Corrective Action Plans

Finding 1200731 (2025-018)

Material Weakness 2025

LA

Questioned Costs Subrecipient Monitoring

Dear Mr. Waguespack: The Louisiana Department of Health (LDH) acknowledges receipt of correspondence from the Louisiana Legislative Auditor (LLA) dated January 5, 2026, titled Inadequate Controls over Billing for Behavioral Health Services. LDH appreciates the opportunity to provide this response to...

Dear Mr. Waguespack: The Louisiana Department of Health (LDH) acknowledges receipt of correspondence from the Louisiana Legislative Auditor (LLA) dated January 5, 2026, titled Inadequate Controls over Billing for Behavioral Health Services. LDH appreciates the opportunity to provide this response to your office's findings. Finding: Inadequate Controls over Billing for Behavioral Health Services Recommendation: LDH management should ensure that agency personnel are adequately monitoring the EQR contract and that the proper validations are being conducted to ensure encounters are coded correctly. LDH Response: LDH concurs with the recommendation. Corrective Action Plan: The Office of Behavioral Health and Medicaid staff shall develop additional standards required by CMS for the EQR contractor to ensure the issues raised by the LLA are addressed. Additionally, Internal Audit staff will review the standards and provide an independent evaluation of the adequacy of the solution. You may contact Holly Howat, OBH Interim Assistant Secretary, by telephone at (225) 342-1435 or email at Holly.Howat@la.gov with any questions concerning this matter.

View Audit 395718

Finding 1200730 (2025-004)

Material Weakness 2025

State of Louisiana

LA

Subrecipient Monitoring Questioned Costs Special Tests & Provisions

Dear Mr. Waguespack, Please find below the University's management response to the audit finding titled "Control Weakness and Noncompliance with Special Tests and Provisions Requirements." Management Response The University concurs with the finding. This letter is provided in response to the audit f...

Dear Mr. Waguespack, Please find below the University's management response to the audit finding titled "Control Weakness and Noncompliance with Special Tests and Provisions Requirements." Management Response The University concurs with the finding. This letter is provided in response to the audit finding related to Special Tests and Provisions requirements. The audit identified that UL Lafayette did not have adequately designed controls to ensure compliance with federal award requirements related to key personnel effort. Specifically, the auditors noted that key personnel were not involved in the project at the level required by the federal award or proposal submissions, prior approvals for changes in effort were not obtained from the federal grantor agency or pass-through entity when required, and time and effort certifications for key personnel were not sufficient to certify that the required level of effort was met. Additionally, the audit determined that UL Lafayette did not have adequate controls in place to monitor key personnel effort on a timely basis to ensure required effort levels were maintained and that prior written approvals were obtained when applicable. The auditors further noted that annual and semiannual certifications alone were not sufficient to timely detect changes in key personnel effort that would require prior approval. Our primary focus has been on ensuring that salaries charged to sponsored projects were accurate and did not exceed approved budgetary limits as required by sponsors. We are actively developing and implementing a documented procedure for effort reporting to address this issue going forward. Corrective Action Plan Dr. Kumer Das, the Interim Vice President of Research, Innovation and Economic Development will be responsible with overseeing all corrective actions to address this finding and strengthen compliance with federal key personnel effort monitoring requirements. The following corrective actions have been implemented or are in progress: 1. Realignment of Research Administration Functions • Effective May 29, 2025, pre-award and post-award operations were consolidated under the Vice President for Research. This structural realignment strengthens oversight, improves coordination of proposal commitments and post-award monitoring, and enhances accountability across the grant lifecycle. 2. Comprehensive Business Process Mapping • The University engaged Ellucian to conduct a comprehensive review of end-to-end grant management workflows. This process mapping initiative evaluated roles, responsibilities, and control points related to proposal development, award setup, payroll distribution, and effort certification. Knowledge transfer sessions have been scheduled for March and April 2026 with Ellucian consultants to support implementation of revised procedures and internal control enhancements. 3. Effort Tracking, Reconciliation, and Certification To address the identified deficiencies, the University is implementing the following control enhancements: • Pre-Award Commitment Review: At the time of proposal submission, Pre-Award staff will review and document key personnel effort commitments to ensure proposed effort is reasonable, attainable, and aligned with institutional responsibilities. A centralized key personnel commitment tracker is under development and will be implemented by March 31, 2026. • Award-Level Commitment Reconciliation: Upon receipt of an award, the tracker will be updated to reflect sponsor-approved effort commitments. This will establish the baseline for post-award monitoring. • Quarterly or Semester-Based Effort Reviews: In addition to formal bi-annual certification cycles, the University will implement quarterly or semester-based internal effort reviews to provide timely identification of changes in key personnel commitment levels. The revised Standard Operating Procedure (SOP) will reflect this change. • Ongoing Monitoring and Payroll Reconciliation: Based on effort reviews, Post-Award will perform reconciliations of payroll charges and compare actual effort to committed effort levels. Variances will be reviewed with the Principal Investigator. Where reductions in effort exceed sponsor thresholds (e.g., greater than 25% reduction or disengagement exceeding three months), the Office of Research Administration and Compliance (ORAC) will determine whether prior approval or sponsor notification is required and will document the resolution. The University remains committed to making continuous improvements and appreciates your understanding of support as we address these challenges.

View Audit 395718

Finding 1200729 (2025-003)

Material Weakness 2025

State of Louisiana

LA

Subrecipient Monitoring Special Tests & Provisions

Dear Mr. Waguespack, Thank you for the opportunity to respond to your office’s findings related to the Special Tests and Provisions Requirements. Louisiana State University Health Sciences Center in Shreveport (LSUHSC-S) has reviewed the issues identified by your staff. During this period, the insti...

Dear Mr. Waguespack, Thank you for the opportunity to respond to your office’s findings related to the Special Tests and Provisions Requirements. Louisiana State University Health Sciences Center in Shreveport (LSUHSC-S) has reviewed the issues identified by your staff. During this period, the institution was modernizing its Time & Effort framework via PeopleSoft, implementing revised PER (personnel change request) routing, and establishing a post-award monitoring process. LSUHSC-S concurs with your recommendations for addressing the finding. The timeliness issues identified in the key control have been addressed, and corrective actions have been implemented to ensure proper functioning going forward. Recommendation: Management should monitor changes in effort for key personnel and verify that prior written approval is obtained from the federal grantor for changes that exceed the thresholds set in federal regulations. Management should also ensure the Time & Effort monitoring forms are completed timely to ensure compliance with Special Tests & Provisions requirements. Response and Corrective Action Plan LSUHSC-S is continuing to strengthen the management, internal controls, and efficiency of sponsored programs management. We have now established our Managing Effort policy to clarify that cost share is required if committed effort is not being charged to a project budget for any reason. We also modified our Cayuse award routing to include the Budget Office and General Accounting if the award record indicates that there will be any institutional cost sharing. This process is now automated and will ensure the setup of cost share accounts is incorporated into the account setup process, where it was a separate and “after the fact” process previously. Additionally, LSUHSC-S will implement a PI Eligibility Policy preventing gratis faculty from serving as PIs in the future. Time & Effort Certifications: LSUHSC-S implemented the PeopleSoft Time & Effort certification system in January 2025, with quarterly certifications for biweekly employees and semiannual certifications for monthly employees. These certifications are the official after-the-fact documentation required by 2 CFR 200. Related institutional directives—AD 4.4 (Time & Effort Reporting Certification) and AD 4.10 (Effort Commitment – Managing Effort on Sponsored Projects)—were revised with an effective date of July 1, 2025, and accompanied by FAQs and distributed training/guidance to campus stakeholders. Importantly, each of the 8 exceptions for the key control had timely official PeopleSoft effort certifications. Quarterly Effort Monitoring Tool (Key Control): Quarterly Effort Monitoring spreadsheets are used as the key control for monitoring effort prior to certification. This quarterly review provides an essential, structured “point in time” checkpoint that allows PIs and departments to identify discrepancies early and correct them before the official PeopleSoft effort certification is finalized. The control issues identified during the audit period were attributable to early-stage implementation of new systems and processes. LSUHSC-S has taken corrective action in several areas, including automating the workflow via AdobeSign, assigning a dedicated staff member to monitor the process, and incorporating escalation procedures to ensure timely return of the monitoring tool. Per our Effort Commitment — Managing Effort policy, quarterly reviews are one monitoring tool among several, including monthly ledger reviews by departments, and PER reviews, where any effort reallocation routes to OSP Post Award for assessment of sponsor rules and prior-approval needs prior to approving the change institutionally. While these complimentary controls support the overall monitoring structure, they do not replace the Quarterly Effort Review Spreadsheet as the key control. Prior Approval Improvements: To strengthen compliance with 2 CFR 200.308, LSUHSC-S implemented the electronic InfoReady Change in Senior/Key Personnel Request on May 1, 2025, now the primary tool for routing prior-approval requests. Integration with PER3 ensures OSP Post Award can deny personnel changes until sponsor approval is obtained. Automated reminders began April 1, 2025. Name of Contacts Responsible for Action Plan: Ramey Benfield, Chief Financial Officer & Vice Chancellor for Finance and Administration Ashley Krukowski, Executive Director, Office for Sponsored Programs Valarie White, Director, Office for Sponsored Programs, Pre-Award Administration Tracy Calvert, Director, Office for Sponsored Programs, Post Award Administration Estimated Completion Date: June 30th, 2026 Conclusion LSUHSC-S considers that the implementation of the PeopleSoft effort certification system, revised effort and cost transfer directives, the InfoReady prior-approval workflow, and automation of the Quarterly Effort Monitoring tool will address the auditors’ concerns and provide a strong, sustainable compliance framework that will be further demonstrated in the next audit cycle. If you have any questions or require additional information, please contact me at 318-675-6327 or via email at ramey.benfield@lsuhs.edu.

View Audit 395718

Finding 1200726 (2025-005)

Material Weakness 2025

State of Louisiana

LA

Subrecipient Monitoring

Dear Mr. Waguespack, Please find below the University's management response to the audit finding titled "Noncompliance with Subrecipient Monitoring Requirements". Management Response The University concurs with the finding. This letter is provided in response to the audit finding related to Subrecip...

Dear Mr. Waguespack, Please find below the University's management response to the audit finding titled "Noncompliance with Subrecipient Monitoring Requirements". Management Response The University concurs with the finding. This letter is provided in response to the audit finding related to Subrecipient Monitoring Compliance requirements. The audit identified that UL Lafayette did not adequately monitor subrecipients of the Research and Development (R&D) Cluster Programs. While the University has focused on established subrecipient monitoring procedures intended to address federal compliance requirements, we acknowledge that documentation supporting certain monitoring activities-specifically risk assessments, evidence of financial and performance report reviews, and elements required within select subaward agreements-was not consistently maintained or readily available. We are actively developing and implementing documented procedures to address this requirement going forward. Corrective Action Plan Dr. Kumer Das, the Interim Vice President of Research, Innovation and Economic Development will be responsible with overseeing all corrective actions to address this finding and strengthen compliance with federal subrecipient monitoring requirements. The following corrective actions have been implemented or are in progress: 1. Hiring of Subaward Coordinator • A dedicated Subaward Coordinator position was filled in October of 2025 to centralize responsibility for subrecipient monitoring, invoice review, and compliance oversight for FY26 going forward. 2. Enhanced Monitoring Oversight • A centralized subaward tracker was created at the beginning of February 2026. It is being used by the coordinator to track each subrecipient and their monitoring requirements. The tracker will allow the coordinator to perform risk assessments and acquire audit reports on a yearly basis. It will also be utilized to track and acquire financial and performance reports as per each subaward document. 3. Development and Implementation of Written Procedures • Formal written procedures for subrecipient monitoring are being developed and implemented. These procedures will establish standardized processes for conducting and documenting risk assessments, collecting and reviewing audit reports, maintaining complete subaward records, reviewing invoices and performance reports, and documenting monitoring activities. Written procedures for subrecipient monitoring are in progress and are expected to be completed by the end of March 2026. 4. Training and Accountability • Subrecipient Monitoring training was stepped up to bring the new Subaward Coordinator in line with Federal Subrecipient Monitoring requirements. We have held meetings with Attain, a consulting firm and sought guidance from colleagues at other Universities. The University remains committed to ensuring full compliance with all subrecipient monitoring requirements and to maintaining strong stewardship of public funds.

View Audit 395718

Finding 1200719 (2025-025)

Material Weakness 2025

State of Louisiana

LA

Questioned Costs Subrecipient Monitoring Reporting

Dear Mr. Waguespack, It has come to my attention the Single Audit of Louisiana performed on Louisiana Department of Health/Office of Behavioral Health (LDH/OBH) has rendered a finding that requires an explanation. As Secretary of LDH, I am committed to ensuring transparency and addressing any concer...

Dear Mr. Waguespack, It has come to my attention the Single Audit of Louisiana performed on Louisiana Department of Health/Office of Behavioral Health (LDH/OBH) has rendered a finding that requires an explanation. As Secretary of LDH, I am committed to ensuring transparency and addressing any concerns raised during the audit process. First, I would like to express my gratitude to the audit team for their thorough examination of our operations. We value the opportunity to improve and grow through constructive feedback. It is essential to note that we take these findings seriously and are committed to addressing them promptly. We have already begun implementing corrective measures to rectify the identified issue and prevent recurrence in the future. OBH corrective action plan, which outlines the status of action taken to correct the internal control weakness and finding of noncompliance related to the FFATA reporting requirements for the Block Grants for Substance Use, Prevention, Treatment and Recovery (SUPTRS) program, is as follows: LLA Request: OBH Response Issue: Noncompliance with Reporting Requirements for the FFATA Agree or Disagree: Yes, OBH agrees with LLA finding. Planned Corrective Action: (1) OBH is updating its internal control procedures to include the FFATA Reporting Requirements, in accordance with 2 CFR Part 170. (2) OBH developed a FFATA Data Form, to obtain information on its Subrecipients to include the entity’s name, unique Entity ID (UEI), address, principle place of performance(s), congressional district, summary of Federal subaward(s) and executive compensation information. Subrecipients will be required to certify the accuracy and completeness of their information submitted. Subrecipients will also be required to provide supporting documentation upon request. (3) OBH will update SAM.gov to include OBH SUPTRS FY2025 FFATA Reporting Data. Responsible Person: Holly Howat, Interim OBH Assistant Secretary Planned Completion Date: (1) December 31, 2025 (2) December 31, 2025. See attached draft FFATA Certification Data Form. (3) January 9, 2026 Furthermore, I have attached a copy of the OBH FFATA Data Form to substantiate our explanations and demonstrate our commitment to compliance and continuous improvement. I want to assure you that LDH remains dedicated to upholding the highest standards of integrity, transparency, and accountability. We appreciate the opportunity to address the audit findings and welcome any further inquiries or feedback. Thank you for your attention to this matter. Should you require additional information or clarification, please do not hesitate to contact me directly.

View Audit 395718

Finding 1200717 (2025-020)

Material Weakness 2025

State of Louisiana

LA

Subrecipient Monitoring

Dear Mr. Waguespack: The Louisiana Department of Health (LDH) acknowledges receipt of correspondence from the Louisiana Legislative Auditor (LLA) dated December 22, 2025, titled Noncompliance with and Inadequate Controls over Subrecipient Monitoring Requirements. LDH appreciates the opportunity to p...

Dear Mr. Waguespack: The Louisiana Department of Health (LDH) acknowledges receipt of correspondence from the Louisiana Legislative Auditor (LLA) dated December 22, 2025, titled Noncompliance with and Inadequate Controls over Subrecipient Monitoring Requirements. LDH appreciates the opportunity to provide this response to your office's findings. Finding: Noncompliance with and Inadequate Controls over Subrecipient Monitoring Requirements Recommendation: OBH management should develop and strengthen its system of internal controls to ensure that subrecipients are provided all required information, an evaluation is performed and documented to determine a subrecipient's risk of noncompliance, and that all subrecipients are adequately monitored to ensure compliance with federal statutes, regulations, and the terms and conditions of the subaward. LDH Response: OBH Concurs with the finding and recommendation. Corrective Action: The Office of Behavioral Health (OBH) has implemented the following measures to address and resolve the auditor's recommendations: 1. Develop and strengthen its system of internal controls to ensure that Subrecipients are provided all required information. Response: OBH has developed and implemented a standardized Subrecipient Subaward Agreement to ensure full compliance with 2 CFR 200.332(b). Effective the start of Fiscal Year 2026, this agreement formally communicates all essential award data, including: • Federal Award Identification Number (FAIN), date, and project description; • Unique Entity Identifier (UEI); and • Assistance Listings Number (ALN). 2. An evaluation is performed and documented to determine a Subrecipient's risk of noncompliance. Response: To improve fiscal and programmatic oversight of our block grant awards, OBH is developing a Risk Assessment Tool designed to assess each subrecipient's potential for fraud and noncompliance as required by 2 CFR 200.332(c). The final draft of the tool will be completed by January 16, 2026 and mandatory for all subrecipient monitoring activities beginning January 21, 2026. 3. All subrecipients are adequately monitored to ensure compliance with federal statutes, regulations, and the terms and conditions of the subaward. Response: During the period of review, OBH addressed a temporary staffing gap caused by the retirement of the internal auditor responsible for fiscal oversight. Monitoring duties were successfully reorganized and transitioned to the Grants Management section. OBH refilled the key position in January 2025. Subsequently, OBH updated its Accountability Plan (AP) Monitoring Tool and established a definitive schedule for 2026 subrecipient reviews. This schedule includes both virtual and on-site engagements, as detailed in the 2026 AP Review Calendar. You may contact Amanda Joyner, OBH Deputy Assistant Secretary, Administration & Finance, at (225) 342-1936 or via e-mail at Amanda.Joyner@la.gov with any questions about this matter.

View Audit 395718

Finding 1200708 (2025-017)

Material Weakness 2025

State of Louisiana

LA

Subrecipient Monitoring Questioned Costs Reporting

Dear Mr. Waguespack: The Department of Children and Family Services (DCFS) acknowledges receipt and concurs with the audit finding titled, “Noncompliance with Reporting Requirements for the Federal Funding Accountability and Transparency Act.” DCFS continually strives to enhance its internal process...

Dear Mr. Waguespack: The Department of Children and Family Services (DCFS) acknowledges receipt and concurs with the audit finding titled, “Noncompliance with Reporting Requirements for the Federal Funding Accountability and Transparency Act.” DCFS continually strives to enhance its internal processes and controls and remains committed to implementing and maintaining corrective actions to ensure compliance with federal and state regulations. DCFS concurs that required FFATA subaward information was not entered into the FFATA Subaward Reporting System (FSRS) or the System for Award Management (SAM), as applicable, for certain federal programs during fiscal year 2025, as required by Title 2 CFR Part 170. Management notes that the primary cause of this noncompliance during the current fiscal year was that corrective action data requests were received late in the fiscal year, which limited the Department’s ability to complete data validation and upload required information into the applicable reporting systems within the required reporting timeframe. Corrective Action Plan DCFS has strengthened and formalized internal controls to ensure the timely identification, collection, and submission of FFATA-required information and to prevent similar timing issues in future periods. Corrective actions include the following: • Corrective Action Planned: DCFS has implemented revised FFATA reporting procedures that establish internal deadlines for identifying reportable subawards and collecting required data from program and procurement areas. These procedures include defined roles and responsibilities, coordination between Procurement and Fiscal Services, and supervisory review to ensure FFATA data is complete and entered into FSRS or SAM, as applicable, within federally required timeframes. Management will also perform periodic monitoring to verify ongoing compliance. • Responsible Contact(s): Ali Bagbey, Program Manager, Office of Management and Finance - Procurement, Angela Hebert, Fiscal Director, Office of Management and Finance • Anticipated Completion Date: December 31, 2026 DCFS believes these actions address the timing issues that contributed to the fiscal year 2025 noncompliance and will strengthen FFATA reporting compliance going forward. Management will continue to monitor FFATA reporting processes to ensure sustained compliance with federal requirements.

View Audit 395718

Finding 1200706 (2025-013)

Material Weakness 2025

State of Louisiana

LA

Subrecipient Monitoring

Dear Mr. Waguespack: The Department of Children and Family Services (DCFS) acknowledges receipt and concurs with the audit finding titled, “Noncompliance and Control Weakness Related to Subrecipient Monitoring Requirements.” DCFS continuously strives to enhance its internal processes and controls an...

Dear Mr. Waguespack: The Department of Children and Family Services (DCFS) acknowledges receipt and concurs with the audit finding titled, “Noncompliance and Control Weakness Related to Subrecipient Monitoring Requirements.” DCFS continuously strives to enhance its internal processes and controls and remains committed to implementing corrective actions to ensure compliance with federal and state regulations. DCFS concurs that instances were identified where adequate controls were not in place to ensure compliance with subrecipient monitoring requirements related to the Temporary Assistance for Needy Families (TANF) and Foster Care Title IV-E (Foster Care) programs. Management recognizes the importance of properly monitoring and managing subrecipients, including documenting risk assessments, in order to comply with federal regulations and decrease the likelihood of improper payments which may have to be returned to the federal grantor. Corrective Action Plan DCFS is improving its internal processes for subrecipient monitoring and risk assessment to reduce the risk of future errors and improve compliance. • Corrective Action Planned: o DCFS will ensure that every subaward is clearly identified to the subrecipient as a subaward and that each subrecipient contract includes the following information: (1) Federal Award Identification; (2) All requirements of the subaward, including requirements imposed by federal statutes, regulations, and the terms and conditions of the federal award; and (3) Any additional requirements that the pass-through entity imposes on the subrecipient for the recipient to meet its responsibilities under the federal award. o DCFS will implement forms and processes to evaluate each subrecipient’s fraud risk and risk of noncompliance with a subaward for purposes of determining the appropriate subrecipient monitoring. o DCFS will use the implemented process to monitor the activities of a subrecipient as necessary to ensure that the subrecipient complies with federal statutes, regulations, and the terms and conditions of the subaward. In monitoring a subrecipient, DCFS will review financial and performance reports. • Responsible Contact(s): Ali Bagbey, Procurement Director • Anticipated Completion Date: June 30, 2026 DCFS believes these actions will address the deficiencies noted in the finding. Management will continue to monitor the effectiveness of these processes to ensure sustained compliance. Should you require additional information, please contact Ali Bagbey, Procurement Director at (225) 342-0277 or Ali.Bagbey.DCFS@la.gov.

View Audit 395718

Finding 1200701 (2025-011)

Material Weakness 2025

State of Louisiana

LA

Allowable Costs / Cost Principles Questioned Costs Subrecipient Monitoring

Dear Mr. Waguespack: The Department of Children and Family Services (DCFS) acknowledges receipt and concurs with the audit finding titled, “Control Weakness over Temporary Assistance for Needy Families Eligibility Requirements”. DCFS continually strives to enhance its internal processes and controls...

Dear Mr. Waguespack: The Department of Children and Family Services (DCFS) acknowledges receipt and concurs with the audit finding titled, “Control Weakness over Temporary Assistance for Needy Families Eligibility Requirements”. DCFS continually strives to enhance its internal processes and controls and remains committed to implementing corrective actions to ensure compliance with federal and state regulations. Although the exceptions noted occurred during the prior period under DCFS, the Louisiana Department of Health (LDH) began administration of the Family Independence Temporary Assistance Program (FITAP) and Kinship Care Subsidy Program (KCSP) programs effective October 1, 2025, and proposed the following continuous corrective actions that include formal coaching and active monitoring through supervisory case reviews. LDH will conduct formal coaching to ensure staff are aware of their responsibilities. This formal coaching will be mandated for eligibility staff identified as inaccurately budgeting income or entering incorrect disability coding, emphasizing the importance of precise and accurate income budgeting and data entry. In addition to routine case reviews, LDH Supervisors will conduct three additional case reviews for three months as continuous monitoring and corrective measures. DCFS TANF Consultant will monitor LDH to ensure the corrective action plan is fully executed. Should you require additional information, please contact Charles Watkins, Assistant Secretary of Family Support at Charles.Watkins.DCFS@LA.GOV.

View Audit 395718

Finding 1200699 (2025-008)

Material Weakness 2025

State of Louisiana

LA

Questioned Costs Subrecipient Monitoring Period of Performance

Dear Mr. Waguespack, Thank you for your diligence in conducting the recent audit of the Student Tuition Assistance and Revenue Trust Programs (START). We have carefully reviewed the audit finding and concur with the assessment of “Noncompliance and Control Weakness Over Gear Up Scholarship” for the ...

Dear Mr. Waguespack, Thank you for your diligence in conducting the recent audit of the Student Tuition Assistance and Revenue Trust Programs (START). We have carefully reviewed the audit finding and concur with the assessment of “Noncompliance and Control Weakness Over Gear Up Scholarship” for the period ending December 31, 2024. Management has contacted the grantor for further instructions for returning the unspent scholarship funds to the grantor. Porsche Harris, START Director, will be responsible to ensure compliance with federal regulations for the return of GEAR UP funds or the redistribution as well as the development of written policies and procedures and staff compliance with that information in accordance with federal regulations. Anticipated completion date is December 31, 2025. We value your ongoing partnership and appreciate the cooperation of your staff throughout the audit process. Please let me know if you have any questions or require further information.

View Audit 395718

Finding 1200668 (2025-001)

Material Weakness 2025

Corporacion Del Proyecto Enlance Del Cano Martin Pena

PR

Subrecipient Monitoring HUD Housing Programs Program Income

During the period that was reported on the finding, the manager in charge of the CDGB-MIT program was taking on additional workload while carrying out onboarding and training procedures for the program coordinator that would be assigned to assist with carrying out both programatic and administrative...

During the period that was reported on the finding, the manager in charge of the CDGB-MIT program was taking on additional workload while carrying out onboarding and training procedures for the program coordinator that would be assigned to assist with carrying out both programatic and administrative duties under the grant. Although the coordinator's training period concurred with the report's deadline, causing the one-day delay in submitting the required information, subsequent reports are being completed in a timely manner due to the addition of program personnel.

View Audit 395706

Finding 1200666 (2025-009)

Material Weakness 2025

Cabell Huntington Coalition for the Homeless, Inc.

WV

Subrecipient Monitoring Reporting

Performance Reporting Management agrees with the finding. We will develop a SAMSHA-specific policy requiring timely performance reporting and outlining procedures to ensure compliance.

View Audit 395703

Finding 1200665 (2025-008)

Material Weakness 2025

Cabell Huntington Coalition for the Homeless, Inc.

WV

Subrecipient Monitoring Reporting

FFATA Reporting Management agrees with the finding. While the primary awardee (CHCH) was reprted, two subrecipients were not. As this was the first year of the grant and assistance was sought during application, management was unaware of the requirement. This requirement has now been noted and will ...

FFATA Reporting Management agrees with the finding. While the primary awardee (CHCH) was reprted, two subrecipients were not. As this was the first year of the grant and assistance was sought during application, management was unaware of the requirement. This requirement has now been noted and will be followed going forward.

View Audit 395703

Finding 1200663 (2025-007)

Material Weakness 2025

Cabell Huntington Coalition for the Homeless, Inc.

WV

Subrecipient Monitoring

Subrecipient Monitoring Management agrees with the finding. In year one of the audited grant, subrecipients lacked adequate documentation and proper budget application. Monitoring has since increased in years two and three, with documentation reviewed prior to drawdown and payment. We also use Excel...

Subrecipient Monitoring Management agrees with the finding. In year one of the audited grant, subrecipients lacked adequate documentation and proper budget application. Monitoring has since increased in years two and three, with documentation reviewed prior to drawdown and payment. We also use Excel to track subrecipient line items to ensure costs remain eligible and within budget.

View Audit 395703

Finding 1200661 (2025-006)

Material Weakness 2025

Cabell Huntington Coalition for the Homeless, Inc.

WV

Allowable Costs / Cost Principles Questioned Costs Subrecipient Monitoring

Allowable Costs/Cost Principles Management agrees with the finding. One subrecipient billed expenses which were unallowable based on budget narrative line-item amounts. Management now closely reviews subrecipient invoices to ensure proper documentation and alignment with approved budget balances.

View Audit 395703

Finding 1200650 (2025-049)

Material Weakness 2025

State of Washington C/o Office of Financial Management

WA

Procurement, Suspension & Debarment Subrecipient Monitoring Internal Control / Segregation of Duties

Finding Number: 2025-049 Finding: The Health Care Authority did not have adequate internal controls over and did not comply with Recovery Audit Contractor requirements for the Medicaid program. Program: 93.775 – State Medicaid Fraud Control Units 93.777 – State Survey and Certification of Health Car...

Finding Number: 2025-049 Finding: The Health Care Authority did not have adequate internal controls over and did not comply with Recovery Audit Contractor requirements for the Medicaid program. Program: 93.775 – State Medicaid Fraud Control Units 93.777 – State Survey and Certification of Health Care Providers and Suppliers 93.778 – Grants to States for Medicaid 93.778 – COVID-19 Grants to States for Medicaid Compliance Requirement: Special Tests and Provisions – Medicaid Recovery Audit Contractors (RACs) Questioned Costs: $0 Status: Corrective action complete Corrective Action: The Authority partially concurs with the finding. The Authority concurs it did not have a Recovery Audit Contractor (RAC) contract in place during fiscal year 2025 but does not concur with the auditor’s recommendation. The Authority signed a contract with its vendor on September 30, 2025. The work of the RAC contractor is one of many tools used by the Authority to identify and report fraud, waste, and abuse. The Authority has policies and procedures in place for claim reviews and recoveries, fraud referrals, and compliance with the Centers for Medicare and Medicaid Services reporting requirements. The work of the RAC contractor is intended to supplement the Authority’s Program Integrity work and will be incorporated into its current workflows. Prior Findings: None Completion Date: September 2025 Agency Contact: Kari Summerour, CPA External Audit Compliance Manager (360) 725-9586 Kari.Summerour@hca.wa.gov

View Audit 395688

Finding 1200649 (2025-048)

Material Weakness 2025

State of Washington C/o Office of Financial Management

WA

Subrecipient Monitoring Special Tests & Provisions Material Weakness

Finding Number: 2025-048 Finding: The Department of Social and Health Services did not have adequate internal controls over and did not comply with requirements to ensure it referred all credible allegations of provider fraud to the state’s Medicaid Fraud Control Unit. Program: 93.775 – State Medica...

Finding Number: 2025-048 Finding: The Department of Social and Health Services did not have adequate internal controls over and did not comply with requirements to ensure it referred all credible allegations of provider fraud to the state’s Medicaid Fraud Control Unit. Program: 93.775 – State Medicaid Fraud Control Units 93.777 – State Survey and Certification of Health Care Providers and Suppliers 93.778 – Grants to States for Medicaid 93.778 – COVID-19 Grants to States for Medicaid Compliance Requirement: Special Tests and Provisions – Medicaid Fraud Control Unit Questioned Costs: $0 Status: Corrective action complete Corrective Action: The Department concurs with the finding. The Department completed corrective actions in April 2025 for the prior year’s audit finding by implementing enhanced internal controls to ensure that all fraud referrals, regardless of dollar amount, are submitted to the Medicaid Fraud Control Unit (MFCU). The audit identified 17 credible allegations within the Aging and Long-Term Support Administration and two within the Developmental Disabilities Administration. These credible allegations occurred prior to April 2025, preceding both the process improvements and the completion of the fiscal year 2024 corrective action plan. All 19 credible allegations were under $1,000 and while those may not have been referred to MFCU, the Department’s contractor, Consumer Direct Care Network Washington, did provide provider education and ensured all funds were returned to the Centers for Medicare and Medicaid Services. Prior Findings: The conditions noted in this finding were previously reported in finding 2024-077. Completion Date: April 2025 Agency Contact: Richard Meyer External Audit Compliance Manager Richard.Meyer@dsha.wa.gov

View Audit 395688

Finding 1200648 (2025-047)

Material Weakness 2025

State of Washington C/o Office of Financial Management

WA

Procurement, Suspension & Debarment Subrecipient Monitoring Allowable Costs / Cost Principles

Finding Number: 2025-047 Finding: The Department of Social and Health Services, Home and Community Living Administration, did not have adequate internal controls over and did not comply with survey requirements for Medicaid intermediate care facilities. Program: 93.775 – State Medicaid Fraud Control...

Finding Number: 2025-047 Finding: The Department of Social and Health Services, Home and Community Living Administration, did not have adequate internal controls over and did not comply with survey requirements for Medicaid intermediate care facilities. Program: 93.775 – State Medicaid Fraud Control Units 93.777 – State Survey and Certification of Health Care Providers and Suppliers 93.778 – Grants to States for Medicaid 93.778 – COVID-19 Grants to States for Medicaid Compliance Requirement: Special Tests and Provisions – Provider Health and Safety Standards Questioned Costs: $0 Status: Corrective action in progress Corrective Action: The Department partially concurs with the finding. The Department was not able to meet the Intermediate Care Facilities for Individuals with Intellectual Disabilities (ICF-IID) survey requirements due to a backlog from prior years, not because of lack of internal controls. It was through applied internal controls that we identified concerns and were able to allocate resources to address the most serious concerns. The Department has made efforts since fiscal year 2023 to address the backlog of complaints and recertification surveys, but resources had to be prioritized to handle new complaints. There is only one team that manages surveys, complaints, and revisits for the entire state. To optimize the use of resources, the Field Manager meets with the Administrative Assistant on a quarterly basis to review the 365-day average report and determine if survey schedules need to be modified to meet federal requirements. To continue to address this audit issue, Regional Administrators have met with their ICF-IID teams to review survey scheduling for the year to ensure teams will be able to meet targeted survey completion dates and the required recertification timeframes. As of November 2025, the Department met compliance with the 15.9-month recertification survey interval measure based on the 2025 CMS State Performance Measurement Report. By August 2026, the Department expects to meet compliance with the 12.9-month statewide average. Prior Findings: The conditions noted in this finding were previously reported in findings 2024-078, 2023-078, 2020-053, 2019-061, 2018–052, 2017-042, 2016-037, 2015-045, and 2014-046. Completion Date: Estimated August 2026 Agency Contact: Richard Meyer External Compliance Audit Manager Richard.Meyer@dshs.wa.gov

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Finding 1200647 (2025-046)

Material Weakness 2025

State of Washington C/o Office of Financial Management

WA

Subrecipient Monitoring Allowable Costs / Cost Principles HUD Housing Programs

Finding Number: 2025-046 Finding: The Department of Social and Health Services, Home and Community Living Administration, did not have adequate internal controls over and did not comply with survey requirements for Medicaid nursing homes. Program: 93.775 – State Medicaid Fraud Control Units 93.777 –...

Finding Number: 2025-046 Finding: The Department of Social and Health Services, Home and Community Living Administration, did not have adequate internal controls over and did not comply with survey requirements for Medicaid nursing homes. Program: 93.775 – State Medicaid Fraud Control Units 93.777 – State Survey and Certification of Health Care Providers and Suppliers 93.778 – Grants to States for Medicaid 93.778 – COVID-19 Grants to States for Medicaid Compliance Requirement: Special Tests and Provisions – Provider Health and Safety Standards Questioned Costs: $0 Status: Corrective action in progress Corrective Action: The Department partially concurs with the finding. The Department was not able to meet the Nursing Home survey requirements due to a backlog from prior years, not because of lack of internal controls. It was through applied internal controls that we identified concerns and were able to allocate resources to address the most serious concerns. The Department has made efforts since fiscal year 2023 to address the backlog of complaints and recertification surveys, but resources had to be prioritized to handle new complaints. There is only one team that manages surveys, complaints, and revisits for the entire state. To optimize the use of resources, the Field Manager meets with the Administrative Assistant on a quarterly basis to review the 365-day average report and determine if survey schedules need to be modified to meet federal requirements. To continue to address this audit issue, Regional Administrators have met with their Nursing Home teams to review survey scheduling for the year to ensure teams will be able to meet targeted survey completion dates and the required recertification timeframes. As of November 2025, the Department met compliance with the 15.9-month recertification survey interval measure based on the 2025 CMS State Performance Measurement Report. By August 2026, the Department expects to meet compliance with the 12.9-month statewide average. Prior Findings: The conditions noted in this finding were previously reported in findings 2024-079, 2023-079, and 2020-054. Completion Date: Estimated August 2026 Agency Contact: Richard Meyer External Audit Compliance Manager Richard.Meyer@dshs.wa.gov

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Finding 1200646 (2025-045)

Material Weakness 2025

State of Washington C/o Office of Financial Management

WA

Procurement, Suspension & Debarment Subrecipient Monitoring Special Tests & Provisions

Finding Number: 2025-045 Finding: The Department of Health did not have adequate internal controls to ensure it complied with transplant hospital survey statement of deficiencies and plan of corrections timelines. Program: 93.775 – State Medicaid Fraud Control Units 93.777 – State Survey and Certifi...

Finding Number: 2025-045 Finding: The Department of Health did not have adequate internal controls to ensure it complied with transplant hospital survey statement of deficiencies and plan of corrections timelines. Program: 93.775 – State Medicaid Fraud Control Units 93.777 – State Survey and Certification of Health Care Providers and Suppliers 93.778 – Grants to States for Medicaid 93.778 – COVID-19 Grants to States for Medicaid Compliance Requirement: Special Tests and Provisions – Provider Health and Safety Standards Questioned Costs: $0 Status: Corrective action complete Corrective Action: The Department has implemented adequate internal controls to ensure compliance with federal requirements. Prior to the commencement of audit work in May 2025, the Department had already developed and implemented a management tracker that actively monitors transplant hospitals’ Statement of Deficiency issuance and Plan of Correction due dates. Compliance with federal requirements resulting from the strengthened internal controls will be evident in future audit cycles. Prior Findings: None Completion Date: May 2025 Agency Contact: Jeff Arbuckle External Audit Manager (360) 701-0798 Jeff.Arbuckle@doh.wa.gov

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Finding 1200645 (2025-044)

Material Weakness 2025

State of Washington C/o Office of Financial Management

WA

Subrecipient Monitoring Internal Control / Segregation of Duties Special Tests & Provisions

Finding Number: 2025-044 Finding: The Department of Health did not have adequate internal controls over and did not comply with requirements to ensure timely review of hospital complaints. Program: 93.775 – State Medicaid Fraud Control Units 93.777 – State Survey and Certification of Health Care Pro...

Finding Number: 2025-044 Finding: The Department of Health did not have adequate internal controls over and did not comply with requirements to ensure timely review of hospital complaints. Program: 93.775 – State Medicaid Fraud Control Units 93.777 – State Survey and Certification of Health Care Providers and Suppliers 93.778 – Grants to States for Medicaid 93.778 – COVID-19 Grants to States for Medicaid Compliance Requirement: Special Tests and Provisions – Provider Health and Safety Questioned Costs: $0 Status: Corrective action complete Corrective Action: The Department has implemented adequate internal controls for timely review of hospital complaints and has developed performance measures which are actively monitored monthly to assess compliance with federal requirements. The Department has taken the following actions: • In July 2024, modified and redesigned the enforcement database to capture the two-day review entries. • In August 2024, instituted a new process to include a date stamping method and allow data entry to capture the “received” and “reviewed” dates in the database. • In September 2024, developed a report to show the two-day review dates and started monitoring the requirement in January 2025 as part of the office performance measures. • In October 2025, transferred the Complaint Intake Unit from the Office of Investigative and Legal Services to be placed directly under the Office of Health Systems Oversight. Prior Findings: The conditions noted in this finding were previously reported in findings 2024-076 and 2023-076. Completion Date: October 2025 Agency Contact: Jeff Arbuckle External Audit Manager (360) 701-0798 Jeff.Arbuckle@doh.wa.gov

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Finding 1200644 (2025-043)

Material Weakness 2025

State of Washington C/o Office of Financial Management

WA

Subrecipient Monitoring Special Tests & Provisions

Finding Number: 2025-043 Finding: The Health Care Authority did not have adequate internal controls over and did not comply with requirements to ensure it periodically audited financial and statistical records for inpatient hospital services. Program: 93.775 – State Medicaid Fraud Control Units 93.7...

Finding Number: 2025-043 Finding: The Health Care Authority did not have adequate internal controls over and did not comply with requirements to ensure it periodically audited financial and statistical records for inpatient hospital services. Program: 93.775 – State Medicaid Fraud Control Units 93.777 – State Survey and Certification of Health Care Providers and Suppliers 93.778 – Grants to States for Medicaid 93.778 – COVID-19 Grants to States for Medicaid Compliance Requirement: Special Tests and Provisions – Inpatient Hospital and Long-Term Care Facility Audits Questioned Costs: $0 Status: Corrective action not taken Corrective Action: The Authority does not concur with the finding and will continue to consult with the Centers for Medicare & Medicaid Services (CMS). The Authority maintains its internal controls are effective and policies and procedures are compliant with federal requirements. Over the past four years, the Authority took corrective action on the prior audit findings including: · Consulted with CMS for direction. · Worked with CMS to revise the State Plan. · Updated Washington Administrative Code and the Revised Code of Washington to align with federal regulations. · Updated procedures for both the Hospital Rates and Program Integrity sections. CMS provided the Authority with technical guidance on two occasions, indicating it defers to the states on how these audits are defined. The Authority believes it has addressed the deficiencies identified in previous audits through the steps listed above and no additional corrective action will be taken. Prior Findings: The conditions noted in this finding were previously reported in findings 2024-080, 2023-081, 2022-060, 2021-051, and 2020-049. Completion Date: Not applicable Agency Contact: Kari Summerour, CPA External Audit Compliance Manager (360) 725-9586 Kari.Summerour@hca.wa.gov

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Finding 1200643 (2025-042)

Material Weakness 2025

State of Washington C/o Office of Financial Management

WA

Subrecipient Monitoring Special Tests & Provisions

Finding Number: 2025-042 Finding: The Health Care Authority did not have adequate internal controls over and did not comply with requirements to ensure it performed procedures to safeguard against unnecessary utilization of care and services for the Medicaid program. Program: 93.775 – State Medicaid...

Finding Number: 2025-042 Finding: The Health Care Authority did not have adequate internal controls over and did not comply with requirements to ensure it performed procedures to safeguard against unnecessary utilization of care and services for the Medicaid program. Program: 93.775 – State Medicaid Fraud Control Units 93.777 – State Survey and Certification of Health Care Providers and Suppliers 93.778 – Grants to States for Medicaid 93.778 – COVID-19 Grants to States for Medicaid Compliance Requirement: Special Tests and Provisions - Utilization Control Questioned Costs: $0 Status: Corrective action in progress Corrective Action: The Authority concurs with the finding and is committed to resolving the issues identified during the audit. The Authority is assessing its statewide surveillance and utilization control program. The results of this analysis will be used to determine any additional work or staffing required to fully comply with standards and align existing statewide workflows within the program. The analysis will also be used to finalize policies, procedures, and internal controls. Prior Findings: The conditions noted in this finding were previously reported in findings 2024-081, 2023-082, 2022-061, and 2021-050. Completion Date: Estimated July 2026 Agency Contact: William Sogge, CPA External Audit Compliance Specialist (360) 725-5110 william.sogge@hca.wa.gov

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Finding 1200641 (2025-040)

Material Weakness 2025

State of Washington C/o Office of Financial Management

WA

Subrecipient Monitoring Special Tests & Provisions Allowable Costs / Cost Principles

Finding Number: 2025-040 Finding: The Health Care Authority did not have adequate internal controls over and did not comply with managed care financial audit requirements. Program: 93.767 – Children's Health Insurance Program 93.767 – COVID-19 Children's Health Insurance Program 93.775 – State Medic...

Finding Number: 2025-040 Finding: The Health Care Authority did not have adequate internal controls over and did not comply with managed care financial audit requirements. Program: 93.767 – Children's Health Insurance Program 93.767 – COVID-19 Children's Health Insurance Program 93.775 – State Medicaid Fraud Control Units 93.777 – State Survey and Certification of Health Care Providers and Suppliers 93.778 – Grants to States for Medicaid 93.778 – COVID-19 Grants to States for Medicaid Compliance Requirement: Special Tests and Provisions – Managed Care Financial Audit Questioned Costs: $0 Status: Corrective action complete Corrective Action: In January 2025, the Authority implemented new contract language requiring Managed Care Organizations (MCOs) to submit audited financial reports in accordance with Generally Accepted Accounting Principles (GAAP) and Generally Accepted Auditing Standards (GAAS). MCOs are required to submit the GAAP and GAAS statements beginning with the June 2026 submission. Prior Findings: The conditions noted in this finding were previously reported in findings 2024-074, 2023-073, 2022-054, and 2021-048. Completion Date: January 2025 Agency Contact: Kari Summerour, CPA External Audit Compliance Manager (360) 725-9586 Kari.Summerour@hca.wa.gov

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Finding 1200640 (2025-039)

Material Weakness 2025

State of Washington C/o Office of Financial Management

WA

Procurement, Suspension & Debarment Subrecipient Monitoring Allowable Costs / Cost Principles

Finding Number: 2025-039 Finding: The Health Care Authority did not have adequate internal controls over and did not comply with federal provider eligibility requirements for the Medicaid and Children’s Health Insurance Program. Program: 93.767 – Children’s Health Insurance Program 93.767 – COVID-19...

Finding Number: 2025-039 Finding: The Health Care Authority did not have adequate internal controls over and did not comply with federal provider eligibility requirements for the Medicaid and Children’s Health Insurance Program. Program: 93.767 – Children’s Health Insurance Program 93.767 – COVID-19 Children’s Health Insurance Program 93.775 – State Medicaid Fraud Control Units 93.777 – State Survey and Certification of Health Care Providers and Suppliers 93.778 – Grants to States for Medicaid 93.778 – COVID-19 Grants to States for Medicaid Compliance Requirement: Special Tests and Provisions – Provider Eligibility (Screening and Enrollment) Questioned Costs: $641 Status: Corrective action in progress Corrective Action: The Authority partially concurs with the finding. Fingerprint based criminal background checks The Authority concurs that a fingerprint-based criminal background check process for high-risk providers was not implemented during the audit period. In coordination with the Centers for Medicare & Medicaid Services (CMS) and the Washington State Patrol, the Authority has developed the required process and is in the final stages of implementation. The program is expected to be launched by March 31, 2026, and will apply to all providers designated as high-risk. Updated license information in ProviderOne When a professional license on a provider record expires, ProviderOne automatically end-dates taxonomies associated with the provider. However, when a provider is enrolled with multiple agencies and only one associated license has expired, the system does not currently end-date the related taxonomies. Currently, 37 of 113,940 servicing-only providers are affected while none of the approximately 9,000 billing providers are impacted. The Authority submitted a system change request in March 2026 to ensure applicable taxonomies are automatically end-dated in these scenarios. In the interim, the Authority developed a weekly report and implemented a process to identify providers with applicable taxonomies that need manually end-dated until the system enhancement is deployed. ProviderOne did not deactivate providers timely ProviderOne is designed to automatically inactivate a provider’s domain when revalidation is not completed timely. Due to an operational issue, a limited number of providers were not deactivated as required. Currently, 50 of approximately 9,000 billing providers are impacted. The Authority submitted a system change request in March 2026 to remediate this issue and prevent recurrence. In the interim, the Authority will conduct weekly monitoring and manually inactivate affected provider domains until the system correction is implemented. Ownership disclosures The Authority does not concur with the determination that it is not in compliance with federal requirements governing ownership disclosures. The Authority’s process requires providers to review and attest to ownership disclosure information maintained by the Authority as part of the revalidation process. The Authority believes this process meets the requirements of 42 CFR 455.104 and appropriately balances regulatory compliance with administrative efficiency. The Authority submitted its procedures to CMS on February 23, 2026, and requested clarification and guidance to ensure continued alignment with federal expectations. Providers not revalidated or deactivated by the five-year deadline The Authority’s revalidation backlog totaled 792 providers in July 2024. Through focused operational improvements and targeted resource deployment, the backlog was substantially reduced to three providers as of June 30, 2025. The Authority remains committed to continuous process improvement to sustain timely revalidations and prevent future backlog growth. As of March 2026, the Authority began working on a daily report of providers nearing the revalidation deadline so they can be prioritized and revalidated timely. Prior Findings: The conditions noted in this finding were previously reported in findings 2024-075, 2023-074, 2022-055, 2021-047, 2020-046, 2019-048, 2018-042, 2017-033, and 2016-035. Completion Date: Estimated March 2026 Agency Contact: Kari Summerour, CPA External Audit Compliance Manager (360) 725-9586 Kari.Summerour@hca.wa.gov

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Corrective Action Plans

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