Johnston County, North Carolina
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2024
Identification of major State programs:
Program Name
Medical Assistance Program
State Foster Home Fund (SFHF) Maximization
Connect NC Bond
Johnston County Radio and Paging Infrastructure Upgrade
Public School Building Capital Fund-Lottery Proceeds
Dollar threshold used to determine
State major programs $ 500,000
Auditee qualified as low-risk auditee? yes X no
None Reported.
Finding: 2024-001 Inaccurate Information Entry
SIGNIFICANT DEFICIENCY
Eligibility
Criteria:
Condition:
Questioned Costs:
Context:
Effect:
Identification of a repeat
finding:
Cause:
There was no known affect to eligibility and there were no known questioned costs.
We examined 60 cases from of a total of 2,229,628 Medicaid claims from the Medicaid beneficiary report
provided by NC Department of Health and Human Services to re-determine eligibility. These findings are being
reported with the financial statement audit as it relates to Medicaid administrative cost compliance audit.
This is a repeat finding from the immediate previous audit, 2023-002.
Ineffective record keeping and ineffective case review process, incomplete documentation, and incorrect
application of rules for purposes of determining eligibility.
For those certifications/re-certifications there was a chance that information was not properly documented and
reconciled to NC FAST and a participant could have been approved for benefits for which they were not eligible.
US Department of Health and Human Services
Section I. Summary of Auditors' Results (continued)
Section II. Financial Statement Findings
Section III. Federal Award Findings and Questioned Costs
Passed through the NC Dept. of Health and Human Services
Program Name: Medical Assistance Program (Medicaid; Title XIX)
AL # 93.778
In accordance with 42 CFR 435, documentation must be obtained as needed to determine if a recipient meets
specific standards, and documentation must be maintained to support eligibility determinations. In accordance
with 2 CFR 200, management should have an adequate system of internal controls procedures in place to ensure
an applicant is properly determined or redetermined for benefits.
There were 3 errors discovered during our procedures that inaccurate information was entered when determining
eligibility.
229
Johnston County, North Carolina
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2024
Recommendation:
Views of responsible
officials and planned
corrective actions:
Finding: 2024-002 Inaccurate Resources Entry
SIGNIFICANT DEFICIENCY
Eligibility
Criteria:
Condition:
Questioned Costs:
Context:
Effect:
Cause:
Recommendation:
Views of responsible
officials and planned
corrective actions:
Files should be reviewed internally to ensure proper documentation is in place for eligibility. Workers should be
retrained on what files should contain and the importance of complete and accurate record keeping. We
recommend that all files include online verifications, documented resources of income and those amounts agree to
information in NC FAST. The results found or documentation made in case notes should clearly indicate what
actions were performed and the results of those actions.
The County agrees with the finding. See Corrective Action Plan in the following section.
We examined 60 cases from of a total of 2,229,628 Medicaid claims from the Medicaid beneficiary report
provided by NC Department of Health and Human Services to re-determine eligibility. These findings are being
reported with the financial statement audit as it relates to Medicaid administrative cost compliance audit.
For those certifications/re-certifications there was a chance that information was not properly documented and
reconciled to NC FAST and a participant could have been approved for benefits for which they were not eligible.
Ineffective record keeping and ineffective case review process, incomplete documentation, and incorrect
application of rules for purposes of determining eligibility.
In accordance with Medicaid Manual MA-2230, Medicaid for Aged, Blind and Disabled case records should
contain documentation that verifications were done in preparation of the application and these items will agree to
reports in the NC FAST system. In this process, the countable resources should be calculated correctly and agree
back to the amounts in the NC FAST system. Any items discovered in the verification process should be
considered countable or noncountable resources and explained within the documentation.
There was 1 error discovered during our procedures where resources were imcorrectly calculated or were not
properly documented in the case file.
There was no known affect to eligibility and there were no known questioned costs.
Section III. Federal Award Findings and Questioned Costs (continued)
US Department of Health and Human Services
Passed through the NC Dept. of Health and Human Services
Program Name: Medical Assistance Program (Medicaid; Title XIX)
AL # 93.778
Case files should be reviewed internally to ensure correct calculations of resources are made, proper information
is included in the case file, and necessary procedures are taken when determining eligibility. The results found or
documentation made in case notes should clearly indicate what actions were performed and the results of those
actions.
The County agrees with the finding. See Corrective Action Plan in the following section.
230
Johnston County, North Carolina
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2024
Finding: 2024-003 Inadequate Request for Information
SIGNIFICANT DEFICIENCY
Eligibility
Criteria:
Condition:
Questioned Costs:
Context:
Effect:
Identification of a repeat
finding:
Cause:
Recommendation:
Views of responsible
officials and planned
corrective actions:
US Department of Health and Human Services
Section III. Federal Award Findings and Questioned Costs (continued)
Ineffective record keeping and ineffective case review process, incomplete documentation, and incorrect
application of rules for purposes of determining eligibility.
Files should be reviewed internally to ensure proper documentation is in place for eligibility. Workers should be
retrained on what files should contain and the importance of complete and accurate record keeping. We
recommend that all files include online verifications, documented resources and income and those amounts agree
to information in NC FAST. The results found or documentation made in case notes should clearly indicate what
actions were performed and the results of those actions.
AL # 93.778
This is a repeat finding from the immediate previous audit, 2023-003.
Passed through the NC Dept. of Health and Human Services
Program Name: Medical Assistance Program (Medicaid; Title XIX)
In accordance with 42 CFR 435, documentation must be obtained as needed to determine if a recipient meets
specific standards, and documentation must be maintained to support eligibility determinations. Electronic
matches are required at applications and redeterminations.
The County agrees with the finding. See Corrective Action Plan in the following section.
There were 8 errors discovered during our procedures that inadequate information was requested at applications
and/or redeterminations.
For those certifications/re-certifications there was a chance that information was not properly documented and
reconciled to NC FAST which could affect countable resource. Therefore, applicants could have received
assistance for which they were not eligible.
We examined 60 cases from of a total of 2,229,628 Medicaid claims from the Medicaid beneficiary report
provided by NC Department of Health and Human Services to re-determine eligibility. These findings are being
reported with the financial statement audit as it relates to Medicaid administrative cost compliance audit.
There was no known affect to eligibility and there were no known questioned costs.
231
Johnston County, North Carolina
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2024
Finding: 2024-004 Untimely Review of SSI Terminations
SIGNIFICANT DEFICIENCY
Eligibility
Criteria:
Condition:
Questioned Costs:
Context:
Effect:
Cause:
Recommendation:
Views of responsible
officials and planned
corrective actions:
US Department of Health and Human Services
Passed through the NC Dept. of Health and Human Services
Program Name: Medical Assistance Program (Medicaid; Title XIX)
Section III. Federal Award Findings and Questioned Costs (continued)
The County did not initiate ex-parte review timely, therefore, no eligibility review was completed in the required
time period. The lack of follow up and certification lead to applicants receiving Medicaid benefits for which they
were not eligible.
Ineffective communication between departments within the Department of Social Services. One area within DSS
received State communications that applicants would no longer be eligible for SSI benefits and the County needed
to conduct an ex-parte review. This information was not shared with other departments in DSS from which the
recipient was also receiving benefits.
Any State communications related to applicants/beneficiaries should be shared with all areas from which the
participant receives benefits. State files should be reviewed internally to ensure all actions have been properly
closed and the corrective action has been taken. Workers should be retrained on what process needs to be followed
when State communications are received.
The County agrees with the finding. See Corrective Action Plan in the following section.
AL # 93.778
In accordance with the Medicaid Manual MA-3120, the State sends notification to the County when a participant
is no longer eligible under a SSI determination. The County has a certain time period to initiate an ex-parte review
to determine whether the recipient qualifies for Medicaid under any other coverage group, such as Family and
Children's Medicaid, North Carolina Health Choice for Children, Work First Family Assistance, or Medicaid for
the Aged, Blind and Disabled.
There were 2 applicants/beneficiaries not reviewed timely and determined to be eligible for Medicaid when their
SSI benefits were terminated.
There was no known affect to eligibility and there were no known questioned costs.
We examined 60 cases from of a total of 2,229,628 Medicaid claims from the Medicaid beneficiary report
provided by NC Department of Health and Human Services to re-determine eligibility. These findings are being
reported with the financial statement audit as it relates to Medicaid administrative cost compliance audit.
232
Johnston County, North Carolina
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2024
Finding: 2024-005 FNS Eligibility Determinations
SIGNIFICANT DEFICIENCY
Eligibility
Criteria:
Condition:
Questioned Costs:
Context:
Effect:
Cause:
Recommendation:
Views of responsible
officials and planned
corrective actions:
Section III. Federal Award Findings and Questioned Costs (continued)
US Department of Health and Human Services
Passed through the NC Dept. of Health and Human Services
Program Name: Food and Nutrition Services (FNS) Cluster
AL # 10.551 and 10.561
Eligibility for food and nutrition assistance programs, such as the Supplemental Nutrition Assistance Program
(SNAP), is governed by federal regulations outlined in 7 CFR Part 273. These regulations mandate that state
agencies verify critical eligibility factors, including income, household composition, and residency, to ensure
benefits are provided only to qualifying individuals and families.
Additionally, North Carolina state regulations, codified under NC Administrative Code 10A NCAC 71U .0100,
require local departments of social services to adhere to specific policies and procedures for determining
eligibility and documenting supporting evidence. Failure to comply with these federal and state regulations can
lead to ineligible disbursements, loss of federal funding, and program sanctions.
There were a total of 9 errors found in our testing: 5 instances where the caseworker did not request adequate
information from the recipient related to income or an incorrect income amount was entered in NCFAST; 3
instances where the caseworker did not request adequate information from the recipient related to an expense
deduction or an incorrect expense deduction was entered in NCFAST; 1 instance where the caseworker did not
include proper residency information in the case file.
One case involved an applicant whose income was not inlcuded in the case file. This omission resulted in an
incorrect eligibility determination, allowing the applicant to receive benefits despite exceeding the income
threshold specified by the program guidelines.
Due to the nature of the populations provided from which the samples were chosen, we are unable to calculate
questioned costs for the above mentioned potential eligibility issue.
We examined 25 of 35,003 FNS/SNAP cases from a report of all active FNS/SNAP beneficiaries in the fiscal
year provided by the County's Department of Social Services. The finding is being reported with the financial
statement audit as it relates to FNS administrative cost compliance audit.
Failure to properly verify eligibility may result in benefits being provided to ineligible individuals, diverting
resources from those who qualify and increasing the risk of program non-compliance, financial losses, and
reputational harm to the administering agency.
Due to the errors noted, eligibility cannot be sufficiently substantiated and there is a risk that the County could
provide funding and/or benefits to individuals who are not program eligible.
The County should provide training of management and staff on the program's eligibility requirements, proper
case review process, and required verifications for eligibility. Also, the County should ensure that their formal
internal review process is adequately completed to identify and correct errors in case reviews.
The County agrees with the finding. See Corrective Action Plan in the following section.
233
Johnston County, North Carolina
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2024
Identification of major State programs:
Program Name
Medical Assistance Program
State Foster Home Fund (SFHF) Maximization
Connect NC Bond
Johnston County Radio and Paging Infrastructure Upgrade
Public School Building Capital Fund-Lottery Proceeds
Dollar threshold used to determine
State major programs $ 500,000
Auditee qualified as low-risk auditee? yes X no
None Reported.
Finding: 2024-001 Inaccurate Information Entry
SIGNIFICANT DEFICIENCY
Eligibility
Criteria:
Condition:
Questioned Costs:
Context:
Effect:
Identification of a repeat
finding:
Cause:
There was no known affect to eligibility and there were no known questioned costs.
We examined 60 cases from of a total of 2,229,628 Medicaid claims from the Medicaid beneficiary report
provided by NC Department of Health and Human Services to re-determine eligibility. These findings are being
reported with the financial statement audit as it relates to Medicaid administrative cost compliance audit.
This is a repeat finding from the immediate previous audit, 2023-002.
Ineffective record keeping and ineffective case review process, incomplete documentation, and incorrect
application of rules for purposes of determining eligibility.
For those certifications/re-certifications there was a chance that information was not properly documented and
reconciled to NC FAST and a participant could have been approved for benefits for which they were not eligible.
US Department of Health and Human Services
Section I. Summary of Auditors' Results (continued)
Section II. Financial Statement Findings
Section III. Federal Award Findings and Questioned Costs
Passed through the NC Dept. of Health and Human Services
Program Name: Medical Assistance Program (Medicaid; Title XIX)
AL # 93.778
In accordance with 42 CFR 435, documentation must be obtained as needed to determine if a recipient meets
specific standards, and documentation must be maintained to support eligibility determinations. In accordance
with 2 CFR 200, management should have an adequate system of internal controls procedures in place to ensure
an applicant is properly determined or redetermined for benefits.
There were 3 errors discovered during our procedures that inaccurate information was entered when determining
eligibility.
229
Johnston County, North Carolina
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2024
Recommendation:
Views of responsible
officials and planned
corrective actions:
Finding: 2024-002 Inaccurate Resources Entry
SIGNIFICANT DEFICIENCY
Eligibility
Criteria:
Condition:
Questioned Costs:
Context:
Effect:
Cause:
Recommendation:
Views of responsible
officials and planned
corrective actions:
Files should be reviewed internally to ensure proper documentation is in place for eligibility. Workers should be
retrained on what files should contain and the importance of complete and accurate record keeping. We
recommend that all files include online verifications, documented resources of income and those amounts agree to
information in NC FAST. The results found or documentation made in case notes should clearly indicate what
actions were performed and the results of those actions.
The County agrees with the finding. See Corrective Action Plan in the following section.
We examined 60 cases from of a total of 2,229,628 Medicaid claims from the Medicaid beneficiary report
provided by NC Department of Health and Human Services to re-determine eligibility. These findings are being
reported with the financial statement audit as it relates to Medicaid administrative cost compliance audit.
For those certifications/re-certifications there was a chance that information was not properly documented and
reconciled to NC FAST and a participant could have been approved for benefits for which they were not eligible.
Ineffective record keeping and ineffective case review process, incomplete documentation, and incorrect
application of rules for purposes of determining eligibility.
In accordance with Medicaid Manual MA-2230, Medicaid for Aged, Blind and Disabled case records should
contain documentation that verifications were done in preparation of the application and these items will agree to
reports in the NC FAST system. In this process, the countable resources should be calculated correctly and agree
back to the amounts in the NC FAST system. Any items discovered in the verification process should be
considered countable or noncountable resources and explained within the documentation.
There was 1 error discovered during our procedures where resources were imcorrectly calculated or were not
properly documented in the case file.
There was no known affect to eligibility and there were no known questioned costs.
Section III. Federal Award Findings and Questioned Costs (continued)
US Department of Health and Human Services
Passed through the NC Dept. of Health and Human Services
Program Name: Medical Assistance Program (Medicaid; Title XIX)
AL # 93.778
Case files should be reviewed internally to ensure correct calculations of resources are made, proper information
is included in the case file, and necessary procedures are taken when determining eligibility. The results found or
documentation made in case notes should clearly indicate what actions were performed and the results of those
actions.
The County agrees with the finding. See Corrective Action Plan in the following section.
230
Johnston County, North Carolina
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2024
Finding: 2024-003 Inadequate Request for Information
SIGNIFICANT DEFICIENCY
Eligibility
Criteria:
Condition:
Questioned Costs:
Context:
Effect:
Identification of a repeat
finding:
Cause:
Recommendation:
Views of responsible
officials and planned
corrective actions:
US Department of Health and Human Services
Section III. Federal Award Findings and Questioned Costs (continued)
Ineffective record keeping and ineffective case review process, incomplete documentation, and incorrect
application of rules for purposes of determining eligibility.
Files should be reviewed internally to ensure proper documentation is in place for eligibility. Workers should be
retrained on what files should contain and the importance of complete and accurate record keeping. We
recommend that all files include online verifications, documented resources and income and those amounts agree
to information in NC FAST. The results found or documentation made in case notes should clearly indicate what
actions were performed and the results of those actions.
AL # 93.778
This is a repeat finding from the immediate previous audit, 2023-003.
Passed through the NC Dept. of Health and Human Services
Program Name: Medical Assistance Program (Medicaid; Title XIX)
In accordance with 42 CFR 435, documentation must be obtained as needed to determine if a recipient meets
specific standards, and documentation must be maintained to support eligibility determinations. Electronic
matches are required at applications and redeterminations.
The County agrees with the finding. See Corrective Action Plan in the following section.
There were 8 errors discovered during our procedures that inadequate information was requested at applications
and/or redeterminations.
For those certifications/re-certifications there was a chance that information was not properly documented and
reconciled to NC FAST which could affect countable resource. Therefore, applicants could have received
assistance for which they were not eligible.
We examined 60 cases from of a total of 2,229,628 Medicaid claims from the Medicaid beneficiary report
provided by NC Department of Health and Human Services to re-determine eligibility. These findings are being
reported with the financial statement audit as it relates to Medicaid administrative cost compliance audit.
There was no known affect to eligibility and there were no known questioned costs.
231
Johnston County, North Carolina
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2024
Finding: 2024-004 Untimely Review of SSI Terminations
SIGNIFICANT DEFICIENCY
Eligibility
Criteria:
Condition:
Questioned Costs:
Context:
Effect:
Cause:
Recommendation:
Views of responsible
officials and planned
corrective actions:
US Department of Health and Human Services
Passed through the NC Dept. of Health and Human Services
Program Name: Medical Assistance Program (Medicaid; Title XIX)
Section III. Federal Award Findings and Questioned Costs (continued)
The County did not initiate ex-parte review timely, therefore, no eligibility review was completed in the required
time period. The lack of follow up and certification lead to applicants receiving Medicaid benefits for which they
were not eligible.
Ineffective communication between departments within the Department of Social Services. One area within DSS
received State communications that applicants would no longer be eligible for SSI benefits and the County needed
to conduct an ex-parte review. This information was not shared with other departments in DSS from which the
recipient was also receiving benefits.
Any State communications related to applicants/beneficiaries should be shared with all areas from which the
participant receives benefits. State files should be reviewed internally to ensure all actions have been properly
closed and the corrective action has been taken. Workers should be retrained on what process needs to be followed
when State communications are received.
The County agrees with the finding. See Corrective Action Plan in the following section.
AL # 93.778
In accordance with the Medicaid Manual MA-3120, the State sends notification to the County when a participant
is no longer eligible under a SSI determination. The County has a certain time period to initiate an ex-parte review
to determine whether the recipient qualifies for Medicaid under any other coverage group, such as Family and
Children's Medicaid, North Carolina Health Choice for Children, Work First Family Assistance, or Medicaid for
the Aged, Blind and Disabled.
There were 2 applicants/beneficiaries not reviewed timely and determined to be eligible for Medicaid when their
SSI benefits were terminated.
There was no known affect to eligibility and there were no known questioned costs.
We examined 60 cases from of a total of 2,229,628 Medicaid claims from the Medicaid beneficiary report
provided by NC Department of Health and Human Services to re-determine eligibility. These findings are being
reported with the financial statement audit as it relates to Medicaid administrative cost compliance audit.
232
Johnston County, North Carolina
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2024
Finding: 2024-005 FNS Eligibility Determinations
SIGNIFICANT DEFICIENCY
Eligibility
Criteria:
Condition:
Questioned Costs:
Context:
Effect:
Cause:
Recommendation:
Views of responsible
officials and planned
corrective actions:
Section III. Federal Award Findings and Questioned Costs (continued)
US Department of Health and Human Services
Passed through the NC Dept. of Health and Human Services
Program Name: Food and Nutrition Services (FNS) Cluster
AL # 10.551 and 10.561
Eligibility for food and nutrition assistance programs, such as the Supplemental Nutrition Assistance Program
(SNAP), is governed by federal regulations outlined in 7 CFR Part 273. These regulations mandate that state
agencies verify critical eligibility factors, including income, household composition, and residency, to ensure
benefits are provided only to qualifying individuals and families.
Additionally, North Carolina state regulations, codified under NC Administrative Code 10A NCAC 71U .0100,
require local departments of social services to adhere to specific policies and procedures for determining
eligibility and documenting supporting evidence. Failure to comply with these federal and state regulations can
lead to ineligible disbursements, loss of federal funding, and program sanctions.
There were a total of 9 errors found in our testing: 5 instances where the caseworker did not request adequate
information from the recipient related to income or an incorrect income amount was entered in NCFAST; 3
instances where the caseworker did not request adequate information from the recipient related to an expense
deduction or an incorrect expense deduction was entered in NCFAST; 1 instance where the caseworker did not
include proper residency information in the case file.
One case involved an applicant whose income was not inlcuded in the case file. This omission resulted in an
incorrect eligibility determination, allowing the applicant to receive benefits despite exceeding the income
threshold specified by the program guidelines.
Due to the nature of the populations provided from which the samples were chosen, we are unable to calculate
questioned costs for the above mentioned potential eligibility issue.
We examined 25 of 35,003 FNS/SNAP cases from a report of all active FNS/SNAP beneficiaries in the fiscal
year provided by the County's Department of Social Services. The finding is being reported with the financial
statement audit as it relates to FNS administrative cost compliance audit.
Failure to properly verify eligibility may result in benefits being provided to ineligible individuals, diverting
resources from those who qualify and increasing the risk of program non-compliance, financial losses, and
reputational harm to the administering agency.
Due to the errors noted, eligibility cannot be sufficiently substantiated and there is a risk that the County could
provide funding and/or benefits to individuals who are not program eligible.
The County should provide training of management and staff on the program's eligibility requirements, proper
case review process, and required verifications for eligibility. Also, the County should ensure that their formal
internal review process is adequately completed to identify and correct errors in case reviews.
The County agrees with the finding. See Corrective Action Plan in the following section.
233