Corrective Action Plans

Finding 515681 (2023-001)

Significant Deficiency 2023

WI

Internal Control / Segregation of Duties Reporting

The Company does not have the resources and/or staff to prepare the financial statements and notes but will continue to oversee the auditor’s services and review and approve the financial statements and notes.

View Audit 333495

Finding 515657 (2023-004)

None 2023

Puerto Rico Metropolitan Bus Authority

PR

Reporting § 200.512

As of 2017, the Puerto Rico Treasury Deparment decreed that all government agencies are required to submit their financial statement for review before making it official, In order to complete and submit the Single Audit Report, the Authority is also required to included information on retirees, thei...

As of 2017, the Puerto Rico Treasury Deparment decreed that all government agencies are required to submit their financial statement for review before making it official, In order to complete and submit the Single Audit Report, the Authority is also required to included information on retirees, their post-emplymnet benefits and their pension. These new requiremt as mentined above are extremely delay in completion of the reports.

View Audit 333456

Finding 515655 (2023-002)

Significant Deficiency 2023

Birminghamgreen Adult Disability Services, Inc.

VA

HUD Housing Programs

Recommendation: Management needs to ensure accounting transactions affecting related parties are communicated in a timely manner to ensure accuracy and agreement between the entities. Management’s Response: Management concurs with the auditor’s finding that the Project’s related parties should com...

Recommendation: Management needs to ensure accounting transactions affecting related parties are communicated in a timely manner to ensure accuracy and agreement between the entities. Management’s Response: Management concurs with the auditor’s finding that the Project’s related parties should communicate and reconcile accounting transactions in a timely manner. Communications and reconciliation will begin immediately.

View Audit 333439

Finding 515654 (2023-001)

Material Weakness 2023

Birminghamgreen Adult Disability Services, Inc.

VA

HUD Housing Programs

Recommendation: Management needs to ensure accrual basis of accounting is maintained. Accounting records need to be reconciled between management agent and Project owner and to the audited financial statements to ensure all entries have been made and the financial records current and accurate. Tra...

Recommendation: Management needs to ensure accrual basis of accounting is maintained. Accounting records need to be reconciled between management agent and Project owner and to the audited financial statements to ensure all entries have been made and the financial records current and accurate. Track invoices to ensure they are correctly recorded in the financial statements and when paid, they are properly removed from the schedules. Management’s Response: Management concurs with the auditor’s finding that the Project’s accounting records should be maintained and reconciled between management agent and Project owner and the audited financial statement. Communications and reconciliations will begin immediately.

View Audit 333439

Finding 515609 (2023-001)

Significant Deficiency 2023

Kansas Association of Conservation Districts

KS

Procurement, Suspension & Debarment Significant Deficiency Internal Control / Segregation of Duties § 200.319

Management agrees with the findings and recommendation. The District will update its policies and procedures to ensure they meet the Uniform Guidance Requirements. .

View Audit 333385

Finding 515608 (2023-001)

Material Weakness 2023

City of Clarion

IA

Internal Control / Segregation of Duties

The City should review its control activities to obtain the maximum internal control possible under the circumstances utilizing currently available staff, including elected officials, to provide additional controls through review of financial transactions, reconciliations and financial report. The r...

The City should review its control activities to obtain the maximum internal control possible under the circumstances utilizing currently available staff, including elected officials, to provide additional controls through review of financial transactions, reconciliations and financial report. The reviews should be documented by the signature or initials of the reviewer and the date of the review.

View Audit 333381

Finding 515600 (2023-001)

Material Weakness 2023

Aha MacAv Housing Entity

AZ

Material Weakness Reporting

Management's Response: The Housing Entity will adhere, and practice set forth in the Financial Management Policy and Procedures, 8. Finance Reporting (a) Reports to Grant Agencies. The Housing Entity will do its best to implement control for filing of financial reporting prior to the deadline(s). Es...

Management's Response: The Housing Entity will adhere, and practice set forth in the Financial Management Policy and Procedures, 8. Finance Reporting (a) Reports to Grant Agencies. The Housing Entity will do its best to implement control for filing of financial reporting prior to the deadline(s). Estimated Completion Date: The TDHE shall complete and submit all reports to Federal, State, and local grant agencies in accordance with, and in the format and timelines required by the agency. In accordance with 2 CFR Section 200.512(a), the audit must be completed and the data collection form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor's report, or nine months after the end of the audit period, adjusted for any extensions permitted by the Office of Management and Budget. Again, the Housing Entity will do its best to implement control for filing of financial reporting prior to the deadline(s). Responsible Party: Executive Director and Bookkeeper.

View Audit 333345

Finding 515588 (2023-006)

Significant Deficiency 2023

The Salvation Army Columbus Area Services

OH

Reporting

Recommendation: We recommend that the organization provide proper training in compiling and preparing the Schedule of Expenditures of Federal Awards which includes identifying the correct ALN’s and pass-through contract numbers, and identifying those contracts that are state funded. Response: SAS ...

Recommendation: We recommend that the organization provide proper training in compiling and preparing the Schedule of Expenditures of Federal Awards which includes identifying the correct ALN’s and pass-through contract numbers, and identifying those contracts that are state funded. Response: SAS AR specialists will be properly trained in compiling and preparing the SEFA, including the correct identification of all signed contracts.

View Audit 333308

Finding 515587 (2023-005)

Significant Deficiency 2023

The Salvation Army Columbus Area Services

OH

Reporting § 200.512

Recommendation: We recommend the organization work closely with the audit firm to ensure that the single audit reporting package is issued by the deadline or within a federally approved extended date along with submitting the required data collection form with the Federal Audit Clearinghouse. Respo...

Recommendation: We recommend the organization work closely with the audit firm to ensure that the single audit reporting package is issued by the deadline or within a federally approved extended date along with submitting the required data collection form with the Federal Audit Clearinghouse. Response: The delinquent single audit reporting package and data collection form will be filed in December 2024. Going forward, we will work with the external audit firm to ensure that their required grant testing is completed, and the single audit reports included with the single audit reporting package, as well as the required data collection form is submitted to the Federal Audit Clearinghouse within the required or extended due date each year.

View Audit 333308

Finding 515573 (2023-008)

Significant Deficiency 2023

Unity Health Care, Inc.

MD

Eligibility Internal Control / Segregation of Duties Subrecipient Monitoring

Management Response #2023-008: Due to staff turnover, the Corporation did not consistently enforce segregation of duties between the individual responsible for determining income eligibility and the one completing the medical risk assessment. The Corporation also failed to provide sufficient support...

Management Response #2023-008: Due to staff turnover, the Corporation did not consistently enforce segregation of duties between the individual responsible for determining income eligibility and the one completing the medical risk assessment. The Corporation also failed to provide sufficient support to verify that the applicant signed the Rights and Obligations statement. Corrective Action Plan: • All eligibility verification data, including screenshots and signed Rights and Obligations statements, will be stored in a centralized, secure shared drive maintained and managed by the WIC Director to ensure it is protected with limited access and password protection. The drive will be organized using a de-identified naming convention to ensure privacy while maintaining ease of access for authorized staff. • To maintain a robust system of checks and balances, tasks related to eligibility verification and documentation will be divided among different team members. This separation will prevent any one individual from having full control over the process, reducing the risk of oversight or potential errors. • The WIC Department’s policy and procedure manuals will be revised and updated to include the new eligibility verification process. • To ensure adherence to the new protocols, periodic audits and review sessions will be conducted by the WIC Director or designated compliance staff to verify that documentation is being properly maintained and that all procedures are followed. Staff will be required to undergo refresher training sessions as needed to reinforce the updated protocols and best practices. Responsible Party: Tracy Harrison, COO

View Audit 333283

Finding 515558 (2023-009)

Significant Deficiency 2023

Unity Health Care, Inc.

MD

Allowable Costs / Cost Principles § 200.303

Management Response #2023-009: Due to the staff shortages and turnover the Corporation did not have adequate personnel or infrastructure in place to monitor costs in order to calculate and determine Corrective Action Plan: The Finance Team will develop overall operational costs reports to calculate...

Management Response #2023-009: Due to the staff shortages and turnover the Corporation did not have adequate personnel or infrastructure in place to monitor costs in order to calculate and determine Corrective Action Plan: The Finance Team will develop overall operational costs reports to calculate and support a new rate. The proposed rate will be submitted for approval. This will allow us to ensure the calculation for indirect costs and documentation supporting the indirect cost pool conform to the current regulations. Responsible Party: Tamara Barnes, CFO

View Audit 333283

Finding 515550 (2023-007)

Significant Deficiency 2023

Unity Health Care, Inc.

MD

Procurement, Suspension & Debarment § 200.214 § 200.317 § 200.327

Management Response #2023-007: Due to staff shortages and turnover, the company lacked adequate personnel to effectively monitor or document grant activity. Additionally, formal documentation of policies and procedures was insufficient, and supporting documents were not stored in a centralized locat...

Management Response #2023-007: Due to staff shortages and turnover, the company lacked adequate personnel to effectively monitor or document grant activity. Additionally, formal documentation of policies and procedures was insufficient, and supporting documents were not stored in a centralized location, creating challenges in retrieving necessary information. Corrective Action Plan: In response to these issues, the company implemented the following corrective measures starting in mid-2023: • The Corporation established comprehensive, formal policies and procedures that document the current compliance practices. These procedures have been disseminated across the organization and incorporated into training programs to ensure all employees are aligned with the updated standards. • A procedure enhancement has been implemented in the procurement process, which requires the procurement manager to obtain three bids prior to the creation of certain purchase orders. This ensures competitive bidding and transparency in vendor selection. • Once a vendor is selected, the procurement manager will forward the vendor’s details to the compliance department. The compliance team will then verify the vendor's debarment status and federal eligibility to ensure compliance with all regulatory requirements. • A central repository platform has been created to store all vendor bids, price analyses, and related procurement documentation. This ensures that all relevant information is easily accessible and properly organized. • All accounts payable invoices designated for grant funding are now routed for prior approval to the respective grant program manager via the WorkPlace software before any payments are processed. This ensures proper oversight and alignment with grant requirements. These corrective actions aim to strengthen compliance, improve document management, and streamline oversight processes to prevent future issues related to grant monitoring and procurement. Responsible Party: Tamara Barnes, CFO

View Audit 333283

Finding 515549 (2023-006)

Material Weakness 2023

Unity Health Care, Inc.

MD

Allowable Costs / Cost Principles Matching / Level of Effort / Earmarking § 200.431

Management Response #2023-006: Due to the financial system and time keeping infrastructure, the Corporation did not maintain evidence of fringe benefit cost objectives calculations. Also, the current fringe cost rate and allocations is based on historical assumptions. Corrective Action Plan: • The...

Management Response #2023-006: Due to the financial system and time keeping infrastructure, the Corporation did not maintain evidence of fringe benefit cost objectives calculations. Also, the current fringe cost rate and allocations is based on historical assumptions. Corrective Action Plan: • The finance team will work to ensure fringe costs are entered into the financial system based on actual costs paid by the Corporation for each employee. • The grants finance department will also create actual to budget reports in accordance with HRSA guidelines for fringe costs. • The Finance Team will develop fringe costs reports to calculate, monitor and support the current rate. This will allow us to ensure the fringe cost allocation conform to the current regulations. Responsible Party: Tamara Barnes, CFO

View Audit 333283

Finding 515548 (2023-005)

Material Weakness 2023

Unity Health Care, Inc.

MD

Allowable Costs / Cost Principles Matching / Level of Effort / Earmarking § 200.430

Management Response #2023-005: The time keeping system and process does not currently allow tracking of time based on funded resources. The past practice had been for the finance department manually calculated salary allocations. Due to the influx of grants and staffing resources the Corporation was...

Management Response #2023-005: The time keeping system and process does not currently allow tracking of time based on funded resources. The past practice had been for the finance department manually calculated salary allocations. Due to the influx of grants and staffing resources the Corporation was unable to maintain this process. Corrective Action Plan: The following action items have been or will be taken: • Finance Management, Human Resource and Payroll will work on integrating time-tracking functions with the current time-keeping system to specifically track time worked on grants in real time for fiscal year 2025. Responsible Party: Tamara Barnes, CFO

View Audit 333283

Finding 515547 (2023-004)

Material Weakness 2023

Unity Health Care, Inc.

MD

Reporting § 200.512

Management Response #2023-004: Due to staffing shortages and turnover, the company lacked sufficient personnel to adequately monitor or document grant activities which led to the delay in timely filing of the audit with the Federal Audit Clearinghouse. Corrective Action Plan: The following actions ...

Management Response #2023-004: Due to staffing shortages and turnover, the company lacked sufficient personnel to adequately monitor or document grant activities which led to the delay in timely filing of the audit with the Federal Audit Clearinghouse. Corrective Action Plan: The following actions have been implemented to address the issue: • The finance team redefined and expanded roles to designate specific staff members whose primary responsibility is to monitor and manage all grant activities. • The finance team developed Project Budget Reports for each federal award. These reports include a detailed budget, monthly expenses, and monthly revenue (drawdowns). The reports will be reviewed and reconciled by both the grants administration staff and the finance team on a monthly basis to ensure alignment with allocated costs. This process ensures compliance with grant regulations and supports the timely reconciliation of grants, which is crucial for year-end reporting, preparation of the Federal Financial Reports (FFRs), SEFA, audit preparations, and data collection for the Federal Audit Clearinghouse (FAC). Responsible Party: Tamara Barnes, CFO

View Audit 333283

Finding 515490 (2023-129)

Significant Deficiency 2023

State of Arizona

AZ

Student Financial Aid Eligibility Matching / Level of Effort / Earmarking § 200.303

Cluster Name: Student Financial Assistance Cluster Assistance listing numbers and names: Northern Arizona University 84.007 Federal Supplemental Educational Opportunity Grants 84.033 Federal Work-Study 84.038 Federal Perkins Loan Program—Federal Capital Contributions 84.063 Federal Pell Grant Progra...

Cluster Name: Student Financial Assistance Cluster Assistance listing numbers and names: Northern Arizona University 84.007 Federal Supplemental Educational Opportunity Grants 84.033 Federal Work-Study 84.038 Federal Perkins Loan Program—Federal Capital Contributions 84.063 Federal Pell Grant Programs 84.268 Federal Direct Student Loans 84.379 Teacher Education Assistance for College and Higher Education Grants (TEACH Grants) 93.364 Nursing Student Loans 93.925 Scholarships for Health Professions Students from Disadvantaged Backgrounds—Scholarships for Disadvantaged Students (SDS) Agency: Northern Arizona University (NAU) Name of contract person and title: Bradley Miner, NAU Associate Vice President and Comptroller Anticipated Completion Date June 30, 2024 Agency’s Response: Concur The University agrees with this finding and although it relies on the Federal agencies for valid identity verification, the University has already taken significant corrective action to proactively monitor and detect fraudulent student identities. The University has various internal controls, system fraud controls, and integrity measures in place as required or identified as industry best-practice to mitigate and prevent the increasing sophistication of fraudulent activity. In academic year 2023 the University had 282 online students selected for Verification by the Department of Education (ED). The 8 isolated fraud instances were the only identified fraud cases. The University receives valid identity verification checks from the Department of Education (ED) as an input for creating student profiles. Additionally, the University works with administrative agencies and leverages FAFSA checks conducted by Social Security Administration (SSA), Department of Veteran Affairs (VA), Department of Homeland Security (DHS), National Student Loan Data System (NSLDS), Department of Defense (DOD), Department of Justice (DOJ). Financial Aid does not disburse until enrollment verification is complete. 1. The University has reviewed prior fiscal years to determine if additional fraudulently enrolled students received student financial assistance, and if fraudulent loans and awards were awarded. The University conducted an in-depth analysis of multiple qualitative attributes of students receiving financial assistance. This analysis identified high risk students receiving loans and awards. Students in this population were required to complete V4 verification. 2. The University implemented anti-fraud measures as an alternative to automated student Internet Protocol (IP) verification. During the analysis to identify fraudulently enrolled students, the University identified programs at high-risk for fraudulent activity. As a proactive fraudulent activity identification measure, the University will require all students in high-risk programs, with active FAFSAs to submit and complete V4 identity verification. This anti-fraud measure will identify fraudulently enrolled students prior to the disbursement of student financial assistance including loans and awards. 3. The University has put in to place a number of additional verification measures and detective controls to validate online student identities and check for repetitive information and trends. The University is conducting feasibility studies to determine if the suggested guidance for Internet Protocol student verification abides by certain security and privacy standards and policies. Additionally, the University has concern with fraudsters ability to mask Internet Protocols by deploying Virtual Private Networks (VPNs). This renders the advanced protocols ineffective. As a compensating control, the University will begin selecting 5% of online students for V4 verification. Random sampling of online students for identity verification provides enhanced detective measures to combat the risk of identity theft for use in financial aid fraud. Additionally, the University put in place several upfront measures to detect repetitive information and trends to identify potentially fraudulent activity. Detective monitoring reporting identifies duplicate deposit information, redundant student email information, and duplicate student address information. The Department will continue to utilize these successful anti-fraud measures to proactively identify fraudulent student identities. 4. The University will continue its efforts working with law enforcement agencies to recover improper payments for fraudulent claims it paid due to identity theft, to the extent practicable. The University worked with law enforcement agencies to investigate the fraud. At the conclusion of the investigation $138,135 has been repaid. The University will continue to partner with federal, state, and local law enforcement agencies and financial institutions across the country to recover losses and aggressively pursue legal action against perpetrators of fraud.

View Audit 333243

Finding 515487 (2023-120)

Significant Deficiency 2023

State of Arizona

AZ

Subrecipient Monitoring Internal Control / Segregation of Duties Student Financial Aid

Assistance listing number and program name: 93.658 Foster Care—Title IV-E 93.658 COVID-19 - Foster Care—Title IV-E Agency: Arizona Department of Child Safety (DCS) Name of contact person and title: Emilio Gonzales, DCS Audit Administrator Anticipated completion date: Fiscal Year 2025 Agency’s Respo...

Assistance listing number and program name: 93.658 Foster Care—Title IV-E 93.658 COVID-19 - Foster Care—Title IV-E Agency: Arizona Department of Child Safety (DCS) Name of contact person and title: Emilio Gonzales, DCS Audit Administrator Anticipated completion date: Fiscal Year 2025 Agency’s Response: Concur The Department will comply with the Federal Funding Accountability and Transparency Act (FFATA) and Federal Uniform Guidance regulations in accordance with the Department’s Grant policies and procedures. As of November 2024, the Department worked with the federal agency to resolve the inability to submit outstanding subaward information prior to January 2024. The FFATA reporting was completed for fiscal years 2024, 2023, 2022 and 2021. The Department will also continue to follow its policies and procedures for reporting subaward actions, as required.

View Audit 333243

Finding 515480 (2023-121)

Material Weakness 2023

State of Arizona

AZ

Reporting Subrecipient Monitoring

Assistance listing number and program name: 93.268 Immunization Cooperative Agreements 93.268 COVID-19 - Immunization Cooperative Agreements 93.323 Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) 93.323 COVID-19 - Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) ...

Assistance listing number and program name: 93.268 Immunization Cooperative Agreements 93.268 COVID-19 - Immunization Cooperative Agreements 93.323 Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) 93.323 COVID-19 - Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) Agency: Arizona Department of Health Services (ADHS) Name of contact person and title: Lora Andrikopoulos, ADHS Grants Administrator Anticipated completion date: June 30, 2025 Agency’s Response: Concur ADHS will continue to work with the CQI Team, Financial Services - Assurance Team, Procurement, Finance Managers, Other internal partners, and Grants to update the process of FFATA. The process moving forward will include a communication plan, updates to the current standard work, the creation of new standard work if necessary for the subaward communication process, and additional training.

View Audit 333243

Finding 515471 (2023-133)

Significant Deficiency 2023

State of Arizona

AZ

Internal Control / Segregation of Duties Eligibility Reporting

Assistance listing number and program name: 93.778 Medicaid Assistance Program (part of the Medicaid Cluster 93.778 COVID-19 Medicaid Assistance Program Agency: Arizona Health Care Cost Containment System (AHCCCS) Name of contact person and title: Jeff Tegen, Assistant Director, AHCCCS Division of B...

Assistance listing number and program name: 93.778 Medicaid Assistance Program (part of the Medicaid Cluster 93.778 COVID-19 Medicaid Assistance Program Agency: Arizona Health Care Cost Containment System (AHCCCS) Name of contact person and title: Jeff Tegen, Assistant Director, AHCCCS Division of Budget and Finance Anticipated completion date: December 31, 2024 Agency’s Response: Concur AHCCCS concurs with the finding in this audit and would like to note this finding is related to no notice of disenrollment being mailed to a deceased member, and not related to enrollment ineligibility. AHCCCS Division of Member and Provider Services (“DMPS”) will identify the standard process for notification that should have been followed for this case. Once the root cause of the issue has been established, AHCCCS will assess current processes and procedures, as appropriate, to address this issue.

View Audit 333243

Finding 515470 (2023-132)

Material Weakness 2023

State of Arizona

AZ

Questioned Costs Special Tests & Provisions Material Weakness

Assistance listing number and program name: 93.778 Medicaid Assistance Program (part of the Medicaid Cluster 93.778 COVID-19 Medicaid Assistance Program Agency: Arizona Health Care Cost Containment System (AHCCCS) Name of contact person and title: Jeff Tegen, Assistant Director, AHCCCS Division of B...

Assistance listing number and program name: 93.778 Medicaid Assistance Program (part of the Medicaid Cluster 93.778 COVID-19 Medicaid Assistance Program Agency: Arizona Health Care Cost Containment System (AHCCCS) Name of contact person and title: Jeff Tegen, Assistant Director, AHCCCS Division of Budget and Finance Anticipated completion date: December 31, 2024 Agency’s Response: Concur AHCCCS concurs with the finding and would like to note this matter was discovered through internal review of OIG recoupment documentation and filings with CMS. This matter was reviewed in detail by our financial management team and AHCCCS determined this was caused by a few factors: (1) staffing issues and employee turnover in all units involved in the process to return OIG recoupments to CMS. (2) A breakdown of inter and intra-departmental communication and collaboration. Efforts to eliminate this from occurring in the future include recently filling the related following positions that experienced turnover: Accounting Supervisor, Reporting Administrator, and 2 Accounting Specialists. In addition, AHCCCS has increased collaboration across the respective departments and divisions to ensure the federal share of all case recoupments is timely returned to CMS. Further, we have revised our standard work processes to include monthly reconciliations of case recoupments among the various departments and divisions. AHCCCS anticipates to have returned the federal share to CMS for all case recoupments identified by December 31, 2024.

View Audit 333243 Questioned Costs: $1

Finding 515469 (2023-131)

Material Weakness 2023

State of Arizona

AZ

Questioned Costs Special Tests & Provisions Material Weakness

Assistance listing number and program name: 93.778 Medicaid Assistance Program (part of the Medicaid Cluster 93.778 COVID-19 Medicaid Assistance Program Agency: Arizona Health Care Cost Containment System (AHCCCS) Name of contact persons and titles: Vanessa Templeman, Inspector General, AHCCCS Offic...

Assistance listing number and program name: 93.778 Medicaid Assistance Program (part of the Medicaid Cluster 93.778 COVID-19 Medicaid Assistance Program Agency: Arizona Health Care Cost Containment System (AHCCCS) Name of contact persons and titles: Vanessa Templeman, Inspector General, AHCCCS Office of Inspector General; Jeff Tegen, Assistant Director, AHCCCS Division of Budget and Finance Anticipated completion date: December 31, 2024 Agency’s Response: Concur AHCCCS OIG agrees with the finding as stated above. AHCCCS OIG commits to a review of the current Deferred Process and will determine areas of improvement to include; timelines for deferred case review completion, quarterly completed deferred case review reports, and required documentation for all deferred case processes.

View Audit 333243 Questioned Costs: $1

Finding 515468 (2023-130)

Material Weakness 2023

State of Arizona

AZ

Questioned Costs Special Tests & Provisions Procurement, Suspension & Debarment

Assistance listing number and program name: 93.778 Medicaid Assistance Program (part of the Medicaid Cluster 93.778 COVID-19 Medicaid Assistance Program Agency: Arizona Health Care Cost Containment System (AHCCCS) Name of contact person and title: Jeff Tegen, Assistant Director, AHCCCS Division of B...

Assistance listing number and program name: 93.778 Medicaid Assistance Program (part of the Medicaid Cluster 93.778 COVID-19 Medicaid Assistance Program Agency: Arizona Health Care Cost Containment System (AHCCCS) Name of contact person and title: Jeff Tegen, Assistant Director, AHCCCS Division of Budget and Finance Anticipated completion date: December 31, 2024 Agency’s Response: Concur In May 2023, AHCCCS announced its initial findings of credible and willful fraud by sober-living providers across the state. Since then, AHCCCS has suspended more than 300 providers, assisted over 10,000 individuals with the humanitarian response, and implemented more than 20 new initiates to combat fraud, waste, and abuse in the Medicaid program. As the extent of the fraud was revealed, AHCCCS recognized the need for holistic and systemwide changes. AHCCCS partnered with the Attorney General and Governor’s Office to develop a comprehensive plan to address the loopholes fraudulent providers were exploiting. Stop gap strategies implemented include, but may not limited to the following: · Increased scrutiny of claims based on claims volume. · Issued a moratorium on new provider registrations for impacted provider types · Prevented Reimbursement of Claims for Impossibly Rendered Services · Claims for Substance Abuse Services for Children under the age of 12 to Require Clinical Review Prior to Payment · Set thresholds for services to initiate a prepayment review. · Required claims to be billed for specific dates of service rather than ranges. · Flagged claims for services of the same style/overlapping codes. · Created a prepayment review process for providers utilizing suspicious billing practices. · Eliminated retroactive billing. · Credible Allegation of Fraud (“CAF”) suspensions include both provider entities and owners/ behavioral health (“BH”) practitioners. · Implemented ID.Me identity verification for AHCCCS Online. · Required providers to disclose any third-party billing relationships. · Behavioral Health Providers are now considered high-risk provider types for provider enrollment. · Per Diem codes have been set to only be able to be billed once per day. · Practitioners, including Behavioral Health Technicians, can no longer be patients at the same provider. · Worked with the Arizona Corporation Commission to flag suspicious registrations. · Ensured AHCCCS coding adhered to National Correct Coding Initiative (“NCCI”) standards and confirmed no edits had been turned off. · Streamlined AHCCCS reporting of bad actors to the appropriate professional oversight boards. Stop gap strategies in process include, but may not be limited to, the following: · Implementing eligibility integrity requirements for AIHP enrollment. · Linking BHP to BH companies they work for. · Link BH Providers to BH facilities they work at. · Conduct onsite quality of care reviews for patients in treatment longer than 90 days. · Require medical records to define specialized services. · Implement a new pre/post pay claims system. · Mandatory transition to Electronic Fund Transfer (direct deposit) for all AHCCCS provider reimbursements. AHCCCS continues to investigate and identify areas of concern and implement necessary system improvements until it is determined that the integrity of the AHCCCS provider network is restored.

View Audit 333243 Questioned Costs: $1

Finding 515447 (2023-112)

Material Weakness 2023

State of Arizona

AZ

Subrecipient Monitoring Matching / Level of Effort / Earmarking Reporting

Assistance listing numbers and program names: 93.575 Child Care and Development Block Grant 93.575 COVID-19 - Child Care and Development Block Grant 93.596 Child Care Mandatory and Matching Funds of the Child Care and Development Fund 93.596 COVID-19 - Child Care Mandatory and Matching Funds of the ...

Assistance listing numbers and program names: 93.575 Child Care and Development Block Grant 93.575 COVID-19 - Child Care and Development Block Grant 93.596 Child Care Mandatory and Matching Funds of the Child Care and Development Fund 93.596 COVID-19 - Child Care Mandatory and Matching Funds of the Child Care and Development Fund Agency: Arizona Department of Economic Security (DES) Name of contact person and title: Martha Franquemont, DES Business Administrator Anticipated completion date: June 30, 2025 Agency’s Response: Concur The Department of Economic Security will address the audit recommendations as follows: The Department will immediately report the required missing information for its subawards on the FFATA Subaward Reporting System for this cluster. The Department will also follow the State’s accounting manual for reporting subaward actions equaling or exceeding $30,000 no later than month-end of the month following the subaward action. In addition, the Department will redirect and train existing resources to ensure FFATA reports are compiled, reviewed, and submitted timely.

View Audit 333243

Finding 515446 (2023-111)

Significant Deficiency 2023

State of Arizona

AZ

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

Assistance listing numbers and program names: 93.575 Child Care and Development Block Grant 93.575 COVID-19 - Child Care and Development Block Grant 93.596 Child Care Mandatory and Matching Funds of the Child Care and Development Fund 93.596 COVID-19 - Child Care Mandatory and Matching Funds of the...

Assistance listing numbers and program names: 93.575 Child Care and Development Block Grant 93.575 COVID-19 - Child Care and Development Block Grant 93.596 Child Care Mandatory and Matching Funds of the Child Care and Development Fund 93.596 COVID-19 - Child Care Mandatory and Matching Funds of the Child Care and Development Fund Agency: Arizona Department of Economic Security (DES) Name of contact person and title: Traci Lira, DES Strategic Operations Coordinator Anticipated completion date: September 1, 2024 Agency’s Response: Concur The Department of Economic Security will address the audit recommendations as follows: The Department has revised its policies and procedures to ensure a signed receipt is captured for all Payment Disbursed Quickly (PDQ) submitted billings. In addition, the Department will retain all records related to a federal award for a period of 3 years from the final expenditure report submission date. These policies and procedures were implemented effective September 1, 2024.

View Audit 333243

Finding 515369 (2023-127)

Material Weakness 2023

State of Arizona

AZ

Allowable Costs / Cost Principles Cash Management Reporting § 200.301 § 200.302 § 200.303

Assistance listing numbers and program names: 84.425D COVID-19 - Education Stabilization Fund—Elementary and Secondary School Emergency Relief (ESSER) Fund 84.425R COVID-19 - Coronavirus Response and Relief Supplemental Appropriations Act, 2021 – Emergency Assistance to Non-Public Schools (CRSSA EAN...

Assistance listing numbers and program names: 84.425D COVID-19 - Education Stabilization Fund—Elementary and Secondary School Emergency Relief (ESSER) Fund 84.425R COVID-19 - Coronavirus Response and Relief Supplemental Appropriations Act, 2021 – Emergency Assistance to Non-Public Schools (CRSSA EANS) Agency: Arizona Department of Education (ADE) Name of contact persons and titles: Michelle Udall, ADE Associate Superintendent Dr. Sarka White, ADE Deputy Associate Superintendent Anticipated completion date: November 30, 2024 Agency’s response: Concur ESSER Reporting will be validated by at least 2 people before submitting to U.S. Department of Education. This validation will include the reconciliation of data from the LEA to ADE's report. ADE is finalizing policies and procedures for validating the data prior to submission. ADE has already begun implementing a reconciliation system to ensure accurate reporting in the EANS annual performance report. This system tracks obligations by category, expenses, and appropriate earmarking of nonpublic schools (e.g., DUNS/UEI, grades served). ADE is finalizing general policies and procedures for how this data is compiled, interpreted, and reported based on the initial implementation and corrections of the EANS program.

View Audit 333243

Corrective Action Plans

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