Report 2009-608 All Recommendation Responses

Report 2009-608: High Risk Update—State Overtime Costs: A Variety of Factors Resulted in Significant Overtime Costs at the Departments of Mental Health and Developmental Services (Release Date: October 2009)

Recommendation #1 To: State Hospitals, Department of

To make certain that patients and consumers are provided with an adequate level of care, and that the health and safety of the employees, patients, and consumers are protected, Mental Health and Developmental Services should encourage Personnel Administration—which is responsible for negotiating labor agreements with employee bargaining units—to include provisions in future collective agreements to cap the number of voluntary overtime hours an employee can work and/or to require the departments to ensure that overtime hours are distributed more evenly among staff. One solution would be to give volunteers who have worked the least amount of overtime preference over volunteers who already have worked significant amounts of overtime.

Agency Response*

Mental Health stated it raised the issue of having staff with the least amount of overtime receive preference over the employees who have worked significant amounts of overtime with Personnel Administration. In spite of that, Personnel Administration reached a tentative agreement as of October 7, 2010, with employee bargaining unit 17 and an agreement dated August 19, 2010, with employee bargaining unit 18, without a provision to have staff with the least amount of overtime receive preference over the employees who have worked significant amounts of overtime. (2011-406, p. 141)

  • Response Type†: 1-Year
  • Response Date: October 2010

California State Auditor's Assessment of Status: Fully Implemented


Recommendation #2 To: Developmental Services, Department of

To make certain that patients and consumers are provided with an adequate level of care, and that the health and safety of the employees, patients, and consumers are protected, Mental Health and Developmental Services should encourage Personnel Administration—which is responsible for negotiating labor agreements with employee bargaining units—to include provisions in future collective agreements to cap the number of voluntary overtime hours an employee can work and/or to require the departments to ensure that overtime hours are distributed more evenly among staff. One solution would be to give volunteers who have worked the least amount of overtime preference over volunteers who already have worked significant amounts of overtime.

Agency Response*

Developmental Services states that the decision-making process for staffing and supervision continues to be influenced by the health and safety of consumers and retaining the facilities certification with the Federal Centers for Medicare and Medicaid Services. However, Developmental Services stated it informed Personnel Administration of the bureaus recommendation. However, as discussed in Mental Healths response above, Personnel Administration reached agreements with the bargaining units, without the inclusion of having staff with the least amount of overtime receive preference over the employees who have worked significant amounts of overtime. (2011-406, p. 141)

  • Response Type†: 1-Year
  • Response Date: October 2010

California State Auditor's Assessment of Status: Fully Implemented


Recommendation #3 To: State Hospitals, Department of

To ensure that all overtime hours worked are necessary, and to protect the health and safety of its employees and patients, Mental Health should implement the Legislative Analyst's suggestion of hiring an independent consultant to evaluate the current staffing model for Mental Health's hospitals. The staffing levels at Mental Health should then be adjusted, depending on the outcome of the consultant's evaluation.

Agency Response*

The Automated Staff Scheduling and Information Support Tool (ASSIST) has been deployed at all Department of State Hospitals (DSH) facilities.

The DSH is currently conducting a clinical staffing study to assess staffing methodologies and staff to patient ratios within core clinical functions. This assessment will review current staffing standards to determine appropriateness; propose new population driven methodologies to adequately support our current populations; assess current relief factors to ensure they continue to reflect our coverage needs; and review staffing levels within core clinical functions. The following is the current status of the staffing study which will focus on the following areas:

Forensic Departments

- Preliminary Findings: Completed October 2015

- Validation: Completed February 2016

- Final Report: Completed September 2016

24-Hour Care Nursing Services

- Preliminary Findings: Completed August 2016

- Validation: Completed February 2017

- Final report: Currently underway, tentative completion November 2017

Protective Services

- Preliminary Findings: Completed February 2017

- Validation: Currently underway; tentative completion October 2017

- Final Report: Not yet initiated; tentative completion December 2017

Treatment Planning and Delivery

- Preliminary Findings: Currently underway, tentative completion September 2017

- Validation: Not yet initiated, tentative completion June 2018

- Final Report: Not yet initiated; tentative completion July/August 2018

  • Response Type†: Annual Follow Up
  • Estimated Completion Date: 2018
  • Response Date: October 2017

California State Auditor's Assessment of Status: Pending


Agency Response*

The Automated Staff Scheduling and Information Support Tool (ASSIST) has been deployed at all Department of State Hospitals (DSH) facilities.

The DSH is currently conducting a clinical staffing study to assess staffing methodologies and staff to patient ratios within core clinical functions. This assessment will review current staffing standards to determine appropriateness; propose new population driven methodologies to adequately support our current populations; assess current relief factors to ensure they continue to reflect our coverage needs; and review staffing levels within core clinical functions.

The initial phase of the staffing study will focus on the following areas: Hospital Forensic Departments, 24 Hour Care Nursing Services, Protective Services and Treatment Planning and Delivery. As each staffing study is completed it will be validated. The staffing study and validation will be completed by December 31, 2018.

  • Response Type†: Annual Follow Up
  • Estimated Completion Date: December 31, 2018
  • Response Date: October 2016

California State Auditor's Assessment of Status: Not Fully Implemented


Agency Response*

The Automated Staff Scheduling and Information Support Tool (ASSIST) has been deployed at all Department of State Hospitals (DSH) facilities and is currently in the process of retiring paper-based scheduling methods and transitioning to paperless schedule management. Plans are in place to transition to Maintenance and Operations by September 30, 2015. Future enhancements may be continued as post project enhancements.

The DSH is currently conducting a clinical staffing study to assess staffing methodologies and staff to patient ratios within core clinical functions. This assessment will review current staffing standards to determine appropriateness; propose new population driven methodologies to adequately support our current populations; assess current relief factors to ensure they continue to reflect our coverage needs; and review staffing levels within core clinical functions.

The initial phase of the staffing study will focus on the following areas: Hospital Forensic Departments, 24 Hour Care Nursing Services, Protective Services and Treatment Planning and Delivery. On August 26, 2016 DSH entered into a contract with the Cooperative Personnel Services (CPS) to provide an independent review and validation of DSH's staffing study efforts. As each staffing study is completed it will be validated by CPS. The staffing study and validation will be completed by September 2016.

  • Response Type†: Annual Follow Up
  • Estimated Completion Date: September 2015
  • Response Date: September 2015

California State Auditor's Assessment of Status: Not Fully Implemented


Agency Response*

As previously indicated, the Department of State Hospitals has the in-house expertise to evaluate its current staffing models. The Department has launched its staffing study project with an initial focus on the nursing classifications and anticipates completion of this phase in fiscal year 2015-16. As an update to the Department's complement IT project, the Automated Staff Scheduling and Information Support Tool (ASSIST), the first round of User Acceptance Testing was completed on October 9, 2014 and Department-wide implementation is scheduled to be completed in the spring of 2015.

  • Response Type†: Annual Follow Up
  • Estimated Completion Date: 2015-16
  • Response Date: October 2014

California State Auditor's Assessment of Status: Not Fully Implemented


Agency Response*

As noted in last year's annual follow-up response to this recommendation, the Department of State Hospitals believes it has the in-house expertise to identify the classifications that use the highest amounts of overtime, identify the key drivers of overtime use and propose solutions to reduce the amount of overtime used DSH staff. The DSH has identified the key classifications that incur the highest overtime usage, psychiatric technicians, registered nurses and hospital police officers. The DSH has tasked in internal unit to identify look at the staffing model and relief factors to determine if those reflect our true operating need and look at other potential drivers of overtime. After the staffing models have been refined and drivers identified, DSH will implement administrative remedies and propose other solutions to address high overtime usage.

As a complementary step, the Department is undertaking and IT project, ASSIST (Automated Staff Scheduling and Information Support Tool), that is expected to help the department reduce its overtime usage. Specifically, ASSIST will do the following:

- Provide an automated scheduling tool to deal with the complexities of appropriately staffing 24/7 mental health hospitals;

- Reduce the need for level-of-care staff in the scheduling function;

- Provide data to enable root cause analysis of staffing issues such as excessive use of overtime;

- Optimize staff scheduling to reduce overtime usage;

- Enable the department to schedule lower cost staff where clinically appropriate to meet treatment needs.

The ASSIST tool will be deployed in the fourth quarter of 2014.

  • Response Type†: Annual Follow Up
  • Estimated Completion Date: July 2017
  • Response Date: November 2013

California State Auditor's Assessment of Status: Not Fully Implemented


Agency Response*

The Department intends to comply with this finding in an alternate manner than that recommended by the Legislative Analyst's Office. The DSH has the in-house expertise to conduct the evaluation of state hospital staffing models. Within the next 90 days, the DSH will be conducting an internal review of clinical staffing models in the state hospitals using DSH staff that have expertise in DSH hospital staffing and operations. During the course of the department's evaluation, if it is determined additional expertise is required, the department may contract for outside expertise. As an outcome of this evaluation, we expect this evaluation to inform the DSH as to whether the existing use of overtime in the state hospitals is appropriate. Since 2009, DSH has taken action to reduce the use of overtime in the state hospital system. In September 2011, the DSH convened a group of fiscal mangers and retired annuitants with fiscal expertise to make recommendations to reduce hospital costs including overtime expenditures. This group of experts was known as the 'Transition Team.' The Transition Team made a series of recommendations to reduce costs at the hospitals that were implemented in December 2011. Implementation of these recommendations by the hospitals resulted in overtime reductions of $11.4 million in FY 2011-12 and projected to be $26 million in FY 2012-13.

  • Response Type†: Annual Follow Up
  • Response Date: September 2012

California State Auditor's Assessment of Status: Will Not Implement


Recommendation #4 To: Developmental Services, Department of

To ensure that the State is maximizing the use of funds spent on patients and consumers, Mental Health and Developmental Services should encourage Personnel Administration to resist the inclusion of provisions in agreements that permit any type of leave to be counted as time worked for the purpose of computing overtime compensation.

Agency Response*

As discussed in Mental Healths response to recommendation 5, Personnel Administration reached agreements with the bargaining units and the calculation of overtime will be based on the California Government Code, Section 19844.1 with the one exception noted in the response to recommendation 5. (2011-406, p. 144)

  • Response Type†: 1-Year
  • Response Date: October 2010

California State Auditor's Assessment of Status: Fully Implemented


Recommendation #5 To: State Hospitals, Department of

To ensure that the State is maximizing the use of funds spent on patients and consumers, Mental Health and Developmental Services should encourage Personnel Administration to resist the inclusion of provisions in agreements that permit any type of leave to be counted as time worked for the purpose of computing overtime compensation.

Agency Response*

Mental Health stated it raised the issue of the methodology for computing overtime with Personnel Administration. Personnel Administration reached a tentative agreement as of October 7, 2010, with employee bargaining unit 17 and an agreement dated August 19, 2010, with employee bargaining unit 18. Under these agreements, the calculation of overtime will generally be based on the California Government Code, Section 19844.1 that states personal leave, sick leave, annual leave, vacation, bereavement leave, holiday leave, and any other paid or unpaid leave, shall not be considered as time worked by the employee for the purposes of computing overtime. However, when an employee is mandated to work overtime during a week with approved leave, other than sick leave, the employee will earn overtime pay. (2011-406, p. 144)

  • Response Type†: 1-Year
  • Response Date: October 2010

California State Auditor's Assessment of Status: Fully Implemented


Recommendation #6 To: State Hospitals, Department of

To improve internal controls over payroll processing Napa should research the overtime over and underpayments we noted and make whatever payments or collections necessary to compensate their employees accurately for overtime earned.

Agency Response*

All necessary salary adjustments that were identified during the bureaus review have been made and processed by the State Controllers Office. (2011-406, p. 145)

  • Response Type†: 1-Year
  • Response Date: October 2010

California State Auditor's Assessment of Status: Fully Implemented


Recommendation #7 To: State Hospitals, Department of

To improve internal controls over payroll processing Sonoma should research the overtime over and underpayments we noted and make whatever payments or collections necessary to compensate their employees accurately for overtime earned.

Agency Response*

Sonoma worked with Developmental Services headquarters to reconcile the payment errors identified during the bureaus review and processed by the State Controllers Office. (2011-406, p. 145)

  • Response Type†: 1-Year
  • Response Date: October 2010

California State Auditor's Assessment of Status: Fully Implemented


Recommendation #8 To: State Hospitals, Department of

To improve internal controls over payroll processing Napa should review, revise, and follow procedures to ensure that their overtime documentation is completed properly; that timekeeping staff are aware of the overtime provisions of the various laws, regulations, and bargaining unit agreements; and that staff who work overtime are paid the correct amount.

Agency Response*

In October and November 2009 it informed its management team to carefully review timekeeping documents since their signatures on these documents indicate they have reviewed and approved the time. In addition, Napa issued an overtime reporting expectations memo in October 2010. This memo covers overtime expectations of staff, supervisors, and program directors/department heads. (2011-406, p. 145)

  • Response Type†: 1-Year
  • Response Date: October 2010

California State Auditor's Assessment of Status: Fully Implemented


Recommendation #9 To: State Hospitals, Department of

To improve internal controls over payroll processing Sonoma should review, revise, and follow procedures to ensure that their overtime documentation is completed properly; that timekeeping staff are aware of the overtime provisions of the various laws, regulations, and bargaining unit agreements; and that staff who work overtime are paid the correct amount.

Agency Response*

Sonoma has developed an ongoing process to audit the compensation transactions in an effort to avoid payment errors in the future. In addition, it provided training to all its human resources transaction personnel and timekeepers of applicable laws, regulations, contracts, rules, and policies. It provided training in February 2010 to all its managers and supervisors responsible for approving employees time. (2011-406, p. 145)

  • Response Type†: 1-Year
  • Response Date: October 2010

California State Auditor's Assessment of Status: Fully Implemented


Recommendation #10 To: State Hospitals, Department of

To improve internal controls over payroll processing Mental Health should fully implement Finances recommendations cited in its report on Mental Healths internal controls dated December 2007.

Agency Response*

Mental Health stated that Napa implemented a mandatory pre-approval from the Central Staffing Office prior to working overtime. Also, a new overtime reporting form, and a pre- and post-approval process have been developed, prior to any overtime payment being issued by Personnel Administration.

Napa stated its Central Staffing Office continues to develop hospital-wide policy and procedures to define responsibility and accountability for personnel practices for overtime.

In January 2010 Napa stated it performed an audit of its November 2008 unit sign-in sheets where a report was provided to its executive policy team, which identified weaknesses and recommendations to ensure that overtime documentation is completed properly and staff who work overtime are paid the correct amount. Also, Napa affirmed it implemented a process for conducting random overtime audits and performed overtime audits in January 2010 and October 2010. These random audits are intended to reduce the instances of fraud and abuse. (2011-406, p. 146)

  • Response Type†: 1-Year
  • Response Date: October 2010

California State Auditor's Assessment of Status: Fully Implemented


All Recommendations in 2009-608

Response Type refers to the interval in which the auditee is providing the State Auditor with their status in implementing recommendations made in an audit report. Auditees must submit a response regarding their progress in implementing recommendations from our reports at three intervals from the release of the report: 60 days, six months, and one year or subsequent to one year.

*Agency responses received after June 2013 are posted verbatim.


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