Arizona Medicaid School Based Claiming Annual Regional Compliance Training February 2015 www.pcgeducation.com
Agenda • Introduction • Compliance Overview • Medicaid Administrative Claiming (MAC) • Annual Cost Reporting • Direct Service Claiming (DSC) • General Compliance Information 2
Introduction • Today we will learn how to Build Compliance • Compliance in the Medicaid School Based Claiming (MSBC) program • Program component review • Requirements and documentation • Compliance review findings and trends • Tools for Success • Tools will be shared throughout the presentation to address common findings • Tools should be added to Local Education Agency’s (LEA’s) Toolbox to improve program compliance 3
Compliance Overview • Compliance Overview • PCG conducts periodic compliance reviews to verify appropriate supporting documentation is maintained by LEAs • Comprehensive compliance reviews includes a review of each MSBC program component • Direct Service Claiming (DSC) • Medicaid Administrative Claiming (MAC) • Annual cost reporting used during cost settlement • Occurs at least once every three years for all participating LEAs • LEAs receive a notification 30 days prior to the start of the review • All reviews and reports are comprehensive with one entrance and exit meeting where all representatives are present 4
Tools for Success Conduct random internal periodic reviews Create checklists for departments detailing the required documentation that should be easily accessible Discuss and outline expectations with vendors in terms of the invoice requirements for reimbursement for the MSBC program Cooperate and collaborate with all departments and people within your LEA 5
Medicaid Administrative Claiming (MAC) 6
MAC Compliance Review • MAC compliance reviews verify 100% of quarterly costs for the last paid MAC claim • System-generated and other substantiating reports are requested for the following: • Salaries • Employer-paid benefits • Purchased Professional Staff (PPS) costs • Federal revenues • Cost data from supporting documentation provided by the LEA is entered into an internal review tool and used to regenerate the applicable quarter’s claim 7
MAC Salaries/Benefits Documentation • All quarterly costs are reported on a cash-basis • Salaries/benefits by pay dates within the quarter • PPS costs by date invoice was paid • Appropriate full/part-time employee documentation • System-generated reports MUST INCLUDE: • Fund/function associated with salaries and employer-paid benefits • Pay dates • Description of pay • Employer-paid portion of benefits • LEA-created documentation (Excel spreadsheet) can only be used to support the required system-generated reports 8
MAC Non-Allowable Funds & Functions • Functions 2330, 2500, and 2600 are non-allowable • 2330 - lobbying • 2500 (including sub-functions 2501-2599) - central services • 2600 (including sub-functions 2601-2699) – operations and maintenance • Funds 100-399 are federal funds and must reported appropriately • With the exception of fund 290 (including sub-funds 291 and 292) • Report 100% of ALL paid salaries and benefits (including non-allowable and federally-funded costs as a best practice) in the appropriate column within the Medicaid Cost Reporting and Claiming System (MCRCS) • Report portions of non-allowable costs and functions, federally-funded salaries, AND all associated benefits in federal column (labeled ‘Compensation Federal Revenues’ within MCRCS) • MCRCS subtracts the reported federal portions from the sum of the salaries and benefits resulting in allowable costs 9
MAC Cost Reporting Example $6,200.00 $890.00 $0.00 $590.00 $7,090.00 $6,500.00 10
MAC PPS Documentation • Appropriate PPS documentation • Invoices MUST INCLUDE: • Participant name (first and last) as listed on the staff roster • Charges allocated to specific participant • Services provided • System-generated payment history MUST INCLUDE: • Fund/function associated with payments • Date invoice was paid 11
MAC PPS Detailed Invoice Example 12
MAC Compliance Review Findings: Next Steps Variance Identified Underpayment Overpayment LEA requests to Variance amount LEA opts to amend costs to recouped via decline receive net prior period additional reimbursement in adjustment on reimbursement future claim future claim 13
MAC Common Findings • Salaries/Benefits • Misidentification of allowable and non-allowable funds/functions/duties • Reports generated for pay dates outside the quarter under review • PPS • Participants not identified by name on invoice • Non-itemized invoices • Costs reported by invoice date or service date rather than date invoice was paid • Pay history not provided • Federal Revenues • Costs not identified as federal revenue • Incorrect reporting of federal revenue within MCRCS 14
MAC Compliance Trends • 30 LEAs reviewed in 2014 • 10 LEAs underreported costs • Average underpayment was $80.00 • 16 LEAs over reported costs • Average overpayment was $183.00 • 4 LEAs had no variance • Average overall variance was $71.00 overpayment (recoupment) 15
MAC Compliance Trends Most Common MAC Review Variance Areas 100 90 Percentage of Total Variances 80 70 60 50 40 30 20 10 Salaries Benefits PPS Federal Funds Reporting Component Over Under 16
Tool for Success Maintain documentation used to enter cost data Know your payroll software, available reports, and resources Report quarterly costs on cash-basis Accurately identify and report allowable and non-allowable costs, in addition to federal funds Work with contractors to receive invoices with required program components Prepare and submit documentation early 17
LEAs that have ‘built’ success • Congratulations to the following LEAs who achieved an overall final score of 100% on the MAC portion of their OD13 comprehensive compliance review: Apache Junction Unified School District Flowing Wells Unified School District Willcox Unified School District Winslow Unified School District 18
Annual Cost Reporting 19
Annual MAC • Allowable Salaries, • • Annual costs Quarterly costs Benefits, and reported for DS, reported for DS PPS are the Personal Care, and Admin staff same • and Cash-based • Report within transportation method MCRCS • staff Post-payment • Only staff • Accrual method review included on • • Pre-payment Results in RMTS roster review quarterly claim may have • Used to reimbursement associated costs calculate cost reported settlement 20
Annual Cost Reporting • The annual component of the review verifies the certified DSC annual costs within the Medicaid Cost Reporting and Claiming System (MCRCS) against LEA supplied supporting documentation including: • Salary and benefit information for direct medical service providers and transportation staff • IEP Ratio information • Transportation data • Documentation is reviewed and entered into the annual compliance review tool and compared to costs reported in MCRCS for that period • If the supporting documentation reviewed does not match what was reported that information must be corrected within MCRCS in a timely fashion to ensure a pre payment correction • All annual costs must be reported on an accrual accounting methodology 21
Transportation Other Cost Data • All transportation other costs are reviewed by PCG to ensure accuracy in transportation reporting • PCG continues to ensure that LEAs understand the difference in reporting “specialized transportation” versus “general transportation” • As a reminder, “general transportation” does not mean exclusively general/regular education costs, these costs must pertain to a vehicle that is physically adapted and has at least one claimable route ridden exclusively by special education students who have specialized transportation in their IEP • “Specialized transportation” criteria must pertain exclusively, 100% of the time to a vehicle that is physically adapted and is always ridden entirely by special education students with specialized transportation in their IEPs 22
Transportation Other Cost Data • Transportation Other Costs categories reviewed: • Lease/Rental • Insurance • Maintenance and Repairs • Fuel and Oil • Purchased Professional Services • The invoices, contracts, and all other appropriate supporting documentation for these costs must be appropriately identified as “specialized” or “general” and figures have to align with what was reported in MCRCS • Creativity in reporting transportation costs is a major audit risk, only report allowable costs • When in doubt, ask PCG 23
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