers and staff to analyze the Division's operations and practices
in the wake of considerable criticism from clients and their families,
legislators, and staff. Case management was one of the five functional
areas studied by the group. The group identified a number of
inefficiencies within the case management system. Management is now
deciding what actions to take to create a stronger case management system
The Division is also beginning to address the issue of excessive
paperwork. For instance, DDD has identified about 20 processes and
corresponding forms it believes could either be consolidated or
eliminated entirely, such as consolidation of the Individual Program Plan
( IPP) document with the Service Plan. The assistant director has also
obtained AHCCCS' approval to complete formal reviews for some clients
less frequently than is currently the case.
DDD is also in the process of developing a stronger and more uniform
training program. The Division recently hired a consulting group to work
with Division staff in assessing the Division's training programs,
especially as they relate to case managers. As a result, DDD is
developing guidelines for training new case managers that combine formal
classroom training with supervised on- the- job t r a i n i n g . Classroom
training i s expected to emphasize basic case management functions as well
as specialty areas, such as mental health and medical needs assessments.
More chanaes w i l l be needed - Although DDD is t r y i n g t o e f f e c t some
changes, more changes w i l l be needed. For examp l e , even a f t e r the
proposed changes, case managers w i l l continue to be overburdened by
excessive and duplicative paperwork.
Once case manager paperwork requirements have been minimized, the
Division needs to develop a policy on case load size. DDD should assess
case manager duties to determine the time case managers need to f u l f i l l
each of their tasks. DDD w i l l then need to establish a plan, which could
include reorganizing or redeploying existing s t a f f . Only after these
steps have been taken should the Division consider requesting more case
manager positions from the Legislature.
Due to budget constraints, State funds may not be immediately available
to hire additional case managers. However, i f DDD wants to improve the
quality of i t s case management services, case load sizes w i l l have to be
reduced. The problems of turnover and low salaries w i l l also need to be
addressed. U n t i l Division case managers are paid s i m i l a r l y to case
managers in other Arizona agencies, high turnover w i l l continue.
1. DDD should continue i t s e f f o r t to further reduce excessive paperwork
requirements and related tasks.
2. Once paperwork requirements are adequately addressed, DDD should
analyze remaining case manager a c t i v i t i e s and develop an appropriate
case manager- to- client r a t i o .
3. DDD should analyze the relationship between high turnover among case
managers and such issues as low salaries. DDD may want to request
the Department of Administration to study restructuring the salary
c l a s s i f i c a t i o n for i t s case managers, when budgetary guidelines and
funding make i t possible to do so.
4. DDD should continue to revise i t s case manager training program to
ensure case managers have the s k i l l s they need. S p e c i f i c a l l y , DDD
should develop a training curriculum for new and experienced case
managers, properly standardize and monitor case manager t r a i n i n g , and
provide t r a i n i n g t o new case managers on a timely basis.
FINDING Ill
The Division's system for reporting, investigating, and acting upon
incidents of c l i e n t abuse and neglect can be strengthened. Many people
who rely on DDD for services must also rely on DDD to protect them, as
they cannot protect themselves. However, DDD does not always conduct
adequate investigations into allegations of abuse and neglect or take
appropriate action to safeguard c l i e n t s . Several factors contribute to
this f a i l u r e . Although DDD has recently taken some steps to address the
problem, further action must occur.
Reports, lnvestiaation Reauired For
Protection Of Vulnerable Clients
The physical and mental limitations that make people e l i g i b l e for DDD
services also make them p a r t i c u l a r l y vulnerable to abuse and neglect.
Many c l i e n t s cannot speak, so cannot protest or t e l l others when they are
mistreated. Others have physical impairments that prevent them from
defending themselves or running away. Some lack the a b i l i t y to recognize
abusive situations. Furthermore, DDD c l i e n t s cannot simply find a new
home, a new job, or a new school i f they become victims, but must depend
on others to help them change their circumstances.
Whenever c l ient abuse or neglect is observed, al leged, or suspected, DDD
division management must be n o t i f i e d by means of an Unusual Incident
Report ( UIR). Licensing regulations ( R6- 6- 1601) require contract agency
employees to report to DDD via the observing employee's supervisor. The
D i v i s i o n ' s p o l i c i e s and procedures require DDD employees to verbally
inform a supervisor immediately upon learning about the problem from the
agency, a c l i e n t , the public, or by their own observation, and to prepare
a written UIR within 24 hours. Investigation of a UIR i s mandatory in
a l l cases of c l i e n t abuse and neglect.(') UlRs and investigation reports
a l e r t management to problems, provide a written h i s t o r y f o r spotting
trends, and supply information needed to determine actions to correct
problems and prevent their recurrence.
The Division Has Not Adeauately
Resolved Some Incidents
Our review of over 100 UIRS(*) and other records revealed several
weaknesses in the Division's system f o r protecting c l i e n t s . Some
incidents did not result in UIRs, some UlRs were slowly or inadequately
investigated or were inappropriately turned over to provider agencies for
investigation, and some investigations did not lead to appropriate
action. In at least two cases, complainants were i d e n t i f i e d to the
subjects of the compiaints, in v i o l a t i o n o f regulations. Of the 19 cases
we chose for review of d i s t r i c t records, 6 were investigated by the
provider instead of by DDD, and 5 were not investigated at a l l . We found
investigation s t a r t and completion dates for 13 of the 19 cases;
investigations started up to 47 days after the incident was reported
( average 8 days), and the investigations took from 1 to 107 days to
complete ( average 24 days).
( 1 ) Other examples of unusual i n c i d e n t s i n c l u d e c l i e n t death, medication e r r o r s , missing
c l i e n t s , t h e f t of c l i e n t property, serious c l i e n t i l l n e s s o r i n j u r y , community
disturbances i n v o l v i n g c l i e n t s , non- routine damage t o State and p r o v i d e r p r o p e r t y , and
community complaints regarding r e s i denti a1 s e t t i n g s . Current1 y, DOD has about 450 to
500 UIRs per month. DDO management estimates approximate1 y t e n percent o f these UIRs
are s e r i o u s .
( 2 ) We reviewed 103 UIRs a t Central Office, based on a judgmental sample of i n c i d e n t s
l i s t e d i n the Central O f f i c e database f o r January and one- half of February 1992. The
i n c i d e n t s selected involved community complaints, c l i e n t neglect or abuse o r death,
unexplained i n j u r y , t h e f t or misuse of c l i e n t money, o r medication e r r o r s , and
appeared t o be p o t e n t i a l l y serious and/ or preventable. When the Central O f f i c e f i 1 es
contained a d d i t i o n a l UIRs f o r the same c l i e n t s noted i n the judgmental sample, we
reviewed those UIRs as we1 1 .
Although we cannot project how frequently they occur, the serious nature
of the problems we discovered, as i l l u s t r a t e d by the following case
examples, make clear the need to improve DDD's system for responding to
incidents of abuse and neglect.
Police were called r e ~ e a t e d lf~ or runawav client. no UlRs written -
One c l i e n t had many incidents but no UlRs u n t i l Child Protective
Services got involved. The police called CPS to report that the
c l i e n t was running away from his group home one to two times a day,
and police had been called eight times in a two- year period to help
find him. Police records showed the c l i e n t had broken his arm in a
f a l l during one incident, and another time he returned to the home
with a bicycle o f unknown o r i g i n . Group home s t a f f n o t i f i e d DDD via
incident reports or phone c a l l s to the case manager.
These incidents clearly signal a problem at the group home that
needed resolution. In addition, they should have been considered in
making license renewal decisions. Without UIRs, however, those who
make the decisions and resolve the problems do not learn about the
Group home manaaement implicated in alleqations but DDD did not
investiaate - A former employee of a group home made several
allegations regarding abuse and neglect of c l i e n t s at the home. The
nature of some of the allegations implicated management of the
contract agency that operated the home. However, instead of
beginning an independent investigation, the DDD d i s t r i c t wrote to the
agency to request investigation. In t h i s l e t t e r , the d i s t r i c t
i d e n t i f i e d the complainant by name and enclosed a copy of the UIR,
although Rule R- 6- 6- 120 prohibits disclosure of the complainant
without his or her written permission. A b r i e f investigation by the
agency director confirmed that at least some of the allegations were
true. Furthermore, the agency director's response revealed that he
had previous knowledge of some of the incidents but had not reported
them to DDD. The d i s t r i c t chose to take no action on t h i s matter,
stating that the agency had adequately addressed the problem when the
agency director counseled the home supervisor to follow the rules.
Several Factors Contribute
To Failures
DDD's UIR system has several weaknesses that prevent i t from e f f e c t i v e l y
protecting c l i e n t s . Although Central Office oversight of UlRs i s
important for several reasons, DDD's decentralized system f a i l s to keep
Central Office informed. In addition, we found DDD f i l e s regarding UlRs
to be incomplete, making i t less l ikely that a case manager or other DDD
employee w i l l identify and resolve an ongoing problem. Furthermore, the
Central Office unit responsible for UIRs is inadequately staffed to
handle the high volume of incidents. Finally, few DDD staff have any
training in investigative methods.
Central Office receives inadeauate information for effective oversiaht -
Central oversight and tracking of UlRs is necessary for several reasons,
but DDD's Central Office does not receive the information i t needs.
Central oversight permits licensing inspectors to consider UlRs in making
license renewal decisions, discloses patterns of injury, abuse, and
neglect, and f a c i l i t a t e s sharing of solutions to complex problems. A t
DDD, however, although policy requires d i s t r i c t s to send a copy of a l l
UlRs and investigation reports to Central Office, we found the Central
Office f i l e s to be so incomplete as to be unusable. Virtually a l l
non- death investigation reports were missing, and DDD s t a f f t o l d us some
UlRs were never sent to Central Office.
Files are incom~ lete - We also found that d i s t r i c t f i l e s did not maintain
UIR information and references in a consistent manner. In some cases,
UlRs and related information were scattered haphazardly among other
documents in client f i l e s . Many case note references to incidents were
not supported by a copy of a UIR or a cross- reference to other f i l e s .
Without the important information contained in UlRs and investigation
reports accessible to case managers, i t is hard to imagine how they can
make c r i t i c a l decisions about clients' needs. Licensing f i l e s also lack
complete information about UIRs, and the Department of Health Services'
recent audit report on DDD licensing criticized the Division's failure to
keep adequate UIR information in those f i l e s .
Central Office s t a f f insufficient - A t i t s Central Office of Compliance
Review, DDD lacks adequate staff to effectively manage UIRs. The office
has only one administrative assistant and one- half of one manager's time
to monitor, review, f i l e , and track a l l the Division's UIRs, and to
handle any incidents and investigations that are too sensitive to be l e f t
up to the d i s t r i c t . With 450 to 500 UlRs every month, this is clearly an
impossible task.
Staff who conduct investiaations lack training - DDD's d i s t r i c t o f f i c e s
handle most UIR investigations. Most d i s t r i c t s , however, do not have
s t a f f who specialize in investigations, or who have received any training
in investigation methods. In a January 1991, report evaluating DDD's
Quality Assurance System, the Human Services Research I n s t i t u t e ( HSRI)
stated that " There i s unanimity among key informants that UIR
investigations are of poor quality and are conducted by poorly trained or
untrained personnel." Although HSRl expected improvement after DDD
completed some planned training sessions and hired f u l l - t i m e
investigators in two d i s t r i c t s , we found that only one of the d i s t r i c t s
had hired investigators and the planned training had been canceled due to
lack of funds. The problems noted in that two- year- old report have s t i l l
not been addressed. Only a few Division s t a f f have received
investigative training, and they are concentrated in D i s t r i c t 2 ( Pima
County) because one of their employees attended a week- long session out
of state and returned to share what she learned with the d i s t r i c t ' s s t a f f .
Division Is Trvina To Improve
But Needs To Do More
DDD is taking some steps to remediate i t s UIR handling system, but
additional steps are needed. Other government e n t i t i e s have processes
that DDD could adopt to improve i t s a b i l i t y to respond to incidents of
abuse and neglect.
DDD's recent e f f o r t s for improving i t s performance include:
A new and clearer UIR policy, currently i n d r a f t form, that includes
guidelines for investigations;
A new computer tracking system, currently in the p i l o t stage, that
w i l l provide more complete information about each UIR so patterns can
be i d e n t i f i e d ;
Review of every abuse and neglect UIR by the Assistant Director of
DDD, to give him a better feel for the problems and to identify areas
where top- level management can make system- wide improvements; and
Planning to coordinate investigative t r a i n i n g with the assistance of
the Attorney General and DES's Office of Internal A f f a i r s , at some
time after the new tracking system is f u l l y implemented.
In addition, D i s t r i c t 2, headquartered in Tucson, has implemented some
innovative techniques to improve i t s quality assurance as a whole,
including UIRs. I t s unique Quality Advocacy Unit reviews the program
manager's recommendations, oversees investigations conducted by others,
and conducts investigations into serious incidents. The D i s t r i c t ' s Human
Rights Committee has also taken an active role in ensuring adequate
follow up on UIRs. As noted e a r l i e r , D i s t r i c t 2 has some s t a f f who have
received training regarding investigative methods.
DDD could adopt some techniques used by other government e n t i t i e s that
manage UIRs d i f f e r e n t l y :
In Connecticut, abuse, neglect, and serious injury are treated
separately from minor incidents. Eighteen liaisons statewide conduct
investigations and maintain d a i l y communication with Central Office
regarding serious incidents, while minor incidents are handled at the
local level. Separating the types of incidents t h i s way could reduce
the burden on Central Office s t a f f .
Maricopa County has 14 investigators who specialize in various
incident types.
Arizona State Hospital uses a duplicate- style UIR form. The person
who f i l l s i t out gives one copy to his or her supervisor, and gives
the other d i r e c t l y to the hospital's Quality Assurance Office. This
ensures that Central Office is informed more quickly, and also
prevents any censoring of the report before i t reaches Central Office.
Adopting these methods of separating serious from minor incidents, using
s t a f f who have been specially trained in investigation techniques, and
using control techniques to improve reporting could strengthen DDD's
a b i l i t y to e f f e c t i v e l y investigate, monitor, and respond to c l i e n t abuse
and neglect.
1. DDD should improve the quality of i t s investigations by:
Giving p r i o r i t y to developing comprehensive investigation training
and providing i t to a l l s t a f f who conduct investigations of c l i e n t
abuse and neglect;
Considering using s t a f f who report d i r e c t l y to the Central
O f f i c e o f Compliance Review to conduct a l l investigations into
serious incidents; and
Investigating a l l abuse and neglect incidents d i r e c t l y instead
of requesting provider agencies to conduct investigations.
2. DDD should more e f f e c t i v e l y address reported problems by:
Analyzing and d i s t r i b u t i n g information from the new computer
tracking system to improve problem solving and trend
i d e n t i f i c a t i o n ; and
Maintaining complete records of reported incidents and
investigations i n f i l e s accessible to licensing s t a f f and case
managers, and noting cross- references to those f i l e s in the
appropriate licensing and c l i e n t f i l e s .
3. DDD should improve Central Office oversight of serious incidents by:
Enforcing i t s requirement that d i s t r i c t s submit information about
incidents and investigative reports to Central Office. DDD may
consider using two- part forms where one copy goes d i r e c t l y t o
Central Office while the other goes through supervisory channels.
Considering establishing a two- tier system, where serious
incidents such as abuse and neglect are handled separately from
minor incidents
Increasing the number of Central Office s t a f f assigned to duties
associated with the tracking and monitoring of c l i e n t abuse and
neglect reports
Action needs to be taken to improve the current licensing process so that
i t more adequately safeguards the c l i e n t s ' health, safety, and f a i r
treatment. The Division has not conducted timely licensing inspections
and repeat violations have not been e f f e c t i v e l y addressed. In addition,
the l i cens i ng process i s cumbersome and d i sorgan i zed and has not been
implemented uniformly throughout the State.
The licensing process i s important in protecting c l i e n t health and safety
rights, and ensuring c l i e n t programs are properly developed and
implemented. The vulnerable nature and medical problems of many DDD
clients mandates the use of the licensing process. Residential
f a c i l i t i e s are not just places to l i v e , but important components of
c l i e n t h a b i l i t a t i o n programs.
DDD licenses residential f a c i l i t i e s under contract with the Division, and
also c e r t i f i e s intermediate care f a c i l i t i e s for the mentally retarded
( ICF/ MRs) and State- operated group homes.(') Faci I i t ies sat i s f a c t o r i ly
passing an inspection receive a one- year regular license or c e r t i f i c a t e ,
which indicates the faci l i t y ' s compl iance with l icensing standards. This
inspection, conducted by Central Office licensing s t a f f , should occur
before the expiration of the current regular license or c e r t i f i c a t e so
the f a c i l i t y can correct violations and have the corrections v e r i f i e d by
d i s t r i c t monitoring s t a f f before the license or c e r t i f i c a t e expires.
Midyear monitoring v i s i t s by d i s t r i c t monitors are expected to ensure
ongoing compliance with standards. According to Division information, in
Fiscal Year 1991- 92, 364 privately operated group homes, 25
State- operated group homes ( SOGHs) , and 14 I CF/ MRs were ope rat i ng under
DDD licenses and c e r t i f i c a t e s .
( 1) DDD does not l i c e n s e f a c i l i t i e s which only provide r e s i d e n t i a l services t o
private- pay c l i e n t s .
The Division's Licensina Process Has
Been Inconsistent And lneff icient
The licensing process has not been consistently and e f f i c i e n t l y
administered by DDD. DDD has routinely fai led to inspect, i n i t i a l l y
license, and relicense residential f a c i l i t i e s in a consistent and timely
manner. Also, DDD failed to e f f e c t i v e l y follow up on licensing
v i o l a t i o n s , r e s u l t i n g in repeat violations among licensees and allowing
underlying problems to go unchecked.
DDD i s routinelv late i n i n s ~ e c t i n a , i n i t i a l l y licensina, and relicensing
residential f a c i l i t i e s - Our review of 50 randomly selected licensing
f i l e s found that DDD routinely f a i l e d to inspect, i n i t i a l l y license, and
relicense f a c i l i t i e s u n t i l months after a f a c i l i t y had opened or the
current license had expired.(') Further, to cover inspection and
licensing delays, DDD inappropriately issued provisional licenses and
backdated both regular and provisional licenses. A review of both
State- operated and contracted group homes indicated that DDD, on average:
lssued a 6- month provisional license( 2) 32 days after the regular
license expired, backdated to the expiration date of the regular
license ( obscuring the 32- day period of operating without a license)
Inspected group homes 87 days after the regular license expired or
55 days after provisional license had been issued
lssued an inspection report 35 days after the inspection had been
completed or 122 days after the regular license had expired
Issued a regular license 31 days after the provisional license had
expired or 213 days after the previous regular license had expired,
backdated to show the expiration date of the provisional license
( again, disguising a 31- day period of operation without any type of
l i cense 1
( 1 ) We reviewed information contained i n 1 icensing f i l e s f o r inspections conducted during
the time period of January 1990 through A p r i l 1992.
( 2 ) I s s u i n g p r o v i s i o n a l licenses t o group homes t o compensate f o r delays i n the
inspection process i s inappropriate because, by d e f i n i t i o n , a p r o v i s i o n a l 1 icense
permi t s a f a c i l i t y t o operate w h i l e c o r r e c t i n g d e f i c i e n c i e s a f t e r a l i c e n s i n g
inspection has been completed. However, DDD issued a t 1 east one i nappropri ate
p r o v i s i o n a l l i c e n s e t o each contracted group home i n our sample.
Allowed new group homes to operate for up to three months under a
provisional license and without the benefit of an i n i t i a l inspection
Failed to inspect State- operated f a c i l i t i e s annually as required by
statute. In two cases reviewed, the last inspection conducted
previous to 1992 was in 1987. Further, when State- operated
f a c i l i t i e s were inspected, the inspection process was not often
completed since reports were not issued, corrective action plans
were not required, and follow- up v i s i t s were not performed.
Finally, DDD failed to conduct monitoring v i s i t s on a consistent and
timely basis. Although the Arizona Administrative Code ( R6- 6- 107)
requires DDD to conduct a monitoring v i s i t no more than 6 months after
the previous licensing inspection, DDD f i l e s lacked documentation of
these v i s i t s for 45 percent of the cases reviewed. In addition, f o r the
monitoring v i s i t s that did occur, our review showed that these v i s i t s
took place, on average, 7 months after the previous inspection.
DDD appears to b; addressing some of these issues. According to the
licensing manager, the unit is now conducting inspections of new group
homes p r i o r t o allowing clients to be placed in these settings. He also
told us that a l l State- operated group homes have been inspected as of
early November 1992.
DDD fai Is to e f f e c t i v e l y follow UD on licensina violations - Our review
of the 50 licensing f i l e s found that 29 licensees were cited for the same
violation during two or more inspections or monitoring v i s i t s . ( ' ) Some
repeated the same violation as many as four times, and several had repeat
citations for up to eight standards. This history of repeated violations
suggests that problems associated with licensees are not being
addressed. The following examples i l l u s t r a t e the problem of repeat
( 1 ) Our review focused on approximately 113 of 320 t o t a l l i c e n s i n g standards used by DDD
i n conducting inspections. These 113 mandatory 1 icensing standards are those deemed
most c r i t i c a l by DDD f o r ensuring the h e a l t h , s a f e t y , and proper treatment o f c l i e n t s
i n r e s i d e n t i a l f a c i l i t i e s .
Ex- le 1 - This group home received i t s f i r s t formal inspect ion in
1986. DDD has inspected t h i s home 7 times since i t s opening,
discovering from 6 to 23 violations of mandatory standards during
each inspection, including:
- Six inspections found the premises to be unclean with numerous
health and safety hazards. Three inspections found that toxic
substances were not locked up. It was also noted during three
inspections that various items in the house did not work, such
as the swamp cooler and lighting.
- Four inspections found f i r e d r i l l s not conducted as required.
Two inspections discovered that f i r e inspections by the
appropriate f i r e authority had not been conducted and one
inspection noted that f i r e extinguishers had not been serviced.
- Five inspections found that c l i e n t medication treatment plans
were improperly maintained or could not be located, or that the
medication log was incorrect, or not properly signed or
i n i t i a l l e d .
- Six inspections found that documentation verifying formal f i r s t
aid, CPR, and additional s t a f f training was not on f i l e for
d i f f e r e n t employees in each inspection.
- Fingerprint clearances were not on f i l e for eight employees
across two inspections.
Exanwle 2 - This group home opened in 1986 and received i t s f i r s t
regular license on January 1, 1987. DDD has inspected the home
seven times since i t s opening, discovering up to ten violations of
mandatory standards during each inspection, including:
- Three inspections found that f i r e d r i l l s were not conducted as
required, especially during the night when c l i e n t s are asleep.
Two inspections discovered that f i r e inspections by the
appropriate f i r e authority had not been conducted and a
separate inspection noted that f i r e extinguishers had not been
- Three inspections found that toxic substances were not properly
locked in storage.
- Documentation verifying formal f i r s t aid and CPR training was
not on f i l e for different employees during two inspections.
- Fingerprint clearances were not on f i l e for four employees
across two inspections.
There are several reasons why DDD follow up is inadequate, leading to
frequent cases of repeat violations among licensees. F i r s t , DDD did not
require corrective action plans ( CAPS) for approximately one- half of the
inspections we reviewed, even though licensing procedures require a CAP.
DDD waived t h i s requirement when i t s inspections were too late to enable
licensees to prepare a CAP and make necessary corrections before
expiration of the provisional license.
Second, DDD does not always conduct the required follow- up v i s i t s to
ensure required corrections are implemented. Files lacked documentation
of these v i s i t s in 18 percent of the cases reviewed which required follow
Finally, DDD addresses specific incidents rather than the systemic
problem that created the incident, thus treating the symptoms of the
problem rather than the problem i t s e l f . The Department of Health
Services, in i t s report on a recent audit of DDD licensing, stated that
" CAP'S addressed only specific instances or examples. There was no
indication o f how the f a c i l i t y would correct systematic problems."
DDD recently took license revocation action against four group homes
known to have multiple repeat violations in c r i t i c a l areas. However, the
high number of licensees with repeat violations indicates that DDD should
strengthen i t s e f f o r t s in this area.
Licensinq Process Could Be Streamlined
And Administered More Consistentlv
In addition to being i n e f f i c i e n t , the licensing process is cumbersome,
disorganized, and lacks statewide uniformity. F i r s t , many licensing
standards are vague and subject to interpretation. Second, the licensing
process i s not uniformly administered, resulting in a fragmented approach
to inspection and monitoring. Third, s t a f f turnover and lack of training
leads to timeliness problems and inconsistent application of standards.
The Division should streamline and consolidate i t s licensing standards
and process.
Licensina standards are vaque and subiective - The licensing standards
DDD has used are vague and subject to interpretation, which has
contributed to the lack of understanding among group home providers and
licensing inspectors of what i s expected for compliance. A task force
led by the Human Services Research lnst i tute ( HSRI ), which i s studying
and making recommendations to the Governor's Council on Developmental
D i s a b i l i t i e s regarding DDD's licensing standards and process, noted the
subjectiveness in the licensing process. The task force, which includes
representatives of providers, c l i e n t s , and d i v i s i o n s t a f f , recommends
reducing licensing standards to an essential core of standards which lend
themselves to only " yes" or " no" interpretat ions. The task force further
recommends simplifying the licensing process by l i m i t i n g i t to basic
health and safety standards only.
We witnessed the vagueness and s u b j e c t i v i t y of licensing standards while
observing a training exercise at a statewide licensing meeting, i n which
inspectors and monitors were asked t o i d e n t i f y which standards were
violated i n scenarios based on actual events. For each scenario,
licensing s t a f f and monitors i d e n t i f i e d several d i f f e r e n t standards which
they thought were violated and applied to each scenario.
A l l were correct. A DDD licensing supervisor agreed that the d i v i s i o n ' s
current approach to licensing is based on subjective interpretations of
standards, not objective application of clear standards. Also, nearly
one- half of the respondents to our survey of group home providers(')
reported that licensing standards are open to interpretation and that
licensing standards have been applied d i f f e r e n t l y t o t h e i r own settings
in d i f f e r e n t locations. Other providers t o l d us that some of their homes
had been rated out of compliance for standards which were not applied to
those same homes i n p r i o r years.
The vagueness of DDD's l icensing standards may be addressed, to some
extent, as a result of recent l e g i s l a t i o n . House B i l l 2487, which became
law on October 1, 1992, established a committee to examine a l l Federal
and State statutes, rules, and standards relating to the licensure of
community residential settings in order to determine their effectiveness
( 1 ) Auditor General s t a f f surveyed a l l 38 group home p r o v i d e r agencies by m a i l .
T h i r t y - t h r e e p r o v i d e r agencies ( 86.8 percent) responded t o the survey.
in protecting the clients' health, welfare, and safety. A report is due
from the committee by October 31, 1993 and during this examination
period, DDD licensing is restricted to using only those standards that
appear in statutes and rules for licensure of group homes. DDD licensing
spent the month of October 1992 revising their licensing process to
reflect this b i l l ' s intent. However, DDD licensing management feels the
standards identified in the statutes and rules are even more vague than
the previous standards, and further revisions are needed to compile an
adequate and appropriate set of licensing standards.
Licensina Drocess is not uniformly administered - The licensing process
has not been uniformly administered, resulting in a fragmented approach
to inspection and monitoring. DDD's Iicensing inspectors report to a
centralized licensing section; but u n t i l recently, monitors, who are
d i s t r i c t employees, reported to d i s t r i c t management with the licensing
section having no clear authority over them. However, in late 1992,
licensing reached an agreement with d i s t r i c t management regarding the use
of staff for monitoring. In most d i s t r i c t s , monitors w i l l continue to
report to d i s t r i c t management and have other responsibilities besides
monitoring, but licensing expects to have a more active role in how
monitors u t i l i z e their time. D i s t r i c t 1 ( Maricopa County) monitors w i l l
now report directly to licensing and are considered full- time monitors.
These changes, i f properly implemented, could help strengthen the
inspection and monitoring functions.
S t i l l , d i s t r i c t monitors do not have clear guidelines to follow or
definitions of their licensing responsibilities.
Staff turnover and lack of training contributes to DDD's licensing
problems - Staff turnover and lack of staff training contributes to the
timeliness problems and inconsistent application and interpretation of
standards. Staff turnover probably has the greatest impact on the timely
completion of inspections. According to the licensing manager, the
turnover rate for licensing inspectors was about 17 percent during
calendar year 1992, and 33 percent during 1991.
Limited training for new licensing inspectors and monitors contributes to
inconsistencies and delays. The majority of training for licensing
inspectors is on the job, as new staff accompany experienced staff on
inspections. Training for d i s t r i c t monitors is v i r t u a l l y nonexistent.
Although licensing management has encouraged monitors to attend the
training sessions that are conducted for Iicensing inspectors, and to
accompany inspectors on inspections, monitors' other duties, assigned by
d i s t r i c t s , have l e f t l i t t l e time to take advantage of these opportunities.
The Division should improve i t s licensing process by:
Conducting inspections and monitoring v i s i t s in a timely manner;
Discontinuing the improper use of provisional licenses;
Modifying and, consolidating the Iicensing standards so they are
properly and consistently interpreted and applied by licensing staff
and understood by licensees;
Changing the I icensing process and procedures to ensure that
underlying systemic problems that prevent compliance with Iicensing
standards are properly addressed and corrected;
Evaluating the effectiveness of placing D i s t r i c t 1 monitors under
Central Office licensing authority, and i f successful, expanding this
practice statewide; and
Providing training to the licensing inspectors and d i s t r i c t monitors.
The Division has taken significant steps to improve i t s contracting
process, but more can be done to ensure that sound procurement practices
are followed statewide. The Division's Central Office has not
effectively overseen and controlled d i s t r i c t contracting practices which,
at times, have been weak and deficient. For example, rate negotiations
have been poorly handled by some d i s t r i c t s , resulting in significant
overpayments to some contractors. The Division has strengthened the
Central Office's role in negotiating contractor rates, but more can be
done to enhance the Central Office's oversight and support role.
Most Division Services
Are Contracted Out
Good procurement practices and procedures are important to the Division
because i t expends a significant amount of funds for the purchase of
care. According to the Division's Business Operations Manager, the
Division spent over $ 150 mi l l ion on contracted services. Furthermore,
the Division accounts for the most procurement a c t i v i t y among the DES
divisions, awarding about 800 contracts and almost 500 individual service
agreements annually. Contractors provide a variety of services,
including room and board, day treatment and training, therapy, home
health services, and respite care.
Current structure - Responsibility for contracting is shared by the
Division's Central Office and the d i s t r i c t s . The Central Office has a
contracts management unit staffed by five employees: the unit manager,
two contracts specialists, and two clerical s t a f f . The Central Office is
responsible for developing and updating policies and procedures, and
preparing the Division's annual solicitation for services ( a
comprehensive request for proposals which is issued annually to a l l
providers statewide). In addition, the unit i s responsible for
processing contracts after they are negotiated and submitted for approval
by the d i s t r i c t s . Although the Central Office played a more significant
role this year negotiating provider contracts, in the past the d i s t r i c t s
have reviewed and evaluated proposals submitted for most services,
negotiated rates, and selected providers in their regions. Contracts
specialists in the d i s t r i c t s work with other employees temporarily
assigned to review proposals and select providers.
Central Office Role
Has Been Limited
The Division needs to strengthen the Central Office's support and
oversight role to ensure that d i s t r i c t s follow proper procurement
procedures uniformly and consistently. In a limited review of d i s t r i c t
contract records, we found several problems, such as poor or nonexistent
documentation, inadequate evaluations of proposals, and superficial
analysis of financial information submitted by providers.
The role of the Division's contracts management unit has primarily been
limited to a support function -- i t is neither structured nor equipped to
oversee and control d i s t r i c t procurement practices. The Division's
Central Office contracts manager stated that she does not review d i s t r i c t
contracting practices. Although i t desires to provide more oversight,
the Central Office is not set up to take on this responsibility easily.
F i r s t , the contracts manager does not have direct authority over d i s t r i c t
personnel involved in the contracting process. These personnel, l i k e the
contracts manager, report directly to the Division's business operations
manager or to the d i s t r i c t program managers. Second, the Central Office
does not have adequate staff to review d i s t r i c t procedures. According to
the contracts manager, her two contracts specialists are too busy
preparing the annual s o l i c i t a t i o n and processing the approximately 800
contracts awarded annually to take on additional tasks. Finally, contract
records that would require review are maintained in the d i s t r i c t s ,
further inhibiting the u n i t ' s a b i l i t y to examine d i s t r i c t practices.
While the Central Office maintains copies of current contracts, time
logs, and related correspondence, other documentation important to the
procurement process, such as provider proposals, proposal evaluation
forms, and negotiation notes are maintained by the d i s t r i c t s .
D i s t r i c t ~ roblems - More oversight over d i s t r i c t practices is needed to
ensure that proper procurement procedures are consistently and uniformly
followed. We conducted a limited review of 11 provider contract f i l e s ,
examining both Central Office and d i s t r i c t records avai lable at the time
of our audit . ( ' I We reviewed both the contract award ( which may have
occurred in Fiscal Year 1990- 91 or 1991- 92) as well as any subsequent
renewals or amendments to the contract. While the results of this review
are not necessarily indicative of a widespread problem, weaknesses we
identified indicate a need for more extensive oversight over d i s t r i c t
contracting practices.
The problems we identified also suggest that the Central Office needs to
provide more effective technical support to d i s t r i c t personnel. Training
of d i s t r i c t personnel has been limited, and policies and procedures have
not been updated and compiled into an easily accessible and useful manual.
The following are problems we identified that collectively can undermine
the integrity, fairness, and competitiveness of the procurement process.
These problems could also result in costly administrative or legal
challenges to the Division's procurement decisions.
Limited review of financial information - Some contract f i l e s showed
l i t t l e analysis and use of financial information submitted by
providers. In several cases, there was no evidence of any
systematic or detailed review of agency budgets. Rates for some
contracts appear to have been derived by dividing the provider's
proposed budget by the number of total client units, suggesting that
the provider's proposed budget was accepted without detailed
review. In three cases, rates accepted and contained in final
contracts were actually higher than rates originally proposed by the
( 1) Our i n i t i a l , exploratory sample of contracts was selected to represent a d i v e r s i t y of
services across d i s t r i c t s . It also included two contracts to one provider awarded by
a u n i t i n the Central Office. We intended to eventually review a larger sample of
contracts; however, the Division was slow i n assembling and sometimes unable to make
available to us complete records f o r the i n i t i a l sample within our audit time frame.
Therefore, we were unable to expand our sample size.
providers without j u s t i f i c a t i o n as to why. In some cases, while
there was documentation that costs were discussed in negotiating
sessions with providers, there was l i t t l e evidence that detailed
review of costs was conducted or that costs and budget information
was independently verified.
Questionable evaluations - Some proposal evaluations were poorly
done. In one case, di fferent evaluators appl ied c r i t e r i a
inconsistently, resulting in discrepancies in point deduct ions. In
other cases, evaluators rated one service proposed by the provider,
then copied the evaluation and used i t for a l l other services
proposed. ( Large provider agencies typical ly offer a variety of
services, a l l of which are required to be evaluated independently.)
We also examined evaluation forms which had more than one rating
number circled for the same evaluation item, i l l e g i b l e entries, and
mathematical errors.
Noncom~ liance with procedures - D i s t r i c t practices did not always
comply with the Division's policies and procedures governing the
contracting process. In one case, proposals were received and
accepted up to seven days after the publicly noticed submittal
deadline. There was no documentation that the deadline had been
extended. In two other cases contracts were awarded to providers
that did not appear to receive the highest ratings.
Inadequate and incom~ lete documentation - Several f i l e s lacked
important documentation. For example, two f i l e s had no documentation
of the evaluation of the provider's proposal. Four contracts
contained no documented j u s t i f i c a t i o n for contract rate increases
that were granted through contract amendments.
Weak Financial Review And
Oversiqht Has Been Costly
Inadequate review of some provider budgets and costs has been costly to
the Division and the clients i t serves. A recent series of financial
audits of major provider agencies disclosed that some providers have been
overpaid and spent service dollars in questionable ways.
Recent audits ordered - In May 1992, the Division hired an independent
accounting firm, KWG Peat Marwick, to conduct a financial review of
service providers. The financial reviews, initiated by the Division's
Assistant Director, were intended to examine provider expenditures and to
determine the reasonableness and allowability of costs. Service
providers selected for review were those receiving the largest amounts of
funding from the Division.
At the same time the Division was procuring an independent firm to review
providers, the DES Office of Internal Audit completed a similar review of
another major service provider. This audit was ordered after a letter
alleging questionable financial practices was received from the Regional
Office of the Inspector General of the U. S. Department of Health and
Human Services. The independent financial reviews conducted by the KPMG
and the Department's internal audit were the first such in- depth
financial examinations ever conducted involving Division service
Siclnificant amounts auestioned - The independent financial reviews and
the DES internal r audit identified a total of over $ 2.1 mi l lion in
questioned and/ or excessive costs for eight of the nine providers
examined. For two providers, total amounts questioned and/ or determined
to be excessive exceeded $ 500,000. Examp Ies of costs questioned or
determined excessive included the following:
$ 417,566 in bonuses paid in three installments from June 1990 to
June 1991 to the president of the agency. The bonuses were paid in
addition to the president's salary of $ 44,000. Funds were also used
to pay for the president's athletic club membership and for his
monthly chi Id care expenses.
$ 40,867 i n con t r i but i ons and enter ta i nmen t expenses spent by the
same provider. Entertainment expenses included charges for food and
beverages, lodging for management retreats, and floral arrangements
for various occasions.
$ 347,506 paid in compensation in 1991 to another provider.
$ 186,013 in excessive professional fees paid by the same provider
for accounting services.
A $ 35,000 bonus paid to the executive director of an agency, a
$ 32,000 bonus paid to the assistant director of the entity, and a
$ 5,000 bonus paid to a former off ice manager in 1991 and 1992. The
assistant director's bonus nearly doubled her base salary.
The nature and amount of the questioned and/ or excessive costs
demonstrate a clear need for a detailed, substantive, and meaningful
review of provider budgets and financial information. Financial
statement information reviewed by the independent auditors showed that
one provider realized net earnings of almost $ 1.3 mi I l ion in Fiscal Year
1990- 91. The provider had received about $ 9.6 million in service funds
from the Division. In another case, the independent auditors found a
mathematical error of over $ 10,000 in computing the provider's service
budget for professional specialty services. In an attempt t o v e r i f y
average hourly costs, the firm also found discrepancies between actual
average costs and hourly costs u t i l i z e d by the provider in i t s proposal.
For example, for personal care services, costs proposed were 38 cents per
hour higher than the average hourly costs calculated by the firm.
The Division Needs To Continue Its
Efforts To Strenathen The Contractina Process
The Division has taken significant steps to address weaknesses in the
contracting process. These efforts need to be expanded to ensure that
d i s t r i c t contracting practices are appropriate and properly documented
and that provider agencies are adequately monitored.
Efforts to improve - The Division took several actions in Fiscal Year
1991- 92 to strengthen the Central Office's role in the contracting
process. F i r s t , the Central Office led negotiations ( with the assistance
of several d i s t r i c t s t a f f ) of the 38 largest value contracts, those
representing $ 700,000 or more. These 38 contracts represent about
two- thirds of the Division's total dollars spent on purchase of care. An
outside firm was hired to assist the Central Office in i t s negotiations.
More detailed financial and budgetary information was requested from the
provider agencies, and more emphasis was placed on in- depth review of
provider costs. As a result of this e f f o r t , the Division estimates i t
saved approximately $ 5 million in contractor costs for Fiscal Year
1992- 93.
Second, as noted earlier, the Division hired an independent accounting
firm to conduct a financial review of eight providers. The Division is
currently pursuing recovery of questioned or excessive costs identified
by the financial reviews. In addition, a financial settlement was
reached with the provider audited by the Department's Office of Internal
Audit. This settlement has resulted in a payback to the State of an
undisclosed portion( 1) of the over $ 500,000 in costs questioned by the
internal audit.
The Division has initiated other efforts as well. For example, i t has
promulgated directives to promote more consistent procedures for
negotiating contracts in the d i s t r i c t s . It is also streamlining the
provider payment system by developing " blended rates" for contractors
that operate multiple programs, for example, group homes, a t d i f f e r e n t
sites. This would reduce the number of individual rates that have to be
negotiated with each provider.
Additional steps need& - The Division needs to continue and expand i t s
efforts. F i r s t , as noted earlier, i t needs to update procedures and i t s
contracts manual for d i s t r i c t personnel. The Central Office developed a
" Guide to Contracting" in April 1991. According to the Division's
contracts manager, the Guide is s t i l l in effect but needs to be updated
and reformatted for easier future revisions. In addition, numerous
directives have been issued to the d i s t r i c t s , on an ad hoc basis, by the
Division director and the Department's Contracts Management Section.
Directives are not compi led into a manual to al low for easy access and
In addition, more training needs to be offered. Some s t a f f t o l d us they
had no previous experience handling contracts and f e l t ill- prepared to
take on the contracting responsibilities they were assigned. The
d i s t r i c t s u t i l i z e program personnel to help in the contracting process,
but l i t t l e training has been offered to them. These personnel specialize
in service delivery, not fiscal control and accountability. The
contracts manager provided some training in 1992 to about 40 personnel,
but not a l l staff involved in contracting attended. Moreover, the
( 1) Under the terms of the settlement, both parties agreed not to disclose d e t a i l s of the
settlement. According to the Assistant Attorney General who hand1 ed the matter, t h i s
was done, i n part, to protect the State's position i n possible settlements with other
training focused s t r i c t l y on the negotiation process. No comprehensive
training has been provided.
Monitoring of contractors also needs to be strengthened. Currently,
financial monitoring is performed on a very limited basis. Contractors
receiving over $ 50,000 annually f i l e quarterly financial reports with the
Central Office, but l i t t l e is done with these reports. U n t i l t h i s past
year, there has been l i t t l e auditing of providers, nor have the d i s t r i c t s
focused on financial accountability. Further, d i s t r i c t contract monitors
focus primarily on programmatic rather than financial issues.
Finally, to strengthen accountability, the Division needs to continue i t s
efforts to c l a r i f y responsibility and authority on contracting matters.
As noted earlier, for example, the contracts manager had overal l
responsibility for the division's contracting process, but had no line
authority over the numerous D i s t r i c t personnel involved in the
contracting process. This made i t d i f f i c u l t for her to ensure and
enforce statewide compliance with the Division's contracting policies and
The Division should continue i t s efforts to strengthen the Central
Office's role in the contracting process.
To supplement i t s current efforts, the Division should also consider:
Compiling a policies and procedures manual on contracting for
D i s t r i c t personnel,
Providing more extensive training to d i s t r i c t staff on
contracting policies and procedures,
Strengthening financial monitoring of contractors,
Clarifying responsibility and authority shared between the
Central Office and the d i s t r i c t s ,
Reviewing d i s t r i c t contracting practices on a regular basis to
ensure compliance with Division procedures, and
Ensuring that documentation of the contracts process is adequate
and consistently maintained.
During the course of the audit, we developed information regarding the
adequacy and avai l a b i l i t y of services provided by the Division.
Peop l e w i t h deve l opmen ta I d i sab i I i t i es do not a l ways rece i ve adequate and
sufficient services. Overal I, our consultants described services
provided by the ALTCS program as " borderline acceptable" when compared to
other states' programs ( see the Introduction and Background, page 6, for
information on our consultants.) The consultants base their conclusion,
in part, on survey and interview results. Specifically, individuals
receiving services, and those persons providing direct care to
individuals ( including families and service providers), reported that
about 25 percent of a l l services being received were, on average, of less
than s u f f i c i e n t quality or that individuals were not receiving enough of
a certain service to meet their needs. They rated occupational therapy,
recreational therapy, speech therapy, and physical therapy as being most
inadequate. Division case managers reported about 19 percent of a l l
services currently provided to those same clients to be less than f u l l y
sufficient. Case managers rated community s k i l l s training and recreation
therapy the lowest.(') Table 3, page 52 l i s t s those service categories
with the lowest sufficiency ratings as identified by both groups.
While interview and survey results revealed concerns over the adequacy of
services received by some individuals, evidence gleaned from f i l e reviews
suggests that some clients are making developmental progress with
services currently received.
( 1) Due t o problems i n the needs assessment process, s e r v i c e p l a n n i n g process, and
process of moni t o r i ng progress toward achieving goal s current1 y i n place wi t h i n the
D i v i s i o n , the consultants cautioned t h a t service s u f f i c i e n c y r a t i n g s as reported may
be a r t i f i c i a l l y high.
Occupational Therapy
Recreational Therapy
Speech Therapy
Physical Therapy
Cogn i t i ve
Community S k i l l s
Med i ca l
Case Management
Behavior Modification
Community S k i l l s
Recreation Therapy
Physical Therapy
Occupational Therapy
Behavior Modification
Percent Of Clients, Families,
And Service Providers Rat i ng
Service Sufficient
Percent Of Case Managers
Ratina Service Sufficient
Source: Auditor General summary of information contained in the
consultant's final report to the Auditor General, dated
November 1992.
In addition to problems with the quality and level of services actually
being received, some services are simply not available when needed.
Research we conducted revealed that demand for certain services cannot
be met because of the scarcity of some services. Survey and interview
information we developed indicated that gaps exist in services needed
for both T i t l e XIX e l i g i b l e and non- Title X I X e l i g i b l e persons
( State- funded only). Moreover, services are general ly less avai lable
for the non- Title XIX recipients, due largely to a lack of State
funding. I n t o t a l , for a l l clients, the results of various surveys and
interviews we conducted indicates that placement in Intermediate Care
F a c i l i t i e s , peer self- help assistance, and special therapies ( physical,
occupational, and speech) are generally unavailable for many clients.
Foster homes ( especial ly cultural ly appropriate homes ) ,
employment- related services, and individual provider services, such as
respite and personal care, were also described as being d i f f i c u l t to
In a similar vein, our consultants were told during a focus group that
due to a dearth of therapists in d i s t r i c t s other than D i s t r i c t s 2 ( Pima
County) and 4 ( Yuma, La Paz, and Mohave counties), therapy services were
rarely, i f ever, prescribed even when i t would have been appropriate to
do so.
Reasons for lack of a v a i l a b i l i t y have been described as including: a
lack of providers for some services, particularly therapies; lack of
State funding ( for example, to pay for services T i t l e XIX does not pay
for and for development of new residential faci l i t ies); lack of Division
staff time to recruit individual providers; limitations resulting from
income requirements for foster homes; provider d i f f i c u l t i e s i n
contracting, b i l l i n g , and receiving payment from the State, and low pay
To improve a v a i l a b i l i t y i n these and other areas, those we interviewed
or who responded to our surveys made severa l suggest i ons , i nc l ud i ng : ( 1 )
consideration of a voucher system for paying individual providers and
therapists, which would be expected to increase the number of those
providing services and lessen payment problems, and ( 2) more aggressive
efforts by the Division in recruiting individual providers, therapists,
and foster homes.
The consultants concluded that the service system lacks innovation,
c r e a t i v i t y , and effective case management. Other than some creative
foster care situations, for example, CFA found l i t t l e evidence of
supported living arrangements or supervised apartments. In terms of day
program options, the consultants queried the focus groups about the
apparent lack of supported employment options, such as job coaches and
sheltered workshops, and were told by case managers that this service
was not fundable through T i t l e X I X . The consultants explained, however,
that many other states have found creative ways to f a c i l i t a t e supported
employment opportunities. Case management, described by the consultants
as a c r i t i c a l l y important service, was found to be ineffective in many
cases. Their research found case managers often lacking the necessary
competence and abi l i ty to per form good case management due to a var i ety
of factors, including inadequate training, high case loads, and too much
paperwork ( see Finding I I , page 17, for additional information on case
management . )
171 7 W. Jefferson - P. O. Box 61 23 - Phoenix, AZ 85005
Fife Symington Charles E. Cowan
Governor Director
Mr. Douglas R. Norton, CPA
Auditor General
Office of the Auditor General
2700 N. Central Avenue, Suite 700
Phoenix, Arizona 85004
Dear Mr. Norton:
Thank you for the opportunity to review the Auditor General's Office
performance audit on the Division of Developmental Disabilities
We have enclosed three copies of our response to the Auditor
General's report. In many cases, the response updates information
provided in your office's report. We are pleased to have this
opportunity to respond and appreciate, as well, the courtesy
consistently displayed by your staff in the course of their review.
We believe that the recommendations contained in this report are
consistent with the direction that DDD has embarked upon under
new leadership. In our response, we demonstrate how the DDD has
already begun implementation of many of those recommendations.
If you have any questions or need additional information, please call
me. *
Sam Thurmond
Before responding to specific items in the Auditor General's draft report, we want to
establish the context in which this information, and the Division of Developmental
Disabilities ODD), must be viewed.
Arizona's Long Term Care System ( ALTCS) Title XIX program is unique in the
United States and meaningful comparisons with other State programs are difficult.
The Auditor General's report drew upon the analysis of an independent consultant firm,
Conroy and Feinstein ( CFA). Much of CFA's conclusions are subjective and derived
from perceptions at the " front linen, that is, case managers and families. These
perceptions are valuable, but this population has not felt the impact of the changes
which have been instituted in Central Office and which have not yet been fully
implemented Statewide.
The DDD recognizes and acknowledges many of the difficulties with this program.
The problems are of a long standing nature. The DDD went through a major
expansion in December 1988 when the DDD became the only agency in the United
States to start both a Long Term and an Acute Care system on the same day. The
ALTCS ( Title XIX) program increased not only the DDD's client population
dramatically but added to the DDD's reporting responsibilities.
Under the current Assistant Director, who has been in charge of the DDD for one year,
a series of principal changes have been instituted to address the problems identified in
the Auditor General's report. The DDD had already identified many of these same
problems in its General Systems Design analysis, and has developed - and in a number
of cases executed - plans to address them in a consistent and uniform manner while
abiding by budgetary restrictions. The DDD has created systems, procedures, and
training to resolve the problems, and is now reaching a stage where these changes are
beginning to become evident. Two very obvious examples are the creation of the
Statewide Policy and Procedures Manual, which, when published, will be available to
case management, and the case manager training program ( described by CFA as " state
of the art"), which is being implemented in March 1993.
We appreciate the recognition which the report gave to the leadership of the current
Assistant Director in pursuing changes in both fiscal and programmatic areas. The
Division is confident that future audits will show the culmination of those changes and
the resolution of many of the problems identified in the Auditor General's report.
The Division Needs to hlore Adequatelv Im lement its Policies for
Assessing and Planning Individual 8 lient Services
All Necessary Assessments Are Not Being Done
This section of the report contains many statements that can be characterized as
The finding that all necessary assessments are not being done is based upon conclusions
reported by CFA. CFA examined case records and determined that, on the average,
31.9 percent of these cases showed " no evidence that assessment was performed"
DDD questions whether this means that no assessments were performed or that an
assessment which CFA felt should have been performed was not. The DDD and
ALTCS policy calls for assessments & in areas that are considered appropriate for
the client and the client's diagnosis.
Evidence that the CFA assessment findings may not be accurate is indicated by family
and consumer input. CFA asked families and consumers if they thought the Individual
Program Plan ( IPP) goals were appropriate. Of respondents, 85.9 percent reported that
goals were appropriate, 8.8 percent reported that goals were partially appropriate, and
5.3 percent reported that goals were not appropriate ( see pp 46 of the CFA report).
Fully 94.7 percent of the respondents believed that the IPPs contained appropriate or
partially appropriate goals. Clearly, the DDD is perceived to be addressing the right
goals by the families and consumers.
This is not to say, however, that DDD does not need to make improvements in this
area. The DDD has launched a number of initiatives that will bring about
improvements. Some of these are:
1. The new Individual Service and Program Plan ( ISPP) format and training for
case managers and provider staff. The ISPP combines the previously used
Individual Program Plan ( IPP) and the Service Plan. The format of the ISPP
specifically requires documentation of all needed assessments and provides a
check list for the team members to ensure that no area of assessment is
2. The Case Management core cumculum addresses the importance of
comprehensive assessments. The utility of this training is acknowledged by
CFA when they point out that " the case manager training materials are
definitely state of the art; if this training were fully implemented, Arizona's
problems with the assessment process would diminish sharply." @ p 40).
3. The DDD case management training and ISPP format emphasize the " person
centered planning" approach which is cited by CFA as a current best practice in
the field.
1. Training in person centered planning has been provided in four of the six
districts since 1990 through a contract with Patterson and Associates. Patterson
and Associates is now working with all districts through its Statewide contract
with the DDD.
5. The Individualized Family Senice Plans ( IFSP) approach is cited by CFA as a
example of a well integrated assessment and planning approach. The IFSP is
being field tested in two DDD districts before Statewide application is
approved. The DDD should be implementing this Statewide in FY 94.
ICAPs Not Done Timely
The new ISPP policy and training will address this issue.
Procedures for Conducting Planning Meetings Are Not Always Followed
The Auditor General's report @ p. 12) summarizes the CFA opinion that, " professional
personnel and others who should be involved in the IPP team meetings are often left
out" and "... only one case in which there was a properly constituted interdisciplinary
team present during the clients' annual IPP reviewn. It is neither cost efficient nor
necessary for all professional personnel to be included in all ISPP ( formerly IPP)
meetings. As a practical matter, physicians and therapists are not able to attend such
meetings. It is sufficient in most cases for their assessments and recommendations to
be available for the team meeting.
It is appropriate to involve medical specialists in the planning process for individuals
with identified medical needs. The DDD's Specialty Services Unit has been established
to provide medical nurse case management to individuals who are medically involved.
These nurses can and do provide assessment of individuals' medical needs. However,
to provide CFA's recommended level of involvement by medical personnel in the
planning process would require a ratio of one nurse for every 30- 50 individuals served
by the DDDIALTCS program. It is doubtful that this could be justified as cost-effective.
The report stated that critical information was not available when IPP teams met. CFA
did not find comprehensive IPPs that encompassed assessment results from other
agencies working with the client ( e. g., local school districts). If a DDD client is in
residential service, the provider would maintain medical records, lab results, etc., and
the case manager would not necessarily maintain copies in the case file. However, the
DDD agrees that this is an area in which they need to tighten their procedures and
document information.
CFA also notes that IPP teams " often do not reconvene when appropriate". The DDD
has instituted actions, such as an Administrative Directive clarifying the review of
ISPP, and addresses this concern in the Policy and Procedure Manual and in Case
Manager and ISPP training; DDD acknowledges, however, that more must be done and
is committed to taking stronger steps in that direction.
Breakdowns Occur Within the Case Management System
The Auditor General's report noted that the DDD's policies and procedures were
appropriate and that communication and lack of training are problems. These problems
are being addressed by the DDD through a comprehens~ vetr aining program.
1. Concur. The DDD has established a Statewide case management training
curriculum being implemented in March 1993.
2. Concur. The DDD is conducting a research project through the Arizona Early
Intervention Project ( AZEIP) field tests in Districts 11 and III to determine an
appropriate tool for this population that can be used Statewide. An assessment
tool has been selected for the field tests based upon a review of national best
3. Concur and addressed through new ISPP form.
4. Concur and being addressed in case management training and in ISPP training.
5. Concur, but may not always be possible. Site reviews will incorporate this as
an item for the monitoring of case files.
6. Concur. Individual Family Service Plan is addressed with a supplemental sheet
in the new ISPP. Policy and Procedures Manual addresses plan coordination.
The Division's Case Management System
Cannot Effectively Service Clients
The DDD generally concurs with the recommendations for improving case
management .
Case Management is Essential, but Inadequate at DDD
Case management is essential for a system in which services are dispersed and require
coordination. CM is also critical to meeting Title XIX, Foster Care, and Statutory
requirements. The introduction of Title XIX funded services in December 1988 placed
new responsibihties on case managers while none were taken away.
Over the past year, much has been done to institute consistent policies and to clarify
case management responsibilities. Administrative Directives were used to provide
rapid solutions to policy issues. These directives are now being incorporated into a
Statewide policy and procedures manual ( scheduled to be distributed in May 1993).
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