Audit 404688

ELIGIBILITY DETERMINATION Federal Agency: U.S. Department of Health and Human Services Federal Program Name: Grants to States for Medicaid (Medicaid Cluster) Assistance Listing Number: 93.778 Pass-Through Agency: Minnesota Department of Human Services Federal Award Identification and Pass-Through Numbers: 2505MN5ADM and 2505MN5MAP Award Period: Year Ended December 31, 2025 Compliance Requirement: Eligibility Type of Finding: Significant Deficiency in Internal Control over Compliance and Other Matter Criteria or Specific Requirement: Uniform Guidance requires the Agency to ensure compliance over eligibility by having the proper documentation of income, citizenship, redeterminations, and social security numbers. Condition: During our testing of compliance over eligibility, it was noted the Agency did not have adequate procedures designed to ensure the verifications required were properly obtained. Context: During testing, it was noted that 3 of 60 Medical Assistance case files tested did not have proper documentation to support citizenship verification, 1 of 60 case files did not have proper documentation to support the basis of eligibility, and 1 of 60 case files did not have proper documentation for asset and income verification and a completed application. The sample sizes were based on guidance from chapter 11 of the AICPA Audit Guide, Government Auditing Standards and Single Audits. Questioned Costs: None noted. Cause: There has been a significant increase in case loads, as well as changing guidance due to waivers expiring. Effect: Errors made in determining eligibility may not be discovered and benefits may be issued to clients who are not eligible. Repeat Finding: Yes – 2024-001. Recommendation: We recommend the Agency implement procedures to ensure that asset and income documentation in the casefiles be retained and that it matches the information input into the METS eligibility system. Views of responsible officials: There is no disagreement with the audit finding. There is an effort to maintain a strong healthcare processing leadership team. In addition, training will be provided to health and human services staff regarding proper documentation and entry into METS and staff will be reminded to perform reviews.

CASE FILE REVIEWS Federal Agency: U.S. Department of Health and Human Services Federal Program Name: Grants to States for Medicaid (Medicaid Cluster) Assistance Listing Number: 93.778 Pass-Through Agency: Minnesota Department of Human Services Federal Award Identification and Pass-Through Numbers: 2505MN5ADM and 2505MN5MAP Award Period: Year Ended December 31, 2025 Compliance Requirement: Eligibility Type of Finding: Significant Deficiency in Internal Control over Compliance Criteria or Specific Requirement: Federal guidelines require grant recipients to implement internal controls for each direct and material compliance requirement applicable to the federal grant to ensure compliance with said requirements. Condition: During testing of controls over Eligibility, it was noted that the Agency does not have adequate procedures designed to ensure proper controls over eligibility requirements. Context: During testing of controls over Eligibility (i.e., casefile reviews), it was noted that casefiles were only reviewed during the first part of the year. The quantity reviewed is insufficient sample sizes for the number of clients the Agency handles. The sample sizes were based on guidance from chapter 11 of the AICPA Audit Guide, Government Auditing Standards and Single Audits. Questioned Costs: None noted. Cause: Lack of staffing during the second half of the year did not allow for reviews to take place. Effect: The Agency may be incorrectly concluding that an applicant is eligible for the federal programs they are applying for. Repeat Finding: No. Recommendation: We recommend the Agency perform case file reviews on a more representative sample of the total clients served and that adequate supporting documentation be retained of those reviews. Views of responsible officials: There is no disagreement with the audit finding. Additional documentation and specific casefile reviews will be implemented