Current through Register Vol. 43, No. 02, November 27, 2024
(1) The financial accountability of the
operating agency for funds expended on Home and Community-Based services must
be maintained and provide a clearly defined audit trail. The operating agency
as described in the waiver document must retain records that fully disclose the
extent and cost of services provided to eligible recipients for a five-year
period. These records must be accessible to the Alabama Medicaid Agency and
appropriate state and federal officials. If these records are not available
within the state of Alabama, the operating agency will pay the travel cost of
the auditors to the location of the records.
(2) The operating agency may have their
records audited annually at the discretion of the Alabama Medicaid Agency.
Payments that exceed actual allowable cost will be recovered by
Medicaid.
(3) The Alabama Medicaid
Agency will review at least annually recipient's PCCP and services rendered by
a sampling procedure. The review will include appropriateness of care and
proper billing procedures.
(4) The
operating agency will provide documentation of actual costs of services and
administration. Such documentation will be entitled "Quarterly Cost Report" for
the SAIL Waiver. The "Quarterly Cost Report" will include all actual costs
incurred by the operating agency for the previous quarter and include costs
incurred year to date. This document will be submitted to the Alabama Medicaid
Agency before the 1st day of the third month of the next quarter. Quarters are
defined as follows:
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(a)
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1st October - December
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Due before March 1
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(b)
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2nd January - March
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Due before June 1
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(c)
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3rd April - June
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Due before September 1
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(d)
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4th July - September
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Due before December 1
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Failure to submit the actual cost documentation may result in
the Alabama Medicaid Agency deferring payment until this documentation has been
received and reviewed. Quarterly cost reports will be reviewed to determine
necessity for a field audit.
(5) Auditing Standards - Office of Management
and Budget (OMB) Circular A-87, "Cost Principles for State and Local
Governments" will apply to governmental agencies participating in this program.
For non-governmental agencies, generally accepted accounting principles will
apply. Governmental and non-governmental agencies will utilize the accrual
method of accounting unless otherwise authorized by the Alabama Medicaid
Agency.
(6) Cost, Allowable and
Unallowable.
(a) 45 C.F.R., part 95, specifies
dollar limits and accounting principles for the purchase of equipment.
Purchases above the twenty-five-thousand-dollar limit require the approval of
Medicaid.
(b) OMB Circular A-87
establishes cost principles for governmental agencies and will serve as a guide
for non-governmental agencies. For governmental agencies, all reported cost
will be adjusted to actual cost at the end of the waiver year.
(c) Contract payments for the delivery of
specific services are allowable expenses. Thus, contracts for case management,
personal care, respite care, environmental accessibility adaptations, assistive
technology, and medical supplies are recognized expenses. All other contracts
will require Medicaid approval to ensure that functions are not being
duplicated. For example, outreach is to be performed by the case manager, thus,
it would not be appropriate to approve other contracts for outreach, unless it
can be clearly shown that the function is required and cannot be provided
within the established organization.
(d) Allowable costs are defined in OMB
Circular A-87. However, the following restrictions apply:
1. Advertising is recognized only for
recruitment of personnel, solicitation of bids for services or goods, and
disposal of scrap or surplus. The cost must be reasonable and
appropriate.
2. The cost of
buildings and equipment is recognized. For governmental agencies, buildings and
equipment exceeding twenty-five thousand dollars will be capitalized in
accordance with
45 C.F.R.
95.705 and depreciated through a use
allowance of two percent of acquisition cost for building and six and
two-thirds percent for equipment. Equipment that has a remaining value at the
completion of the project will be accounted for in accordance with
45 C.F.R.
95.707. For automated data processing
equipment, see
45
C.F.R. 95.641. When approval is required, the
request will be made to Medicaid Agency in writing.
3. The acquisition of transportation
equipment will require prior approval from the Alabama Medicaid Agency. When
approval is required, the request will be made to Medicaid in
writing.
4. Transportation is an
allowable expense to be reimbursed as follows:
(i) For non-governmental agencies, it will be
considered as part of the contract rate.
(ii) For government and private automobiles
utilized by state employees, reimbursement will be made at no more than the
current approved state rate.
(iii)
All other types of transportation cost will be supported by documents
authorizing the travel and validating the payment.
(e) Unallowable costs are
specified in OMB Circular A-87. In addition to these, the following are not
covered by this program:
1. Costs covered by
other programs, such as:
(iv) Inhalation, group,
speech, occupational, and physical therapy.
(v) Non-emergency transportation
2. The cost of advisory councils
or consultants without Alabama Medicaid Agency's approval.
3. Legal fees as follows:
(ii) Relating to fair hearings,
(iii) In connection with lawsuits, which
result in an adverse decision,
(iv)
Services that duplicate functions performed by Medicaid or the provider, such
as eligibility determination for the program,
(v) Other legal fees not relating to the
providing of services to the beneficiaries.
4. Dues and subscriptions not related to the
specific services.
(7) Cost Allocation Plans.
(a) State agencies are required to have a
cost allocation plan approved by the Division of Cost Allocation (DCA) when the
agencies handle multiple federal funds. The format of a cost allocation plan is
specified by
45 C.F.R.
95.507, which also calls for written
agreements between state agencies. Existence of such a plan will be an item of
audit.
(b) Direct costs are charged
to the specific services that incurred them. It is the indirect/overhead costs
that are allocated to the specific fund. If there is more than one project
within a fund, there must be a written plan to distribute fund costs among the
projects. Within this project, there are two types of indirect costs. The first
are those that can be associated with the services that are provided, such as
an assessment at the central office that verifies the quality of service. This
cost can be prorated to each service by some method that is described in
writing. This first type of cost qualifies for the federal match benefit
percentage.
The second type of allocated costs falls under the
administration definition. For example, a case manager that spends time on two
individuals (or group of people) that have not attained waiver eligibility.
This second type has a federal match; therefore, both types must be accounted
for separately.
(c)
Contracts which are used for procuring services from other governmental
agencies must be cost-allocated. As a minimum, these contracts should meet the
requirements of
45 C.F.R.
95.507; these contracts must indicate:
1. The specific services being
purchased.
2. The basis upon which
the billing will be made --(i.e., time reports, number of homes inspected,
etc.).
3. A stipulation that the
billing will be based on actual costs incurred. This is not a requirement for
non-governmental agencies. For governmental agencies, the billing should be
either actual cost or an agreed upon fixed fee approximating actual cost which
will be adjusted to actual cost at completion of the waiver year.
Author: Sigrid Laney, Associate Director, LTC
Project Development/Program Support Unit Statutory
Authority: 42 C.F.R. § 441, Subpart G and
the SAIL Waiver.
