Auditors cite ‘excessive’ spending at UConn Health Center

The state auditors’ office outlined a series of “excessive” spending practices Wednesday at the UConn Health Center involving professional development, compensatory time, retirement benefits and specialized legal fees topping $800 per hour.

Auditor John C. Geragosian also cited the Farmington-based center — which hosts UConn’s medical and dental schools and John Dempsey Hospital — with failing to document millions of dollars in purchases that might have required competitive bidding.

And while the health center agreed to revise some of its practices, it argued that others remain necessary to ensure fairness or a proper staffing levels.

The audit, which covered the 2010-11 and 2011-12 fiscal years, found the center paid $73,000 in costs for one worker’s sabbatical leave. But while UHC bylaws require those on sabbatical to return and work for at least one year, this employee never came back.

“Furthermore, correspondence indicates that the employee had accepted a full-time faculty position at another institution shortly after being granted sabbatical leave,” wrote Geragosian.

The center revised its system this past June that will require faculty to pay back sabbatical costs if they don’t return.

But UHC officials indicated they don’t plan to change another policy cited by the auditors, this one involving retirement benefits for about 50 managers that cost about $18,000 per year.

The auditors previously had cited the center for providing long-term disability coverage for managers who also were covered by the State Employees Retirement System — which also contains disability coverage.

“We noted that this coverage was excessive,” the audit states. “… The health center should not incur unnecessary expenses.”

UHC stopped coverage for managers hired after Nov. 1, 2011, but the latest audit notes that it retained coverage for about 50 managers, who had been hired before that date and who also have SERS coverage.

In its written response to the auditors’ office, center officials wrote that SERS coverage is inferior. Specifically, if an employee is injured off the job and can’t return to work — and has fewer than 10 years of experience — that worker can’t apply for disability retirement under the SERS system.

“We have concerns about withdrawing a benefit that was part of the terms and conditions for managerial employees hired before Nov. 1, 2011,” center officials wrote.

The health center released a written statement Wednesday afternoon indicating the audit has been reviewed thoroughly and that “action plans are already in place for many of the areas mentioned.

“While we do not agree with every finding raised in the report, we take it very seriously and have used the report to direct changes within the health center where appropriate. Significant progress has been made.”

The statement added that “the UConn Health Center is a complex and diverse institution with a workforce of approximately 5,000 employees. We constantly monitor our operations, and perform internal audits to verify procedures and processes are sound. We believe these limited findings reflect important but isolated opportunities for improvement.”

Other items cited by Geragosian in the new audit include:

  • ‘Excessive payment upon separation.’

The center paid $24,534 in compensatory time to one manager upon leaving the job. Those funds covered 39.5 hours of comp time, some of which was earned as far back as 2004.

“The health center has adopted a far more generous managerial compensatory time policy than other state agencies,” the auditors wrote, recommending that employees be required to use comp time “within a reasonable time frame” and that the center not pay for unused time when employees leave.

Center officials wrote that “it is not always practical or desirable” to mandate when comp time must be used, particularly when staff shortages exist in key clinical areas. It also is better, at times, to pay comp time to ensure a departing manager stays on the job long enough to ensure a smooth transition.

  • Tuition Reimbursement

The health center reimbursed one official for $6,250 in tuition courses involving courses taken at an institution other than UConn, even though they cost $2,850 more than UConn’s tuition rate.

UConn’s main campus in Storrs won’t reimburse tuition costs that exceed the university’s rate, and the auditors said the center should do the same.

“The health center is providing benefits to its employees in excess of what is deemed necessary,” Geragosian wrote. “The establishment of a maximum tuition reimbursement rate for managerial employees has not been deemed a priority.”

Center officials agreed to adopt a policy similar to that of the Storrs campus.

  • Competitive bidding and purchased services

The UHC paid legal fees as high as $820 per hour, spending almost $2 million in total over two years, for legal services related to patent issues.

The center agreed to the auditors’ recommendation to investigate using current staff, or hiring new staff with specialized legal training, to handle this duty at lesser expense.

The auditors also cited more than $1.9 million in large purchases, noting they could find no evidence the center tried to find the most favorable price.

In addition, the center couldn’t document whether it had bid for a laser microscope that cost more than $879,000, or for a multi-year contract worth $7.5 million.

Center officials agreed to improve documentation of purchasing.

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