More than 200 state workers who process applications for government assistance programs could lose their jobs, their union said, and at least 50 eligibility offices statewide could close under a cost-cutting proposal that advocates are worried will make it harder for the poor to access key social services.

The state Department of Human Services said the planned reorganization is aimed at improving efficiency and lowering costs, but also stressed that the changes are still in the planning stages and no decisions have yet been made.

Under the proposal, eligibility offices statewide that accept walk-ins would be replaced with processing centers in Honolulu and Hilo, where workers would have no in-person contact with clients. Instead, they would touch base with clients by phone, fax, mail or e-mail.

The proposed changes come as more residents struggling in the economic downturn are turning to social welfare programs for help. The state has seen increases in the number of people on welfare, food stamps, Medicaid and child care subsidies.

DHS says the reorganization will improve the timeliness of application processing and renewals, but social service advocates fear it will just result in fewer people getting benefits because they don't have access to a computer or a phone or can't get in touch with an eligibility worker because of short-staffing.

Nora Nomura, deputy director of the Hawaii Government Employees Association, said the reorganization will mean more than 200 — and as many as 400 — layoffs of state eligibility workers and support staff.

DHS didn't confirm those numbers, but did say the reorganization plan includes layoffs.

The job losses will be on top of earlier layoffs of about 366 DHS workers, Nomura said.

"We think this is a really bad idea," Nomura told lawmakers yesterday, at a legislative briefing on the proposed reorganization. "We understand it's a tough budget situation, but we also know that people shouldn't be hurt in the process."

Nomura said the layoffs will result in massive caseloads for remaining employees, and will be detrimental to clients who already struggle to navigate the system, including the elderly, disabled and those who don't speak English.

Lawmakers also raised concerns about the plan at yesterday's briefing, and called on DHS to sit down with the union, social service nonprofits and others to get feedback on the planned reorganization before it is put into place.

Rep. John Mizuno, chairman of the House Human Services Committee, said yesterday that the proposed changes were "shocking" and he expressed anger at the absence of a DHS representative at the briefing and the lack of public input on the plan.

"It's actually deplorable, what's being done here," Mizuno said.

In a statement, DHS director Lillian Koller said yesterday that the reorganization proposal is still in the planning stage.

"This consultation has barely begun and no decisions have been made," she said. "It's unfortunate that the union has chosen a public forum to speak prematurely with legislators and alarm DHS employees about potential layoffs when we haven't even met with HGEA representatives to consider the various options, which ... we have tried to do on numerous occasions."

SERVICES FOR NEEDY

DHS oversees a slew of social service programs, including welfare (Temporary Assistance to Needy Families), food stamps, general assistance and Medicaid. Enrollment for many of these benefits has risen because of the economy.

The number of households in the Islands using food stamps, for example, increased 23 percent to 65,114 in the 12 months that ended in November, the latest federal statistics show. That translates to 131,361 people statewide on food stamps.

In a Jan. 29 letter to the HGEA, Koller said that given the economic crisis and increased need for public assistance, "it is imperative that we change the way DHS conducts eligibility functions as soon as possible."

In the letter, Koller said that the way DHS handles "eligibility functions is highly inefficient, requires customers to engage in repeated and inconvenient contacts with DHS staff, causes frequent backlogs of new or incomplete work, risks federal financial penalties for eligibility error and is not fiscally sustainable."

She said that DHS must make "significant improvement in customer service, timely and accurate work productivity and general fund savings."

It's unclear when the reorganization would go into effect.

Koller said in the letter that layoffs would be part of the proposed changes, but that it was too early to say how many would be needed.

PROCESSING CENTERS

Under the plan, the state would set up a new eligibility division that would replace the Med-QUEST and benefits divisions at DHS. Koller said the eligibility division would oversee processing centers to be located in Honolulu and Hilo, where the state already has the highest concentration of eligibility workers.

As part of the plan, the state would do away with dozens of eligibility offices sprinkled across the state. Some are housed in commercial properties, so closing them would also save in rent costs, though a savings estimate was not available.

Koller said the reorganization is based on successful models in other states.

But advocates say those models have big flaws, and they worry that the reorganization will hurt households in greatest need, especially those without access to phones and computers. They also say nonprofits can't be expected to provide access to office equipment so people can apply for benefits.

Debbie Shimizu, executive director of the National Association of Social Workers-Hawai'i chapter, said yesterday at the briefing that nonprofits haven't been told about the reorganization plan and are already struggling to serve clients.

Several people who receive state benefits also attended the briefing and raised concerns.

Natisha Taualai, who is living at Onelau'ena with her husband and three children, said she goes to the Waikele eligibility office monthly to make sure her benefits are on track. She said that without in-person contact, she'd worry about missing a deadline or mis-filing paperwork, which could put her benefits at risk.

"I think it would be better in person," she said.

State Rep. Maile Shimabukuro, D-45th (Wai'anae, Mākaha, Mākua), a member of the Human Services Committee, said yesterday at the briefing that communicating in person is also imperative for people with mental illnesses, who often have trust issues and need extra help with applications.

"I can think of so many scenarios," she said, "where this is just going to be devastating."