Adams County staff recommend against bidding on state—s shared-services plan, flag cost and liability risks

Adams County human services officials recommended to the Board of Commissioners that the county not bid to run the state—s proposed shared services, saying the current proposal understates costs and shifts unacceptable financial and performance risk to counties.

Katie McDougall, Adams County—s director of human services, told commissioners the state—s proposal would centralize tier-1 call-center functions, Medicaid-only fraud investigations, central document scanning and quality assurance and that the decision item lists roughly $49,000,000 for shared services without clear county-match requirements. "The recommendation to you today is that we don't bid for the shared services," McDougall said, advancing staff—s formal guidance to the board.

The county—s chief financial officer, Bettina Schneider, said the state—s estimate of operational costs is low and does not account for higher county salary, benefit and IT costs. "Their operational costs are too low," Schneider said, adding that Adams County—s actual costs would be higher and that the proposal could put the county at financial risk if the state model requires counties to carry a portion of the budget.

Commissioners pressed staff on the size of potential reductions to county administration allocations and the net dollar impact. Staff estimated a likely 5—% reduction to the base county administration allocation under revised calculations, and commissioners offered rough dollar comparisons between $10 million in state backfill and county cost estimates of $12—$13 million, suggesting a possible net exposure of $2—$3 million if the county were to operate the services.

Several commissioners and staff also raised concerns about the state—s use of performance-based contracts. One commissioner summarized staff—s reading of the proposal as exposing contractors to large penalties tied to error rates; staff said the proposal referenced performance penalties they described as roughly $200,000,000 annually in the event of higher error rates. McDougall and Schneider warned that follow-on recertification volume and limited funding could increase error rates and thereby raise the county—s liability under performance-based terms.

At the same time, some commissioners noted the local workforce implications of declining to bid. Commissioner Julie Duran Molotov said Adams County human services jobs are "real jobs with real opportunities for people to take care of their family," and urged staff to consider whether bidding with a cost structure that preserves wages and benefits might keep those positions local rather than shifting them to private contractors.

Staff proposed a two-track approach: continue legislative advocacy to seek better funding and safeguards in the state decision item, and prepare a side-by-side operational and fiscal analysis showing what it would cost Adams County to run the shared services at a level that maintains current pay, benefits and performance standards. McDougall told commissioners staff will return with more visible numbers and comparative analysis and will continue weekly engagement with state leads and through groups such as CHSDA and CCI.

The board did not take a formal vote on the item at this meeting. Commissioners generally supported receiving the more detailed risk and cost analysis and continuing to press state leaders through letters, memos and meetings. The presentation also moved on to a discussion of the proposed hub (district) model and related technology concerns, which staff said will be the subject of future updates.