Report to/Rapport au:
Health, Recreation and Social Services Committee/
and Council/et au Conseil
20 June 2002 / le 20 juin 2002
Submitted by/Soumis par: Dick Stewart, General
Manager/Directeur général People Services Department/Services
aux citoyens
Contact/Personne-ressource :
Danielle Massé, Director/DirectriceEmployment and Financial
Assistance/Services d'emploi et aide financière
580-2424 ext./poste 43080, Danielle.Masse@ottawa.ca
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Ref N°: ACS2002-PEO-EFA-0001 |
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SUBJECT: |
service
delivery model issues and Financial implications regarding Ontario Works and
the Ontario Disability Support Program |
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OBJET: |
ENJEUX
DU MODÈLE DE PRESTATION DES SERVICES ET RÉPERCUSSIONS FINANCIÈRES TOUCHANT À
ONTARIO AU TRAVAIL ET AU PROGRAMME ONTARIEN DE SOUTIEN AUX PERSONNES
HANDICAPÉES |
REPORT RECOMMENDATION
That the Health, Recreation and Social Services
Committee receive this report for information.
Que le Comité de la santé, des
loisirs et des services sociaux prenne connaissance du présent rapport à titre
d’information.
The purpose of this report
is to advise Committee of operating pressures currently facing the Employment
and Financial Assistance (EFA) Branch related to:
I. The
Provincial Service Delivery Model (SDM) of social assistance; and
II. Financial and accountability issues regarding the delivery of
Ontario Works (OW) and the Ontario Disability Support Program (ODSP).
A
review of challenges stemming from the implementation of the new Service
Delivery Model and various other Provincial Initiatives, Directives,
downloading and decreases in funding, will demonstrate the increased
administrative burden, increased costs and negative impacts on the Employment
and Financial Assistance Branch.
DISCUSSION
I. The Provincial Service Delivery Model
(SDM) of Social Assistance
SDM History
In
1996, the Ministry of Community, Family and Children’s Services (MCFCS),
formerly the Ministry of Community and Social Services (MCSS), established the
Business Transformation Project (BTP) and engaged Andersen Consulting (renamed
Accenture) to design and implement the SDM, a comprehensive system of social
reform that would change the delivery of social assistance in Ontario. Development of the SDM was concurrent with the
Province’s overall reform measures, such as:
·
The passage of the Ontario Works Act (OWA) and
the Ontario Disability Support Program Act (ODSPA) in 1997;
·
Devolution of key responsibilities to
municipalities (e.g. single parent families and the Family Support Program);
and
·
The introduction of new funding models and
program priorities.
These
reforms have substantially changed the context in which municipalities deliver
the Ontario Works (OW) Program and their role in the funding and delivery of
the Ontario Disability Support Program (ODSP).
SDM Objectives
The Province’s objectives,
to be achieved upon full implementation of SDM, were to create a more
efficient, cost-effective social assistance delivery system that:
a.
Improves client service;
b.
Increases support for the delivery of employment assistance;
c.
Improves program integrity; and
d.
Reduces expenditures.
Presently,
the Province has not met the objectives noted above. This report will illustrate that client service has not improved;
that there is insufficient Provincial support for the delivery of employment
assistance; that there are some integrity issues within the program; and that
administrative expenditures have increased as a result of SDM.
A. Improved Client Service
Municipal service managers,
including the City of Ottawa, are concerned that aspects of the SDM may
adversely affect client service, contrary to Provincial expectations and
objectives:
·
The
overall time required to review client eligibility has not been reduced. Most clients still proceed from the
telephone screening stage to a face-to-face interview in local offices, which
takes longer than before given that additional information is now required to
confirm eligibility, develop initial employment plans and complete new
mandatory processes (e.g. mandatory literacy testing);
·
System
generated form letters to clients are not customer friendly and cannot be
customized to support local practices.
The current letters cause client confusion and result in increased
client phone calls, drop-ins and correspondence. In addition, EFA is restricted to using one contact name for all
client correspondence (the EFA Director), which creates further confusion as
clients are unsure whether they should contact their caseworker or the Director
to discuss issues related to their file; and
·
Supports
to the most vulnerable in communities (e.g. homeless, emergency hostel
residents) are not effectively or efficiently supported by the SDM technology
platform resulting in delays in services and benefits.
B. Supporting the Delivery
of Employment Assistance
The technology was marketed
as supporting the efficient delivery of both employment and financial
assistance. However, the technology is
primarily focused on the financial aspects of delivering OW. The technology is not an effective tool to
manage Employment Placement Activities and as such, EFA must continue to
augment the Provincial technology with local technical and program solutions
(e.g. the Employment Activities Outcomes Database [EAOD]) that allow for the
tracking and evaluation of client referrals to community partners for training,
employment placements, employment initiatives and community participation
activities, etc. Due to increases in
administrative demands on staff (e.g. double data entry), caseworkers do not
have additional time to assist clients to achieve their employment goals. This is particularly disconcerting, as the
amount and level of employment activities are directly related to Provincial
funding allotment.
C. Improved Program
Integrity
EFA has identified a number of
concerns related to the technology’s impact on payments to clients and audit
functions. With respect to payments,
situations have occurred where, payments cannot be reconciled, clients may have
overpayments assessed in error and payments cannot be generated or
cancelled. Another example is that the
expenditure report (for subsidy claims) and the cheque register (actual client
payments) have not balanced since implementation in November 2001. The total variance is $59,500.78 from
November 2001 to April 2002. EFA is
also concerned that the tracking of changes, by user, does not fully support
the Branch’s requirements for integrity and security. MCFCS has been apprised of these concerns and EFA continues to
support Provincial efforts to address these issues and to assist in the
development of necessary solutions.
D. Reduced Expenditures
The Province
anticipated that the SDM would substantially reduce social assistance
administration and delivery costs. At
this point, the City and other municipalities’ experiences do not support this
position. The following summarizes the
key impacts for the EFA Branch:
·
EFA must continue to rely on secondary systems, supported in-house, to
manage key delivery functions. This
creates the need for time consuming double data entry (e.g. EAOD and Record
Services and Verify Payment [RSVP], which is used to issue vendor payments);
and
·
EFA has evaluated the new centralised 2-stage intake screening model
(referred to later in this report) in order to assess the financial and
operational outcomes against Provincial objectives. Based on EFA’s evaluation, financial savings targets have not
been realized.
There are also some critical
issues that concern EFA and other municipal service managers throughout
Ontario. Of considerable concern is
that the SDM is increasing administrative complexity by placing additional
demands on staff. Also, EFA is
concerned by the number of MCFCS Directives and Initiatives that diminish
municipal flexibility by standardizing processes and policies that ultimately
micro-manage municipal delivery of services (e.g. Transition Directive 2001-04
of December 2001, introduced a $15.00 medical transportation threshold
policy). The new functions and
capacities incorporated into the SDM, in conjunction with more detailed program
standards and requirements may actually necessitate additional resources in
order to continue to deliver quality services.
Key Components of the SDM
There are four key components of the new Service
Delivery Model are outlined below:
1.
CVP: The Consolidated Verification Process, a
standardized process for assessing and reviewing eligibility for OW and ODSP
that includes the use of third party records to verify information provided by
clients. CVP was implemented in Ottawa
in November 1999;
2.
IVR: The Interactive Voice Response system, an
automated telephone system that provides clients with general information, was
implemented in Ontario in October 2000; and
3.
ISU: A
centralized 2-step intake process featuring an initial telephone application
taken at one of 7 Intake Screening Units,
followed by a face-to-face interview at a municipal office to verify
eligibility. This component was
implemented for Eastern and South Eastern Ontario, including Ottawa, in October
2000;
4.
SDMT: The implementation
of a province-wide technology platform
called Service Delivery Model Technology (SDMT) that supports the core delivery
functions of OW and ODSP, application intake, ongoing eligibility
determination, calculation of benefits, delivery of employment supports, and
day-to-day management of cases. This
final component of the SDM was implemented in Ottawa in November 2001, with
full Provincial rollout achieved in January 2002.
Adherence
to the SDM is mandatory for all municipal service managers throughout the
province. The ISU and SDMT are
presenting particular challenges at this time and are reviewed in greater
detail in the next section of this report.
Review of the Intake Screening Unit
As previously indicated, a key component of the SDM
was the establishment of 7 telephone Intake Screening Units (ISU) across the
Province. The ISU is the first step in
a 2-step intake process designed to standardize intake,
create efficiencies and reduce costs across the Province.
The ISU for Eastern and South Eastern Ontario is
located in Trenton, Hastings County.
Since October 2000, it has provided intake-screening services to nine
municipal service managers, including Ottawa.
Most OW applicants telephone the ISU, where information is gathered for
the purpose of assessing potential financial eligibility. Potentially eligible applicants must then
attend an employment information session at one of four EFA Centres in the
City, followed by a face-to-face interview.
·
Evaluation of the ISU
In
August 2001, MCFCS released an early performance evaluation of the ISU and
results were disappointing in that Provincially targeted efficiencies were not
being realized. Specifically, there were lower than expected applicant
ineligibility decisions made at the ISU and a higher than expected proportion
of applicants who were bypassing the ISU altogether as they were not deemed
suitable for telephone intake. It was
originally projected that 50% of requests and inquiries would not proceed to
the second step (municipalities). These
projections have not materialized, as actual percentages of applicants
proceeding to municipalities was averaged at 64% from November 2001 to April
2002.
Furthermore,
the EFA Branch has undertaken its own evaluation of the ISU, which included the
City of Ottawa and five municipal partners.
In 100% of the applications completed at the second stage municipal
interview, an average of three amendments were required per application. Because of legal and appeal implications,
caseworkers deem it imperative to review applications with every applicant to
ensure accuracy and completeness. These
essential reviews translate into a duplication of effort for clients and staff
and indirect residual costs of this intake process being passed onto
municipalities. A subsequent ISU
performance evaluation, comparing all 7 ISUs, should be forthcoming from MCFCS
in the near future.
·
Cost of the ISU
The Trenton ISU’s
budget for 2001 was approximately $3.36 Million. Nine municipalities partners fund the ISU and MCFCS cost-shares
50% of the overall budget. For 2000 and
2001, Ottawa’s annual portion was 54.6%, which was based on the average OW
caseload count from October 1999 to June 2000 in relation to the combined OW
caseload of the nine municipalities.
The estimated cost to the City of Ottawa is $918 Thousand for the year 2002.
Ottawa's legislated apportionment of ISU costs,
54.6% of the total ISU budget, is substantially higher than the monthly average
of OW applications received from the Ottawa area 44.4% from November 2001 and
April 2002. A higher than anticipated
percentage of applicants bypass the ISU altogether,
because vulnerable clients such as the homeless, 16/17 year olds and victims of
violence warrant a heightened level of service delivery, resulting in some
applications being processed directly at the municipal level.
The
financial and operational efficiencies that the ISU was intended to generate
have not materialized. Budget and
apportionment details are not received in a timely fashion for municipalities
to include them into their local budget process. EFA has conveyed the following
concerns to the ISU, its municipal partners and MCFCS:
·
MCFCS has not signed off on the 2001 actual expenditures, (estimated at
$3.2 Million);
·
MCFCS has not signed off on the 2002 budget (estimated at $3.36
Million);
·
MCFCS
has not officially announced the apportionment formula for 2002 and subsequent
years; and
·
The
initial ISU staffing model recommended 39 FTEs based on an estimated call
volume that is 60% higher than the actual call volume, yet the ISU staffing
level remains constant at 39 FTEs.
The Reciprocal Service Agreement For Intake
Screening Unit Services states “the roles and responsibilities of the Host
CMSM (Hastings County) include the negotiation and maintenance of a service
agreement with the Ministry including the budget for the ISU”. Municipal partners’ consultation and input
is limited to raising concerns to the ISU Advisory Committee. Despite the fact
that the City of Ottawa’s share of the ISU’s costs are 54.6%, there is no clear
mechanism for EFA to influence and ultimately impact the ISU budget preparation
or approval process.
Review
of the Service Delivery Model Technology (SDMT)
The
new technology platform, the Service Delivery Model Technology (SDMT), supports
the delivery of the Province’s social assistance reform efforts. The SDMT is generating certain improvements in the
front-end of the delivery system. Staff
like the fact that it is a province-wide, web based system that operates in
real time. SDMT
replaced legacy computer systems and some Provincial databases that were used
to deliver social assistance. Over
time, SDMT has the potential to be an effective service delivery tool for
municipalities across Ontario.
As
anticipated, with any new system of this magnitude, there have been technology
challenges that municipalities have been addressing with MCFCS by direct staff
logging of system issues, communiqués and collaboration with Provincial
staff. The City of Ottawa has forwarded
a letter to the Province (Attachment 1) detailing EFA’s concerns.
Of
particular concern to Ottawa are:
·
Identification, reporting, tracking and
resolution of a myriad of system bugs that hinder the capacity to delivery
quality services;
·
Accuracy and usefulness of “canned” reports;
·
System-generated client letters are costly due
administrative reviews, distribution, printing, paper, envelopes and postage;
·
Insufficient audit security when granting
benefits;
·
Multiple system modifications that contradict
“known” functionality elsewhere in the system;
·
Copious manual “workarounds” that reduce users’
confidence in data integrity; and
·
Ongoing allocation of human resources to manage
all outstanding issues and concerns related to the system due to the
evolutionary state of the technology.
Ottawa
has taken a proactive role and has devoted substantial internal resources to
the implementation of SDM. EFA staff
met frequently with MCFCS to ensure the effective coordination and
implementation of processes and has continued to communicate with MCFCS to
discuss issues and recommend solutions.
Significant
preparations were made by EFA, including the provision of extensive training to
over 650 staff and the conversion and transfer of data from legacy systems to
the new technology platform. While
MCFCS automated electronic conversion of core financial and limited case
management data, EFA staff must manually enter other case management data into
SDMT, as well as all data related to participant employment activities. The employment activities data conversion is
targeted for completion in June 2002 and the case management data conversion is
targeted for completion by mid 2003.
These manual data conversion operations require a substantial investment
in staff hours, as approximately 18,000 OW files must be updated and converted.
Overall,
implementation has been successful in Ottawa, primarily due to EFA’s planning
and coordination and continued collaboration with MCFCS staff. However, given the extent of the new case
management functions, new business processes, and the complex nature of new
technology, initial implementation represents the beginning of a lengthy
transition period that will continue through 2002 and beyond.
·
Costs of the Technology
Given the ongoing
modifications and adjustments being made to the technology, it will take an
extended period of time for municipalities to accurately assess the SDM’s
operational and financial outcomes. It
is important to note that EFA must also share in the additional technology
costs for ODSP and the ISU. The cost of
ODSP administration will be addressed later in this report.
Throughout this transition
period, during which all facets of the delivery of OW will be affected, EFA
must continue to dedicate resources to SDM to ensure that the new technology
and business processes function effectively. This will require a commitment to
identify and resolve core concerns by both the City and the Ministry, such as
those discussed in this report. EFA must
also continue to develop and maintain technological and administrative
expertise necessary to carry out critical functions and upgrades, including
local registration agent responsibilities for staff subscription of security
rights. In addition, indirect costs,
estimated to be $200 Thousand to the City annually (added to the 2002 budget)
covers other items, such as printing, toner, cartridges, paper, distribution
and postage.
In January 2002, the
responsibility for the ongoing operation of SDM was transferred to a new
Provincial Social Assistance and Municipal Operations group (SAMO) that is
comprised of MCFCS staff. Although
Provincial staff have indicated that they are exploring mechanisms that will
facilitate municipal input into planning and prioritization of issues, there
are some concerns that municipalities may not be able to connect directly with
SAMO. How municipalities link with the
Province is critical, given the degree to which the identification and
resolution of issues directly affect the delivery of programs and services. It is imperative that EFA staff continue to
be involved in the ongoing efforts required to improve the SDM, including
direct collaboration with SAMO.
A substantial transition
period will be required before the SDM, and particularly the case management
component, is fully functional in Ottawa.
Provincially directed modifications to SDM are being introduced
regularly to address aspects of the system that are not functioning
effectively, or to make improvements to the system’s performance. As a result,
caseworkers must make extensive and complicated adjustments to work processes
and work flows on a frequent basis. Due
to the complexity of the technology, continuous fine-tuning is required. Therefore, staffing efficiencies expected
for 2002 will not likely be realized due to this lengthy and difficult
transition period.
II. Financial
and Accountability Issues Regarding the Delivery of Ontario Works (OW) and the Ontario Disability Support Program
(ODSP)
Ontario Disability Support Program (ODSP)
The
Ontario Disability Support Program (ODSP) provides financial assistance to
disabled citizens and the City is mandated to cost share the ODSP with
MCFCS. The City pays 50% of ODSP
administration costs and 20% of ODSP benefits.
Cost of ODSP Administration
The
City received a letter from MCFCS in January 2002 stating that EFA’s 50%
contribution for the 2002 cost of administration for the ODSP program will be
increasing by $1.1 Million (21.6%) over EFA’s 2001 costs, and will increase a
further $830 Thousand in 2003 (13.5%), despite the fact that the ODSP caseload
has only increased by 1.2% over the past two years. MCFCS’s rationale for this cost increase is that it is due to
“fraud control” initiatives, which are associated with SDM.
EFA
had anticipated that an increase would be forthcoming from MCFCS and had
budgeted an additional $500 Thousand to cover impending increases in 2002. However, EFA did not anticipate such a
substantial increase and was unable to make adjustments to its submitted 2002
budget and as such, must internally fund the remaining $600 Thousand, resulting
in budget pressures for 2002. Also,
additional budget pressures exist for 2003, as EFA must contribute an
unanticipated additional $1.4 Million towards the cost of ODSP administration
next year.
EFA
was not informed of this increase until January 2002. A letter was forwarded to Mr. Pierre Lalonde, Regional Director,
MCFCS, to convey the City’s concern regarding this substantial, unexpected
increase. Please refer to Attachment 2
for additional details.
The imposed municipal increase is
substantial and untimely, as it was provided to municipalities as budget cycles
were either being completed or had already been passed. The Province has yet to communicate to municipalities,
the specific information about the items to be funded, the rationale for the
cost increases and the contributing factors for these increases. Municipalities are funding partners in the
delivery of ODSP yet are not consulted nor do they have input into decisions that
directly affect their budgets.
Cost of Ontario Works Administration (OW)
The
SDM supports and reflects MCFCS’s overall social reforms, legislative and
funding frameworks; all of which are highly prescriptive. Provincial governance and management of the
funding, delivery and administration of OW is progressively detailed and
municipalities have increasingly limited flexibility and discretion. Mandatory policies and programs introduced
over the past several years outline rigid criteria that govern client
eligibility and participation requirements.
Furthermore, the measures and systems introduced by MCFCS designed to
improve program integrity and accountability have resulted in a more complex
and resource intensive administration of OW.
MCFCS
has indicated that they are currently reviewing the funding formula for the
administration of the OW program.
Although MCFCS has not provided municipalities with any details and it
is six months into the year, MCFCS had advised EFA that OW administration subsidies
would potentially be reduced by approximately 6% effective 2002 with a further
reduction planned for 2003. These
subsidy reductions were anticipated for 2002 and have been reflected in the
2002 Operational Budget; they are not currently a budget pressure.
Cost
of administration of OW programs has historically been cost shared 50% MCFCS
and 50% municipality. Over the last few
years, MCFCS has attempted to develop a formula for the average cost per OW
case that would directly relate back to the cost of administration. A taskforce was established, comprised of
Provincial and Municipal staff in order to evaluate and recommend
administrative funding formulas, however, no recommendations have been
forthcoming as of yet. At present, the
Provincial subsidy does not cover the actual administrative costs and various
municipalities are expressing concerns that the cost per case formula
established by the Province, may be even less viable.
EFA
is also concerned that the funding formula would not support other programs and
services, such as essential health and social supports to ODSP recipients,
employment supports to ODSP spouses and adult dependants, supports to citizens
of low income and the administration of the Home Help Program.
EFA staff consulted with
various municipal service partners and MCFCS.
No public consultation was held.
FINANCIAL
IMPLICATIONS
As a result
of continual Provincial adjustments, the following summarize key financial
implications to the City of Ottawa:
1. The City’s share of the ODSP cost of administration budget has increased effective 2002 by 21.6% ($1.1 Million) and a further increase of 13.5% ($830 Thousand) for 2003;
2. MCFCS has verbally advised EFA of a potential reduction to the OW Cost of Administration budget of approximately 6% for 2002, with further reductions planned for 2003; and
3. SDM has additional associated costs, such as the City’s cost of the ISU for 2002 ($918 Thousand) and is not delivering on its expected administrative efficiencies.
Increasingly, EFA is not consulted by MCFCS in a timely or meaningful way relating to budgets and issues affecting the Branch’s program and services, nor is the Province transparent and accountable when requesting additional funds from the City (e.g. ODSP cost of administration, “fraud control” costs and ISU costs).
Attachments
1.
Letter
from General Manager, Dick Stewart, to Rhoda Matlow, Director, SAMO, February
27, 2002.
DISPOSITION
No action is required as a result of
this report.
Reference: “MCSS Business Transformation Project: Social Assistance Intake
Screening Unit (ISU) for Eastern Ontario”, provided to Committee April 2000 –
attachments “The Service Delivery Model General Overview” and “Business
Transformation Project, The New Service Delivery Model for Social Assistance”.