- Associated Press - Thursday, December 17, 2015

LINCOLN, Neb. (AP) - A Nebraska agency that serves developmentally disabled people faced tough questioning Thursday from lawmakers who recently learned of payment errors that cost the state millions.

The division’s new leader said the state has repaid nearly $20 million to the federal government because it mistakenly paid service providers at rates the federal government hadn’t yet approved.

The developmental disabilities division absorbed some of the cost by pulling money from its community-based services aid, but still expects to ask lawmakers for $11.3 million during the legislative session that begins in January.

Courtney Miller, the newly appointed head of the state’s developmental disabilities division, said state officials discovered the errors and voluntarily reported them to the federal government to avoid additional penalties.

The division “is committed to a transparent, inclusive approach to addressing the challenges presented to you today,” Miller said in testimony to a special investigative committee.

Miller said state officials enacted the new rates in July 2014, but the federal Centers for Medicare and Medicaid Services didn’t approve the rate methodology until July 2015. The difference between the rates the federal government had approved and what the state paid totaled about $19.6 million.

In addition, Miller told lawmakers that the state also has to refund nearly $1 million in federal money that was used for a state ward pilot project. The money should have come from the state instead.

Lawmakers on the committee voiced concern about the errors and questioned whether they could happen again.

“What did we do wrong, and how are we going to stop ourselves from doing this in the future?” said Sen. Burke Harr of Omaha.

Sen. Al Davis of Hyannis asked why the spending wasn’t overseen by someone who could have caught the mistakes.

Miller, who was chosen as the division’s permanent director this month, said many of problems originated under the administration of former Gov. Dave Heineman. Miller said the division is working on reforms and is advertising for a new finance director to replace staff members who have left.

Sen. Kate Bolz of Lincoln said that despite the problems, the programs themselves served a worthy goal. The state ward pilot program was designed to keep more neglected children with their families as long as steps can be taken to keep them safe.

“There were some timing issues, but a lot of the things we’ve done are in the best interest of the state,” she said.

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