Hawaii Legislature Advancing Measures to Raise Taxes
by Lillian B. Koller, Hawaii State Human Services Director

Rather than searching for ways to reduce expenditures in State government, the Legislature is advancing measures that would raise taxes on residents and businesses.

Clearly, it is counter-productive for Legislators to increase our already heavy tax burden during the worst economic downturn in State history.

A far better approach is for government to carry out its duties in innovative ways that are more efficient and cost-effective.

That is why the Department of Human Services (DHS) wants to streamline the processing of applications and renewals for public assistance programs, including welfare, Medicaid and nutrition benefits.

With the demand for social services rising, this initiative would deliver much-needed help to vulnerable residents faster, easier and more accurately.

This initiative would also save tax dollars as Hawai‘i grapples with a projected budget shortfall of over $1.2 billion.

Given the urgency of delivering public aid and the shortage of funds, we can no longer afford an outdated “horse-and-buggy” system that is labor-intensive, costly and slow.

Instead of bringing in more horses, we should bring benefit processing into the 21st century.

DHS wants to create the Eligibility Processing Operations Division (EPOD), which would handle benefit applications and renewals for the entire state. EPOD would have two processing centers – one in Honolulu and one in Hilo – where the majority of eligibility workers are already located.

Under the current system, customers must apply for benefits in-person or by mailing or faxing applications. This typically requires labor-intensive and time-consuming follow-up contacts with DHS, including face-to-face interviews. It also produces work backlogs and risks federal penalties for errors and missed deadlines.

With EPOD, in-person interviews would no longer be required, and customers could submit applications online or by phoning a new DHS call center. Customers could still fax or mail applications, if they prefer, and receive in-person help at community social service agencies, health facilities and remaining DHS offices across the Islands.

Before long, the demand for in-person contact with DHS would diminish significantly as residents realize they can receive benefits faster and without spending time in offices.

Other EPOD advantages include:

• Reducing the complexity of work and risk of error or fraud;
• Creating a highly efficient “production” type atmosphere;
• Equalizing workloads among eligibility staff; and
• Eliminating the “silo” approach that interferes with efficient teamwork to get the job done.

Consolidating eligibility operations has worked well in Arizona, Oregon, Washington, Utah and Florida. DHS modeled EPOD after the ACCESS Florida initiative, which has gained national attention for efficiency and for satisfaction ratings among both customers and state employees.

An independent analysis by the Mathematica research firm concluded that consolidated eligibility cut administrative costs by 36 percent and reduced the average interview time with clients from one hour to just 15 minutes.

With EPOD’s efficiencies, fewer eligibility staff would be needed. Accordingly, DHS is consulting with the Hawai‘i Government Employees Association (HGEA) about a proposed reorganization of our State agency and a reduction-in-force.

Initially, HGEA prematurely and publicly speculated that our EPOD proposal would result in up to 400 layoffs, 50 office closures and the end of face-to-face help for customers.

In reality, our proposal would close 31 offices, retain 289 eligibility staff and eliminate 232, while ensuring that customers could receive in-person help on all islands.

It is regrettable that employees would be laid off under this plan, but DHS must keep our focus on improving customer service at lower cost to taxpayers.

That is much better than raising taxes to prop up an inefficient and outdated government system.

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Related: DHS workers brace for another round of layoffs