Improving collection procedures and quickly securing an $11.7 million grant are among the 32 steps recommended in a report on the Lexington-Fayette County Health Department, issued Monday by state Auditor Crit Luallen.
Overall, the report showed "no glaring areas of wrongdoing," Luallen said.
The way money is tracked and spent is at the heart of the majority of the recommendations. The health department wrote off more than $1.2 million in patient fees during 2009 and 2010 without trying to collect them, according to the report. And the $11.7 million federal grant to expand health services for the poor in Fayette County continues to be in limbo because an agreement on financial details hasn't been reached.
How the Board of Health and the board that oversees primary care services work together has long been a point of contention. But Luallen said preserving the $11.7 grant "certainly provides a strong incentive" for the two groups to work together better.
The message on the grant is, "You guys have got to get moving," said Dr. Rice Leach, the health commissioner, who requested the audit in April. But, he said, federal officials have not given a deadline for completing the details of how the money should be spent. Part of the federal stimulus package, the grant must be spent by September, Luallen said.
The status of the grant has been in question since last fall, when an original partnership involving the Bluegrass Regional Mental Health-Mental Retardation Board fell apart. The latest hurdle is the Board of Health's refusal to co-sign a lease for a new building with HealthFirst, the recently renamed non-profit formerly known as the Primary Care Center.
HealthFirst was looking for a financial partner to co-sign a lease for the former Verizon building near Turfland Mall. Health officials said securing that building could double the number of primary care patients served to about 40,000. As of Monday, a partner had not been found, Leach said. As for the auditor's other recommendations, he said, "There is a lot of work to do" but few surprises.
The report "showed the need to tighten a lot of things up," he said. But "there were no major problems," he said, such as systematic misuse of public funds.
Many of the report's recommendations dealt with policies that were used on a day-to-day basis but had not been properly documented. Luallen said Leach and William North, executive director of HealthFirst, were working well together to solve the issues addressed in the report. A response is required within 60 days.
Also, the report suggested that the Board of Health allocate a specific amount of tax dollars annually to HealthFirst. The board has for decades received the health tax money and then determined the allocation for primary care services, with the amount varying from year to year.
The audit recommends an allocation of a percentage of the total tax amount or an annual flat fee. This year, HealthFirst will receive $1.2 million in tax money.
In terms of personnel spending, the audit showed that former Dr. Melinda Rowe, the former health commissioner, spent $2,211 for car washes and fuel that lacked proper documentation during 2010 and 2011. Rowe's W-2 also did not reflect the benefits of using a health department vehicle. Rowe's attorney, Richard Getty, said Rowe had not been questioned about the expenses during the course of the auditor's review but that the use of a car was included in her compensation package. He also said Rowe was not responsible for creating her W-2 forms.
The audit signals the end to a difficult year in which Rowe resigned in the spring after a series of volatile public meetings with health department staff. A separate review of the health department by the state Cabinet for Health and Family Services' Office of the Inspector General resulted in the indictment of two former health department officials over allegations of misuse of the pharmacy.