State health department sees sharp rise in at-will workers

Now, those workers will be more subject to the political wishes of their supervisors.

Critics of the changes say they will make managers and health policy experts less willing to push back on policies they think might be damaging to the department or patients, for fear of being fired. Some say the highly skilled workers who run DHHS programs, but who make less than they would in the private sector in exchange for job security, are being given a signal that they’re now expendable.

“That's going to be awfully difficult to overcome some of the angst that you're causing,” said Allen Feezor, former senior policy adviser to the secretary of DHHS under Perdue. “It may become harder to get what you need – the best ideas, the best energy and the most effort – from the people who know the programs and the environment.”

“We will be able to leverage your creativity, passion and expertise for the benefit of the Department and the people we serve every day,” Wos wrote.

Staff at the Office of Human Resources attribute the massive increase in at-will workers to the size and structure of DHHS, which employs around 17,000 people across the state.

"[DHHS] is greatly decentralized," Paula Woodhouse, deputy state personnel director, said in an early August interview. "We've got some hospitals that are larger than some agencies."

Compared to other agencies, the percentage of exempt employees at DHHS is a little less than average at about 2 percent. The legislative changes that bumped up the cap on these designations now allow governors to create more alignment across different departments, said Director of the Office of State Human Resources Neal Alexander. That way, similar positions can all be exempt no matter what department they're in.

"They've got so many divisions and organizations, like hospitals and these other things, that allow them to get consistent within their organization," Alexander said of DHHS in early August.

With all those employees, the department has a huge impact on residents across the state.

“DHHS programs touch more than 2 million lives in the state of North Carolina daily,” Feezor said. “There are not that many agencies that do that.”

But the change inside the department is a big one.

The reach is deep, according to numerous former DHHS officials who spoke both on and off the record. Some of the newly exempt positions are for program managers who are three, four and even five layers down the chain of command.

“I can't imagine why you want to make some of those jobs exempt,” said former Office of Rural Health head John Price, who retired at the end of February. “Those are professional people, and it's hard to find those credentials.”

Price said there are about three dozen people in the Office of Rural Health. As head, he was exempt, and he had perhaps one other employee who had that status.

Now that office alone has five, Price said after being shown the list of exempt employees.

Price said he spent decades as a field worker in the Office of Rural Health without having to worry about the political winds that blew from the left or the right.

“I was insulated from the political stuff by the director and the assistant director,” Price said. “They dealt with that stuff, and I was able to focus on my job.”

Price said that’s the way it should be for state employees. They’ll do what they’re instructed to do, he said, but they don’t want to have to pass a political litmus test.

On the other hand, Price said that, when he took his job as director, he knew what he was signing up for.

“When I signed the paperwork, it said I knew I was becoming exempt,” he said, comparing it with being named an assistant football coach. “If the head coach went away, I knew I could lose my job.”

But Price said there was some uncertainty that came along with his decision. With more exempt positions in the department, “it discourages people from career growth, that you have to worry about losing your job if you get promoted to a certain level.”

"When you change anybody's employment terms, they've got to decide whether those are terms they want to live with," said Dr. Georges Benjamin, executive director of the American Public Health Association, especially if there are better-paying jobs in the private sector for which they are qualified.

Other former division heads say they’ve heard from old co-workers that morale is low –  “jumpy” is how one described it – and they say many long-time employees are looking to leave state service or have already left. For example, at least three long-time top Medicaid officials have left that division since February.

“When you have the two top people leaving like that, the division loses direction,” Cassidy said. “It’s hard enough when you put in qualified people, but when you put in people who don't have the deep knowledge, it's a serious setback for state government.”

When asked about allegations of low morale inside the department, Assistant Director of Communications Julie Henry said the secretary’s focus is on trying to “encourage people to do the best they can and be proud of a team that makes a difference.”

“The overall goal is to accomplish what we set out to do and meet the needs of people in North Carolina,” Henry said.

She said she doesn’t see the rise in exempt positions leading to a more politicized department.

“This is an $18 billion organization, comparable to big companies in the private sector,” Henry said. “At those organizations, individuals who have these responsibilities are expected to perform.”

But the private sector analogy is a bad one in a lot of ways, Benjamin said. He points out that private companies don’t have to be accountable to the public and lawmakers for taxpayer dollars. Nor are their CEOs, along with the entire management team, subject to change every few years as the political landscape shifts.

"I often hear elected officials say, 'I want to make this look like the private sector,'" Benjamin said. "Well, this is not the private sector. This is government."

To questions about how state workers are now simply facing what other workers in a right-to-work state face, all of the former directors said the people they had under them were well-qualified to leave and make more in the private sector.

“Look, they're there every day looking after my health and the health of my family and the folks who live around them,” said Price of many of the newly exempt employees. “They wake up every morning with that on their minds. It’s not a job for them.”

With major decisions on the horizon for DHHS, including a controversial new law rewriting regulations for abortion clinics, McCrory has reassured voters these rules will be made by experts.

But that doctor may have been hired in a highly political atmosphere – one critics say may intensify with more at-will employees among the health department rank-and-file.

Duke University public policy professor Don Taylor Jr. said it’s not necessary to exempt a lot of workers for a new administration to get what it wants in terms of policy.

“It's useful from everybody's perspective to have some civil servants who are career employees and are seen as somewhat a bit above the fray,” Taylor said.

He said people at the top will drive the policy changes. The workers below them will be obligated to carry out the policies the governor and his division heads want.

Taylor said the thing to watch is the amount of turnover in the department now that the letters have been sent. Benjamin, who in his role at APHA interacts with government workers around the country, agrees.

“You can make it more political, but you don't have to act on it," he said. "The real test will be if those jobs have turnover after they are exempt."

McCrory has repeatedly made mention of added flexibility as the big reason for the expansion in exempt positions. With the grievance process removed for these employees, he has said he and his staff can improve the efficiency and effectiveness of state government.

Because these employees run divisions and departments, DHHS spokeswoman Henry says this at-will status promotes a higher level of accountability.

“The positions designated exempt are people who have responsibility for large program areas, budget areas,” Henry said. “It’s not just their responsibility to come in and do their own job.”

Although these employees are no longer explicitly protected from arbitrary termination, McCrory spokesman Rick Martinez said it’s in no one’s interest to rid any department of professionals with deep institutional knowledge.

"No chief executive is going to want to get rid of that for the sake of giving a buddy a job as a political payoff," Martinez told WRAL News in early August. "Gov. McCrory has stressed efficiency probably more than any other governor in recent times given his background."

Henry said no determinations have been made yet about additional at-will positions in the department, so it’s unclear whether the number will change after McCrory designates his additional 500 exemptions.

Regardless of how the number fluctuates in the department over the next four years, Benjamin said the real issue for DHHS will be how McCrory -- and his health secretary -- use their expanded firing power.

"I remind people – and I always tell my political friends – this is a very small world," Benjamin said. "If you don't treat your professionals well, your ability to get someone else to take that job is very limited."