In December 1980, the city Department of Human Services ran out of blank forms used to bill patients at St. Elizabeths Hospital and at neighborhood health clinics.
So, for about a year the District of Columbia government sent no bills to hospital or clinic patients responsible for their own bills. In all, 32,953 bills totaling $7.3 million were not sent until after a new supply of forms was delivered to DHS in December 1981.
The incident was one of dozens cited yesterday in a General Accounting Office audit that concluded the D.C. government was failing to take "timely, forceful and persistent action" to collect at least $75 million in delinquent bills owed to the city.
In all, the city government had $269 million in outstanding bills as of Sept. 30, 1980, and considered $130 million of that uncollectable because the bills were so old, the GAO said.
The GAO audit focused on only three city departments--Human Services, Transportation, and Environmental Services, which handles water billings. In those agencies alone, GAO said, $75 million was delinquent by at least 30 days, and $64 million of that was deemed uncollectable.
"The agencies were not following good billing and collection practices," GAO said, "which may be the reason many accounts were delinquent and why many were declared uncollectable." The uncollected billings were primarily for water service, health care, and for overpayments of well over $5 million made to food stamp vendors, hospitals, doctors and persons receiving public assistance, the report said.
In many cases, city agencies took months to send out initial bills but never followed up with second collection attempts, the GAO said. By contrast, the auditors said, private firms and hospitals generally send three or more collection letters and follow up with telephone calls and referrals to private collection agencies.
City Administrator Elijah B. Rogers, in a four-page response included in the GAO audit, said it contained "some helpful ideas," but said the report was incomplete because it failed to credit the "tremendous progress" the city has made in collections.
"Your major conclusion that three agencies, and by implication the city in general, are 'making little effort' to collect debts is not supported by the facts," Rogers said.
He said DHS has recouped $15 million in Medicaid overpayments from hospitals and said the city has recently automated many of its collection systems. In addition, he said the city has collected $10 million in delinquent water bills, although he acknowledged continuing problems in that long-troubled billing system.
Rogers also said parking ticket collections, which were not discussed in the audit, generate $19 million in annual revenue and said the program is considered "the best in the nation."
DHS director James A. Buford said yesterday he would "reserve comment" on the audit until he has read it. DHS officials have said they will change their method of ordering billing forms to prevent incidents like that at St. Elizabeths, in which the order for new bill forms had been lost, GAO said.
The GAO said that at St. Elizabeths the city stands to lose up to $5.9 million more because the federally run hospital is billing the city $142.60 daily for care of city residents, but DHS has not yet changed its 1979 billing rate of $38.39 daily which the city, in turn, charges patients or their families or insurers.
Overpayments are a continuing problem for the city, the GAO said. The audit cited cases in which the city continued making regular payments for as long as one year to persons who were no longer employed as providers of foster care, home health care and other services.
The GAO recommended that the city adopt a policy for all agencies to speed up billing and use many of the methods employed by the private firms. By law, Mayor Marion Barry has 90 days to respond in writing to the City Council and Congress, outlining the city response to the GAO recommendations.