Finding 626199 (2022-004)

2022-004 Eligibility Federal Agency: U.S. Department of Health and Human Services Program: Medical Assistance Program (ALN 93.778) Pass-through Entity: State of Minnesota, Department of Human Services Federal Assistance Identification Number or Pass-Through Numbers: 2005MN5ADM, 2105MN5ADM, 2105MN5MAP, NH23IP922628 Federal Award Years: Year ended December 31, 2022 Type of Finding: Material Weakness in Internal Control over Compliance; Other Matter Compliance Finding Criteria: 2 CFR 200.303(a) requires that each non-Federal entity must "Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award." Specific criteria are established with respect to eligibility for assistance and the County?s responsibilities related to the intake function: ? Minnesota Stat 256B.056 requires that for certain eligibility groups to be eligible for Medical Assistance, a person must not individually own more than certain asset limits based on household size, disability status, and employment status. ? The Minnesota Health Care Programs Eligibility Policy Manual at 1.3.2.4 requires a County agency to evaluate and pursue resolution of information that is inconsistent with other information. ? Minnesota Stat 256B.056 requires to be eligible for Medical Assistance, a person must not have income in excess of certain limits based on household size. The Minnesota Health Care Programs Eligibility Policy Manual at 1.3.2.4 requires a County agency to evaluate and pursue resolution of information that is consistent with documentation or information on file. ? 42 CFR 435.910 requires, as a condition of eligibility, each individual seeking Medicaid must furnish his or her Social Security number (SSN). Condition: During our testing, we noted the following instances of noncompliance in the sample of 120 case files tested: ? One MAXIS case file had assets greater than their applicable household size asset limit. While beneficiaries may reduce their assets to continue to qualify, there was no documentation in the case notes showing the applicant reduced their assets subsequent to renewal in order to continue to qualify for benefits. ? One MAXIS case file had different bases of eligibility in MAXIS and MMIS where MAXIS indicated the beneficiary was ?EX? (age 65 or older) while MMIS indicated the beneficiary was ?DX? (disabled). ? One METS case file included documentation of verification of income that did not match the information entered into METS. ? One METS case file did not have a SSN entered at either the initial application date nor any of the subsequent renewal dates. No exemptions to the requirement to submit a SSN was noted in the case within METS. In addition, the County does not have effective internal controls over eligibility of the Medicaid program: ? The County does not have a formalized supervisory case file review process in place to ensure accuracy and completeness of inputs into the MAXIS and METS systems. ? We were not able to review and test the automated application controls and the related ITGCs within the MAXIS, METS and MMIS systems, all of which are state systems that are administered by the state and required to be used by the County, to determine whether the system controls are adequately designed and implemented and operating effectively for the determination of eligibility. Cause: The County relied on the pandemic related continuous eligibility provisions for the Medical Assistance program. Program personnel entering case data into MAXIS or METS did not ensure all required information was input correctly, supported or that all required information was obtained. In addition, the State was not able to provide information regarding the design and implementation of MAXIS, METS and MMIS system controls nor were we able to review and test the MAXIS, METS and MMIS systems due to complexities of data privacy and resources within the State. Effect: Although not found during our testing, benefits paid for participants in the program by the State of Minnesota may have paid for ineligible participants. Context: The State of Minnesota Department of Human Services (DHS) contracts with county social services departments to perform the ?intake function? (meeting with the social services client to determine income and categorical eligibility), while the State maintains the MAXIS and METS systems, which determine eligibility. Participants receive benefit payments from the state. The eligible individuals consist of two populations, and a total of 120 enrolled persons were selected, 60 from the MAXIS system and another 60 from the METS system. The sample sizes were based on guidance from chapter 11 of the AICPA Audit Guide, Government Auditing Standards and Single Audits. Of the 120 selections, errors were noted in four of the cases (see condition section above for more detail). Questioned Costs: None. The County only receives reimbursement for administrative costs of the program. All benefits paid to participants in the program are paid directly by the State of Minnesota. Repeat Finding?: No Recommendation: We recommend that the County designs internal controls to determine that inputs used to determine eligibility are correctly entered and the information required by the contract is retained in the County?s records. In addition, we suggest that the County encourage the State to provide an independent audit of the design and implementation of MAXIS, METS and MMIS system controls. View of responsible officials of the auditee: Hennepin County has reviewed and agrees with the finding and recommendation.