Corrective Action Plans

Finding 567863 (2024-013)

Material Weakness 2024

State of Michigan

MI

Cash Management Eligibility Material Weakness

Finding 2024-013 Medicaid Cluster, ALN 93.775, 93.777, and 93.778 and Children's Health Insurance Program, ALN 93.767 - Expenditure Processing for Medical Payments Management Views MDHHS agrees with the finding. Planned Corrective Action MDHHS has been working to ensure correct eligibility classif...

Finding 2024-013 Medicaid Cluster, ALN 93.775, 93.777, and 93.778 and Children's Health Insurance Program, ALN 93.767 - Expenditure Processing for Medical Payments Management Views MDHHS agrees with the finding. Planned Corrective Action MDHHS has been working to ensure correct eligibility classifications in Bridges at the time of payment and a system change was implemented in April 2021 to correct the issue. All new cases are correctly routed. MDHHS is continuing to update cases following the end of the public health emergency (PHE) and expects that all existing cases will be updated by July 2025, as MDHHS completes a mass update and renewals for existing cases. MDHHS identified and updated its manual process of transferring expenditures from the Medicaid Cluster to the Children’s Health Insurance Program in June 2021; and will continue this manual process, on a quarterly basis, by completing a summary-level adjustment determined by analyzing CHAMPS payment data and Bridges eligibility data until all existing cases have been updated. Anticipated Completion Date July 2025 Responsible Individual(s) Brant Cole, MDHHS Logan Dreasky, MDHHS Crystal Kline, MDHHS

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Finding 567855 (2024-055)

Material Weakness 2024

State of Michigan

MI

Questioned Costs Eligibility Subrecipient Monitoring § 200.516

Finding 2024-055 Low-Income Home Energy Assistance, ALN 93.568 - Eligibility Determinations Management Views MDHHS agrees with the finding. Planned Corrective Action MDHHS implemented quarterly case reads beginning in fiscal year 2023, and during April 2023, MDHHS began monthly meetings with the B...

Finding 2024-055 Low-Income Home Energy Assistance, ALN 93.568 - Eligibility Determinations Management Views MDHHS agrees with the finding. Planned Corrective Action MDHHS implemented quarterly case reads beginning in fiscal year 2023, and during April 2023, MDHHS began monthly meetings with the BSC analyst team to discuss common errors, answer questions, provide guidance, and on a quarterly basis discuss the results of the State Emergency Relief (SER) case reads. During April 2024, MDHHS SER program policy management and staff began attending BSC leadership meetings to discuss SER case read data findings, policy changes, and communicate common errors found during audits. In addition to updating verification requirements on October 1, 2023, SER program policy management and staff added copay verification requirements on October 1, 2024. MDHHS completed system updates during April 2024 to allow specialists access to directly upload verification documentation to the electronic case file instead of providing the documentation to other areas to process and upload. MDHHS will provide annual training directly to counties that fail to meet the state average for SER case reads relating to verification of the client's income, client contribution payment, and proof of energy crisis. MDHHS will continue to communicate with BSCs and local offices regarding the requirements to obtain adequate verification and maintain sufficient documentation to support SER processing. MDHHS will also continue to provide direct SER guidance and clarification through the SER mailbox. Anticipated Completion Date September 30, 2025 Responsible Individual(s) Bethany Cabanaw, MDHHS Kent Schulze, MDHHS Julie McLaughlin, MDHHS

View Audit 360209 Questioned Costs: $1

Finding 567854 (2024-054)

Significant Deficiency 2024

State of Michigan

MI

Cash Management

Finding 2024-054 Low-Income Home Energy Assistance, ALN 93.568 - Recertification of Clearance Patterns Management Views Treasury agrees with the finding. Planned Corrective Action Since the fall of 2024, the Treasury Financial Services Division (FSD) has gained a better understanding of the clear...

Finding 2024-054 Low-Income Home Energy Assistance, ALN 93.568 - Recertification of Clearance Patterns Management Views Treasury agrees with the finding. Planned Corrective Action Since the fall of 2024, the Treasury Financial Services Division (FSD) has gained a better understanding of the clearance pattern review process and updated its procedures through April 2025 to ensure compliance with federal regulations in future fiscal years. This included gaining an understanding of and documenting how the clearance patterns are determined for each program, which programs require clearance pattern review each year, how the SIGMA Business Intelligence (BI) queries function, and how to interpret the BI query results. Treasury FSD completed a post review of the fiscal year 2025 Treasury State Agreement using the updated procedures. Anticipated Completion Date Completed Responsible Individual(s) Melanie Alvord, Treasury Lauren Markwart, Treasury

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Finding 567849 (2024-053)

Material Weakness 2024

State of Michigan

MI

Subrecipient Monitoring

Finding 2024-053 Refugee and Entrant Assistance State/Replacement Designee Administered Programs, ALN 93.566 - Subrecipient Audits and Subaward Information Management Views LEO agrees with the finding. Planned Corrective Action For part a., LEO OGM is working with LEO-IC to establish a process to ...

Finding 2024-053 Refugee and Entrant Assistance State/Replacement Designee Administered Programs, ALN 93.566 - Subrecipient Audits and Subaward Information Management Views LEO agrees with the finding. Planned Corrective Action For part a., LEO OGM is working with LEO-IC to establish a process to immediately identify which subrecipients are required to have a Single Audit and ensure reports are reviewed, and management decision letters issued timely when required. For parts b. and c., LEO OGM will have a more significant role in the review process and will work with the LEO Grants Office to help ensure that UEI and updated federal award information is always accurately and completely incorporated into agreements. As an extra measure, starting with fiscal year 2026, most grants with subrecipients will be single-year agreements. This will help ensure that federal award information that changes with the onset of a new fiscal year is not inadvertently overlooked during the amendment process. Anticipated Completion Date a. September 30, 2026 b. and c. October 31, 2025 Responsible Individual(s) Nicole Gorski, LEO Christopher Blondell, LEO

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Finding 567848 (2024-052)

Material Weakness 2024

State of Michigan

MI

Subrecipient Monitoring Material Weakness Reporting § 200.514

Finding 2024-052 Refugee and Entrant Assistance State/Replacement Designee Administered Programs, ALN 93.566 - FFATA Reporting Management Views LEO agrees with the finding. Planned Corrective Action The LEO Finance Division updated its FFATA procedure effective March 2025 and has been working to c...

Finding 2024-052 Refugee and Entrant Assistance State/Replacement Designee Administered Programs, ALN 93.566 - FFATA Reporting Management Views LEO agrees with the finding. Planned Corrective Action The LEO Finance Division updated its FFATA procedure effective March 2025 and has been working to correct the inaccurate FFATA reporting for the Refugee and Entrant Assistance State/Replacement Designee Administered Programs subawards. All of LEO’s open subawards are reported correctly in SAM and LEO completed corrections to the closed subawards in April 2025. Going forward, LEO will ensure that future subawards are reported both accurately and timely in accordance with FFATA requirements. Anticipated Completion Date Completed Responsible Individual(s) Heidi Parker, LEO

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Finding 567847 (2024-051)

Material Weakness 2024

State of Michigan

MI

Reporting

Finding 2024-051 Refugee and Entrant Assistance State/Replacement Designee Administered Programs, ALN 93.566 - Accuracy and Completeness of Financial Reports Management Views LEO agrees with the finding. Planned Corrective Action The LEO Finance Division will implement the following updates to it...

Finding 2024-051 Refugee and Entrant Assistance State/Replacement Designee Administered Programs, ALN 93.566 - Accuracy and Completeness of Financial Reports Management Views LEO agrees with the finding. Planned Corrective Action The LEO Finance Division will implement the following updates to its financial reporting process: 1. Procedural changes to ensure financial records, supporting documents, statistical records, and workpapers are maintained and retained appropriately. 2. An updated coding process to ensure all transactions are recorded with appropriate FAINs. 3. Procedural stipulations that financial report disclosures are prepared based on the applicable reporting period in SIGMA; and adjusting entries posted outside of the applicable reporting period are not included in quarterly financial reports. 4. An additional layer of management review on financial reports prior to submission. Anticipated Completion Date August 31, 2025 Responsible Individual(s) Heidi Parker, LEO Christopher Johnson, LEO

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Finding 567846 (2024-050)

Material Weakness 2024

State of Michigan

MI

Questioned Costs Allowable Costs / Cost Principles Eligibility § 200.516

Finding 2024-050 Refugee and Entrant Assistance State/Replacement Designee Administered Programs, ALN 93.566 - Assistance to Ineligible Refugees Management Views LEO and MDHHS agree with the finding. Planned Corrective Action MDHHS, in conjunction with LEO, will provide mandatory training for all ...

Finding 2024-050 Refugee and Entrant Assistance State/Replacement Designee Administered Programs, ALN 93.566 - Assistance to Ineligible Refugees Management Views LEO and MDHHS agree with the finding. Planned Corrective Action MDHHS, in conjunction with LEO, will provide mandatory training for all specialists that determine eligibility for refugee cash assistance payments by September 30, 2025. MDHHS also will implement ongoing management and peer-to-peer spot checks of cases to ensure that documentation is maintained to support the client’s eligibility beginning October 2025. In addition, MDHHS will determine if technical changes are needed to help ensure the proper documentation is in the electronic case file by December 31, 2025. If potential system modifications are needed, the Bridges technical team will follow the Departmental Work Intake Process for prioritization and determine an anticipated completion date for implementation. Anticipated Completion Date MDHHS has not yet determined an anticipated completion date because the date is dependent on the determination of whether system modifications are necessary. Responsible Individual(s) Benjamin Cabanaw, LEO Nicole Adams, LEO Bethany Cabanaw, MDHHS Kent Schutz, MDHHS Mariah Schaefer, MDHHS

View Audit 360209 Questioned Costs: $1

Finding 567845 (2024-049)

Significant Deficiency 2024

State of Michigan

MI

Subrecipient Monitoring Allowable Costs / Cost Principles Period of Performance

Finding 2024-049 Refugee and Entrant Assistance State/Replacement Designee Administered Programs, ALN 93.566 - Salesforce Security Management and Access Controls Management Views LEO agrees with the finding. Planned Corrective Action The LEO Office of Global Michigan (OGM) will improve established...

Finding 2024-049 Refugee and Entrant Assistance State/Replacement Designee Administered Programs, ALN 93.566 - Salesforce Security Management and Access Controls Management Views LEO agrees with the finding. Planned Corrective Action The LEO Office of Global Michigan (OGM) will improve established procedures and tracking logs to help ensure compliance with SOM Technical Standard 1340.00.020.01 (Access Control Standard). Specifically, LEO OGM will review user access semiannually for privileged accounts and annually for all other accounts. Also, LEO-IC is in the process of establishing a compliance team that will perform validation of the ongoing reviews. Anticipated Completion Date September 30, 2025 Responsible Individual(s) Ben Cabinaw, LEO Allen Williams, LEO

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Finding 567839 (2024-048)

Significant Deficiency 2024

State of Michigan

MI

Eligibility Special Tests & Provisions Reporting

Finding 2024-048 Temporary Assistance for Needy Families, ALN 93.558 - Child Support Non-Cooperation Management Views MDHHS disagrees with part a. of the finding. MDHHS’s eligibility system, Bridges, was functioning as intended for the two cases identified because each case was in a non-ongoing mod...

Finding 2024-048 Temporary Assistance for Needy Families, ALN 93.558 - Child Support Non-Cooperation Management Views MDHHS disagrees with part a. of the finding. MDHHS’s eligibility system, Bridges, was functioning as intended for the two cases identified because each case was in a non-ongoing mode at the time the automated interface occurred. A case is placed into this status if the client circumstances have changed for any MDHHS program within Bridges and the case requires a redetermination. TANF policy cannot mandate Bridges to change the non-ongoing mode because each impacted program is required to be certified prior to changing the status. MDHHS policy does not mandate a specific length of time that a case can be in a non-ongoing status. The results of the redetermination can impact the client’s non-cooperation status and therefore the client should not be sanctioned until the certification by all programs is complete. For one of the cases, the client was appropriately sanctioned after the case review was complete and for the other case, the client was determined to be in compliance once the case was removed from the non-ongoing status mode. MDHHS agrees with part b. of the finding. Planned Corrective Action For part a., MDHHS disagrees with the finding and does not intend to take further action. For part b., MDHHS ESA policy staff will work with the MDHHS Bridges technical team to determine if there was a technical aspect that contributed to the inappropriate sanction and identify a solution by September 30, 2025. If potential system modifications are needed, MDHHS will follow the Departmental Work Intake Process for prioritization and determine an anticipated completion date for implementation. Anticipated Completion Date a. Not applicable b. MDHHS has not yet determined an anticipated completion date because the date is dependent on the potential solution identified. Responsible Individual(s) Bethany Cabanaw, MDHHS Kenton Schulze, MDHHS Brian Sanborn, MDHHS

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Finding 567838 (2024-047)

Significant Deficiency 2024

State of Michigan

MI

Subrecipient Monitoring

Finding 2024-047 Temporary Assistance for Needy Families, ALN 93.558 - Risk Assessment and During-the-Award Monitoring Management Views MDHHS agrees with the finding. Planned Corrective Action MDHHS monitors financial and programmatic reports submitted by the grantee and communicates with the gran...

Finding 2024-047 Temporary Assistance for Needy Families, ALN 93.558 - Risk Assessment and During-the-Award Monitoring Management Views MDHHS agrees with the finding. Planned Corrective Action MDHHS monitors financial and programmatic reports submitted by the grantee and communicates with the grantee on a consistent basis. The subrecipients identified in the finding were awarded separate grants, and MDHHS has implemented corrective action to help ensure each subrecipient is sufficiently monitored and evaluated for risk of noncompliance with program requirements. For the subrecipient identified in part a., MDHHS completed a risk assessment and evaluated the results for fiscal year 2025 to develop a documented monitoring plan. An annual monitoring plan and corrective action plan workbook have been developed and implemented to track monitoring activities and follow-up action related to deficiencies noted during monitoring. For the subrecipient identified in part b., MDHHS developed and implemented a template for fiscal year 2025 to document monitoring activities, including the follow-up action related to deficiencies noted during monitoring. Anticipated Completion Date Completed Responsible Individual(s) a. Lynn Nee, MDHHS b. Amber Troupe, MDHHS

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Finding 567837 (2024-046)

Significant Deficiency 2024

State of Michigan

MI

Questioned Costs Allowable Costs / Cost Principles Student Financial Aid § 200.516

Finding 2024-046 Temporary Assistance for Needy Families, ALN 93.558 - Inappropriate TANF- Funded Emergency Foster Care Assistance Management Views MDHHS agrees with the finding. Planned Corrective Action MDHHS redetermined the Foster Care Title IV-E (Title IV-E) program eligibility after the bi...

Finding 2024-046 Temporary Assistance for Needy Families, ALN 93.558 - Inappropriate TANF- Funded Emergency Foster Care Assistance Management Views MDHHS agrees with the finding. Planned Corrective Action MDHHS redetermined the Foster Care Title IV-E (Title IV-E) program eligibility after the birth certificate was identified and the youth was determined to be Title IV-E eligible. MDHHS will reclassify the funds to the appropriate funding source, allowing the department to claim Title IV-E for the eligible placement. For those cases in which Title IV-E funding is denied initially based on lack of a birth certificate or other documentation of citizenship, the Child Welfare Funding Specialists will continue to monitor the case for updated documentation in order to complete a redetermination of funding. Child Welfare Funding Specialists will be reminded to monitor cases for updated documentation during a Child Welfare Funding conference call in June 2025. Anticipated Completion Date June 30, 2025 Responsible Individual(s) Nancy Berger, MDHHS

View Audit 360209 Questioned Costs: $1

Finding 567836 (2024-045)

Significant Deficiency 2024

State of Michigan

MI

Questioned Costs Allowable Costs / Cost Principles Eligibility § 200.516

Finding 2024-045 Temporary Assistance for Needy Families, ALN 93.558 - Non-Financial Eligibility Documentation Management Views MDHHS agrees with the finding. Planned Corrective Action MDHHS ESA policy staff will work with the MDHHS Bridges technical team to determine the reason for the incomplet...

Finding 2024-045 Temporary Assistance for Needy Families, ALN 93.558 - Non-Financial Eligibility Documentation Management Views MDHHS agrees with the finding. Planned Corrective Action MDHHS ESA policy staff will work with the MDHHS Bridges technical team to determine the reason for the incomplete application by September 30, 2025, and implement a solution to correct the issue, if needed. If potential system modifications are needed, MDHHS will follow the Departmental Work Intake Process for prioritization and determine an anticipated completion date for implementation. MDHHS will also send a memo and template of the application to the local offices to highlight the required questions on the application to help ensure all required questions are appropriately answered. Anticipated Completion Date MDHHS has not yet determined an anticipated completion date because the date is dependent on the potential solution identified. Responsible Individual(s) Bethany Cabanaw, MDHHS Kenton Schulze, MDHHS Brian Sanborn, MDHHS

View Audit 360209 Questioned Costs: $1

Finding 567835 (2024-044)

Significant Deficiency 2024

State of Michigan

MI

Internal Control / Segregation of Duties Allowable Costs / Cost Principles Eligibility

Finding 2024-044 Temporary Assistance for Needy Families, ALN 93.558 - MiSACWIS Security Management and Access Controls Management Views MDHHS agrees with the finding. Planned Corrective Action For part a., MDHHS currently has a process in place to review the user narrative describing the incomp...

Finding 2024-044 Temporary Assistance for Needy Families, ALN 93.558 - MiSACWIS Security Management and Access Controls Management Views MDHHS agrees with the finding. Planned Corrective Action For part a., MDHHS currently has a process in place to review the user narrative describing the incompatible role exceptions within the DSA Michigan Statewide Automated Child Welfare Information System (MiSACWIS) request as part of the approval process. MDHHS will continue to work on adding an incompatible role form in the DSA MiSACWIS request with automated routing for appropriate approval. MDHHS anticipates completion of corrective action by October 30, 2025. For part b., MDHHS will evaluate the current DSA timelines for generation of access renewal and access drop requests and implement any necessary changes by September 30, 2025. MDHHS will continue to provide training for LOSCs via quarterly webinars to emphasize the appropriate procedures for granting access, reviewing, and comparing access. All new information related to security access is presented to the LOSCs during the webinars and one-on-one assistance is available as needed for additional support. Anticipated Completion Date a. October 30, 2025 b. September 30, 2025 Responsible Individual(s) Alana Lowe, MDHHS Deon Nelson, MDHHS

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Finding 567769 (2024-043)

Significant Deficiency 2024

State of Michigan

MI

Questioned Costs Matching / Level of Effort / Earmarking Allowable Costs / Cost Principles

Finding 2024-043 Medicaid Cluster, ALN 93.775, 93.777, and 93.778 - Practitioner Reimbursement Management Views MDHHS agrees with the finding. Planned Corrective Action MDHHS has determined the primary remaining source for overlaps between fee-for-service and capitation payments is due to retroact...

Finding 2024-043 Medicaid Cluster, ALN 93.775, 93.777, and 93.778 - Practitioner Reimbursement Management Views MDHHS agrees with the finding. Planned Corrective Action MDHHS has determined the primary remaining source for overlaps between fee-for-service and capitation payments is due to retroactive removal of Medicaid eligibility within Bridges. An upgraded interface fix was implemented during March 2025 to address several issues. This upgraded interface removed the existing limitations to mitigate the occurrence of retroactive disenrollment. Anticipated Completion Date Completed Responsible Individual(s) Latina McCausey, MDHHS Alexis Bond, MDHHS

View Audit 360209 Questioned Costs: $1

Finding 567768 (2024-042)

Significant Deficiency 2024

State of Michigan

MI

Questioned Costs Matching / Level of Effort / Earmarking Allowable Costs / Cost Principles § 200.516

Finding 2024-042 Medicaid Cluster, ALN 93.775, 93.777, and 93.778 - Ineligible Home Help Assistance Management Views MDHHS agrees with the finding. Planned Corrective Action MDHHS added the Electronic Document Management system (EDM) to MiAIMS in March 2023 and issued an Adult Services Notificatio...

Finding 2024-042 Medicaid Cluster, ALN 93.775, 93.777, and 93.778 - Ineligible Home Help Assistance Management Views MDHHS agrees with the finding. Planned Corrective Action MDHHS added the Electronic Document Management system (EDM) to MiAIMS in March 2023 and issued an Adult Services Notification to adult services staff, communicating that medical needs forms should be uploaded into EDM. MDHHS issued an Adult Services Notification to adult services staff during May 2025 to communicate the exceptions identified and remind them of the medical needs form requirements. MDHHS will develop a procedure to monitor the expiration of medical needs forms using the MiAIMS Plan of Care by August 2025. In addition, MDHHS will research potential options to automate monitoring of the medical needs forms in MiAIMS and determine if any necessary system changes are needed by December 2026. Anticipated Completion Date December 2026 Responsible Individual(s) Elaina Brown, MDHHS

View Audit 360209 Questioned Costs: $1

Finding 567767 (2024-041)

Significant Deficiency 2024

State of Michigan

MI

Questioned Costs Matching / Level of Effort / Earmarking Allowable Costs / Cost Principles § 200.516

Finding 2024-041 Medicaid Cluster, ALN 93.775, 93.777, and 93.778 - Ineligible HHP Payments Management Views MDHHS agrees with the finding. Planned Corrective Action MDHHS generates a monthly hospitalization report and distributes to adult services workers as part of the post-payment review proce...

Finding 2024-041 Medicaid Cluster, ALN 93.775, 93.777, and 93.778 - Ineligible HHP Payments Management Views MDHHS agrees with the finding. Planned Corrective Action MDHHS generates a monthly hospitalization report and distributes to adult services workers as part of the post-payment review process. MDHHS enhanced the report query to improve the data used to identify overlaps in services and timely recover payments. MDHHS implemented the updated query during June 2025. Also, MDHHS issued an Adult Services Notification to managers and directors during February 2025, informing them of the audit finding and reminding local office management of the expectation to thoroughly monitor and review the hospitalization reports to ensure timely and accurate action is taken by adult services workers. In addition, MDHHS reissued the Home Help Recoupment Process training and procedural resources during February 2025 to adult services workers who manage Home Help cases to ensure process steps are consistently followed. Anticipated Completion Date Completed Responsible Individual(s) Elaina Brown, MDHHS Michelle Martin, MDHHS

View Audit 360209 Questioned Costs: $1

Finding 567766 (2024-040)

Significant Deficiency 2024

State of Michigan

MI

Questioned Costs Matching / Level of Effort / Earmarking Allowable Costs / Cost Principles § 200.516

Finding 2024-040 Medicaid Cluster, ALN 93.775, 93.777, and 93.778 - Payments on Behalf of Ineligible Beneficiaries Management Views MDHHS agrees with the finding. Planned Corrective Action MDHHS continues to work with DTMB on the underlying issues in Bridges causing these overpayment issues, as we...

Finding 2024-040 Medicaid Cluster, ALN 93.775, 93.777, and 93.778 - Payments on Behalf of Ineligible Beneficiaries Management Views MDHHS agrees with the finding. Planned Corrective Action MDHHS continues to work with DTMB on the underlying issues in Bridges causing these overpayment issues, as well as developing mitigation strategies to temporarily address the overpayment concerns while the more permanent system solutions are developed. MDHHS expects all remaining synchronization issues to be resolved once the remaining larger system changes are implemented in December 2025. Anticipated Completion Date December 31, 2025 Responsible Individual(s) Jamy Hengesbach, MDHHS

View Audit 360209 Questioned Costs: $1

Finding 567765 (2024-039)

Significant Deficiency 2024

State of Michigan

MI

Questioned Costs Matching / Level of Effort / Earmarking Allowable Costs / Cost Principles

Finding 2024-039 Medicaid Cluster, ALN 93.775, 93.777, and 93.778 - Transitional Medicaid Eligibility Management Views MDHHS agrees with the finding. MDHHS recognizes there are opportunities for improvement to ensure renewals are processed on a timely basis for beneficiaries receiving transitional ...

Finding 2024-039 Medicaid Cluster, ALN 93.775, 93.777, and 93.778 - Transitional Medicaid Eligibility Management Views MDHHS agrees with the finding. MDHHS recognizes there are opportunities for improvement to ensure renewals are processed on a timely basis for beneficiaries receiving transitional medical assistance (TMA) Medicaid coverage, however due to time constraints, it was not feasible to manually review and validate all 1,802 beneficiaries queried to ensure they should be terminated from TMA. Also, although beneficiaries might not be eligible for TMA, they may be eligible for other Medicaid aid categories, and this will be determined as part of the department’s corrective action. Planned Corrective Action MDHHS implemented a system enhancement during May 2023 that generates redetermination requests one month in advance to allow additional time for processing and help ensure renewals are processed timely. MDHHS is continuing to update the backlog of cases following the end of the PHE, including those identified in the finding, to determine if the beneficiary should remain on Medicaid or if coverage should be terminated, and expects all existing cases will be reviewed and updated by July 2025. MDHHS will evaluate potential underlying system issues related to the timeliness of TMA renewals and will implement system enhancements if necessary by December 2026. Anticipated Completion Date December 2026 Responsible Individual(s) Logan Dreasky, MDHHS Brant Cole, MDHHS

View Audit 360209 Questioned Costs: $1

Finding 567764 (2024-038)

Significant Deficiency 2024

State of Michigan

MI

Matching / Level of Effort / Earmarking Allowable Costs / Cost Principles

Finding 2024-038 Medicaid Cluster, ALN 93.775, 93.777, and 93.778 - MiAIMS User Access Management Views MDHHS agrees with the finding. Planned Corrective Action The MDHHS Access Management Section reconciles the users in MiAIMS to the users approved within DSA monthly, resolves discrepancies, and...

Finding 2024-038 Medicaid Cluster, ALN 93.775, 93.777, and 93.778 - MiAIMS User Access Management Views MDHHS agrees with the finding. Planned Corrective Action The MDHHS Access Management Section reconciles the users in MiAIMS to the users approved within DSA monthly, resolves discrepancies, and sends an email notification to LOSCs with a summary of the results. Beginning May 2025, the monthly email notification distributed to the LOSCs will emphasize appropriate procedures for granting access, including a reminder to synchronize MiAIMS activations and the DSA final approval to serve as documentation of the activation. By June 2025, MDHHS MiAIMS management and the Access Management Section will begin meeting annually with LOSCs, help desk, and technical staff to review access procedures. Anticipated Completion Date June 30, 2025 Responsible Individual(s) Cynthia Farrell, MDHHS Tim Kwast, MDHHS

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Finding 567763 (2024-037)

Significant Deficiency 2024

State of Michigan

MI

Matching / Level of Effort / Earmarking Allowable Costs / Cost Principles

Finding 2024-037 Medicaid Cluster, ALN 93.775, 93.777, and 93.778 - MiAIMS General Controls Management Views For part a., DTMB agrees it had not fully implemented all SOM database specific configurations during the audit period. However, DTMB disagrees these specific configurations created signifi...

Finding 2024-037 Medicaid Cluster, ALN 93.775, 93.777, and 93.778 - MiAIMS General Controls Management Views For part a., DTMB agrees it had not fully implemented all SOM database specific configurations during the audit period. However, DTMB disagrees these specific configurations created significant security risks. DTMB has been and continues to follow the manufacturer’s recommendations regarding security configurations. For part b., DTMB agrees with the finding. Planned Corrective Action For part a., DTMB will implement the SOM approved database configurations. For part b., DTMB will review and update internal business processes as needed to ensure privileged Michigan Adult Integrated Management System (MiAIMS) database accounts are reviewed in accordance with SOM Technical Standards. Anticipated Completion Date July 31, 2025 Responsible Individual(s) Nathan Buckwalter, DTMB

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Finding 567762 (2024-017)

Significant Deficiency 2024

State of Michigan

MI

Finding 2024-017 Medicaid Cluster, ALN 93.775, 93.777, and 93.778 and Children's Health Insurance Program, ALN 93.767 - Managed Care Periodic Audits Management Views MDHHS agrees with the finding. Planned Corrective Action MDHHS formally added the Encounter Data Validation (EDV) protocol to its Ex...

Finding 2024-017 Medicaid Cluster, ALN 93.775, 93.777, and 93.778 and Children's Health Insurance Program, ALN 93.767 - Managed Care Periodic Audits Management Views MDHHS agrees with the finding. Planned Corrective Action MDHHS formally added the Encounter Data Validation (EDV) protocol to its External Quality Review Organization (EQRO) contracts as of October 1, 2022. The EQRO identified three EDV protocol elements to review for the managed care entities including information systems, administrative profiles, and medical records. During fiscal year 2023, EQRO completed the comprehensive information systems review that analyzed MDHHS’s information systems infrastructure and an administrative profile review that analyzed MDHHS’s electronic encounter data completeness, accuracy, and timeliness. MDHHS published the completed reports for the information system and administrative profile reviews on its website during February and March 2024. During fiscal year 2024, EQRO began the medical records review component, which analyzes the completeness and accuracy of MDHHS’s electronic encounter data by comparing it to the information documented in the corresponding members’ medical records. MDHHS completed the fiscal year 2024 medical records report and published it to MDHHS’s website during March 2025. Anticipated Completion Date Completed Responsible Individual(s) Brad Barron, MDHHS Katarzyna Gruszka, MDHHS

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Finding 567761 (2024-016)

Significant Deficiency 2024

State of Michigan

MI

Finding 2024-016 Medicaid Cluster, ALN 93.775, 93.777, and 93.778 and Children's Health Insurance Program, ALN 93.767 - Medical Loss Ratio Management Views MDHHS agrees with the finding. Planned Corrective Action MDHHS updated the medical loss ratio (MLR) instructions and comparisons were required...

Finding 2024-016 Medicaid Cluster, ALN 93.775, 93.777, and 93.778 and Children's Health Insurance Program, ALN 93.767 - Medical Loss Ratio Management Views MDHHS agrees with the finding. Planned Corrective Action MDHHS updated the medical loss ratio (MLR) instructions and comparisons were required to be submitted to MDHHS as part of the MLR reporting process for the MHP Comprehensive Health Care Plan (CHCP) during June 2023 and for the Dental Health Plans and MI Choice during April 2024. MDHHS will update MLR instructions for PIHPs to clarify that comparisons are required to be submitted as part of the MLR reporting process. MDHHS will continue to work with the CHCPs, PIHPs, MI Choice, and Dental Health plans to obtain the comparisons as part of the MLR reporting process and will follow established procedures to reject those MLR submissions received that fail to attach a comparison. Anticipated Completion Date September 2025 Responsible Individual(s) Keith White, MDHHS Jackie Sproat, MDHHS

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Finding 567760 (2024-015)

Significant Deficiency 2024

State of Michigan

MI

Reporting

Finding 2024-015 Medicaid Cluster, ALN 93.775, 93.777, and 93.778 and Children's Health Insurance Program, ALN 93.767 - Refunding of Federal Share of Overpayments Management Views MDHHS agrees with the finding. Planned Corrective Action For part a., MDHHS has added additional verification checks t...

Finding 2024-015 Medicaid Cluster, ALN 93.775, 93.777, and 93.778 and Children's Health Insurance Program, ALN 93.767 - Refunding of Federal Share of Overpayments Management Views MDHHS agrees with the finding. Planned Corrective Action For part a., MDHHS has added additional verification checks to ensure all overpayment reports are included in each quarter’s financial reports. For part b., MDHHS will document the process of identifying late overpayments and calculating interest. There were no late payments identified during fiscal year 2024 that required an interest calculation. For part c., MDHHS will identify and implement CHAMPS enhancements needed to correct Federal Medical Assistance Percentage calculations. Anticipated Completion Date a. Completed b. September 30, 2025 c. September 30, 2025 Responsible Individual(s) Rebecca Jones, MDHHS

View Audit 360209

Finding 567759 (2024-014)

Significant Deficiency 2024

State of Michigan

MI

Eligibility HUD Housing Programs Reporting

Finding 2024-014 Medicaid Cluster, ALN 93.775, 93.777, and 93.778 and Children's Health Insurance Program, ALN 93.767 - Provider Eligibility Management Views MDHHS agrees with the finding. Planned Corrective Action MDHHS amended the Pharmacy Benefits Manager, Prepaid Inpatient Health Plan (PIHP),...

Finding 2024-014 Medicaid Cluster, ALN 93.775, 93.777, and 93.778 and Children's Health Insurance Program, ALN 93.767 - Provider Eligibility Management Views MDHHS agrees with the finding. Planned Corrective Action MDHHS amended the Pharmacy Benefits Manager, Prepaid Inpatient Health Plan (PIHP), MI Choice Waiver Program (MI Choice), Medicaid Health Plan (MHP), and Dental Health Plan entity fiscal year 2025 contracts to require that signatures are obtained on the Provider Screening Information Collection Tool (PSICT) forms and returned timely when contracts and waivers are renewed and extended. Also, MDHHS is in the process of amending the remaining Integrated Care Organization contract to include this requirement. MDHHS will continue to educate the managed care entities and MDHHS contract areas on this process to help ensure compliance. MDHHS expects that signatures will be obtained on the PSICT forms effective September 2025 for the fiscal year 2026 contract cycle and will continue to send an annual reminder to the managed care entities to report any change in ownership to MDHHS within 35 days. In addition, MDHHS continues to review provider agreements as part of its monitoring process conducted for all MI Choice entities. MDHHS’s review of fiscal year 2024 provider agreements for MI Choice entities will be completed by December 31, 2025, and will be ongoing during the Administrative Quality Assurance Review process as outlined in the waiver application that was approved by CMS. MDHHS will continue to send annual reminders to MI Choice entities to submit completed PSICT forms by September 1 each year as required by MI Choice contracts. MDHHS obtained an updated provider agreement for the Home Help provider cited in the finding. Home Help providers are now enrolled in CHAMPS and provider agreements, including updated terms and conditions, are completed electronically. Anticipated Completion Date December 31, 2025 Responsible Individual(s) Heather Hill, MDHHS Kim Heinicke, MDHHS Elaina Brown, MDHHS

View Audit 360209

Finding 567757 (2024-012)

Material Weakness 2024

State of Michigan

MI

Questioned Costs Eligibility Subrecipient Monitoring § 200.516

Finding 2024-012 Medicaid Cluster, ALN 93.775, 93.777, and 93.778 and Children’s Health Insurance Program, ALN 93.767 - Beneficiary Eligibility Management Views MDHHS agrees with the identified exceptions for parts a. and c. of the finding. However, MDHHS disagrees that 3 Medicaid cases and 20 Chil...

Finding 2024-012 Medicaid Cluster, ALN 93.775, 93.777, and 93.778 and Children’s Health Insurance Program, ALN 93.767 - Beneficiary Eligibility Management Views MDHHS agrees with the identified exceptions for parts a. and c. of the finding. However, MDHHS disagrees that 3 Medicaid cases and 20 Children’s Health Insurance Program (CHIP) cases with MAGI determinations cited in part b. did not have case file documentation supporting the beneficiary eligibility determination. The Centers for Medicare and Medicaid Services (CMS) has determined that a reasonable compatibility indicator can be used for CMS audit purposes to determine if the attested income information was electronically verified for MAGI cases and MDHHS disagrees that documentation was not maintained to support the eligibility determination. The SOM MiIntegrate system communicates with various State and federal electronic trusted data sources and sends the information from these sources, along with the beneficiaries’ attested income, to the SOM MAGI Rules Engine where the MAGI eligibility determination is made. As part of the MAGI eligibility determination, a reasonable compatibility test is completed to determine if beneficiary/applicant attested income is within a specified percentage of the electronic trusted data sources or if the attested and verified income are below the threshold for the applicable program. The results of the MAGI eligibility determination are sent back to MiIntegrate using an Account Transfer (AT) packet that contains the results. MiIntegrate then communicates the results to the SOM MAGI Viewer and Bridges using an AT packet and Bridges stores the AT packet number only that can be used to view the details of the AT packet within the SOM MAGI Viewer. The version of the AT packet within the MAGI Viewer also contains a reasonable compatibility indicator that documents the outcome of the reasonable compatibility test and supports the SOM MAGI Rules Engine eligibility decision. MDHHS stores the AT packet information, including facts essential to the eligibility determination, within MiIntegrate and the MAGI Viewer instead of Bridges to help protect and secure the federal income tax data and unemployment data used for the determination. The AT packet for each individual determination can be retrieved from the MAGI Viewer using the AT packet number stored in each beneficiary’s case file within Bridges. MDHHS is not aware of any federal regulations that preclude MDHHS from storing this information in a separate system to help secure the data and restrict access as required by federal and state law. Planned Corrective Action To address the exceptions identified that are not related to MAGI-based income verification results, MDHHS has developed mandatory training protocols for eligibility workers and expects to have the first Medicaid audit focused mandatory training implemented by July 2025. MDHHS will continue to determine where additional training or enhancements to training are needed to ensure eligibility is accurately determined and documentation is properly maintained within the electronic case file. MDHHS disagrees it did not maintain case file documentation that supports the beneficiary eligibility determination for MAGI cases and does not intend to take further action. Anticipated Completion Date MDHHS will implement the first Medicaid audit focused training by July 2025. Responsible Individual(s) Logan Dreasky, MDHHS Mariah Schaefer, MDHHS

View Audit 360209 Questioned Costs: $1

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