Clarity lacking in fee from Health Department
WHEN state government provides a specific service to citizens or local governments, it’s reasonable for beneficiaries to pay a fee to cover the cost of that service. But the system should be transparent, equitable and predictable.
The data-services fee imposed by the State Department of Health on county governments doesn’t appear to pass that test.
The state has a role in most county health departments aside from those in Tulsa County and Oklahoma County, which are operated independently of the state system. Thus, the state provides data services for county departments. Recently, the state Health Department has issued three quarterly bills for data charges, which would generate a combined total of about $900,000 a year.
The problem with these bills is that the link between the amount that specific counties owe and any specific services rendered appears weak at best.
Indirectly quoting a Health Department spokeswoman, The Oklahoman’s Randy Ellis reported that the agency “pays for costs that it believes are incurred at the state level, but is now attempting to recover costs it attributes to county health operations.”
One can understand why county commissioners would balk at bills based on a provider’s vague beliefs and attributions, rather than a concrete accounting of specific services rendered and associated costs.
The department is billing county governments using a formula based on the percentage of each county health department’s salaries that are paid from county millage levies. Yet one would think bills would be based on actual services rendered. Surely some county governments use these data services at disproportionately higher rates, while others use those services at disproportionately lower rates. And one assumes those usage rates fluctuate depending on local circumstances.
Furthermore, the Health Department declined to bill 17 counties because state officials didn’t think those counties could pay their bills. That effectively provides those counties a taxpayer subsidy other counties don’t receive. It’s also a tacit incentive for county governments to be less efficient, since officials know good management will lead to bigger bills and poor management will generate subsidies.
It’s also worth noting that the Department of Health has never billed counties for these services until recently. An agency spokeswoman said the state simply absorbed these costs in the past, but the current state budget situation doesn’t allow for that practice to continue.
That suggests counties should have been paying for these services for years. That the state didn’t bother to collect those payments does not inspire confidence in the fiscal management of state government.
There should be a clear relationship between a state government fee and a service rendered. Those paying the fee should know in advance what a service will cost them. But in this instance, there appears to be little correlation between service provision and billing, especially given that some people using the service received no bill at all.
Critics often blame state government’s financial challenges for forcing cost-shifting. But the Health Department’s data-services fee instead highlights the fact that state government rarely employs basic business practices — which explains many of the state’s financial problems in the first place.