New York Codes, Rules and Regulations
Title 18 - DEPARTMENT OF SOCIAL SERVICES
Chapter II - Regulations of the Department of Social Services
Subchapter E - Medical Care
Article 3 - Policies and Standards Governing Provision of Medical and Dental Care
Part 517 - Provider Audits
Section 517.3 - Audit and record retention

Universal Citation: 18 NY Comp Codes Rules and Regs § 517.3

Current through Register Vol. 46, No. 39, September 25, 2024

(a) Cost-based provider.

(1) All fiscal and statistical records and reports of providers which are used for the purpose of establishing rates of payment made in accordance with the medical assistance program and all underlying books, records, documentation and reports which formed the basis for such fiscal and statistical records and reports are subject to audit. All underlying books, records and documentation which formed the basis for the fiscal and statistical reports filed by a provider with any State agency responsible for the establishment of rates of payment or fees must be kept and maintained by the provider for a period of not less than six years from the date of filing of such reports, or the date upon which the fiscal and statistical records were required to be filed, or two years from the end of the last calendar year during any part of which a provider's rate or fee was based on the fiscal or statistical reports, whichever is later. In this respect, any rate of payment certified or established by the commissioner of the Department of Health or other official or agency responsible for establishing such rates will be construed to represent a provisional rate until an audit is performed and completed, or the period within which to conduct an audit has expired without such audit having been begun or notice of such audit having been issued, at which time such rate or adjusted rate will be construed to represent the final rate as to those items audited.

(2) All required fiscal and statistical reports are subject to audit for a period of six years from the date of their filing or from the date when such reports were required to be filed, whichever is later. This limitation does not apply to situations in which fraud may be involved or where the provider or an agent thereof prevents or obstructs the commissioner from performing an audit pursuant to this Part. Where reports and documentation have been submitted pursuant to a rate appeal of a provisional rate, such reports and documentation will likewise be subject to audit for a period of six years from the submission of material in support of such appeal or two years following certification of any revised rate resulting from such appeal, whichever is later.

(b) Fee-for-service providers.

(1) All providers, who are not paid at rates or fees approved by the State Director of the Division of the Budget based upon their allowable costs of operation but who are paid in accordance with the rates, fees and schedules established by the department, must prepare and maintain contemporaneous records demonstrating their right to receive payment under the medical assistance program. All records necessary to disclose the nature and extent of services furnished and the medical necessity therefor, including any prescription or fiscal order for the service or supply, must be kept by the provider for a period of six years from the date the care, services or supplies were furnished or billed, whichever is later.

(2) All information regarding claims for payment submitted by or on behalf of the provider is subject to audit for a period of six years from the date the care, services or supplies were furnished or billed, whichever is later, and must be furnished, upon request, to the department, the Secretary of the United States Department of Health and Human Services, the Medicaid Fraud Control Unit or the New York State Department of Health for audit and review. This limitation does not apply to situations in which fraud may be involved or where the provider or an agent thereof prevents or obstructs an audit.

(c) Notification by the department to the provider of the department's intent to audit shall toll the six-year period for record retention and audit. The department shall not notify a provider of its intent to audit more than six years from the date of filing of the fiscal and statistical reports to be audited or six years from the date they were required to be filed, whichever is later. The audit shall begin within 60 days of such written notification of intent to audit. The department may extend this period for 60 days upon written notice to the provider. The department shall initiate no more than one extension of a notification of intent to audit.

(d) If an audit has not been commenced within 60 days of a notification of intent to audit or within 120 days of an extended notification, the effectiveness of the notification shall lapse. However, the department may issue subsequent notifications of intent to audit within the six-year period described in subdivision (b) of this section. The passage of this six-year period shall preclude the department from conducting an audit unless there is in existence an unexpired notification of intent to audit or an extended notification. The passage of this six-year period shall not prohibit the department from concluding an audit already begun.

(e) Notwithstanding the provisions of subdivisions (c) and (d) of this section, the period within which to commence an audit may be indefinitely extended on account of delays in the commencement of the audit caused or requested by the provider or a representative of the provider.

(f) An on-site audit begins with an entrance conference at which the nature and extent of the audit must be discussed. The time, manner and place of an audit will be determined by the department.

(g) Where feasible, the department shall enter into an agreement to undertake a combined audit with other organizations and agencies having audit responsibilities to satisfy the department's auditing needs. In this respect, the department reserves the right, after entering into any such agreement, to use the findings of the combined audit or to perform an independent audit of either limited or comprehensive scope of the same fiscal period audited by the other organization or agency.

(h) In its discretion, the department may terminate an audit at any time in the audit process. The provider shall be notified in writing of such termination. This written notification shall serve in the place of a closing conference, draft audit report or final audit report, as appropriate. If an audit is terminated, the department is precluded from recommencing an audit of those items which were the subject of the terminated audit.

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