Indiana Welfare Automation Project Experiences Growing Pains

Indiana's automated welfare eligibility pilot is having growing pains, according to officials at the state's Family and Social Services Administration (FSSA). Last week, the U.S. Department of Agriculture's Food and Nutrition Service (FNS) recommended that Indiana delay further deployment of the $1.16 billion project because it kept welfare recipients waiting too long for benefits.

Mitchell Roob, secretary of the Indiana FSSA, said rollout of the automation project already was halted in June due to flooding in the Midwest. Roob said FSSA officials are working to determine why benefits-processing timeliness has deteriorated since the pilot launched in October, but he said Indiana's current wait times are still within the maximum time allowed by the the FNS.

Roob cautioned that glitches are typical at the outset of large outsourcing projects, adding that the FSSA had planned to delay further deployment even before the FNS recommendation. The state will proceed cautiously, he said. "We're in no hurry. It's a 10-year contract. It's a brittle population. We want to make sure we're effective at it."

Indiana's project aims to accelerate food stamp eligibility by eliminating individually assigned caseworkers and empowering anyone answering the phone to help customers. The system also automates back-end processes and was outsourced to a private-sector team led by IBM under a long-term contract.

The letter sent to Roob last week from FNS Regional Administrator Ollice Holden cited deteriorating performance of benefits processing under the new system. "Indiana's most recent monthly reports indicate a decline in the timeliness of application processing that has occurred in the pilot region since the transition to the modernized service delivery model," Holden's letter said.

The automation program is deployed in 59 of the state's 92 counties. Before the rollout, participating counties approved 85 percent of benefits applications within 30 days of receiving them. Since changing to the new system, those counties approve less than 50 percent of benefits applications within 30 days, according to the FNS. Most of those applications were approved within 60 days, however, which Roob said is Indiana's maximum acceptable limit with the FNS.

The difficulties aren't uniform across all benefit programs managed by the new system, according to Roob. For instance, counties showing the sharpest drops in food stamp disbursals report the highest participation in the Healthy Indiana Plan (HIP), the state's low-income health-care program. Citizens access both programs through the new system.

"I'm honestly befuddled as to why Madison County, where we had a drop of about 6 percent in food stamps, had the highest per capita involvement in HIP, and the involvement in HIP far exceeds the drop in food stamps. Why is that? It doesn't make sense to me," Roob said.

Indiana's initiative is the latest welfare system outsourcing project to encounter problems. Texas cancelled a similar contract last year with Accenture which would have privatized the state's welfare eligibility process.

Zach Main, director of the Indiana FSSA's Division of Family Resources, criticized Texas' use of inexperienced call-center workers in an April interview with Government Technology. "Texas modernized and thought they could replace seasoned caseworkers with $8-per-hour people off the street," Main said. "We had an incredibly educated work force -- a lot of them with master's degrees and bachelor's degrees. The average tenure was more than 10 years, especially as you got into more rural areas. ... We said, 'These people are too valuable to let them go off to other places.'"

The FSSA turned 1,500 of its 2,200-person work force into IBM employees. The agency required IBM to offer all 1,500 employees jobs for at least two years at the same pay and benefits they received from the state.

In his April interview, Main said citizens were satisfied with Indiana's call-center operations, even though callers were waiting longer than planned to speak to eligibility workers. The FSSA planned for phone hold times of only 90 seconds. Instead, callers waited an average of five minutes, Main said.

He added that many callers were understanding when call-center operators apologized for those delays. "[Clients] say, 'Are you kidding me? Five minutes on the phone? I waited 10 minutes at the bus stop just to catch the first of two buses I needed to take to the county welfare office. This is incredibly convenient for us.'"