Finding Text
U.S. Department of Health and Human Services
Federal Financial Assistance Listing 93.423
1332 State Innovation Waivers
Activities Allowed or Unallowed and Allowable Costs/Cost Principles
Significant Deficiency in Internal Control in Federal Compliance
Criteria: Costs charged to the federal funds under the 1332 Waiver program must comply with the cost principles at 45 CFR Part 75, Subpart E, and any other requirements or restrictions on the use of federal funding outlined in the grant Standard Terms and Conditions.
Condition: The Association’s existing controls over their IT environment for reviewing and reimbursing carriers for claims was not able to detect and prevent a claim from being reimbursed twice.
Cause: The Association began working with a new carrier, Aetna, and did not modify their IT environment for this specific carrier to ensure that claims being reimbursed were not able to be duplicated.
Effect: A claim was able to be reimbursed to a carrier twice using federal monies.
Questioned Costs: $74,799.52
Context/Sampling: A nonstatistical sample of 60 claims out of 89,552 claims were selected for testing.
Repeat Finding from Prior Year(s): No
Recommendation: Management should implement parameters in their IT environment that allow them the ability to detect and prevent a claim being duplicated and paid out twice.
Views of Responsible Officials: Management of the Association agrees with the finding.