Finding 1228848 (2024-005)

Reference Number: 2024-005 Federal Program Title: Medicaid Cluster / Medical Assistance Program Federal Assistance Listing Number: 93.778 Federal Agency: U.S. Department of Health and Human Services Pass-Through Entity: California Department of Health Care Services Federal Award Number and Year: N/A Name of County Department: Health and Human Services Category of Finding: Reporting Instance of Noncompliance and Material Weakness Criteria 2 CFR §200.302 Financial Management (a) Each State must expend and account for the Federal award in accordance with State laws and procedures for expending and accounting for the State's funds. All recipient and subrecipient financial management systems, including records documenting compliance with Federal statutes, regulations, and the terms and conditions of the Federal award, must be sufficient to permit the preparation of reports required by the terms and conditions; and tracking expenditures to establish that funds have been used in accordance with Federal statutes, regulations, and the terms and conditions of the Federal award 2 CFR § 200.303 states that the non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in Standards for Internal Control in the Federal Government issued by the Comptroller General of the United States or the Internal Control–Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The California Department of Health Care Services (State) requires that quarterly administrative expense claims (invoices) be submitted within 60 days of the quarter end and any supplemental claims and revision within six months of the fiscal year end and use the appropriate invoice template provided to the Counties by the State. Condition We selected 10 quarterly administrative expense claims submitted during fiscal year 2024 and noted the following: FY Quarter Program* Due Date Date Submitted Days Late 2024 1 HCPCFC (PMMO) 11/30/2023 12/20/2023 20 2024 1 CHDP 11/30/2023 12/19/2023 19 2024 1 CCS 11/30/2023 1/8/2024 39 2024 1 CCS 11/30/2023 5/24/2024 176 2024 2 CCS 2/28/2024 5/24/2024 86 * CHDP - Child Health and Disability Prevention HCPCFC - Health Care Program for Children in Foster Care HCPCFC (PMMO) - Health Care Program for Children in Foster Care - (Psychotropic Medication Monitoring and Oversight) CCS - California Children Services Program We also noted that two of the reports reviewed had clerical errors in the claim templates in the period dates, creating confusion regarding the reporting period to which the claims related. There were instances in which the period dates were incorrect throughout the claims and instances in which the dates were not consistent across all pages of the claims. Cause The County’s Health and Human Services Department does not have a formal process to monitor and track reporting deadlines or maintain documentation if communications were made with the grantor regarding the need for an extension. The department has experienced staffing constraints leading to delays in preparing, reviewing, and filing reports for the CHDP and HCPCFC programs. Effect Untimely submission of reports may result in funding delays and potential denial of funding by the grantor if the fiscal year’s six-month deadline is exceeded. In addition, insufficient review of report content, such as covered periods and accuracy of the invoice template may create confusion, further delay the receipt of funding, result in inaccurate amounts being claimed and extend the time necessary to resolve discrepancies during subsequent audits. Questioned Costs None identified. Context We identified 20 administrative expense claims filed in fiscal year 2024. This included eight claims related to the prior fiscal year that were filed significantly after the applicable deadlines. We selected 10 of the 20 claims for review. Identification as a Report Finding Previously reported as Finding 2023-004. The sample was not a statistically valid sample. Recommendation We recommend the County consider the following: 1. Establish a tracking system to identify all reports and their respective due dates. 2. Communicate with the grantor if required reports are expected to be submitted late and maintain correspondence. 3. Review employee responsibilities and workloads to properly allocate resources to support compliance needs.