Public Health Management

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Public Health Management OrganizationEPID
602Lecture and Discussion onFINANCIAL
ACCOUNTABILITYSeptember 14, 2005
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Guest Lecturers

• Beth Franklin
• Acting Director of Financial Management
• Virginia Department of Health
• Steve Sullivan
• Director of Financial Management
• College of Humanities Sciences
• Virginia Commonwealth University

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State Health BudgetPublic health funding at the
state level

• The Virginia Department of Health (VDH),
  Virginias public health agency includes the
  following major service areas
• Higher Education Student Financial Assistance
• Emergency Medical Services
• Medical Examiner and Anatomical Services
• Vital Records and Health Statistics
• Statewide Communicable and Chronic Disease
  Prevention and Control
• Health Research, Planning and Coordination
• State Health Services
• Community Health Services (local health
  departments)
• Financial Assistance to Nonstate Entities
• Drinking Water Improvement
• Environmental Health Hazards Control
• Emergency Preparedness
• Administrative and Support Services

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State Health BudgetPublic health funding at the
state level

• The FY 2006 appropriations for VDH break down as
  follows
• Federal grant funds 217M 45
• State general funds 143M 29
• Locality match/
• health department revenue 83M 17
• Fee-for-service/other revenue 45M 9
• Total 488M

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Public health funding at the state level

• Federal Grants
• Federal grant funds represent nearly 100 separate
  awards from various federal agencies (CDC, HRSA,
  USDA, EPA, Homeland Security, etc.)
• Grant award cycles begin and end throughout the
  calendar year the old federal fiscal year is
  a thing of the past

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Public health funding at the state level

• Largest federal funding streams include
• WIC/Nutritional services for women, infants and
  children
• Ryan White HIV/AIDS services
• Maternal Child Health Block grant
• Local Waterworks Supervision and Construction
• Nursing Home Licensure Certification
• Family Planning
• The federal governmental has virtually eliminated
  the use of block grants to states federal
  funding is increasingly categorical in nature,
  and now almost exclusively categorical in the
  area of public health

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State general funds

• The percentage of total state funding directed to
  VDHs services, and VDHs total appropriations as
  a percentage of the states total budget has
  steadily declined over the last two decades
• State funding to VDH services is currently just
  over 1 of total state spending (see chart)

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State/local government cooperative budget
approach

• The Code of Virginia requires that each locality
  have a local health department
• With the exception of 3 urban health departments,
  VDH manages these local health departments
  statewide
• Local health department operations are funded by
  what is known as the cooperative health budget
  a combination of state funding, matched by
  local governments according to an
  ability-to-pay match rate developed by the
  Joint Legislative Audit and Review Commission

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Unique challenges to effective state/local public
health service budgeting and planning in a
Networked or Safety Net environment

• Ever-evolving array of public and private
  partners in the safety net of service delivery
• Impact of rising health care costs
• Ever-changing nature of public health needs
• Question
• Can we think of examples over the last two
  decades where the role, responsibilities and/or
  expectations in public health dramatically
  changed?
• Governing by network has long been a reality in
  public health and the network and demand for
  services is constantly changing

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Exercise Allocating Virginias state public
health

• Assign a percentage of the total state funding to
  VDH for each of the agencys major program areas
  according to your priority consider the
  appropriate role of local, state and federal
  governments in each program area
• Higher Education Student Financial Assistance
• Emergency Medical Services
• Medical Examiner and Anatomical Services
• Vital Records and Health Statistics
• Statewide Communicable and Chronic Disease
  Prevention and Control
• Health Research, Planning and Coordination
• State Health Services
• Community Health Services (local health
  departments)
• Financial Assistance to Nonstate Entities
• Drinking Water Improvement
• Environmental Health Hazards Control
• Emergency Preparedness
• Administrative and Support Services

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• Break Time! Back at 600PM

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Ensuring Financial Accountability

• Critical financial practices/principles
• Accounting/Purchasing
• Sound internal controls clear roles and the use
  of appropriate separation of duties is essential
  to maximize efficiency and minimize fraud and
  abuse this creates a certain level of
  redundancy in how transactions flow through an
  organization
• Risk management continual review of agency
  practices and procedures is necessary to identify
  and prioritize risks in areas such as
  cash/receivables processing, fixed
  asset/inventory control, accounts payable, etc.

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Critical financial practices/principles

• Managing the buckets proper use of fund
  accounting is vital to avoid co-mingling of
  discrete funding sources, e.g. to ensure
  accountability to federal/other grantors, state
  and local governments
• Question
• How can we see fund accounting requirements
  creating tension with the direction toward the
  higher trust contractual arrangements described
  in Chapter 6 of Governing by Network?

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Critical financial practices/principles

• Thorough knowledge of policies and financial
  compliance expectations from local, state and
  federal governments most good public policy
  allows some degree of flexibility and the art
  of public health financial and administrative
  management is to find the right way to do the
  right thing

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Critical financial practices/principles

• Budgeting/Financial Reporting
• Comprehensive tracking of historical
  appropriation actions to include legislative and
  management intent
• Manageable management reports, i.e. the ability
  to convert legalese of appropriation action
  language and complexity of governmental financial
  structures into English for managers and other
  staff
• Development of historical expenditure and revenue
  data direction toward data-driven
  decision-making

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Critical financial practices/principles

• Sound budget development and budget execution
  cycle to include
• Solicitation of additional needs/financial issues
  in advance of each budget cycle
• Initial budget target communication to managers
• Periodic mid-cycle analyses and management
  reviews
• Effective agency-level budget execution at end of
  cycle
• Appropriate action when managers fail to properly
  manage their resources

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Critical financial practices/principles

• Thorough knowledge of programs and services and
  maintenance of two lists at all times
• What are our current unmet needs should funding
  present itself?
• If budget reductions should occur, what are our
  least worst options?

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Creating a climate of accountability

• Always tell the truth
• Accept the human element and create an
  environment where employees acknowledge their
  mistakes quickly and without fear of
  over-reaction the Goofy Award
• Conduct business in an above-aboard manner
  including the wide sharing of financial
  information whenever possible

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Creating a climate of accountability

• Apply policy and procedures consistently and
  without regard to organizational rank ethics
• Take appropriate management action when staff are
  ill-suited for their positions either from a
  technical or ethical perspective

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Effective Financial Management

• Budgeting meets strategic planning a success
  story
• Surviving the 2002-2004 state budget reductions
  through the identification and prioritization of
  core and non-core public health services
• Exercise discussion - state public health
  allocation