DHHS Seeking Private Partner for Welfare-to-Work Program

Sep 12, 2016

Maine’s Department of Health and Human Services is preparing to shift some responsibility for a welfare-to-work program to a private company. New York-based Fedcap Rehabilitation Services has been awarded the $63 million contract, but advocates for those on welfare say the company’s proposal raises red flags.

The goal of the welfare-to-work program, known as ASPIRE, is to help usher people off of assistance and through the doors of independence. But when Chris Hastedt of Maine Equal Justice Partners looks at the proposal by the company that wants to help run ASPIRE, what she sees is a revolving door, where people will cycle from welfare, to a job, then back to welfare.

“It appeared to limit opportunity by limiting access to education and training,” she says.

Hastedt says most people who receive assistance want to work. But they need proper support to be successful for the long term.

“You don’t want people to sort of walk into employment without being able to meet the needs of that employer, and losing their job. That’s not moving anybody forward,” she says.

But achieving more efficient, effective outcomes is the reason behind the state shifting some of the operation of the ASPIRE program to a private partner, according to a DHHS news release in January. The state is facing about $30 million in federal penalties for failing to meet work participation standards, dating back to 2007.

“Our programs, before these changes with the RFP, were in compliance,” says Ramona Welton, president of the Maine State Employees Association.

About 50 of the ASPIRE program’s 80 positions are currently held by state employees. Maine hasn’t had to pay those federal penalties, Welton says, and other states facing penalties have been able to come into compliance. It’s a shame, she says, that Maine chose to outsource ASPIRE to Fedcap Rehabilitation Services.

“This is a New York company, contracting out, sending Maine monies, services for Maine residents, Maine citizens, out of state, once again,” she says.

Welton also points out that Fedcap Rehabilitation Services is currently facing a dozen lawsuits for workplace discrimination, disability claims, and wage issues.

“Is this who we want to be doing business with?” she says.

Drew Gattine, co-chair of the Legislature’s Health and Human Services Committee, doesn’t think so.

“I mean, I’m not opposed to the Department using outside expertise to help us do a better job,” he says, but Gattine doesn’t think that’s what’s really happening.

He says the state can meet federal work participation requirements either by actually helping people find work or by shrinking the number of people who participate in the ASPIRE program.

“They’re really just scapegoating state employees, kicking them to the curb, and bringing somebody in who is not going to make poor Maine families better off, the goal is simply going to be to continue the Department’s effort to shrink the program,” Gattine says.

“I can tell you that Fedcap has a strong and longstanding commitment to education training and placement, and we see it as a critical component of poverty fighting,” says Christine McMahon, president of Fedcap Rehabilitation Services, which was established in 1935.

McMahon says her program is focused on helping people find long-term, sustainable employment. As for the dozen lawsuits over the past few years, she says with 3,500 employees, having just 12 lawsuits that amount to about $400,000 in payouts is a good track record.

“We have had one slip and fall is what’s really important about that number. So anyone looking at the details would realize that one of those incidents had to do with someone slipping and falling. And the rest of them were pretty routine situations, where there were disputes over how much someone is owed, and they’re handled relatively quickly,” she says.

DHHS declined to comment for this story as it finalizes the contract with Fedcap.

Hastedt says she hopes the final contract will ensure opportunity for education, training and services to successfully help people move out of poverty, and that DHHS will also carefully measure the outcomes of the program.