State audit reveals significant overpayments by Texas HHSC to contractor

AUSTIN (KXAN) -- The Texas State Auditor’s Office has released the results of its comprehensive forensic audit into the Texas Civil Commitment Office (TCCO) revealing significant overpayments to a contractor by the Health and Human Services Commission (HHSC).

According to the audit, TCCO and HHSC are administratively attached, with TCCO responsible for supervising and treating civilly committed sex offenders and HHSC providing them with mental health services.

The audit, which was published in July, said of the approximately $1.2 million paid during a 14-month period to the contractor providing mental health services, HHSC overpaid $242,099 which is 26% of total mental health expenditures.

HHSC responded to the audit stating they, "agreed to the report’s findings," and intend to, "implement measures to address these issues moving forward such as retraining all payment processing staff," and "updating training modules," to prevent it from happening again.

Auditors said the contractor’s accounting and payroll records supported the mental health services expenditures, including detailed general ledgers submitted monthly, however, HHSC failed to review them or verify the allowability of the costs as required by their policy.

The audit said HHSC issued duplicate payments and payments for expenses that TCCO’s contract already covered with the contractor.

When reached for comment, TCCO provided the following statement:

“This audit covered both the Texas Civil Commitment Office (TCCO) and the Health and Human Services Commission (HHSC), which are separate state agencies. Your questions and that portion of the audit report relate to the HHSC contract for mental health services rather than a TCCO contract or TCCO payments/expenditures. Accordingly, we recommend that you reach out to the HHSC Press Office for comment and response.”

Here is HHSC's full response to KXAN:

“HHSC continues to strive to be a good steward of taxpayer’s dollars while providing much needed mental health services to Texans across the state. HHSC has agreed to the report’s findings and will implement measures to address these issues moving forward such as retraining all payment processing staff to avoid duplicate payments and updating training modules. HHSC will also implement sampling and validating measures to ensure the agency does not pay twice for the same service as well as develop new contract language with vendors to avoid these errors. HHSC plans to recoup the funds.”

No timeline has been shared for the recouping of the funds. This story will be updated as more information becomes available.