Report 2006-035 Recommendations

When an audit is completed and a report is issued, auditees must provide the State Auditor with information regarding their progress in implementing recommendations from our reports at three intervals from the release of the report: 60 days, six months, and one year. Additionally, Senate Bill 1452 (Chapter 452, Statutes of 2006), requires auditees who have not implemented recommendations after one year, to report to us and to the Legislature why they have not implemented them or to state when they intend to implement them. Below, is a listing of each recommendation the State Auditor made in the report referenced and a link to the most recent response from the auditee addressing their progress in implementing the recommendation and the State Auditor's assessment of auditee's response based on our review of the supporting documentation.

Recommendations in Report 2006-035: Department of Health Services: It Has Not Yet Fully Implemented Legislation Intended to Improve the Quality of Care in Skilled Nursing Facilities (Release Date: February 2007)

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Recommendations to Health Care Services, Department of
Number Recommendation Status
1

To provide more complete information to the Legislature on the reimbursement rate and fee systems, Health Services should include information on any savings to the General Fund in the reports its licensing division is required to prepare.

Will Not Implement
Recommendations to Health Services, Department of
Number Recommendation Status
2

To reduce the risk of using flawed data to calculate reimbursement rates, Health Services should conduct all the audits of skilled nursing facilities called for in the Reimbursement Act.

Fully Implemented
3

To reduce the risk of using flawed data to calculate reimbursement rates, Health Services should Identify which audits conducted in fiscal years 2004-05 and 2005-06 were field audits to determine whether it met the field audit requirement of the Reimbursement Act.

Fully Implemented
4

To ensure that it collects the Quality Assurance Fees (fees) it is entitled to, Health Services should promptly initiate collection efforts for facilities that are delinquent in making their fee payments by either offsetting amounts owed against Medi-Cal reimbursements or levying a penalty against facilities that do not participate in Medi-Cal.

Fully Implemented
5

To ensure that it collects the Quality Assurance Fees (fees) it is entitled to, Health Services should reconcile the fee payments made by facilities to the estimated payments due and follow-up on all significant variances.

Fully Implemented
6

To hold the consultant contracted by Health Services to the intended terms and conditions of the contract to develop and administer the reimbursement rate system, Health Services should amend the contract to clearly describe the scope of work and to include a statement that Health Services will obtain the logic and business rules of the reimbursement rate system and a specific date that Health Services will take over developing reimbursement rates for facilities.

Fully Implemented
7

To hold the consultant contracted by Health Services to the intended terms and conditions of the contract to develop and administer the reimbursement rate system, Health Services should Include in its 60-day response to this audit report or sooner, formal and detailed documentation that includes all of the complexities of the reimbursement rate development methodology and evidence that the methodology, when used, produces the reimbursement rates Health Services published for fiscal year 2005-06.

Fully Implemented
8

To hold the consultant contracted by Health Services to the intended terms and conditions of the contract to develop and administer the reimbursement rate system, Health Services should follow best practices for contracting in the future by including clear language to describe the products or services it expects from the agreement.

Fully Implemented
9

To reduce its costs and maximize savings to the General Fund, Health Services should continue to learn how to use the database and then train its staff to calculate the rates for fiscal year 2007-08.

Fully Implemented
10

To reduce its costs and maximize savings to the General Fund, Health Services should amend the contract with Navigant to include training Health Services staff in using the rate calculation database and facilitate staff takeover of managing the annual calculations.

Fully Implemented
11

To develop a mechanism to formally document changes, Health Services should formalize a rate change process that documents the reason for a rate change and provides a notification of the rate change to EDS.

Fully Implemented
12

To develop a mechanism to formally document changes, Health Services should formalize a change process that documents and records any changes either it or Navigant makes to the reimbursement rate systems programming language.

Fully Implemented
13

To ensure that its contract consultant authorizes disbursements of Medi-Cal funds only to facilities entitled to them, Health Services should further investigate the possibility that duplicate payments were authorized by the contractor beyond those we noted to ensure that the magnitude of the problem is identified and corrected. This would include researching all payment types authorized by the contractor since at least October 2005.

Fully Implemented
14

To ensure that its contract consultant authorizes disbursements of Medi-Cal funds only to facilities entitled to them, Health Services should research and identify all the duplicate payments authorized by its contractor and recoup those payments.

Fully Implemented


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