Contract Providers’ Services Suffer as They Wait for Md. Health Dept. to Settle Unpaid Invoices

A backlog of invoice payments that the Maryland Department of Health owes to public health contractors has hampered their ability to assist those most in need.

Natanya Robinowitz is the executive director of Charm City Care Connection, an organization that provides Naloxone and sterile needles with the goal of preventing drug overdoses, and connects people who use drugs with public health and social services in East Baltimore.

She said the delay has impacted her organization’s payroll and ability to provide services, like helping people who needed to get copies of their birth certificates or providing emergency rental assistance.

“We didn’t have the cash to provide that so those services get put on hold,” Robinowitz said. “And what happens when you do that is you erode trust with community … but that is so hard to build, right?”

The uncertainty caused an “unnecessary erosion of staff morale, as well,” she said.

The agency’s inability to pay some of its vendors in a timely fashion has prompted a new round of criticism aimed at Health Department leaders, a frequent occurrence throughout the COVID-19 pandemic.

During a February budget briefing, Del. Kirill Reznik (D-Montgomery) confronted Maryland Health Secretary Dennis R. Schrader about a backlog of 900 unpaid invoices to contracted health care providers and grant recipients from as far back as July 2021.

Reznik said that some vendors have had to take out loans to make pay their employees because of the delays.

At the hearing, Amalie Brandenburg, the chief financial officer for the Maryland Department of Health, told Reznik that vacancies in the agency’s accounting department, the significant amount of funding used to combat COVID-19, and the “network security incident” that crippled the Department of Health’s computer systems in early December created a “perfect storm” for the backlog.

Brandenberg said during the hearing that the agency expects to have “the backlog completed by the end of the month.” Reznik said he would be checking in with the agency to see if the unpaid invoices had been cleared.

In a text exchange Monday, Reznik said that he was told that the Department of Health has “pushed through” approximately $22 million in invoices to the comptroller’s office for payment — “representing the vast majority of the outstanding invoices” for the Behavioral Health Administration.

“When asked if that constitutes the bulk of the 900 outstanding invoices for the entire department, they could not answer and say that they would get back to me tomorrow or later this week,” Reznik wrote.

Michael Ricci, a spokesperson for Gov. Lawrence J. Hogan Jr. (R), disputed Reznik’s reported number of invoices.

“There is not a backlog of 900 invoices — that falsehood may have stemmed from a reference to the number of emails in relation to this subject,” he wrote in an email.

Ricci pointed to the “network security incident” and the late submission of invoices — some of which he said weren’t submitted to the Department of Health until Feb. 10 — as the cause for delay. A portion of those outstanding February submissions are for services rendered in July, he said.

According to Ricci, the February submissions are “well within” the 30-day time period permitted for review and processing.

“Furthermore, many of these invoices were billed for work that has not yet started, let alone been completed,” he wrote. “Any remaining invoices, including the recently submitted ones, will be paid as soon as possible.”

‘The best explanation I got’

Dillon McManus was a special projects coordinator for the Department of Health’s Maternal Infant and Early Childhood Home Visiting Program, a federal grant program that sends people into homes to support healthy pregnancy and nutrition practices and connect families with social service resources.

McManus left the Department of Health in early February. He was there for over two-and-a-half years.

“I mean, there’s always kind of been invoicing issues, you know, either they were a little bit late, or sometimes we wouldn’t get our vendor’s invoices … in a timely way,” he said during a phone interview last week.

But, according to McManus, this payment backlog was different.

His team was responsible for allocating federal funding to 15 home visit providers across the state. To keep track of each case under his office’s purview, the department contracted with a data vendor to create and maintain case management software.

McManus said the agency’s data contractor went without pay for five months because of the invoice backlog but was “very kindly … on their own dime” continuing to operate the system and keep the office’s servers running.

“There was a point at which one of the people that we work with … said to us that, you know, ‘If we don’t really kind of get a resolution soon, we’re going to have to take the data system offline,’” McManus said.

This pushed his office director to pull all of the strings possible to get money to this contractor, or else they would have had to transition to an antiquated program or even keep tabs on client data by hand.

“I don’t know what we would have done it because we have to collect federal benchmarks … for our federal funder,” McManus said.

Inadequacies in tracking program data could have resulted in federal funding decreases or complete cuts.

“It would, you know, devastate the home visiting infrastructure in the state,” McManus said.

He said the data contractor was paid before their services were pulled.

McManus said that the problem stemmed from a miscommunication between the comptroller’s office and the fiscal and accounting office at the Department of Health.

“The best explanation that I got was that there was a glitch in the system and the invoices never made it to the comptroller’s office,” he said. “Even upon review, it looked like the invoices have been paid — they weren’t, and so they had to be re-sent to the comptroller’s office.”

Requests for comment from the comptroller’s office and the Maryland Department of Health were not returned.

‘A state executive issue’

During an interview in early February, Robinowitz said payments to her organization from the state and Behavioral Health System Baltimore had “been late over and over.”

Behavioral Health System Baltimore is a nonprofit that manages and provides funding to the city’s mental health and substance abuse care providers. Approximately 85% of its funding is provided by the state. The remaining 15% is philanthropic, from the federal government or grants provided by the city.

As of Dec. 6, state agencies and Behavioral Health Systems Baltimore owed Charm City Care Connection $235,000 — “65% of our quarterly budget,” Robinowitz said.

The money that Charm City Care Connection receives from the state comes in the form of reimbursement grants, meaning Rabinowitz and her staff pay for their supplies and services upfront and get paid back after they’ve been rendered.

But Behavioral Health Systems Baltimore is waiting for payments from the state, too.

“We still have nine outstanding invoices totaling $15 million,” Adrienne Breidenstine, the vice president of policy and communications for Behavioral Health System Baltimore, said during a phone interview Friday.

She said that the organization had received two payments totaling approximately $2 million earlier that week.

Ricci confirmed Tuesday that Behavioral Health System Baltimore was among the $22 million worth of invoices sent to the comptroller’s office on Monday.

Because of the missing funds, Breidenstine said that Behavioral Health Systems Baltimore is having to withhold payments to the organizations it funds while trying to pay workers.

Deborah Agus, the executive director of the Behavioral Health Leadership Institute of Baltimore, another agency that provides mental health and substance use disorder services, said that her organization had to cut payroll at the executive level because of the Department of Health’s unpaid invoices.

Breidenstine said Friday that Behavioral Health Systems Baltimore is beginning to be concerned about its own rent and payroll.

“We managed our budget so it didn’t impact our services at all,” Agus said. “Nobody on the ground saw any difference from what we were doing because we were able to plan and to cushion that in advance.”

After badgering a series of agencies, the Behavioral Health Leadership Institute had received most of the funding it was owed in early February.

And, in spite of the agency’s ownership of the funding delays, Agus doesn’t think the problem lies with the Department of Health.

“​​I don’t understand why the governor — knowing of all of this — would not be applying to use funds from his emergency fund … to solve the problem temporarily while all the other kinks are worked out,” said Agus. “To me, this is a state executive issue, and so I call on the governor for lack of leadership.”

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