HHS lays off 3 top managers; more may be on way

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BY NANCY HICKS / Lincoln Journal Star

Three top Health and Human Services managers are being laid off, with more layoffs expected in the future, as part of a move to streamline the agency and flatten the top administrative structure.

One of the layoffs has raised concerns in Nebraska’s disability community about the agency’s commitment to clients with disabilities.

The three managers all work for  the new Division on Medicaid and Long-Term Care, the division that is furthest along in its strategic planning, according to Kathie Osterman, a spokeswoman for  the Department of Health and Human Services.

The three managers who received layoff notices  were originally hired by the former Department of Social Services. 

Mary Jo Iwan, administrator for home and community services,  was hired in August 1972 as a case worker.

 Cec Brady, a Medicaid deputy administrator, was hired in June 1988 as an attorney for the social services agency. 

David Cygan, a medical/surgical managed care administrator, was hired in March 1994 as an attorney.

The decision to lay off Iwan, who has worked recently to create more community-based services for seniors and younger adults with disabilities, has members of the disability community worried about the future of that program,  said Tim Kolb, a well known advocate for people with disabilities.

The work Iwan did requires great understanding of people with disabilities, Kolb said. “It is not about the numbers. It is about the lives of people who are trying to be served in the community.”

Iwan’s dismissal is worrisome, he said. The fear is that the top leaders — the governor; Chris Peterson, the CEO of the Department of Health and Human Services;  and    Vivianne Chaumont, the new director of the Medicaid and Long-Term Care Division — have a very conservative position and their ultimate goal is to greatly reduce community services, he said.

Cutting back on the commitment to community services may reduce current expenses, but it will be more expensive in the long run, Kolb said.

But Osterman said, on behalf of  Chaumont, that the administration and staff are committed to the community-based programs.

“No programs for people with disabilities are being eliminated,” she noted. 

“But we are restructuring the division and in that process difficult decisions have to be made,” she said on behalf of Chaumont.

Iwan said in a telephone interview that she has helped build several programs over her 35 years with the state, including establishing community-based services, the respite care network, and the Disable Persons and Family Support Program, and an early intervention program for infants and toddlers with disabilities. 

“I’ve probably had the best job in state government,” Iwan said.

Iwan said she does not know what she will do after her layoff at the end of this month but is considering consulting work. 

The other two managers did not return telephone calls. 

The layoffs  are part of a strategic planning process being undertaken by the six divisions of HHS. 

The planning process, which includes prioritizing, streamlining and flattening management, means making difficult decisions about people and positions, Osterman said.

The layoff letters did point out that none of the layoffs are in any way a negative reflection on the individuals or their performance,  she said.  

The Medicaid and Long-Term Care division is further along in its planning process, she said.  

As the process continues in other divisions, there will likely be layoffs, she said. But there is an expectation  that front line staff will not be included in those layoffs, she said. 

“We heard state senators and the governor loud and clear that the outcome of our reorganization cannot be business as usual,” she said about discussions this year that led to the decision to create a single Health and Human Services department with six divisions.

The division directors must also find ways to reduce spending since the Legislature did not provide enough funding to continue operations at the current level, Osterman said. 

The agency’s administrative budget lost about $10 million in state and federal funding during the budget process this year, she said.

“As an agency, we are looking at ways to reduce spending,” she said.

The divisions will be saving money in printing and publications, equipment, travel, contractual services and temporary employee budgets, but it probably is “not going to get us to $10 million,” she said.

So the layoffs of top managers will “help us meet the amount the budget was reduced,” she said. 

Reach Nancy Hicks at 473-7250 or nhicks@journalstar.com.