Information on the Federal Program: Federal Grantor: U.S. Department of Health and Human Services Federal Cluster: None Assistance Listing No: 93.767 – Children’s Health Insurance Program (CHIP) Criteria or Specific Requirement (Including Statutory, Regulatory, or Other Citation): Title XXI of the Social Security Act requires that a child be placed in the health care coverage program for which the child is financially eligible. CHIP is one of the programs for which eligibility must be determined. A child is evaluated for CHIP eligibility when it is determined that the annual family income is above the income limit for Medicaid (MA) for the child’s age group. The Commonwealth of Pennsylvania’s Department of Human Services (PA DHS) is responsible for the management and oversight of the CHIP program. PA DHS has agreements with select private health care organizations, referred to as managed care organizations (MCOs), to provide the CHIP insurance coverage and to assist with enrollment and eligibility verification, renewals, terminations, and member assistance for case updates and questions on eligibility, coverage, etc. UPMC serves as an MCO for Pennsylvania’s CHIP program. As outlined in the PA DHS Children’s Health Insurance Program (CHIP) Procedures Handbook, MCOs are responsible for the following processes: a. Application Processing – The CHIP eligibility process starts when a parent or caregiver submits an application either electronically, via telephone call, or in paper form to a managed care organization (MCO). Applications may also be referred to the MCOs from other sources, such as a county assistance office (CAO). Any electronically submitted application that does not pass the CHIP eligibility requirements is routed to the MCO chosen by the parent or caregiver for manual processing. If no MCO is chosen, one is assigned. MCOs are also responsible for processing applications received through other sources (e.g., telephone, paper form, or CAO). Manual processing includes income verification if not previously verified by another party (e.g., PA DHS through MA application, CAO, or another MCO). The MCOs input the income data into CHIP Application Processing System (CAPS) (or verify data previously submitted) for CAPS to determine eligibility. MCOs are responsible for maintaining the source documentation provided by the enrollee. MCOs are also responsible for working with enrollees on incomplete applications and current members on renewals. b. Renewals – Renewal of CHIP coverage must occur prior to the end of the 12-month period of enrollment. Enrollees are automatically notified of renewal at 120 days prior to the expiration of the 12-month enrollment period. MCOs are required to send follow-up notifications to parents or caregivers at 90 and 60 calendar days prior to the expiration of the 12-month period of enrollment. The MCO is responsible for reviewing eligibility for continued coverage by verifying income. MCOs are encouraged to consider family circumstances that are also likely to change, including household income; age of child (as children age out of CHIP at 19 years old); number of household members (additions and deletions) that may impact income eligibility limits; MA eligibility and/or enrollment; enrollment in private health insurance; or other missing data. c. Ineligibility – MCOs are required to send notice of denial to applications or a notice of termination to enrollees. The notice must include the reason for ineligibility, the right to request an impartial review of the decision of ineligibility; and how to file a request for impartial review. d. Eligibility Review Process (ERP) – An applicant or enrollee may request an impartial eligibility review when a determination of an application or renewal results in denied or terminated coverage; a change in the coverage (e.g., from Free CHIP to Low-Cost or Full-Cost CHIP) or cost; applicant with income over eligibility thresholds disagrees with the determination of availability or affordability of private insurance; or MCO fails to make a timely eligibility determination. Requests for reviews are made directly to the MCO. Reviews must be completed within 2 business days, and, if the MCO cannot resolve the matter within this timeframe, the MCO must notify DHS. Coverage is required to be reinstated or continued during the review. MCOs must maintain a log of requests received and completed. e. Quality Management – MCOs must establish and implement an ongoing comprehensive quality assessment and performance improvement program that complies with requirements outlined by PA DHS. MCOs are also responsible for enrollee orientation, processing complaints and grievances, as well as other administrative processes. Condition: PA DHS utilized the CHIP Application Processing System (CAPS) to accumulate and process data associated with the CHIP program. The operation and management of CAPS, as well as the underlying data, was the responsibility of PA DHS. Beginning April 17, 2023, PA DHS decommissioned CAPS, transitioning the CHIP process to another application utilized by PA DHS. At this date, PA DHS began handling all applications, renewals, case updates, and eligibility questions for CHIP families, reducing the responsibility of MCOs. These functions were primarily performed in CAPS to capture application information and process eligibility determinations for CHIP. With the decommissioning of CAPS on April 17, 2023, the evidence to support UPMC’s completion of these processes is not available for the period January 1, 2023 to April 16, 2023. PA DHS is unable to provide all the required data from the archived version of CAPS, including certain enrollee or application data points; notes and commentary documented by the MCOs; and evidence of the date/time procedures were performed. This information is necessary to test internal controls over compliance and compliance over eligibility and special tests and provisions. Therefore, we were not able to support internal controls over compliance and compliance over the eligibility or the special tests and provisions compliance requirements through re-performance and have issued a disclaimer of opinion based on the scope limitation. Effect or Potential Effect: A disclaimer of opinion was issued for Assistance Listing 93.767 as we were unable to obtain sufficient documentation supporting the compliance of UPMC with eligibility and special tests and provisions compliance requirements. Questioned Costs: None. Context: Federal expenditures reported in the schedule of expenditures of federal awards for Assistance Listing 93.767 totaled $11,613,050 for the year ended December 31, 2023. Identification as a Repeat Finding, If Applicable: This is not a repeat finding. Recommendation: As UPMC has no further compliance responsibilities related to eligibility and special tests and provisions, not further follow-up is required. Views of Responsible Officials: As UPMC utilizes the Commonwealth of Pennsylvania’s system as described above, no further corrective action will be taken.
Reporting – SEFA Preparation Information of the federal program: Federal Grantor: U.S. Department of Health and Human Services Federal Cluster: None Assistance Listing No.: 93.918, Grants to Provide Outpatient Early Intervention Services with Respect to HIV Disease (Ryan White, Part C) Federal Award Numbers: H76HA31655, H76HA25775, H76HA00617, and P06HA9851 Federal Award Period: April 1, 2022 through March 31, 2025; May 1, 2022 through April 30, 2025; May 1, 2022 through April 30, 2025; and September 1, 2023 through August 31, 2024 Criteria or specific requirement (including statutory, regulatory or other citation): The Uniform Guidance 2 CFR section 200.510 states, “(b) Schedule of expenditures of Federal awards. The auditee must also prepare a schedule of expenditures of federal awards (the SEFA) for the period covered by the auditee’s financial statements which must include the total Federal awards expended as determined in accordance with §200.502 Basis for determining Federal awards expended.” Condition: Ryan White, Part C requires the use of program income under the additive method, which requires program income earned from a federally funded program is added to the federal award amount and used to further program objectives. Under the method, allowable expenditures of program income are included on the SEFA. UPMC’s SEFA did not include expenditures related to program income, which were allowable. Cause: UPMC’s SEFA included grant funds expended under the Ryan White, Part C program but did not include program income funds expended under the Ryan White, Part C program for the year ended December 31, 2023. Effect or potential effect: The expenditures in the SEFA for the Ryan White, Part C a program for the year ended December 31, 2023, were understated which resulted in the improper identification of major federal programs and, therefore, required the restatement of the previously issued Uniform Guidance report to include Ryan White, Part C as a major federal program. Questioned costs: None. Context: Expenditures for Ryan White, Part C were understated by $5,528,826 (as compared to total restated expenditures for Ryan White, Part C of $7,149,887), which resulted in Ryan White, Part C being identified as major federal program upon inclusion of the allowable expenditures from program income. Identification as a repeat finding, if applicable: This finding is not a repeat finding. Recommendation: UPMC should evaluate its internal controls over the SEFA process to ensure that reported federal expenditures include both grant expenditures and applicable program income expenditures, when required, to support the accurate reporting of federal expenditures. Views of responsible officials: Management concurs with this finding.
Ryan White Program Review and Approval Internal Controls Identification of the Federal Program: Federal Agency: U.S. Department of Health and Human Services Federal Cluster: None Assistance Listing No.: 93.918, Grants to Provide Outpatient Early Intervention Services with Respect to HIV Disease (Ryan White, Part C) Federal Award Numbers: H76HA31655, H76HA25775, H76HA00617, and P06HA9851 Federal Award Period: April 1, 2022 through March 31, 2025; May 1, 2022 through April 30, 2025; May 1, 2022 through April 30, 2025; and September 1, 2023 through August 31, 2024 Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): Section 200.303 of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) states the following regarding internal control: “The non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).” Condition: For the period under audit, UPMC did not retain sufficient evidence to support the design and operation of internal controls over the following compliance requirements: • Allowability • Cash Management • Procurement and Suspension and Debarment • Program Income • Reporting Cause: The design and operation of UPMC’s controls over the program did not incorporate appropriate procedures to document and maintain evidence to support the operation of such controls. Revisions to the design and operation of UPMC’s controls were made subsequent to year-end, thus leading to no evidence of controls during the year under audit. Effect or Potential Effect: If appropriate controls are not documented and functioning properly, program data used to determine allowability and program income and compile required reports may not be complete and accurate resulting in noncompliance with the applicable compliance requirements or questioned costs. Questioned Costs: None Context: Total federal expenditures on the SEFA for Ryan White, Part C totaled $7,149,887 for the year ended December 31, 2023. Identification as a Repeat Finding, if Applicable: No. Recommendation: UPMC should ensure all control policies related to the applicable compliance processes are implemented and that evidence of each control is maintained. Views of Responsible Officials: Management concurs with this finding. Subsequent to December 31, 2023, management revised the internal control policies and procedures for Ryan White, Part C to appropriately maintain evidence of controls performed.