[{"_1":2,"_88":-5,"_89":-5},"loaderData",{"_3":4,"_26":27},"root",{"_5":6,"_17":10,"_18":19,"_20":21,"_22":10,"_23":-5,"_24":-5,"_25":10},"user",{"_7":8,"_9":10,"_11":10,"_12":-5,"_13":-5,"_14":15,"_16":-5},"roles",[],"isAuthenticated",false,"isPremium","planName","subscriptionStatus","featureFlags",{},"insightsBudget","isDevelopmentHost","userPreferences",{},"recaptchaSiteKey","6LcvOJcUAAAAAHsB-gPGfGktcRlKpH7OTIU_dMTD","isImpersonating","impersonation","affiliateStatus","isFreedomPortal","routes/v2/article/layout",{"_28":29,"_30":31},"notFound",true,"relatedArticles",[32,76],{"_33":34,"_35":36,"_37":38,"_39":40,"_41":42,"_43":44,"_45":46,"_47":48,"_49":50,"_51":52,"_53":54,"_55":56,"_57":58,"_59":60,"_61":62,"_63":64,"_65":66,"_67":68,"_69":70,"_71":72,"_73":74,"_75":74},"mediaId",6353406,"mediaKeyId","2221329-1ca4fded361ea6822af5d06a9b4d5d77","parentId",2221329,"title","DPHHS business and financial services asks for procurement staff as contracts, indirect costs and compliance demands rise","audioSeconds",3816,"startMs",2234000,"endMs",6050000,"viewUrl","/Search/View?dp=1&key=2221329-1ca4fded361ea6822af5d06a9b4d5d77&start=2234&end=6050","thumbnailUrl","https://assets.pipeline.soar.com/2221329-1ca4fded361ea6822af5d06a9b4d5d77/thumbnail_2234000.jpg","articleUrl","/articles/6353406/Montana/DPHHS-business-and-financial-services-asks-for-procurement-staff-as-contracts-indirect-costs-and-compliance-demands-rise","mediaUrl","https://secure.pipeline.soar.com/6353406-9c97ca70b24e75eaed39ac6dcc802482/orig.mp4?Expires=1775786113&Signature=OD6W6WM2gBNei4sQogQ9uu32PBNNV5W-JGnsmQFmrRMndA4hpM4JXD170QuuZ-80VqyGDWSMYKbXyam1uuLPcNlRFWorN9KsV3K2tgET56oAiq8r8mciE2gcnFy7qyKQL87KpciBVQfSlw9qj1mdcq5xtdsnhGZX5z5aLApMe3IO~lMVjIM3LijjOBZNHhz-QLx2IJq7IrBkN2IgWI9kp5xM4ap5Vk7UyhHDmTJOn9ub0eW6Y1ChBH5msDfmlgPE6XBiKsJERq~-bfHl7U9yULLp~2y3frZtQB0bOThZQIy2~v47Tkv9v5Lj29ppB-C~lSKSRNUrGk02pYdfb6Xc4A__&Key-Pair-Id=KUT5TJCACFTXG","author","Montana Legislature","date","2025-01-31T00:00:00Z","article","The Department of Public Health and Human Services told an appropriations subcommittee that contracting volume, changing cybersecurity insurance requirements and complex federal-cost-allocation rules have increased workload in its Business and Financial Services Division (BFSD) and prompted a request to convert two modified procurement positions to permanent status.

Corinne Kyler, BFSD division administrator, said the division oversees central accounting, procurement, accounts payable/receivable, facility billing and the department’s cost-allocation activities. BFSD is budgeted at 56 position-base (PB) units with a base budget the department described as approximately $14.3 million and a requested fiscal-year 2026 amount of roughly $15.1 million.

Kyler told the committee BFSD executed close to 1,500 contracts and managed roughly 4,000 active contracts and amendments in fiscal 2024. She said the division processed more than 100,000 vouchers for business payments in 2024 and collected about $285 million through accounts-receivable work during the year.

The department provided a breakdown of contracting and subgrant spending: in 2024, contracted services billed as in-state totaled about $38 million (largely federal funds) while out-of-state contracted services were about $22 million. BFSD staff said those totals do not capture certain benefit payments (for example, some out-of-state placements can appear in benefit lines) and that cross-system data matching remains difficult.

Kyler said the procurement office is one of the hardest roles to fill and that temporary staff and overtime were used to handle spikes in demand. “In the last biennium through 2025, the agency has accrued over 61,000 in overtime services to meet the demands of the high contract volume,” she said.

Officials cited two near-term drivers of contracting workload: (1) a higher cyber-insurance threshold for vendors — the transcript cites a rise from $2 million to $6 million effective July 1, 2024 — which required more vendor negotiation and documentation, and (2) increased IT contracting tied to system design and implementation work (the department reported roughly $65 million in IT contracting in 2024). Both factors require closer review by the Department of Administration (DOA) and the state’s SITSD unit, increasing review time for each procurement.

The division asked the committee to convert two modified procurement PBs to permanent FTE. BFSD said the governor’s budget and the Legislative Fiscal Division show two additional procurement positions, although one narrative line mistakenly listed only one. LFD analysts confirmed the requested total of two positions.

Committee members asked for detail on sole-source procurements, and the department said sole-source requests are reviewed by DOA and must follow delegated authority limits: executive-branch agencies have delegated procurement authority up to a specified threshold, while DOA handles procurements above that threshold and reviews sole-source justifications. The department said it will provide the subcommittee the sole-source request forms that DOA uses.

On cost allocation, BFSD staff explained the Public Assistance Cost Allocation Plan (PAW CAP) used to distribute indirect administrative costs to benefiting federal programs. Mikayla Aiken and Corinne Kyler said the department runs approximately $180 million per year through indirect cost pools; large cost pools include eligibility determination (Human and Community Services), child welfare (Child and Family Services), and technology services.

Kyler outlined allocation methods the department uses: random moment time studies (RMTS) for worker time allocation in eligibility and child-welfare programs; claims counts for Medicaid claims-processing modules; and computer counts or time-and-effort measures for some IT and general-ledger activities. The department said it moved from monthly to quarterly allocation during recent business-process improvements to allow additional quality control time.

Legislators asked whether Montana can build preference for in-state vendors into solicitations. Department officials and committee members said state procurement law restricts preferences; counsel for the Department of Administration previously indicated resident-preference rules apply primarily to public-works and goods contracts and that services procurements generally fall under different code sections. The department said it would seek formal clarification from DOA counsel and share it with the committee.

The presentation closed with requests for additional data: committee members asked for a breakdown of DFHHS contract spending over time, the number of sole-source contracts and justifications, a facility-by-facility and payer-source breakdown of collections and billings, and copies of the PAW CAP and FFATA reporting summaries.

Ending — The subcommittee did not vote on the staffing request at the hearing; members asked the department for follow-up documentation on sole-source justifications, procurement staffing history, and more granular contract and accounts-receivable data.","mediaType","Video","parentTitle","Joint Subcommittee on Health and Human Services 2025-01-31","oneSentenceSummary","The department’s Business and Financial Services Division told legislators it is managing thousands of contracts and millions in federal pass-through funds, and requested two procurement FTE to handle heavier workloads driven by cybersecurity requirements, IT projects and increased subrecipient monitoring.","taxTitle","2025 Legislature MT, Montana","taxId",77694,"location","Montana","headline","","shortSummary",{"_33":77,"_35":36,"_37":38,"_39":78,"_41":79,"_43":80,"_45":81,"_47":82,"_49":83,"_51":84,"_53":85,"_55":56,"_57":58,"_59":86,"_61":62,"_63":64,"_65":87,"_67":68,"_69":70,"_71":72,"_73":74,"_75":74},6353411,"DPHHS reorganizes operations, centralizes compliance and health data analytics",2120,94000,2214000,"/Search/View?dp=1&key=2221329-1ca4fded361ea6822af5d06a9b4d5d77&start=94&end=2214","https://assets.pipeline.soar.com/2221329-1ca4fded361ea6822af5d06a9b4d5d77/thumbnail_94000.jpg","/articles/6353411/Montana/DPHHS-reorganizes-operations-centralizes-compliance-and-health-data-analytics","https://secure.pipeline.soar.com/6353411-5e615ad3917bd55a18693a42a7bb29dd/orig.mp4?Expires=1775786113&Signature=jW4mH1hfVvaFQ6y28WMI3alRIARcHgcbQWO9xhuNrhgrS3Gg6zi04YGZIRc8FE274MXpZhmTEkBkmqApCAsQZMUQf2CD0k9K3EgGgqq7XMVudDAFTlBCLP002bCPvGvUNsNPHeBX3NLroHPW7lTJ2P99xTo4-yIQ3ijvWiAzO4LRerS1UrSE-NmNJEK~ta36R7c0HyzjBzEQEaG8oXfqrMe2cQPgaXOg0FItr7X~7JKVNv-oUm4MgzEJYwy~DdNrwABGxYGMsihG3IYwr4qIU9oRRBitkQSC61TxVdHRY9mBFzT7Jfs9FQAKIjXjw42Q4RXgHtLcDR8tWRIe9IgIvA__&Key-Pair-Id=KUT5TJCACFTXG","The Department of Public Health and Human Services on Friday told a legislative subcommittee that it has centralized compliance and data-analytics functions into its Operations Services Division to reduce repeat audit findings and improve financial and data oversight.

The reorganization moved the Office of Health and Data Analytics and several compliance and internal-control positions into Operations Services Division. Kim Aiken, Chief of Finance and Operations for DPHHS, told the committee the division now has just over 20 full-time-equivalent positions and that the division’s base budget is about $2.7 million, with the executive request at roughly $2.9 million per year of the upcoming biennium.

The change matters because the department said repeat audit findings from the Legislative Audit Division prompted a centralized approach to monitoring subrecipients, clarifying “what it is to have a vendor relationship or a subgrantee relationship,” and better tracking corrective actions. The department also emphasized that moving the analytics and compliance work into one division should improve consistency in controls and program support.

Aiken described the compliance goal as reducing repeat audit findings and providing technical assistance and common processes across programs. “Subrecipients generally are entities, providers essentially that take on the functions of a grant award that are essentially granted to the department,” Aiken said. She contrasted that with vendors or contractors: “In a vendor relationship, we’re procuring goods or services, and that would be a contractor. And those relationships do not have the same reporting requirements. The state retains those.”

On analytics, Aiken said the Office of Research and Data Analytics — which includes the Office of Health Data and Analytics and staff who produce Medicaid projections — was moved back into Operations Services after earlier shifts between technology and operations. Paul Bellotti, who leads the office, has begun outreach to Montana universities and has statements of work to hire analytics partners. Aiken told the committee two positions for analytics are currently advertised and she reported substantial applicant interest.

Committee members pressed whether the department planned to use artificial intelligence tools. Aiken said some recently funded system replacements would allow future AI use but “we’re nowhere close to that today,” and added that the executive branch coordinates AI pilots with the state’s SITSD (State Information Technology Services Division).

The department described several personnel and accounting consequences of the reorganization: 12 position base (PB) units moved into the division in the interim, and an amount transferred for those PBs exceeded the actual need, producing a small negative adjustment in the fiscal detail. The division’s budget changes were driven largely by personal-services increases for pay adjustments and by statewide present-law adjustments.

The department said compliance centralization includes work to improve subrecipient monitoring and risk assessments, to avoid excessive monitoring of low-risk subrecipients and to strengthen scrutiny of higher-risk ones. Aiken and staff said the changes respond in part to audit findings that grew more frequent after new federal funding streams such as ARPA increased the number of subrecipient relationships.

Lawmakers asked for more collaboration with MARA (Montana’s data advisory group) and with the Department of Administration’s chief data officer; Aiken and Bellotti said informal contacts already exist and that the department could expand coordination.

The presentation included performance data: the division’s fiscal 2024 appropriation was about 72.8% expended overall, with general-fund spending at roughly 96.8% expended. Aiken said the division’s work is primarily personal services and operating expenses; it was “administrative” rather than grantmaking or benefits-focused.

The department said it will continue to report back to the committee with details on subrecipient monitoring and analytics staffing as hires proceed.

Ending — The subcommittee did not take formal action during the presentation; members asked the department to provide additional documentation about analytics collaborations and to return with more detail on the subrecipient-monitoring tools and timelines.","The Department of Public Health and Human Services outlined a reorganization that moved compliance and the Office of Health Data and Analytics into Operations Services Division, highlighting steps to reduce repeat audit findings and build analytics capacity tied to Medicaid forecasting.","actionData","errors"]

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DPHHS business and financial services asks for procurement staff as contracts, indirect costs and compliance demands rise

DPHHS reorganizes operations, centralizes compliance and health data analytics