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August 19, 2010

Benefits beyond the grave

Giving new meaning to the concept of cradle-to-grave care, the city of Buffalo paid $2 million to provide health insurance for 152 deceased employees.

Meanwhile, the Japanese government sent pension checks to a supposedly 111-year-old man, who was found "mummified in his bed, dead for more than three decades," his checks cashed by his daughter. In addition, officials have not been able to locate another 281 pensioners who reportedly are 100 years old or older.

It's not clear whether the Japanese scandal was caused by pension fraud, faulty government bookkeeping or "disintegrating family ties," reports the New York Times.

In contrast, Buffalo City Comptroller Andrew SanFilippo clearly faults the city's Department of Human Resources for insuring former employees beyond the grave. According to the audit:

We found 152 employees for whom the City was paying medical benefits, who were in fact deceased. This has resulted in $1.998 million taxpayer dollars being spent on healthcare premiums for deceased employees. The majority of the employees died within the last 3 fiscal years, representing 96 percent of the costs, but some had deceased as long ago as 1998.
The audit says $2 million expenditure could have been avoided if the city matched its beneficiaries against the federal government's Social Security Death Index. Updated monthly, the index costs $34,585. Auditors, "using free services available on the Internet," confirmed the 152 deaths. (The audit does not indicate how many of the "former employees" were retirees or active employees at the time of their deaths.)

On January 11, Mayor Byron Brown ordered Human Resources Director Karla Thomas to "immediately subscribe to the monthly reports of deaths from the Social Security Administration." She did not.

"To be honest, it's a disgrace," SanFilippo told the Buffalo News.

A December audit also found the city had overpaid a $526,309 to insure 250 employees. Thomas has yet to recoup funds from the insurance carrier--despite the mayor ordering her to do so in January.

Brown has not ruled out firing Thomas, whom he appointed two years ago, according to the News. In a second story, the newspaper reports Brown "circumvented rules" when he appointed Thomas to a six-year term.

Posted by Lise Bang-Jensen

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