It’s encouraging to see Denver City and County Auditor Timothy O’Brien and his office continue to put pressure on city government to tighten its belt and provide more transparent accountability to Denver taxpayers.

A follow-up audit report from O’Brien’s office this week is a reminder to rightly skeptical Denver residents that there is a branch of local government serving as an able watchdog. The report shines a spotlight on the city’s Office of Human Resources for not doing enough to self-police the city’s self-funded health plan review process. The lead auditor and his team informed Denverites the city’s spending of taxpayer money on ineligible health-care benefits remains a persistent problem. That’s even after the city’s HR office made some oversight changes — one of O’Brien’s recommendations from his previous audit in 2024 — that already has led to $2 million in budget savings. 

The HR office only partially implemented three other recommendations while taking no other steps to address the risks the other recommendations sought to resolve. Though part of the blame goes to one of the city’s two providers, UnitedHealthcare (the other is Kaiser Permanente), for refusing to share cost data to help HR determine whether the city is overpaying, the buck ultimately stops with the city bureaucracy. Since 2020, city employees’ UnitedHealthcare-run health insurance has been self-funded by City Hall — meaning the city acts as its own insurer and is responsible for processing and paying all claims for medical care.

“City agencies should comply with city ordinances, but sometimes it takes public accountability through our audits for change to occur,” O’Brien said in a statement. “The importance of our work is all the more evident when our audits guide agencies to find savings. This is especially critical as the city’s budget outlook is bleak.”

The estimated $2 million the city already has saved seems like the tip of the iceberg of what’s possible. Enacting that one auditing recommendation — requiring external audits every five years to ensure employees’ dependents are eligible — uncovered 4.6% (614 of 13,397) verified dependents were ineligible. Each dependent cost the city $3,500.

What remains to be resolved? Much, the auditor’s office suggests. That’s starting with city HR developing and implementing policies and procedures to review eligibility for the city’s self-funded health plan; monitor third-party contracts, and align processes with federal standards for internal controls. The risks of not resolving those issues endangers fundamental eligibility elements including incorrect information, not communicating health plan changes promptly and unauthorized individuals having access to the United Healthcare online portal.

Speaking of UnitedHealthcare, the lapses by HR are rooted in undocumented processes, opening up the possibility of institutional knowledge loss through employee turnover. The office’s work with third parties needs to get back on track in general, as O’Brien warns more taxpayer money still may end up being spent on a medical claims audit because HR is not identifying risks and specific needs before outsourcing the work to third parties.

Even if Denver City Hall is far from ship shape, the city’s auditor is trying to get things on the right course.