H.B. 365 Consolidates Utah Department of Health and Department of Human Services

Representative Paul Ray presented H.B. 365, State Agency Realignment, to the House Health and Human Services Standing Committee on February 25, 2021. The bill transitions the Utah Department of Health (UDOH) and the Department of Human Services (DHS) into a newly created single state agency; the Department of Health and Human Services. All functions of the two departments would be merged with the exception of certain Medicaid eligibility components, which will be merged into the Department of Workforce Services – DWS already makes Medicaid eligibility determinations on behalf of UDOH.

Rep. Ray presented H.B. 365 with the assistance of Rich Saunders, Executive Director of Utah Department of Health, and Tracy Gruber, Executive Director of Department of Human Services. Director Saunders stated the purpose of H.B. 365 isn’t to cut jobs, only to improve the services provided by these two departments, “[Our goal is] improving the delivery of these critical services, mostly to our underserved and marginalized communities… My experience with the Department of Health suggests that there are these deficiencies and we have to figure out how to close some gaps. H.B. 365 would enable some structural changes to take place to move in that direction, in a stronger way than we have been able to do so far”. Director Gruber noted that pooling resources and streamlining funding would be fiscally and functionally beneficial for the State Alzheimer’s Plan, Suicide Prevention, and Medicaid.

As dictated in the 1st substitute, affected agencies will have until December 1, 2021, to create a transition plan; the actual merge would take place July 1, 2022. This timeline gives the legislature the opportunity to review the plans put drafted by agency heads, and another legislative session to address issues and make appropriations adjustments before the transition takes place.

The fiscal note appropriates $3.0 million to the Department of Health and the Department of Human Services respectively from the newly-created Department of Health and Human Services Transition Restricted Account in FY 2022 to pay for staffing and computer programming for the agency transition. This legislation appropriates a transfer from the Department of Health to the Department of Workforce the funding associated with 10 FTEs ongoing beginning in FY 2023 for the transfer of the remaining Medicaid eligibility components.

UPEA Executive Director, Todd Losser, testified during the bill’s first committee hearing, “On behalf of the association I am speaking to H.B. 365 UPEA has met with Governor Cox and it’s our understanding that the agency consolidation will not result in a reduction of jobs. Utah’s public employees are considered the most efficient workforce in the country. UPEA expects to work with the Governor’s office and state agencies for a smooth transition for public employees and continue the gold standard we have established”.