The May Institute, Inc. Administration of Limited Unit Rate Service Agreements

The Auditor was reviewing whether DDS used these limited, as-needed service contracts properly and whether public money was being handled with accountability.

“The overall audit of DDS was conducted as part of OSA’s ongoing efforts to audit human-service contracting activity by state agencies and to promote accountability, transparency, and cost effectiveness in state contracting.”

The records were too weak to prove that some services were properly approved, actually provided, or paid at the right amount.

“The lack of adequate documentation violated provisions of the Commonwealth Terms and Conditions for Human and Social Services, and as a result, there was insufficient evidence to show that these LUSA payments had been properly authorized and accounted for; that they were not duplicative or excessive; and that the contractor had actually provided the LUSA services billed.”

If you are a Massachusetts resident, this matters because state money meant for people with developmental disabilities may not have been tracked or used as intended.

“DDS’s practice of improperly administering and using LUSAs has led to the problems with the administration and use of these funds at various DDS contractors, such as May.”

The Auditor found that DDS and May did not consistently follow the rules for approving, documenting, and using these LUSA funds.

“Our testing identified a number of problems with the granting, receipt, and use of Limited Unit Rate Service Agreement (LUSA) funds that the Department of Developmental Services (DDS) provided to the May Institute, Inc. (May).”

The report says oversight agencies should review the problems, and May should improve its controls so future LUSA work is properly done, documented, billed, and recorded.

“In accordance with the recommendations of the overall report and the testing results specific to May, May should implement appropriate control measures to ensure that all LUSA services are performed, documented, billed, and accounted for in compliance with applicable requirements.”

This was not just a paperwork issue at one provider; the report says DDS’s broader LUSA system was being used for year-end funding in ways that did not match the contracts’ intended purpose.

“Instead DDS Regional and Area Office staff have used LUSA contracts to provide additional year-end funding to some DDS human-service contractors for various purposes, many of which are not consistent with the intended use of these funds and resulted in unnecessary and excessive compensation to contractors.”

LUSAs are contracts DDS can use to buy short-term or occasional services from an already approved provider when a client is not covered by another contract.

“LUSAs are a form of a master contract agreement that can be used by DDS to purchase services from a preapproved contractor on an intermittent, limited-time basis for clients who are not already covered through an existing contract.”