Lax controls and poor oversight created a "high risk of errors" from 2005 to mid-2007. Corrections continue to be made, official says.
Financial oversight at the Minneapolis Veterans Home was so sloppy that some residents were overcharged for their care and some staff nearly doubled their salaries with unauthorized overtime in a system open to fraud and theft, Legislative Auditor Jim Nobles said Wednesday in a scathing report.
"The Minneapolis home did not fulfill its financial management responsibilities," the report concluded.
The 18 problems identified in the report occurred from 2005 through mid-2007, the time examined in the audit. But all continued after massive care issues led Gov. Tim Pawlenty to move control of the home to the Minnesota Department of Veterans Affairs.
The home lacked adequate internal controls to protect residents' assets and trust accounts, monitor the cost of care and keep accurate payroll records, the report said.
Five of the 18 problems have been corrected, and the rest will be fixed sometime next year, said Gil Acevedo, Veterans Affairs deputy commissioner in charge of the five state-owned veterans homes. The other four homes have been free of the problems that dogged the Minneapolis home, he said.
"You have to realize that this is a different home now," Acevedo said Wednesday. "While we're still making improvements, the financial and care control systems are much better and the spirit of people at the home is greatly improved."
The legislative audit did not address issues of care and well-being of the 400 residents.
However, the Department of Justice has launched an investigation into whether residents are getting adequate care. Federal investigators made a brief visit last Thursday and will begin an intensive visit late in January, Acevedo said.
State health officials, who cited the home for 66 care infractions since 2005, have found the home now in compliance with state regulations.
The home's focus on care lapses, together with frequent turnover of top officials, "may have contributed to the home's poor internal controls [and] created an unacceptably high risk of errors and numerous opportunities for fraud," the report said. The audit report can be read at www.auditor.leg.state.mn.us.
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Did not pay proper interest on trust accounts held for some residents. An attempt to correct that in early 2006 resulted in some getting overpaid and some underpaid. Those errors will be corrected next year, Acevedo said.
Overcharged 40 to 60 residents who paid for their own care in 2005 and 2005. The calculation errors ranged from about $18 to $$221 a year, and will be repaid next year.
Mass-approved nurses' timesheets without verifying hours worked.
Apparently did not approve more than $2 million a year in overtime, which was used at a rate 2 1/2 times that of the four other veterans homes. Last year, nine nurses and aides received $204,000 for overtime, but work schedules showed only half of the 1,077 overtime hours they logged.
Hired 78 employees at starting pay higher than allowed by state personnel rules.
Could not find eight pieces of equipment valued at $50,000, including an air compressor and a computer projector. It also violated state law by not seeking bids for eight of 11 purchases that auditors examined.
Spent $58,000 in donations without authorization, and did not track non-cash gifts, increasing the risk of theft.
Allowed a pharmacy employee to both order and take delivery of prescription drugs, increasing the risk of theft.