Work and Pensions Committee - Universal Credit implementation: meeting the needs of vulnerable claimantsWritten evidence submitted by Maximus Employment and Training

1. Summary

1.1 This paper sets out Maximus’s submission to the Work and Pensions Select Committee’s inquiry on the Government’s progress towards implementation of Universal Credit. This submission draws on Maximus’ long standing international experience in the welfare to work sector and seeks to set out some of the real world operational challenges faced by a similar integrated welfare reform programme in Texas, entitled Integrated Eligibility. This submission does not seek to comment on any specific aspects of Universal Credit but to outline some of the initial challenges faced in the delivery of the Integrated Eligibility welfare scheme in Texas and how the valuable lessons learnt could be used to inform the effective implementation of Universal Credit in the UK, making sure benefits services are simple and accessible for customers while reducing costs to the public purse.

1.2 The paper highlights the key lessons learnt from the project which Maximus would encourage the Department for Work and Pensions (DWP) to consider as it rolls out Universal Credit, and outlines potential solutions to overcome some of the barriers around technology and business processing associated with such an ambitious reform programme, to ensure the successful roll out of the scheme. In particular, Maximus would like to highlight the following key lessons for Universal Credit: the need to perform a detailed business process analysis before selecting the delivery model and technology solution; the importance of having access to real time data for reporting and performance metrics; managing a culture change amongst public sector staff in conjunction to the new system; as well as effective communication with operational staff.

1.3 Maximus would be willing to give further oral evidence to the Committee on the Texas Integrated Eligibility project should this be helpful. Maximus is currently engaging with the DWP to help share its experiences and best practice in the implementation of large-scale enrolment, eligibility determinations and transitions to new benefit regimes.

2. Background to Integrated Eligibility

2.1 The term integrated eligibility has been used in the United States to mean the combining of more than one social services programme into a single application to enable eligibility decisions to be made in a simpler, quicker way. It can be done by combining applications for various programmes into a single application, or by proactively screening applicants for other programmes after they have applied for another.

2.2 The first major attempt at integrating various health and human services in the USA was conducted in Texas with the passing of House Bill 2292 by the Texas Legislature in May 2003. This integrated a number of services agencies into one large Health and Human Services Commission. The Bill also integrated the processing of a number of entitlement programmes through a single application form—including Medicaid, Temporary Assistance for Needy Families, food stamps, and long-term care. These all had different eligibility thresholds, enrolment timelines and validation requirements. In order to do this, the Bill anticipated the use of a new technology system: Texas Integrated Eligibility Redesign System (TIERS). TIERS had been approved for development and piloting in 1999 but was only used in two counties at that point.

2.3 The Bill also allowed the creation of a new delivery model, centralised call centres, which would be operated by an outsourced entity rather than the existing face-to-face transactions in local offices. The Bill predicted significant savings for the Commission, anticipating that the new delivery model would be vastly more efficient. The changes were put into effect from 1 January 2006. The integration also affected services that had already been outsourced, bringing them into the integrated system. These services were the Children’s Health Insurance Programme (CHIP) and the Enrolment Broker contract, which was held by Maximus.

2.4 The State of Texas began the process in June 2003 by piloting TIERS and the integrated application in two counties, prior to procuring a vendor to perform any of the processing. It was not until 2004 that the State initiated the procurement process to find a vendor to deliver the new centralised call centres. The original expectation was to have the vendor assume responsibility for the technology (TIERS) and establish calls centres, facilities, a mailing house, and centralised imaging functions immediately in the two pilot counties and begin expanding the use of TIERS across the whole State by the end of 2006.

2.5 Maximus was a key sub-contractor in a consortium established to help the State of Texas switch to an “integrated eligibility” process in its social services programmes from 2005 until 2007. This ambitious project faced significant obstacles from the beginning, and the failure to overcome those obstacles led to the cessation of the consortium’s contract. The pilot began on 1 January 2006, but by June 2006, the State of Texas determined that the pilot was not sustainable in its current form and the planned extension of the new model to another 20 counties was put on hold. In May 2006, the pilot was suspended indefinitely.

2.6 The TAA contract was finally terminated on 13 March 2007. The outsourced services were split up and awarded under an operational contract in order to maintain continuity of operations. The relationship between the State of Texas, Accenture and Maximus ended in a tripartite Settlement Agreement. The contracts were subsequently competed and both Maximus and Deloitte continue in their roles today. Maximus has maintained its significant role supporting citizens through the call centres. TIERS has been implemented across the whole State and is meeting its timeliness requirements. Maximus meets all of its service requirements and scored 5/5 on its client survey for 2010 and 4.8/5 for 2011.

3. What were the lessons learned?

3.1 This was the first attempt at integrated eligibility in the United States. The degree of complexity and challenge was significant. From our experience helping to implement integrated eligibility—and to improve it when problems emerged—Maximus has learned a number of lessons:

Perform a detailed business process analysis before selecting the delivery model, training methods, technology and staffing levels. This analysis phase will point out the inefficiencies of different policies, the feasibility of timelines and opportunities for savings. Where possible, streamline rules and minimise validation steps to provide a simple business model for delivery.

Have in place performance metrics and reporting information. It is critical in these arrangements to be able to track and report on all operations. This is a key advantage of beginning with business process modelling and management.

Ensure that the technology is designed to support the optimised business processes. Build or buy technology to meet business requirements.

Focus on operations as well as technology—and make sure you have direct communication with your operators. The requirements for each of the individual programmes were so different that the estimates for training and transactional volume proved insufficient.

Manage change effectively within the delivery organisations. State field staff must be part of the solution.

Do not promise savings or change until the proof of concept has delivered reliable metrics.

4. Other Examples From the USA

4.1 The State of Indiana pursued a very similar model to Texas but approached it slightly differently. It was determined that the successful vendor would employ the existing state eligibility workers and use the existing technology; but, like Texas, develop a centralised call centre and centralised eligibility determination process.

Unfortunately, the integration effort resulted in significant backlogs, poor service and overwhelming complaints. The contract was terminated and the services were largely taken back in-house and the state reverted back to its state-worker, non-centralised model of processing eligibility.

5. Conclusion: Recommendations for the DWP

5.1 In summary, Maximus welcomes the Government’s ambition to introduce Universal Credit as a means to simplify the benefit system by bringing together a range of working-age benefits into a single streamlined payment and help claimants and their families to become more independent. Maximus have considerable experience in managing large-scale enrolment, eligibility determinations and transitions to new benefit regimes, and we have learned from our mistakes as well as our successes. Our work as a key sub-contractor in the consortium helping the State of Texas to switch to an integrated eligibility process in its social services programmes has taught us valuable lessons that we would encourage the DWP to consider as it takes forward the implementation of Universal Credit. Our subsequent role and success as the prime contractor delivering the operational services for integrated eligibility and Children’s Health Insurance Program, has proven the results of business process management and performance monitoring.

5.2 In particular, Maximus would like to highlight the following recommendations for the department:

Perform detailed analysis of the anticipated volumes and pathways that clients will follow to apply, inquire, submit information, etc. In order to minimise costs and resources, the department should consider ways to ensure entitlement applications for Universal Credit can be processed with minimal paperwork, meaning that claimants are less likely to need to seek face to face advice with an official around evidencing their entitlement. This will need to be supported by fit for purpose IT interfaces, including online portals, that are user friendly and easily accessible for the claimant, along with an adequate advisory support service such as a contact centre to handle any queries from customers. Automated services are only effective if they are user-friendly and provide the necessary features and support services.

Ensure adequate support mechanisms are in place to manage the transition for claimants transferring from weekly to monthly payments, including access to financial education and effective money management services. The Department should consider in greater detail what role Work Programme providers will play in managing this transition process.

The DWP should consider leveraging the expertise of the private sector to make efficiency savings in the management of the business processes behind Universal Credit, including exploring the outsourcing of functions such as contact centres, and case management facilities to verify benefit entitlement evidence.

The department should consider how best to effectively communicate the change management process, both in terms of nudging compliance amongst clients, as well as instilling a culture change in the staff delivering the new benefit.

6. About Maximus

Maximus Employment and Training is one of the Department for Work and Pensions’ accredited providers of the Work Programme, delivering the scheme in West London and the Thames Valley, Hampshire and the Isle of Wight. We also work in partnership with the charity Careers Development Group (CDG) who are the prime contractor for East London and with Avanta who are the prime contractor in Surrey, Sussex and Kent to support the delivery of the Work Programme in these locations.

Maximus has considerable experience providing support to help disadvantaged people back into the labour market. For nearly forty years Maximus has partnered with Governments around the world to provide critical health and human service programmes to a diverse range of communities, operating in the UK, US, Canada and Australia. Prior to the Work Programme, Maximus was the prime contractor for the Flexible New Deal (FND) in Surrey, Sussex and Kent, delivery these schemes in partnership with subcontractors CDG, Tomorrow’s People, TBG Learning and Kennedy Scott. Together, we served approximately 25,000 customers who had been unemployed for 12 months or more through this programme.

14 August 2012

Prepared 21st November 2012