Executive Board

Investigative committee sought for child welfare contract

The Legislature would establish a committee to investigate the quality of care and related staffing issues in one of the state’s child welfare service areas under a proposal considered Feb. 10 by the Executive Board.

Sen. Machaela Cavanaugh
Sen. Machaela Cavanaugh

LR29, introduced by Omaha Sen. Machaela Cavanaugh, would create the Eastern Service Area Child Welfare Contract Special Investigative and Oversight Committee. The committee would investigate placement and quality of care received by children in Nebraska’s eastern service area through the state’s contract with Saint Francis Ministries.

The committee also would study the process undertaken by the state Department of Health and Human Services and Administrative Services to award, implement and oversee the contract.

Nebraska implemented a statewide privatization of its child welfare system in 2009. By 2012, the experiment had failed and all service areas except the one serving Douglas and Sarpy counties had returned to DHHS casework provision.

In 2019, the department awarded Saint Francis Ministries a $197 million, five-year contract as provider for the eastern service area. LR29 states that Saint Francis Ministries has estimated a $27 million operating loss for the first year of the contract and may be at risk of bankruptcy.

Cavanaugh said the history of child welfare privatization in Nebraska is indicative of systemic problems with how the state approaches caring for vulnerable children. She said her interest is not in assigning blame, but in finding solutions.

“We’ve been here before,” Cavanaugh said. “Here we are, over a decade later, and no lessons have been learned.”

The proposed committee would include members of the Health and Human Services, Appropriations, Education and Judiciary committees appointed by the Executive Board. The committee would have subpoena power and would report findings and recommendations to the Legislature by Dec. 1, 2022.

Speaking in favor of the proposal was Lana Temple-Plotz, CEO of Nebraska Children’s Home Society. Testifying on behalf of the Children and Family Coalition of Nebraska — a statewide association of 10 child welfare and family service provider agencies — she said the initial contract between Saint Francis Ministries and the state was not feasible and that the procurement process should be investigated.

“We are extremely concerned with the ability of Saint Francis to carry out the contractual agreement with the state of Nebraska without disrupting or causing harm to children and families in the [eastern service area],” Temple-Plotz said.

Kerry Winterer, former DHHS CEO, also supported the proposal. Winterer, who led the department’s initial efforts to implement privatization and then course-correct after its failure, called the Saint Francis contract “grossly underfunded.”

Winterer said Saint Francis has failed to achieve the state-mandated caseworker ratio — which he said is not surprising, given that their contract bid was less than 60 percent of what the previous provider needed to carry out its duties.

“This bid clearly should not have been awarded to Saint Francis,” Winterer said. “I think anyone … who had experience with that whole privatization process and saw these contracts signed with the dollars [bid] would say, ‘It can’t work.’”

Current DHHS CEO Dannette Smith testified in opposition to the proposal. She said the Legislature’s existing Health and Human Services Committee can provide the necessary oversight for the child welfare contracting process for the eastern service area.

“A separate, special investigative committee proposed in LR29 would limit the department’s ability to move forward efficiently,” she said.

Smith said the department signed an emergency contract extension with Saint Francis Ministries in January 2021, which will ensure continuity of care and stability in the system for children and families until the situation can be stabilized.

Calling the current circumstances “unfortunate,” Smith said DHHS also is developing a more transparent process for managing the new emergency contract with Saint Francis.

The committee took no immediate action on the proposal.

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