Progressive Thinking

This week Senator Vinehout writes about a couple of the latest scams reported by the DATCP Division of Consumer Protection.  People who receive suspicious phone calls or emails should report them to Consumer Protection Investigators.

MADISON - “I got a call saying the IRS was taking me to court, but I filed everything on time. What do I do?” Linda asked. We both agreed the phone call sounded fishy, so I reached out to the Wisconsin Department of Agriculture, Trade and Consumer Protection (DATCP) to learn more.

The Consumer Protection experts explained there has been an explosion in the number of IRS imposters contacting people and demanding their financial information. Tax identity theft can lead to fraudulent tax filings or use of the victim’s Social Security number.

IRS Commissioner John Koskinen stated the first contact with the IRS would be official correspondence sent through the mail. Consumer Protection officials advise never to respond to an email or phone call requesting your Social Security number or other financial information.

Every year I am reminded that scammers and thieves prey on Wisconsinites and they become more sophisticated in their tactics. It is important for everyone to know what to watch for and where to get help.

According to DATCP officials, consumer complaint statistics have been on the rise. They report that scammers and thieves have stepped up efforts to steal people’s money or identity. Sandy Chalmers, Division Administrator of Trade and Consumer Protection, noted that many citizens report, “receiving fraudulent calls offering ‘Credit Card Services’, Microsoft tech support and medical equipment.”

One of the latest scams reported by the Consumer Protection Bureau relates to people receiving emails from the “State Court”. The message falsely claims the person must appear in court on a specific date with documents related to “the case.” DATCP officials warn the email and attachments should be deleted because they contain malicious software that can infect your computer with a virus.

This scam has been reported nationwide. The general rule to know is that Wisconsin courts will not send you email unless you are participating in an electronically filed case or consent to receive electronic court notifications.

Consumer Protection officials noted the other most often reported scam is offers that sound too good to be true. Prize scams offer “official” entry numbers, certificates, and envelopes al or like telegrams to lure you into opening the envelope and returning what is inside. Internet scams offer the promise of quick cash or investment schemes.

“You can be sure you won't win any prize with a brand name, cash, or a government bond. Prizes such as jewelry and watches are junk, vacations are actually vacation certificates hardly worth the paper they're printed on, and shopping sprees amount to coupons that are good only when making purchases,” warns the Senior Alert & Advice page on the Consumer Protection website.

They also warn about the late night calls saying your debit card needs to be re-activated and asks that the card number be entered. The other type of call to be wary of is one that offers lower interest rates on mortgages or credit cards. The caller asks for a credit card number so the lower rate can be “processed.”

The bottom line on all of these types of calls is that the caller is trying to lure you into giving away personal information. The rule of thumb is if someone calls asking for your credit card or bank information over the phone, hang up and report the scam.

A few other rules the Consumer Protection folks reminded me to pass on is do not pay a handling fee or provide a credit card number or information about your savings or checking account to win an award. Also, do not wire a payment or send a check through an express courier service without checking references and contacting the Office of Consumer Protection.

Finally, if you do lose money to a fraudulent telemarketer – REPORT IT! Many people are embarrassed and do not report. That allows the swindler to victimize other people in our community. Wisconsin law has serious penalties for those who engage in such illegal behavior. The best way to protect yourself and others is to be informed and to report any suspicious phone calls or email messages. You can call 800-422-7128 to speak with a consumer protection investigator or file a complaint on-line at https://mydatcp.wi.gov/Complaints.

MADISON - The dictionary defines “twilight zone” as an “area just beyond ordinary legal and ethical limits” or alternatively as a “world of fantasy where things are not real” or a “situation or an idea that is unclear or confusing.”

All these definitions describe Wisconsin’s State Capitol and those who rule the place at the moment.

A leading Republican lawmaker who sits on the Assembly Campaigns and Elections Committee says “there’s no question” Wisconsin should dump the nonpartisan agency that oversees elections, campaign finances, lobbying and government ethics in favor of a partisan replacement modeled after the Federal Election Commission.

Republicans like state Representative Joe Sanfelippo are convinced Wisconsin’s Government Accountability Board is biased because it did its job and joined with both Democratic and Republican prosecutors to investigate suspicious election campaign conduct.

The law school at Ohio State University has singled out the GAB as anational model that should be copied by other states and Wisconsin’s largest newspaper calls it a “model for impartiality.”

Nevertheless, Sanfelippo insists “Wisconsin would be wise to follow the model of the Federal Election Commission and have state legislative leadership appoint” a new six-member board replacing the GAB.

Wise clearly means two entirely different things to Sanfelippo and the business-oriented Bloomberg news service. In an editorial published in recent days, Bloomberg said: “No agency better represents Washington’s dysfunction than the FEC.” The editorial went on to say the commission is “hopelessly and endlessly deadlocked” and noted that as the amount of money spent on campaigns has increased candidates, parties and independent groups have been allowed to stretch the law with “virtual impunity” and “the agency’s impotence has become all the more embarrassing.”

You’d think such an assessment might dampen Representative Sanfelippo’s enthusiasm for creating a state-level version of the FEC in Wisconsin. You would think wrong. Sanfelippo still fantasizes about “following the FEC prototype . . . which guarantees greater transparency and compliance for all residents and public officials.”

Representative Sanfelippo is in that fifth dimension Rod Serling always used to talk about.

At a recent Joint Audit Committee hearing, legislators asked WEDC officials if they would implement the latest LAB recommendations to improve Governor Walker’s flagship jobs creation agency. Those questions were not answered in a way that indicated WEDC would take the clearest path to improvement and building public confidence.

MADISON - “Are you going to follow the recommendations in the audit?” I asked the Board Chair of the Wisconsin Economic Development Corporation (WEDC). He crossed his arms, sat back and smiled at me.

A smile that, to me, said I was annoying him.

The clearest path to better outcomes at Governor Walker’s flagship jobs creation agency is to follow the recommendations of the nonpartisan Legislative Audit Bureau (LAB).

However, during a recent and very long public hearing investigating the troubled agency, I repeatedly heard obfuscation, deception and disdain for the law.

Legislators serving on the Joint Audit Committee heard familiar problems: grants and loans given without legal or financial vetting; job creation promises never verified by WEDC officials; inadequate follow-up on companies lacking adequate reports.

The third LAB audit report in three years documents that WEDC has made progress. A financial system is in place (at one time the organization lacked even an accounting system). Credit risk managers review files – some of the time. Contracts are based on requirements in the law – part of the time. Plenty of new policies exist – if only staff would consistently follow these policies.

Dan Ariens serves as the Chair of the WEDC board. It’s a new position to Mr. Ariens. He’s been on the board since the creation of WEDC, but this summer he took over as Board Chair when Governor Walker resigned that position. Mr. Ariens runs a business that manufactures snow blowers and lawn tractors. In a seemingly incestuous tangle, he also serves as Board Chair of Wisconsin Manufacturers and Commerce (WMC); one of the largest lobbying groups and ranks high on the list of political spending organizations.

Maybe that is why some of my colleagues were hesitant to pressure WEDC officials into a commitment to follow the law. Not so for Senator Alberta Darling.

During questioning, I pointed to the statute book – Wisconsin’s state laws – and identified page after page of laws WEDC did not follow. I asked officials how people could be confident their tax dollars were well spent when WEDC staff failed to verify whether jobs were actually created. Senator Darling followed my questioning adding, “We need to know the answers to Senator Vinehout’s questions.”

Instead lawmakers heard explanations like “we need to make the organization as fluid as possible so we’re not handcuffed by policies.” Never mind that for this quasi-public entity, “policies” serve in place of administrative rules and are designed to carry out the law.

In response to questions by Representative Berceau about contracts that did not follow the law, the Chief Legal Counsel answered, “We are not so arrogant to think the law doesn’t apply to us.” Their actions tell us otherwise.

The recent Audit Committee public hearing provided WEDC’s top brass an opportunity to turn the page. With a sincere apology, they could begin to renew the public’s faith in the organization; address poor decisions head on, improve legislative relations and gain back good will.

Instead, the CEO didn’t even attend the hearing despite the meeting being changed to accommodate his schedule. The Board Chair appeared aloof; his answers were often cagey. The Chief Legal Counsel teetered between whitewashing the truth and denying recent violations by claiming problems were in the past.

The Harvard Business Review might be somewhere in WEDC’s office. After all, the agency touts its ability to operate like a business. I’d suggest the WEDC folks take a look at the most recent issue.

Professors Schweitzer, Brooks and Galinsky offer practical guidelines for when top leadership should apologize. “The bottom line for serious transgressions: Senior leadership must immediately express candor, remorse and a commitment to change in a high profile setting – and make it sincere.”

The recent Audit Committee hearing provided a perfect opportunity for WEDC to come clean and start over. Instead, without a sincere apology, they risk more bad news and yet another scathing audit.

The economic development community wants to turn the page on WEDC’s problems. A simple, unqualified “Yes” to my question about following the LAB recommendations would be a great first step. But without a clear commitment to change and real remorse for actions, WEDC’s redemption appears doubtful.

Sitting by the window and waiting. Elderly and disabled stranded when company did not deliver rides.

MADISON - “Just how many ‘no shows’ are acceptable?” I asked Medicaid Director Kevin Moore at a recent Audit Committee Hearing. “Is 4,154 people left without a ride too many?”

Wisconsin needs a different system for getting seriously ill elderly and disabled to their medical appointments. A recent audit showed poor services provided by a private company contracted to give rides to some elderly and disabled.

A Rock County resident arranged for a wheelchair van. But the vehicle sent did not have a wheelchair lift. The wheelchair bound person missed their appointment. A developmentally disabled Dane County person walked home in a thunderstorm after being stranded at the clinic. A paralyzed Richland County resident could not get a ride to a surgery appointment.

These are just a few of the cases from a recent audit conducted by the nonpartisan Legislative Audit Bureau. Auditors wrote, “from August 2013 through June 2014, we found 4,154 instances in which transportation providers did not arrive to provide a scheduled trip and 55,320 instances in which they arrived more than 15 minutes late to take recipients to their appointments.”

The State Medicaid Director has a contract with a private St. Louis-based firm, Medical Transportation Management (MTM), to provide non-emergency medical transportation to almost 70,000 people in Wisconsin. MTM is a “broker” which organizes rides to pick up and deliver Medicaid recipients to medical appointments.

I have received many complaints from families, patients and local transportation companies. One disabled resident in Black River Falls told me about traveling in a van with no heater on a cold Wisconsin winter day. An Eau Claire woman waited more than an hour for a ride with her sick daughter. When constituents tried to complain they ended up getting the run-around.

Medical transportation companies – hired by MTM – were so discouraged that over half of them responding to an Audit Bureau survey said they were dissatisfied or strongly dissatisfied with MTM. Scheduling was one area of concern.

The audit reported on many problems, including examples of poor management. Auditors found that MTM sent faxes to transportation companies requesting a ride after the trip was supposed to be provided. They then charged the company with failing to provide the trip.

The disastrous treatment of Wisconsin transportation companies has led to a huge exodus of companies willing to provide rides for medical visits to Medicaid recipients. Prior to the brokerage system, Janet Zander testified, “Wisconsin had approximately 200 specialized medical vehicle (SMV) providers. Today, there are only about 80 providers operating in the state.” Especially hard hit are rural areas.

Mr. Moore, the Medicaid Director, testified he accepted the auditors’ recommendations and was amending the contract with MTM. “We know there are challenges that we didn’t know before the audit,” he told the committee. “We’ve taken aggressive action.” He also encouraged people to let him know if things were not working. “If we don’t know what’s wrong, we can’t fix it. If they [riders] don’t complain, we won’t know. Please call us.”

Many advocates testified that the system was not set up to succeed. “The broker is paid for all rides, regardless of whether the ride shows up or gets a rider to their destination late,” said one advocate. This system creates a “perverse incentive” that encourages MTM to skimp on providing services. When they skimp, others sometimes pick up the cost. Molly Nolte from Rock County told of services so poor the county dipped into its own limited funds to provide rides.

Ms. Zander and many other advocates told committee members that without an adequate transportation system for the elderly and disabled to get to medical appointment, more folks would end up sicker, in the hospital, with the state spending more.

“We need a complete overhaul of this system,” testified Representative Peter Barca who spearheaded efforts to approve the audit. He listed several ways in which the current system rewards MTM to discourage riders and pay for fewer rides. “We need to look at a different type of contract.”

I agree. Even majority party members of the Joint Finance Committee agree. They added a pilot study to explore a new system into the state budget. The governor vetoed the idea.

National data says letting insurers set their own rates has led to the 4th highest insurance premiums in the nation for silver plans, and cost inflation 7% to 9% higher for Wisconsinites. The average premium for a Wisconsin silver plan is $780 more per year than the national average.

STATEWIDE - The Walker’s Administration’s Office of the Commissioner of Insurance recently defended Wisconsin’s lax approach to reviewing health insurance rates, but national data refutes their claims.

According to the Milwaukee Business Journal, Deputy Insurance Commissioner Dan Schwartzer said “letting insurers set their own rates” has led to “minimal” rate increases in Wisconsin.

However, a recent report by the Commonwealth Fund found that Wisconsin had among the highest health insurance rates in the nation on the individual insurance market, and inflation rates that are well above average.

The Commonwealth Fund report found Wisconsin had the 4th highest insurance premiums in the nation for silver plans, the plans that federal government uses to calculate tax credits to make health insurance more affordable. Wisconsin also had inflation rates 9% above the national average for silver plans, and 7% above the national average for all plans on the individual market. The average premium for a Wisconsin silver plan is $780 more per year than the national average.

Citizen Action of Wisconsin has repeatedly pointed to the Walker’ Administration's lax approach to rate review as a factor in high Wisconsin health insurance costs. In June the federal government called on Wisconsin and other states to more carefully scrutinize large rate increases.

States such as Minnesota have reduced health insurance premium increases by implementing more robust rate review.

“The Walker Administration’s refusal to police excessive health insurance rates is a disaster for Wisconsinites struggling to afford rising premiums,” said Robert Kraig, Executive Director of Citizen Action of Wisconsin. “Simply allowing insurance companies to set their own rates violates the intent of the federal health care law. It’s long overdue for the Walker Administration to move beyond its endless efforts to sabotage health care reform, and take advantage of the tools available to hold health insurance companies accountable for unjustified premium hikes.”