Auditor uncovers more financial abuse in Nebraska DHHS program

A recent audit found the Nebraska Department of Health and Human Services paid out nearly $20,000 to caregivers who claimed to be working impossibly long hours.

One caregiver was authorized to provide 66 hours of service each week in addition to a full-time job as a school bus driver. Another caregiver was paid for 118 hours each week for three separate clients. A third billed DHHS for more than 24 hours each day for 45 days over a three-month period.

“Some of these people are making the Energizer Bunny look like a slacker, because there’s just so many hours in the day,” said State Auditor Mike Foley. “You’ve got to sleep sometime, and if you're putting in 80 hours a week caring for someone, you're obviously not able to also hold down full-time employment somewhere else.”

A random sample of five caregivers revealed all five received improper payments.

“If you take the just the findings of those handful that were in the sample and extrapolate it out, I'm sure we're talking about a very significant sum of money,” Foley said.

Other programs under the Nebraska Department of Health and Human Services have also been the focus of several concerning reports from the state auditor’s office in recent months.

In September, the office issued an audit report that found autism service providers, which received $85 million from the state in 2024, billed the state with duplicate invoices and often had a lack of documentation and employees without proper credentials.

Last year, a report found more than 1,000 unique child care providers were billing the state incorrectly, resulting in up to $128 million in improper payments.

The personal assistance services program itself had been the target of an audit last year, which revealed a potential $1.5 million in questionable payments, citing similar problems of fraudulent working hours being claimed.

“This particular program has been kind of a sore thumb for that agency for a long time,” Foley said. “We've been writing them up in our various audit reports for a number of years, probably a decade at least.”

The results in the most recent audit come from the federal single audit, an annual report that looks at the federal funds that come into the state and how they are spent. The State of Nebraska receives around $5 billion in federal funds annually.

Foley said findings of fraud could impact the state’s ability to receive funds in the future.

“It might mean some penalties back to the state. It might mean some recoupment of some of those federal funds. It might mean a reduction in future federal funds,” he said. “There's a lot of tools in the toolbox that the federal government has, but they always want to know what happened with the money we gave you.”

Foley said he trusts DHHS director Steve Corsi, who was appointed to the position in 2023, to turn the culture around. DHHS accounts for around 40% of the state government, with around 5,000 total employees.

“It's just hard to change a culture in an agency that large, but he's working at it, and I think he's making progress, and I have confidence in him,” Foley said.

DHHS responded to the letter from the auditor’s office and cited several actions it has taken to prevent fraud following earlier instances uncovered by the auditor’s office.

“The department had already taken significant actions throughout State Fiscal Year 2025 to implement several procedures and controls which are expected to mitigate the majority of the conditions observed in the audit,” the agency wrote. “Specifically, in late February 2025, [Medicaid and Long-Term Care] implemented systematic controls to require that GPS/IVR visit verification and recipient signature is captured for visits to be submitted for claim payment. Additional changes included tightening down, or reducing, the radius of the geofence area for location verification.”

DHHS also implemented additional procedures and controls in late June which limit the number of hours/units per week that can be billed for client services.

Many of the improper billings in the most recent auditor’s report were listed for work done prior to that date.