Full text
State of Arkansas
Single Audit Report
For the Year Ended June 30, 2021
Page
Introduction and Summary
1
Independent Auditor's Report on Internal Control Over Financial Reporting and on
Performed in Accordance with Government Auditing Standards
8
Independent Auditor's Report on Compliance For Each Major Federal Program;
Report on Internal Control Over Compliance; and Report on Schedule of Expenditures
of Federal Awards Required by the Uniform Guidance
10
Findings and Questioned Costs Narrative
14
Section I:
15
Section II:
Financial Statement Findings
17
Section III:
Federal Award Findings and Questioned Costs
20
Schedule of Expenditures of Federal Awards
111
Notes to Schedule of Expenditures of Federal Awards
146
Summary Schedule of Prior Audit Findings
152
Audit Status for Unresolved Prior Audit Findings
250
Summary of Auditor's Results
Compliance and Other Matters Based on an Audit of Financial Statements
State of Arkansas
Table of Contents
For the Year Ended June 30, 2021
Schedule of Findings and Questioned Costs:
State of Arkansas
I ntroduction and Summary
For the Year Ended June 30, 2021
- 1 -
The Single Audit Act, as amended in 1996, was enacted to streamline the effectiveness of audits of federal
awards. The Single Audit Act gives the Office of Management and Budget (OMB) the authority to develop
government-wide guidelines and policy on performing audits to comply with the Act. OMB issued Uniform
Guidance (2 CFR § 200) to establish audit guidelines and policies on all aspects of managing federal
awards. A Single Audit under Uniform Guidance is required to determine whether:
•
The State’s financial statements are presented fairly, in all material respects, in conformity with
generally accepted accounting principles (GAAP).
•
The Schedule of Expenditures of Federal Awards (SEFA) is presented fairly, in all material
respects, in relation to the State’s financial statements taken as a whole.
•
The State has adequate internal controls in place to ensure compliance with the requirements
of various federal awards.
•
The State has complied with federal statutes, regulations, and the terms and conditions of
federal awards that may have a direct and material effect on each of its major programs.
The State of Arkansas Single Audit for the fiscal year ended June 30, 2021, as performed by Arkansas
Legislative Audit, meets these requirements.
Expenditures of federal awards have varied over the past five years, increasing significantly to
approximately $14 billion in fiscal year 2021 due to expenditures for the coronavirus pandemic (COVID-
19). The chart below depicts the five-year trend of expenditures of federal awards. The 2021 Single Audit
includes federal expenditures from 408 federal programs.
$-
$2
$4
$6
$8
$10
$12
$14
$16
2017
2018
2019
2020
2021
$9.66
$9.48
$9.42
$11.33
$14.01
Billions
Expenditures of Federal Awards
Five-Year Trend
Total Expenditures
State of Arkansas
I ntroduction and Summary
For the Year Ended June 30, 2021
- 2 -
In accordance with Uniform Guidance, larger federal programs are identified and labeled as Type A. The
following table outlines how the Type A programs for the State of Arkansas were identified.
Type A Program Determination
Total Federal Awards Expended
Type A Threshold
Exceed $10 billion but less than or
equal to $20 billion
$30 million
All federal programs with expenditures of at least $30 million were labeled Type A. All other federal
programs were labeled Type B. Of the 408 federal programs represented in the June 30, 2021, State of
Arkansas Single Audit, 25 were Type A programs with expenditures totaling $13,272,666,897, which is 95%
of total expenditures, and 383 were Type B programs with expenditures totaling $740,108,555, which is 5%
of total expenditures.
Uniform Guidance requires the auditor to perform risk assessments on all Type A programs and to audit,
as major, each Type A program assessed as high-risk based on various risk factors. There were 25 Type
A programs, and the risk assessments performed identified 15 of those programs as high-risk or major.
The Type A major programs are:
Medicaid Cluster
Research and Development Cluster
Unemployment Insurance*
Coronavirus Relief Fund*
Epidemiology and Laboratory Capacity for
Infectious Diseases (ELC)*
Rehabilitation Services_Vocational Rehabilitation
Grants to States
Education Stabilization Fund – CARES Act*
Immunization Cooperative Agreements*
Foster Care_Title IV-E
Federal Family Education Loans
Community Development Block Grant Program*
Temporary Assistance for Needy Families
Children’s Health Insurance Program
Low-Income Home Energy Assistance Program*
Presidential Declared Disaster Assistance to
Individuals and Households – Other Needs*
* Denotes program includes COVID-19 funding
95%
5%
Type A and Type B Programs
Expenditures of Federal Awards
Type A Programs
Type B Programs
State of Arkansas
I ntroduction and Summary
For the Year Ended June 30, 2021
- 3 -
Additionally, Uniform Guidance requires the auditor to perform risk assessments on larger Type B programs
with expenditures that exceed 25% of the Type A threshold; the auditor is not expected to perform risk
assessments on the relatively small federal programs.
Threshold for Type B Programs
Type A Threshold
$ 30,000,000
25%
x
0.25
Threshold of Type B programs
$ 7,500,000
The auditor is not required to select as major more high-risk Type B programs than at least one-fourth of
the Type A programs identified as low-risk. Ten low-risk Type A programs were identified, so the auditor is
required to select at least three high-risk Type B programs. The auditor selected five high-risk Type-B
programs as major. The Type B major programs are:
Clean Water State Revolving Fund Cluster
Drinking Water State Revolving Fund Cluster
HOME Investment Partnership Program
Homeowner Assistance Fund
Provider Relief Fund
For the year ended June 30, 2021, major program expenditures represented 72% of total expenditures of
federal awards.
Fiscal Year 2021
Major vs. Non-Major Programs
$14,012,775,452
Major Programs
Non-Major Programs
($10 Billion)
($4 Billion)
State of Arkansas
I ntroduction and Summary
For the Year Ended June 30, 2021
- 4 -
Five state entities expended the majority (85%) of federal awards, as noted below:
Arkansas Department of Human Services
55%
Arkansas Department of Commerce –
Division of Workforce Services
16%
Arkansas Department of Education
6%
Arkansas Department of Transportation
6%
Arkansas Department of Health
2%
Other Departments
15%
The State received federal awards from 29 different federal agencies. Most of the federal awards (84%)
came from four federal agencies as follows:
US Department of Health and Human Services
50%
US Department of Labor
13%
US Department of Education
12%
US Department of Agriculture
9%
Other Departments
16%
The audit resulted in 41 findings regarding noncompliance and deficiencies in internal control over
compliance for 5 of the 20 major programs identified on page 16. As illustrated below, 12 of the 41 findings,
or 29%, were repeat findings. Repeat findings indicate that an agency has not taken adequate measures
to correct noncompliance and deficiencies in internal control over compliance reported in the previous
Single Audit. The Schedule of Findings and Questioned Costs begins on page 14.
0%
10%
20%
30%
40%
50%
60%
70%
80%
Repeat Findings
New Findings
Fiscal Year 2021
41 Findings
Repeat vs. New
State of Arkansas
I ntroduction and Summary
For the Year Ended June 30, 2021
- 5 -
The number of findings reported in the Single Audit has fluctuated over the past five years, as illustrated in
the chart below.
23
25
21
28
41
20
25
30
35
40
45
2017
2018
2019
2020
2021
Number of Findings
Trend of Findings over Past 5 Years
State of Arkansas
I ntroduction and Summary
For the Year Ended June 30, 2021
- 6 -
Administered By/
Program
SFY
2017
SFY
2018
SFY
2019
SFY
2020
SFY
2021
ADE
1
0
0
0
0
Title I
1
0
0
0
0
AEDC
0
0
0
0
2
CRF
0
0
0
0
2
AEDC/Parks
0
0
0
0
1
CRF
0
0
0
0
1
ARDOT
0
0
0
0
1
F/S
0
0
0
0
1
ARS
1
0
0
0
0
Rehab
1
0
0
0
0
DFA
0
0
0
0
3
CRF
0
0
0
0
3
DHS
21
21
21
16
17
CACFP
4
2
1
0
0
CHIP
3
2
1
3
2
CNC
0
1
0
0
0
FC
2
1
0
0
0
Medicaid
7
10
13
8
4
Medicaid/CHIP
3
5
6
4
6
Rehab
1
0
0
0
0
Various
1
0
0
0
0
Adoption
0
0
0
1
0
CRF
0
0
0
0
5
DHS/AEDC
0
0
0
0
1
CRF
0
0
0
0
1
DWS
0
2
0
3
15
TANF
0
2
0
0
0
UI
0
0
0
2
8
LWA
0
0
0
0
6
F/S
0
0
0
1
1
SAU
0
0
0
4
0
SFA
0
0
0
3
0
HEERF
0
0
0
1
0
ANC
0
0
0
1
0
SFA
0
0
0
1
0
ASU-3 Rivers
0
0
0
1
0
SFA
0
0
0
1
0
UAF
0
0
0
1
0
SFA
0
0
0
1
0
HSU
0
0
0
1
0
SFA
0
0
0
1
0
ATU
0
0
0
1
0
SFA
0
0
0
1
0
UAMS
1
2
0
0
1
Head Start
0
1
0
0
0
R&D
0
0
0
0
1
R&D/Head Start
1
0
0
0
0
SFA
0
1
0
0
0
Grand Total
23
25
21
28
41
Legend-Programs:
CACFP
Child and Adult Care Food Program
Rehab
Vocational Rehabilitation_Grants to States
FC
Foster Care_Title IV-E
Medicaid
Medical Assistance Program (Medicaid Cluster)
CHIP
Children's Health Insurance Program
Various
Various Federal Programs
Adoption
Adoption Assistance Program
CNC
Child Nutrition Cluster
TANF
Temporary Assistance for Needy Families
Title I
Title I Grants to Local Educational Agencies
SFA
Student Financial Assistance Cluster
R&D
Research and Development Cluster (Various programs)
UI
Unemployment Insurance
F/S
Financial Statements (not a Federal Program)
HEERF
Higher Education Emergency Relief Fund
CRF
Coronavirus Relief Fund
LWA
Presidential Declared Disaster Assistance to Individuals and Households –
Other Needs (Supplemental Payments for Lost Wages)
Legend-Agencies/Higher Education Institutions:
DHS
Arkansas Department of Human Services
ARS
Arkansas Rehabilitation Services
UAMS
University of Arkansas for Medical Sciences
ARDOT
Arkansas Department of Transportation
ADE
Arkansas Department of Education
DWS
Division of Workforce Services
DFA
Department of Finance and Administration
AEDC
Arkansas Economic Development Commission
Parks
Department of Parks, Heritage, and Tourism
UAF
University of Arkansas, Fayetteville
SAU
Southern Arkansas University
HSU
Henderson State University
ATU
Arkansas Tech University
ANC
Arkansas Northeastern College
ASU-3 Rivers
Arkansas State University - Three Rivers
State of Arkansas
I ntroduction and Summary
For the Year Ended June 30, 2021
- 7 -
Many findings result in questioned costs. Uniform Guidance defines “questioned costs” as costs that
resulted from a violation or possible violation of a statute, regulation, or the terms and conditions of a federal
award, including funds used to match federal funds; where the costs, at the time of the audit, are not
supported by adequate documentation; or where the costs incurred appear unreasonable and do not reflect
the actions a prudent person would take in the circumstances.
The table below depicts findings with questioned costs that were not resolved by the federal awarding
agency as reported in the June 30, 2020, Single Audit. In addition, the table notes each finding’s questioned
costs status, including recoupments, other adjustments, or recoupments not required, as of June 30, 2021.
Questioned
Other
Recoupment
Outstanding Balance
Federal Program
Finding #
Costs
Recoupment
Adjustment
Not Required
(as of 06/30/21)
2018
CACFP
2018-002
1,339,409
315,612
$
1,023,797
$
Medicaid and CHIP
2018-005
146,619
103,189
$
43,430
Medicaid and CHIP
2018-006
1,779
1,281
498
Medicaid and CHIP
2018-007
13,572
13,572
0
CHIP
2018-010
4,920,931
4,920,931
0
Medicaid
2018-012
475
475
0
Medicaid
2018-013
2,073
492
1,581
0
Medicaid
2018-014
376,595
244,180
132,415
0
Medicaid
2018-015
47,343,219
47,343,219
0
Medicaid
2018-016
12,421
12,421
0
Medicaid
2018-017
392,746
4,766
387,980
0
Medicaid
2018-019
209,046
209,046
0
Medicaid
2018-020
3,572,108
3,572,108
0
Medicaid
2018-021
2,882
1,869
1,013
0
2019
CACFP
2019-001
1,526,467
350,000
1,176,467
Medicaid and CHIP
2019-002
1,044
594
450
Medicaid and CHIP
2019-003
9,210
9,210
0
Medicaid and CHIP
2019-006
9,910,667
9,910,667
0
Medicaid
2019-009
8,962
8,962
0
Medicaid
2019-010
107,381
107,380
1
0
Medicaid
2019-011
279,488
279,487
1
0
Medicaid
2019-012
58,894
58,894
0
Medicaid
2019-016
40,302
36,750
3,552
0
Medicaid
2019-019
2,215
1,411
804
2020
Unemployment Insurance
2020-002
42,499
42,499
0
Unemployment Insurance
2020-003
103,438
103,438
0
SFAC - SAU
2020-007
29,909
29,909
HEERF - SAU
2020-009
250,935
250,935
0
Adoption Assistance
2020-013
14,077
14,077
Medicaid and CHIP
2020-014
72,686
72,686
0
CHIP
2020-018
94,715
94,715
0
CHIP
2020-019
20,710
20,710
Medicaid
2020-021
197,344
197,343
1
0
Medicaid
2020-022
108,960
108,960
0
Medicaid
2020-023
48,220
48,219
1
0
Medicaid
2020-024
495,421
495,421
Medicaid
2020-025
7,239
7,239
0
Medicaid
2020-026
2,477,398
2,477,398
Totals
$
74,242,056 $
1,592,548 $
674,574 $
66,691,973 $
5,282,961
CACFP
Child and Adult Care Food Program
CHIP
Children's Health Insurance Program
SFAC
Student Financial Assistance Cluster
HEERF
Higher Education Emergency Relief Fund
SAU
Southern Arkansas University
Legend
St at e of Arkansas Single Audit
____________________________________________________________________________________________________
I ndependent Audit or’s Report s
For t he Year Ended June 30, 2021
___________________________________________
500 WOODLANE STREET, SUITE 172 • LITTLE ROCK, ARKANSAS 72201-1099 • PHONE: (501) 683-8600 • FAX: (501) 683-8605
www.arklegaudit.gov
Sen. Ronald Caldwell
Senate Chair
Sen. Gary Stubblefield
Senate Vice Chair
Roger A. Norman, JD, CPA, CFE, CFF
Legislative Auditor
LEGISLATIVE JOINT AUDITING COMMITTEE
ARKANSAS LEGISLATIVE AUDIT
Rep. Richard Womack
House Chair
Rep. Nelda Speaks
House Vice Chair
Report on Internal Control Over Financial Reporting and on
Compliance and Other Matters Based on an Audit of Financial Statements
Performed in Accordance with Government Auditing Standards
Independent Auditor’s Report
The Honorable Asa Hutchinson, Governor,
and Members of the Legislative Joint Auditing Committee
State of Arkansas:
We have audited, in accordance with the auditing standards generally accepted in the United States of
America and the standards applicable to financial audits contained in Government Auditing Standards
issued by the Comptroller General of the United States, the financial statements of the governmental
activities, the business-type activities, the aggregate discretely presented component units, each major
fund, and the aggregate remaining fund information of the State of Arkansas (the State) as of and for the
year ended June 30, 2021, and the related notes to the financial statements, which collectively comprise
the State’s basic financial statements, and have issued our report thereon dated January 21, 2022. Our
report includes a reference to other auditors who audited the financial statements of the discretely
presented component units, the University of Arkansas for Medical Sciences (a portion of the Higher
Education Fund), the Construction Assistance Revolving Loan Fund (non-major enterprise fund), and the
Other Revolving Loan Funds (non-major enterprise funds), as described in our report on the State’s
financial statements. This report does not include the results of the other auditors’ testing of internal control
over financial reporting or compliance and other matters that are reported on separately by those auditors.
The financial statements of the University of Arkansas Foundation, Inc., and the University of Arkansas
Fayetteville Campus Foundation, Inc. (discretely presented component units), were not audited in
accordance with Government Auditing Standards, and accordingly this report does not include reporting on
internal control over financial reporting or compliance and other matters associated with the University of
Arkansas Foundation, Inc., and the University of Arkansas Fayetteville Campus Foundation, Inc. or that are
reported on separately by those auditors who audited the financial statements of the University of Arkansas
Foundation, Inc., and the University of Arkansas Fayetteville Campus Foundation, Inc.
Internal Control Over Financial Reporting
In planning and performing our audit of the financial statements, we considered the State’s internal control
over financial reporting (internal control) as a basis for designing audit procedures that are appropriate in
the circumstances for the purpose of expressing our opinions on the financial statements, but not for the
purpose of expressing an opinion on the effectiveness of the State’s internal control. Accordingly, we do
not express an opinion on the effectiveness of the State’s internal control.
A deficiency in internal control exists when the design or operation of a control does not allow management
or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct,
misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in
internal control, such that there is a reasonable possibility that a material misstatement of the entity’s
financial statements will not be prevented, or detected and corrected on a timely basis. A significant
deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a
material weakness, yet important enough to merit attention by those charged with governance.
- 9 -
Our consideration of internal control was for the limited purpose described in the first paragraph of this
section and was not designed to identify all deficiencies in internal control that might be material
weaknesses or significant deficiencies and therefore, material weaknesses or significant deficiencies may
exist that have not been identified. Given these limitations, during our audit we did not identify any
deficiencies in internal control that we consider to be material weaknesses. We did identify certain
deficiencies in internal control, described in the accompanying Schedule of Findings and Questions Costs
as item 2021-001 that we consider to be a significant deficiency.
Compliance and Other Matters
As part of obtaining reasonable assurance about whether the State’s financial statements are free from
material misstatement, we performed tests of its compliance with certain provisions of laws, regulations,
contracts, and grant agreements, noncompliance with which could have a direct and material effect on the
financial statements. However, providing an opinion on compliance with those provisions was not an
objective of our audit, and accordingly, we do not express such an opinion. The results of our tests
disclosed instances of noncompliance or other matters that are required to be reported under Government
Auditing Standards and which are described in the accompanying Schedule of Findings and Questioned
Costs as item 2021-002.
State’s Response to Findings
The State’s response to the findings identified in our audit is described in the accompanying Schedule of
Findings and Questioned Costs and Corrective Action Plan. The State’s response was not subjected to
the auditing procedures applied in the audit of the financial statements, and accordingly, we express no
opinion on it.
Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance
and the results of that testing, and not to provide an opinion on the effectiveness of the entity’s internal
control or on compliance. This report is an integral part of an audit performed in accordance with
Government Auditing Standards in considering the entity’s internal control and compliance. Accordingly,
this communication is not suitable for any other purpose. However, pursuant to Ark. Code Ann. § 10-4-
417, all reports presented to the Legislative Joint Auditing Committee are matters of public record, and
distribution is not limited.
ARKANSAS LEGISLATIVE AUDIT
Roger A. Norman, JD, CPA, CFE, CFF
Legislative Auditor
Little Rock, Arkansas
January 21, 2022
500 WOODLANE STREET, SUITE 172 • LITTLE ROCK, ARKANSAS 72201-1099 • PHONE: (501) 683-8600 • FAX: (501) 683-8605
www.arklegaudit.gov
Sen. Ronald Caldwell
Senate Chair
Sen. Gary Stubblefield
Senate Vice Chair
Roger A. Norman, JD, CPA, CFE, CFF
Legislative Auditor
LEGISLATIVE JOINT AUDITING COMMITTEE
ARKANSAS LEGISLATIVE AUDIT
Rep. Richard Womack
House Chair
Rep. Nelda Speaks
House Vice Chair
Report on Compliance For Each Major Federal Program;
Report on Internal Control Over Compliance; and
Report on Schedule of Expenditures of Federal Awards
Required by the Uniform Guidance
Independent Auditor’s Report
The Honorable Asa Hutchinson, Governor,
and Members of the Legislative Joint Auditing Committee,
State of Arkansas:
Report on Compliance for Each Major Federal Program
We have audited the State of Arkansas’s compliance with the types of compliance requirements described
in the OMB Compliance Supplement that could have a direct and material effect on each of the State’s
major federal programs for the year ended June 30, 2021, except for the major federal programs listed
below:
Program/cluster title
Administered by
Research and Development Cluster
University of Arkansas for Medical Sciences
Provider Relief Fund
University of Arkansas for Medical Sciences
HOME Investment Partnerships Program
Arkansas Development Finance Authority
Homeowner Assistance Fund
Arkansas Development Finance Authority
Federal Family Education Loans
Arkansas Development Finance Authority
(Arkansas Student Loan Authority)
Clean Water State Revolving Fund Cluster
State of Arkansas Construction Assistance
Revolving Loan Fund Program
Drinking Water State Revolving Fund Cluster
State of Arkansas Safe Drinking Water Revolving
Loan Fund Program
Those major federal programs were audited by other auditors whose reports have been furnished to us,
and our opinion, insofar as it relates to those major federal programs’ compliance with the types of
compliance requirements described in the OMB Compliance Supplement, is based solely on the report of
the other auditors. The State’s major federal programs are identified in the summary of auditor’s results
section of the accompanying Schedule of Findings and Questioned Costs.
The State of Arkansas’s basic financial statements include the operations of the Disability Determination
for Social Security Administration, which expended $51,356,950 in federal awards and is not included in
the State’s Schedule of Expenditures of Federal Awards during the year ended June 30, 2021. Our audit,
described below, did not include the operations of Disability Determination for Social Security Administration
because the entity engaged other auditors to perform an audit in accordance with the Title 2 U.S. Code of
Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and audit
Requirements for Federal Awards (Uniform Guidance) that is based on a September 30 year-end.
- 11 -
Management’s Responsibility
Management is responsible for compliance with the requirements of federal statutes, regulations, and the
terms and conditions of federal awards applicable to its federal programs.
Auditor’s Responsibility
Our responsibility is to express an opinion on compliance for each of the State’s major federal programs
based on our audit of the types of compliance requirements referred to above. We conducted our audit of
compliance in accordance with auditing standards generally accepted in the United States of America; the
standards applicable to financial audits contained in Government Auditing Standards, issued by the
Comptroller General of the United States; and the audit requirements of Title 2 U.S. Code of Federal
Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for
Federal Awards (Uniform Guidance).
Those standards and the Uniform Guidance require that we plan and perform the audit to obtain reasonable
assurance about whether noncompliance with the types of compliance requirements referred to above that
could have a direct and material effect on a major federal program occurred. An audit includes examining,
on a test basis, evidence about the State’s compliance with those requirements and performing such other
procedures as we considered necessary in the circumstances.
We believe that our audit provides a reasonable basis for our qualified and unmodified opinions on
compliance for major federal programs. However, our audit does not provide a legal determination of the
State’s compliance.
Basis for Qualified Opinion on Unemployment Insurance, the Children’s Health Insurance Program,
the Medical Assistance Program, COVID-19: Presidential Declared Disaster Assistance to
Individuals and Households – Other Needs (Supplemental Payments for Lost Wages), and the
Research and Development Cluster
As described in the accompanying Schedule of Findings and Questioned Costs, the State did not comply
with requirements regarding the following:
Finding #
ALN
Program Name
Compliance Requirement
2021-004
17.225
Unemployment Insurance;
COVID-19: Unemployment Insurance
Activities Allowed or Unallowed;
Eligibility
2021-024
93.767
Children’s Health Insurance Program;
Medical Assistance Program
Matching, Level of Effort,
Earmarking
2021-035
97.050
COVID-19: Presidential Declared
Disaster Assistance to Individuals and
Households – Other Needs
(Supplemental Payments for Lost
Wages)
Activities Allowed or Unallowed;
Eligibility
2021-039
97.050
COVID-19: Presidential Declared
Disaster Assistance to Individuals and
Households – Other Needs
(Supplemental Payments for Lost
Wages)
Matching, Level of Effort,
Earmarking
2021-041
Various
Research and Development Cluster
Cash Management
Compliance with such requirements is necessary, in our opinion, for the State to comply with the
requirements applicable to that program.
- 12 -
Qualified Opinion on Unemployment Insurance, the Children’s Health Insurance Program, the
Medical Assistance Program, COVID-19: Presidential Declared Disaster Assistance to Individuals
and Households – Other Needs (Supplemental Payments for Lost Wages), and the Research and
Development Cluster
In our opinion, except for the noncompliance described in the Basis for Qualified Opinion paragraph, the
State complied, in all material respects, with the types of compliance requirements referred to above that
could have a direct and material effect on Unemployment Insurance, the Children’s Health Insurance
Program, the Medicaid Program, COVID-19: Presidential Declared Disaster Assistance to Individuals and
Households – Other Needs (Supplemental Payments for Lost Wages), and the Research and Development
Cluster for the year ended June 30, 2021.
Unmodified Opinion on Each of the Other Major Federal Programs
In our opinion, the State complied, in all material respects, with the types of compliance requirements
referred to above that could have a direct and material effect on each of its other major federal programs
identified in the summary of auditor’s results section of the accompanying Schedule of Findings and
Questioned Costs for the year ended June 30, 2021.
Other Matters
The results of our auditing procedures disclosed other instances of noncompliance, which are required to
be reported in accordance with the Uniform Guidance and which are described in the accompanying
Schedule of Findings and Questioned Costs as items 2021-003, 2021-005 through 2021-018, 2021-020
through 2021-021, 2021-023, 2021-025 through 2021-027, 2021-029 through 2021-034, 2021-036 through
2021-038, and 2021-040. Our opinion on each major federal program is not modified with respect to these
matters.
The State’s response to the noncompliance findings identified in our audit is described in the accompanying
Schedule of Findings and Questioned Costs and Corrective Action Plan. The State’s response was not
subjected to the auditing procedures applied in the audit of compliance, and accordingly, we express no
opinion on the response.
Report on Internal Control over Compliance
Management of the State is responsible for establishing and maintaining effective internal control over
compliance with the types of compliance requirements referred to above.
In planning and performing our audit of compliance, we considered the State’s internal control over
compliance with the types of requirements that could have a direct and material effect on each major federal
program to determine the auditing procedures that are appropriate in the circumstances for the purpose of
expressing an opinion on compliance for each major federal program and to test and report on internal
control over compliance in accordance with Uniform Guidance, but not for the purpose of expressing an
opinion on the effectiveness of internal control over compliance. Accordingly, we do not express an opinion
on the effectiveness of the State’s internal control over compliance.
Our consideration of internal control over compliance was for the limited purpose described in the preceding
paragraph and was not designed to identify all deficiencies in internal control over compliance that might
be material weaknesses or significant deficiencies and, therefore, material weaknesses or significant
deficiencies may exist that have not been identified. However, as discussed below, we did identify certain
deficiencies in internal control over compliance that we consider to be material weaknesses and significant
deficiencies.
A deficiency in internal control over compliance exists when the design or operation of a control over
compliance does not allow management or employees, in the normal course of performing their assigned
functions, to prevent or detect and correct noncompliance with a type of compliance requirement of a federal
program on a timely basis.
- 13 -
A material weakness in internal control over compliance is a deficiency or combination of deficiencies in
internal control over compliance, such that there is a reasonable possibility that material noncompliance
with a type of compliance requirement of a federal program will not be prevented or detected and corrected
on a timely basis. We consider the deficiencies in internal control over compliance described in the
accompanying Schedule of Findings and Questioned Costs as items 2021-003 through 2021-010, 2021-
023 through 2021-024, 2021-026 through 2021-033, and 2021-035 through 2021-041 to be material
weaknesses.
A significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies,
in internal control over compliance with a type of compliance requirement of a federal program that is less
severe than a material weakness in internal control over compliance yet important enough to merit attention
by those charged with governance. We consider the deficiencies in internal control over compliance
described in the accompanying Schedule of Findings and Questioned Costs as items 2021-013 through
2021-014, 2021-016 through 2021-022, 2021-025, and 2021-034 to be significant deficiencies.
The State’s response to the internal control over compliance findings identified in our audit is described in
the accompanying Schedule of Findings and Questioned Costs and Corrective Action Plan. The State’s
response was not subjected to the auditing procedures applied in the audit of compliance, and accordingly,
we express no opinion on the response.
The purpose of this report on internal control over compliance is solely to describe the scope of our testing
of internal control over compliance and the results of that testing based on the requirements of the Uniform
Guidance. Accordingly, this report is not suitable for any other purpose.
Report on Schedule of Expenditures of Federal Awards Required by the Uniform Guidance
We have audited the financial statements of the State as of and for the year ended June 30, 2021, and
have issued our report thereon dated January 21, 2022, which contained an unmodified opinion on those
financial statements. Our audit was conducted for the purpose of forming an opinion on the financial
statements as a whole.
The accompanying Schedule of Expenditures of Federal Awards is presented for purposes of additional
analysis as required by Uniform Guidance and is not a required part of the financial statements. Such
information is the responsibility of management and was derived from and relates directly to the underlying
accounting and other records used to prepare the financial statements.
The information has been subjected to the auditing procedures applied in the audit of the financial
statements and certain additional procedures, including comparing and reconciling such information directly
to the underlying accounting and other records used to prepare the financial statements or to the financial
statements themselves, and other additional procedures in accordance with auditing standards generally
accepted in the United States of America.
In our opinion, the Schedule of Expenditures of Federal Awards is fairly stated in all material respects in
relation to the financial statements as a whole.
ARKANSAS LEGISLATIVE AUDIT
Roger A. Norman, JD, CPA, CFE, CFF
Legislative Auditor
Little Rock, Arkansas
May 31, 2022, except for the
Schedule of Expenditures of Federal
Awards, dated January 21, 2022
St at e of Arkansas Single Audit
____________________________________________________________________________________________________
Schedule of Findings and Quest ioned Cost s
For t he Year Ended June 30, 2021
___________________________________________
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 14 -
Audit findings regarding compliance and internal controls over compliance for the major programs are
disclosed on the following pages. Each finding has been evaluated and assigned one or more of the
following designations:
Material Noncompliance with the provisions of federal statutes, regulations, or
terms and conditions of federal awards related to a major program. The
determination of whether noncompliance is material for the purpose of reporting is in
relation to 1 of the 12 types of compliance requirements for a major program
identified in the OMB Uniform Guidance Compliance Supplement.
Noncompliance with the provisions of federal statutes, regulations, or terms and
conditions of federal awards related to a major program
Material Weakness in internal control over compliance. A deficiency, or combination
of deficiencies, in internal control over compliance such that there is a reasonable
possibility that material noncompliance with a type of compliance requirement will not
be prevented or detected and corrected timely.
Significant Deficiency in internal control over compliance. A deficiency, or
combination of deficiencies, in internal control over compliance with a type of
compliance requirement that is less severe than a material weakness yet important
enough to merit attention by those charged with governance.
In addition, known questioned costs that are greater than $25,000 for a type of compliance requirement
for a major program are required to be reported. Questioned costs are costs that are questioned by the
auditor because of an audit finding (a) which resulted from a violation or possible violation of a statute,
regulation, or the terms and conditions of a federal award, including funds used to match federal funds; b)
for which the costs, at the time of the audit, are not supported by adequate documentation; or (c) for
which the costs incurred appear unreasonable and do not reflect the actions a prudent person would take
in the circumstances.
As part of the audit process, the findings were provided to the applicable State/Educational Agency
(Agency) for management’s response. The responses were prepared by management of each Agency
and are included at the end of each finding beginning on page 17 under the caption “Views of
Responsible Officials and Planned Corrective Action.” The responses include the planned corrective
action, the anticipated completion date, and the Agency contact.
We have presented our findings, generally, by Federal Grantor Agency, State/Educational Agency, and
Assistance Listing Number. Each finding is assigned a seven-digit reference number (e.g., 2021-xxx).
The first set of digits represents the fiscal year audited, and the second set represents the sequential
finding number. An index of the federal award findings begins on page 20.
- 15 -
Section I - Summary of Auditor's Results
Financial Statements
Type of auditor's report issued:
Internal control over financial reporting:
Material weakness(es) identified?
Yes
X
No
Significant deficiency(s) identified not
considered to be a material weakness(es)?
X
Yes
None reported
Noncompliance material to financial statements noted?
Yes
X
No
Federal Awards
Internal control over major programs:
Material weakness(es) identified?
X
Yes
No
Significant deficiency(s) identified not
considered to be a material weakness(es)?
X
Yes
None reported
Type of auditor's report issued on compliance for major programs:
*Except for the programs listed on page 11 of this report,
which were Qualified
Any audit findings disclosed that are required to be
reported in accordance with 2 CFR § 200.516(a)
X
Yes
No
Dollar threshold used to distinguish between Type A and Type B programs:
Auditee qualified as low-risk auditee?
Yes
X
No
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
$30,000,000
Unmodified*
Unmodified
- 16 -
Section I - Summary of Auditor's Results (Continued)
Identification of major programs:
Assistance Listing
Number(s)
Name of Cluster or Federal Program
1.
66.458
Clean Water State Revolving Fund Cluster
2.
66.468
Drinking Water State Revolving Fund Cluster
3.
93.775, 93.777, 93.778
Medicaid Cluster
4.
Various
Research and Development Cluster
5.
14.228
Community Development Block Grant Program
COVID-19: Community Development Block Grant Program
6.
14.239
HOME Investment Partnerships Program
7.
17.225
Unemployment Insurance
COVID-19: Unemployment Insurance
8.
21.019
COVID-19: Coronavirus Relief Fund
9.
21.026
COVID-19: Homeowner Assistance Fund
10.
84.032
Federal Family Education Loans - Lenders
11.
84.126
Rehabilitation Services_Vocational Rehabilitation Grants to States
12.
84.425
COVID-19: Education Stablization Fund - CARES Act
13.
93.268
Immunization Cooperative Agreements
COVID-19: Immunization Cooperative Agreements
14.
93.323
Epidemiology and Laboratory Capacity for Infectious Diseases (ELC)
COVID-19: Epidemiology and Laboratory Capacity for
Infectious Diseases (ELC)
15.
93.498
COVID-19: Provider Relief Fund
16.
93.558
Temporary Assistance for Needy Families
17.
93.568
Low-Income Home Energy Assistance Program
COVID-19: Low-Income Home Energy Assistance Program
18.
93.658
Foster Care_Title IV-E
19.
93.767
Children's Health Insurance Program
20.
97.050
COVID-19: Presidential Declared Disaster Assistance to
Individuals and Households - Other Needs
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 17 -
Section II – Financial Statement Findings
REPORT FINDING: 2021-001
Division of Workforce Services
The Committee of Sponsoring Organizations of the Treadway Commission (COSO) framework of internal controls,
adopted by the State of Arkansas in DFA's Financial Management Guide, states that communications related to both
operational and financial data are needed at all levels of an agency in a relevant, reliable and timely fashion. The
State did not have the policies and procedures in place to appropriately record the financial effects of the new
unemployment insurance pandemic programs. As a result, we noted the following:
•
Operating revenues were overstated by $151,317,347 when a portion of federal grant receipts was
erroneously coded to a general ledger account related to Operating revenues, as opposed to the more
appropriate general ledger account related to Non-operating revenues.
•
Expenditures were overstated by $8,710,073 when revenue-correcting entries were made to a general
ledger account related to expenditures, as opposed to the more appropriate general ledger account related
to Non-operating revenues.
•
The net effect of the first two misstatements was an understatement of Non-operating revenues of
$142,607,274.
•
Federal payables of claimant benefit overpayments due to the federal government were understated by
$19,887,434 when the State neglected to consider overpayments made out of the legacy Unemployment
Insurance payment system.
Lack of appropriate controls over financial reporting could cause financial statements to be misstated.
Upon notification of the potential misstatements, DFA Office of Accounting made an entry in AASIS to correct the first
three amounts listed above. The remaining misstatement was noted subsequent to the first three and did not meet
the threshold requiring adjustment.
We recommend the State work to improve its controls over financial reporting, creating policies and procedures that
would encourage more accurate reporting of its programs.
Views of Responsible Officials and Planned Corrective Action:
Bullet Points #1-#3: This posting error was related to the Lost Wages Assistance Program from FEMA. The Lost
Wages Assistance program is now complete and we will not be posting any transactions from this program again. A
contributing factor was staff turnover, including the unit manager resigning.
The following enhanced controls and procedures will be, or have been, implemented:
1.
The Assistant Controller will review all new templates for appropriate coding before posting, including
the distinction of operating vs. non-operating revenues.
2.
Additionally, ADWS has worked with DFA to update NBR account mapping. Revenue correcting entries
were made to the NBR account that was mapped to the revenue general ledger account that otherwise
would have been used, but the NBR mapping for that NBR account was to an expenditure line rather
than a revenue line on the financial statements. While a different (non-operating revenue) general
ledger account should have been used for the transactions, this updated NBR mapping will drive any
future entries made through this NBR mapping to a revenue line rather than an expenditure line.
3.
The UI Assistant Controller will periodically perform an analytical review of general ledger account
balances to help detect significant changes in the use of accounts between years for new programs or
which may have been caused by errors. Significant changes noted will be further reviewed for
appropriate coding.
Bullet Point #4: It is uncommon for ADWS to post a federal payable for overpayments, since the majority of the
overpayments were paid with ADWS funds through regular UI benefits. The following enhanced controls and
procedures will be, or have been, implemented to help identify when this uncommon situation has occurred that
requires posting of a federal payable:
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 18 -
Section II – Financial Statement Findings (Continued)
REPORT FINDING: 2021-001 (Continued)
Views of Responsible Officials and Planned Corrective Action (Continued):
•
To enhance communications between units related to identifying, calculating, and posting the year-end
payable, the Controller Unit has updated its Standard Operating Procedure (SOP) titled “UI Year-End
Federal Payables Calculation” to ensure all appropriate entries are posted. A key element in this SOP
is that the Controller Unit will receive a breakdown of the receivables by program, which the Assistant
Controller will review to ensure the appropriate amount of federal payable is posted.
•
Additionally, the agency has a project called UI Modernization underway to modernize UI system
software. It is anticipated that more information will be available through the updated system when
completed that will provide detailed reports related to overpayments balances.
Anticipated Completion Date:
June 20, 2022 items #1 to 3; August 15, 2022 item #4
Contact Person:
Tracii Laettner
Chief Financial Officer/Deputy Director
Division of Workforce Services
#2 Capitol Mall
Little Rock, AR 72201
501-682-3108
Tracii.L.Laettner@arkansas.gov
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 19 -
Section II – Financial Statement Findings (Continued)
REPORT FINDING: 2021-002
Arkansas Department of Transportation
Arkansas Code Ann. § 19-4-1502 requires an agency to keep and maintain a record of property owned by the
agency.
Arkansas Department of Transportation (ArDOT) failed to maintain a record of right of way property owned.
Failure to maintain a complete record could lead to the misuse or misappropriation of assets.
We recommend the Agency develop and maintain a record of all right of way property owned, with costs that support
the balance reported in AASIS.
Views of Responsible Officials and Planned Corrective Action:
The Arkansas Department of Transportation (ARDOT) Fiscal Services and Right of Way Divisions are currently
working together to update, reconcile and maintain a complete ongoing record of right of way property owned, that
the Right of Way Division and Fiscal Services will maintain. This record will be reconciled to the balance reported in
AASIS each Fiscal Year.
Anticipated Completion Date:
December 31, 2022
Contact Person:
Patrick Patton
CFO
Arkansas Department of Transportation
10324 Interstate 30
Little Rock, AR 72203
501-569-2051
Patrick.patton@ardot.gov
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 20 -
Section III - Federal Award Findings and Questioned Costs
Federal Program Name
Page Number(s)
Arkansas Department of Commerce –
Division of Workforce Services
Unemployment Insurance
21 - 36
Presidential Declared Disaster Assistance to
Individuals and Households – Other Needs
(Supplemental Payments for Lost Wages)
97 - 108
Arkansas Department of Finance and Administration
Coronavirus Relief Fund
37 - 42
Arkansas Department of Commerce –
Arkansas Economic Development Commission
Coronavirus Relief Fund
43 - 46; 57 - 65
Arkansas Department of Parks, Heritage and Tourism
Coronavirus Relief Fund
57 - 61
Arkansas Department of Human Services
Coronavirus Relief Fund
43 - 56
Medicaid Cluster
66 - 79; 86 - 96
Children’s Health Insurance Program
66 - 85
FINDINGS COVERING PROGRAMS AUDITED BY OTHER EXTERNAL AUDITORS
University of Arkansas For Medical Sciences
Research and Development Cluster
109 - 110
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 21 -
Finding Number:
2021-003
State/Educational Agency(s):
Arkansas Department of Commerce –
Division of Workforce Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
17.225 – Unemployment Insurance
17.225 – COVID-19: Unemployment Insurance
Federal Awarding Agency:
U.S. Department of Labor
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
Not Applicable
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Eligibility
Type of Finding:
Noncompliance and Material Weakness
Repeat Finding:
Not applicable
Criteria:
In accordance with 2 CFR § 200.303, a non-federal entity must establish and maintain effective internal control over
the federal award that provides reasonable assurance that the non-federal entity is managing the federal award in
compliance with federal statutes, regulations, and the terms and conditions of the award.
In addition, 2 CFR § 200.516(a)(6) requires the auditor to report as an audit finding any known or likely fraud affecting
a federal award.
Condition and Context:
In state fiscal year 2021, the Division of Workforce Services (DWS) identified 6,642 claims, totaling $19,903,597, as
likely fraud. This amount is comprised of $16,306,917 in federal funds and $3,596,680 in state funds.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
$19,903,597
NOTE: As disclosed in Note 7 on page 150 in the Notes to Schedule of Expenditures of Federal Awards of the report,
State Unemployment Insurance (UI) funds as well as federal funds are reported on the Schedule.
Cause:
In response to the increase in demand for services/benefits, the State relaxed controls over identity verification and
income verification for the program during fiscal year 2021.
Effect:
Lack of appropriate internal controls resulted in overpayments of state and federal funds.
Recommendation:
ALA staff recommend the Agency continue to strengthen controls over benefit payments to ensure that payments are
made in the correct amount and to eligible claimants. ALA staff also recommend the Agency seek recoupment of the
identified overpayments, returning them to the appropriate source.
Views of Responsible Officials and Planned Corrective Action:
Due to the pandemic and health concerns as well as unprecedented volume, claimants were not required to come into
a local office and provide ID, the waiting week was waived for 2020, and the requirement for work search were all
adjusted due to the pandemic to protect employees and claimants. Before the pandemic, all claimants were required
to come to the local office. Removing these controls had several implications:
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 22 -
Finding Number:
2021-003 (Continued)
State/Educational Agency(s):
Arkansas Department of Commerce –
Division of Workforce Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
17.225 – Unemployment Insurance
17.225 – COVID-19: Unemployment Insurance
Federal Awarding Agency:
U.S. Department of Labor
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
Not Applicable
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Eligibility
Type of Finding:
Noncompliance and Material Weakness
Views of Responsible Officials and Planned Corrective Action (Continued):
1.
By waiving the waiting week, the claimant could get paid the following week. For example, a fraudster
could file a claim on Friday, then receive payment on Sunday, removing the typical week that an employer
had to respond.
2.
The information mailed to the employer and claimant were not received by them before payments were
being made.
3.
Businesses were also closed at this time, and they did not respond to the unemployment paperwork timely
to let the agency know that it was a fraudulent claim.
4.
Identity thieves would change the address of the claimants for which they had files claims and because
of this many of the claimants that had identity theft did not know a claim had even been filed in their name.
In 2020 the work search requirement was reinstated. In 2021, all claimants had to bring into the local office their ID
before the claim would be opened for a regular unemployment claim. UIdentify was used on the PUA claims after
January 1, 2021. And the waiting week was reinstated January of 2021, which reinstated the number of days for the
employer to respond and for staff to be able to work the notices before payment was issued.
Internal Audit transitioned to the Fraud Unit and have added staff to focus investigating fraudulent claims. When the
bad actor is identified, the overpayment is set up in their name and removed from the identity theft victim’s SSN.
Anticipated Completion Date:
July 2024, due to the statute of limitations on collections.
Contact Person:
Ken Jennings
Program Administrator UI
Division of Workforce Services
2 Capitol Mall
Little Rock, AR 72201
501-682-3244
Kenneth.jennings@arkansas.gov
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 23 -
Finding Number:
2021-004
State/Educational Agency(s):
Arkansas Department of Commerce –
Division of Workforce Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
17.225 – Unemployment Insurance
17.225 – COVID-19: Unemployment Insurance
Federal Awarding Agency:
U.S. Department of Labor
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
Not Applicable
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Eligibility
Type of Finding:
Material Noncompliance and Material Weakness
Repeat Finding:
A similar issue was reported in prior-year finding 2020-002.
Criteria:
In accordance with 2 CFR § 200.303, a non-federal entity must establish and maintain effective internal control over
the federal award that provides reasonable assurance that the non-federal entity is managing the federal award in
compliance with federal statutes, regulations, and the terms and conditions of the award.
In addition, 2 CFR § 200.516(a)(6) requires the auditor to report as an audit finding any known or likely fraud affecting
a federal award.
Condition and Context:
Our review of claimant data revealed overpayments as follows:
•
Using data analytics, ALA staff identified 17 mailing addresses that were heavily used to receive debit
cards containing Unemployment Compensation (UC) benefits for 64 claimants, totaling $80,187. A review
of the related case files revealed that the claims were all initiated at a time when identity (ID) verification
controls had been relaxed. When the Agency reinstated ID verification controls and requested the
claimants provide ID, none of the claimants provided ID to validate the claims. As of June 30, 2021,
benefits totaling $3,268 for 3 claimants had been identified as likely fraud by the Agency and are included
in the total identified fraud and questioned costs discussed in finding 2021-003.
•
Using data analytics, ALA staff identified 41 mailing addresses that were heavily used to receive debit
cards containing Pandemic Unemployment Assistance (PUA) benefits for 231 claimants. Benefits totaling
$2,075,651 for 126 of these claimants were questioned due to the lack of identification documentation in
the case file.
•
During our review of Unemployment Insurance (UI) claims, we noted 7,302,064 weekly UI benefits that
were paid during the fiscal year, totaling $1,963,329,057. In a random sample of 60 weekly UI benefits
to 60 different claimants, totaling $15,091, ALA staff noted 5 claimants, with benefits totaling $660, who
were deemed ineligible at a later date by caseworkers.
To determine the severity of the noncompliance, likely questioned costs must be calculated. As a result
of this calculation, the $660 identified as known questioned costs was projected to the population,
resulting in likely questioned costs totaling $85,865,561.
•
Claimant benefit data was compared to death data provided by the Arkansas Department of Health,
resulting in identified unemployment benefits, totaling $272,949, that were paid for claims on behalf of 72
deceased individuals.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
$2,426,179
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 24 -
Finding Number:
2021-004 (Continued)
State/Educational Agency(s):
Arkansas Department of Commerce –
Division of Workforce Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
17.225 – Unemployment Insurance
17.225 – COVID-19: Unemployment Insurance
Federal Awarding Agency:
U.S. Department of Labor
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
Not Applicable
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Eligibility
Type of Finding:
Material Noncompliance and Material Weakness
Cause:
In response to the increase in demand for services/benefits, the State relaxed controls over identity verification and
income verification for the program during fiscal year 2021.
Effect:
Lack of appropriate internal controls resulted in overpayments of both state and federal funds.
Recommendation:
ALA staff recommend the Agency maintain and strengthen internal controls over benefit programs to ensure that
payments are made in the correct amount and to eligible claimants. ALA staff also recommend the Agency seek
recoupment of the identified overpayments, returning them to the appropriate source.
Views of Responsible Officials and Planned Corrective Action:
The Agency started using the NASWA Integrity Data Hub on the PUA program and the IT program started running
analytic reports to query multiple claims at the same address, bank account, email address, etc. All of those considered
to be fraud have been sent to the Internal Audit/Fraud Unit.
Prior to January of 2021, there was not a requirement for ID verification for the PUA program. ID verification on all
unemployment claims filed was restarted January 2021 and the PUA claims started using UIdentify at that time.
The waiting week was reinstated January of 2021, which reinstated the number of days for the employer to respond
and for staff to be able to work the notices before payment was issued. This reinstated the control for employers to
have the opportunity to report the possible fraud.
A special request was made for the Department of Health Death Crossmatch from the start of the pandemic until the
date of the request. The list has been reviewed and all claims paid after the date of death have been turned in to
Benefit Payment Control to have overpayments created. ADWS has been working this crossmatch weekly since that
time and has identified no additional issues.
Anticipated Completion Date:
Completed
Contact Person:
Ken Jennings
Program Administrator UI
Division of Workforce Services
2 Capitol Mall
Little Rock, AR 72201
501-682-3244
Kenneth.jennings@arkansas.gov
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 25 -
Finding Number:
2021-005
State/Educational Agency(s):
Arkansas Department of Commerce –
Division of Workforce Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
17.225 – Unemployment Insurance
17.225 – COVID-19: Unemployment Insurance
Federal Awarding Agency:
U.S. Department of Labor
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
Not Applicable
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Eligibility
Type of Finding:
Noncompliance and Material Weakness
Repeat Finding:
Not applicable
Criteria:
In accordance with 20 CFR § 604.3 and Ark. Code Ann. § 11-10-507(3)(A)(i), individuals must be unemployed,
physically and mentally able to perform suitable work, and available for the work to be eligible for Unemployment
Insurance (UI) benefits. Incarcerated individuals are generally not available for work, making them ineligible for
benefits.
In addition, 2 CFR §200.516(a)(6) requires the auditor to report as an audit finding any known or likely fraud affecting
a federal award.
Condition and Context:
Using data analytics, ALA identified $4,823,110 in UI benefits paid to 528 incarcerated individuals who did not appear
to be eligible for benefits. As of June 30, 2021, benefits totaling $96,952 for 11 claimants had been identified as likely
fraud by the Agency and are included in the total identified fraud and questioned costs discussed in finding 2021-003.
Statistically Valid Sample:
Not applicable
Questioned Costs:
$4,726,158
Cause:
Due to increased demand for services/benefits during the Coronavirus pandemic and turnover of key personnel, the
control that cross-matched the Division of Workforce Services UI claimant data with the Arkansas Department of
Corrections inmate data was not properly performed.
Effect:
Lack of appropriate internal controls resulted in overpayments of state and federal funds.
Recommendation:
ALA staff recommend the Agency implement appropriate controls over benefit payments to ensure that payments are
not made to incarcerated individuals. ALA staff also recommend the Agency seek recoupment of identified
overpayments, returning them to the appropriate source.
Views of Responsible Officials and Planned Corrective Action:
The regular UI system gets a DOC crossmatch weekly and is worked by staff. The PUA system was set up to get the
crossmatch and has been checked and are up to date. The list provided by the DOC also contains incorrect SSN
numbers, and some of the instances identified by the audit staff were in fact incorrect as the individual with the claim
was not incarcerated.
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 26 -
Finding Number:
2021-005 (Continued)
State/Educational Agency(s):
Arkansas Department of Commerce –
Division of Workforce Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
17.225 – Unemployment Insurance
17.225 – COVID-19: Unemployment Insurance
Federal Awarding Agency:
U.S. Department of Labor
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
Not Applicable
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Eligibility
Type of Finding:
Noncompliance and Material Weakness
Views of Responsible Officials and Planned Corrective Action (Continued):
There were also individuals that were incarcerated on the list that were paid weeks of PUA outside of the time they
were incarcerated and no change was needed. The fraudulently filed claims have been turned over to the Internal
Audit/Fraud Unit. Some claims were found to be legitimate claims and the others have been turned in for overpayment.
Anticipated Completion Date:
Completed
Contact Person:
Ken Jennings
Program Administrator UI
Division of Workforce Services
2 Capitol Mall
Little Rock, AR 72201
501-682-3244
Kenneth.jennings@arkansas.gov
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 27 -
Finding Number:
2021-006
State/Educational Agency(s):
Arkansas Department of Commerce –
Division of Workforce Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
17.225 – COVID-19: Unemployment Insurance
Federal Awarding Agency:
U.S. Department of Labor
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
Not Applicable
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Eligibility
Type of Finding:
Noncompliance and Material Weakness
Repeat Finding:
A similar issue was reported in prior-year finding 2020-003.
Criteria:
In accordance with 2 CFR § 200.303, a non-federal entity must establish and maintain effective internal control over
the federal award that provides reasonable assurance that the non-federal entity is managing the award in compliance
with federal statutes, regulations, and the terms and conditions of the award.
In addition, Unemployment Insurance Program Letter No. 14-20 established Pandemic Unemployment Assistance
(PUA) for individuals who are self-employed, who are seeking part-time employment, or who otherwise would not qualify
for regular Unemployment Compensation (UC) under state or federal law. As such, these programs are mutually
exclusive, and it is unallowable for claims to be paid for the same week of unemployment out of both programs.
Condition and Context:
Using data analytics, ALA staff identified 891 claimants who received a total of 9,561 payments for the same week in
the regular UC system and the new PUA system. Duplicate payments paid from the UC system totaled $2,703,968,
and duplicate payments paid from the PUA system totaled $2,580,543.
ALA staff reviewed the case files of 30 of the 891 claimants. This review revealed that all 30 claimants were ineligible
for the PUA benefits they received, totaling $87,424.
Because 100% of the sampled PUA claims failed, likely questioned costs would include the entire population and total
$2,580,543.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
$87,424
Cause:
Appropriate communication between the two systems administering the regular UC benefits and the PUA benefits was
lacking.
Effect:
A lack of adequate controls allowed benefit payments from two separate systems to be issued for the same week of
unemployment for the same claimant, resulting in overpayments of federal funds.
Recommendation:
ALA staff recommend the Agency work to strengthen internal controls over the establishment of eligibility for regular
UC and PUA, as well as the payment of benefits, in a way that considers information in both systems. In addition, ALA
staff recommend the Agency continue to pursue the recovery of overpayments of funds, returning them to the
appropriate source.
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 28 -
Finding Number:
2021-006 (Continued)
State/Educational Agency(s):
Arkansas Department of Commerce –
Division of Workforce Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
17.225 – COVID-19: Unemployment Insurance
Federal Awarding Agency:
U.S. Department of Labor
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
Not Applicable
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Eligibility
Type of Finding:
Noncompliance and Material Weakness
Views of Responsible Officials and Planned Corrective Action:
The Unemployment System and the Pandemic Unemployment Assistance system were different systems and did not
communicate at the beginning of the pandemic period. There are instances of claimants being paid on both systems.
Enhancements were made to the systems to allow them to start communicating beginning in November 2020. The
overpayments have been identified and are being investigated. Overpayments or waivers will be issued to these
claimants.
Anticipated Completion Date:
July 2022
Contact Person:
Ken Jennings
Program Administrator UI
Division of Workforce Services
2 Capitol Mall
Little Rock, AR 72201
501-682-3244
Kenneth.jennings@arkansas.gov
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 29 -
Finding Number:
2021-007
State/Educational Agency(s):
Arkansas Department of Commerce –
Division of Workforce Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
17.225 – Unemployment Insurance
17.225 – COVID-19: Unemployment Insurance
Federal Awarding Agency:
U.S. Department of Labor
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
Not Applicable
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Eligibility
Type of Finding:
Noncompliance and Material Weakness
Repeat Finding:
Not applicable
Criteria:
2 CFR § 200.302 requires that the state’s financial management systems, including records documenting compliance
with federal statues, regulations, and the terms and conditions of the federal award, must be sufficient to permit the
tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the
federal statutes, regulations, and the terms and conditions of the federal award.
In accordance with 2 CFR § 200.303, a non-federal entity must establish and maintain effective internal control over a
federal award that provides reasonable assurance that the non-federal entity is managing the award in compliance with
federal statutes, regulations, and the terms and conditions of the award.
Condition and Context:
The Agency was unable to reconcile claimant benefit payments from the regular Unemployment Compensation (UC)
and Pandemic Unemployment Assistance (PUA) systems to the underlying disbursements from the related bank
account. As of November 10, 2021, the Agency provided ALA staff with claimant benefit payment data, totaling
$1,810,324,233, to support the disbursements from the bank account totaling $1,811,623,574, resulting in
disbursements exceeding claimant data by $1,299,341.
Statistically Valid Sample:
Not applicable
Questioned Costs:
$1,299,341
Cause:
While the Agency was able to demonstrate daily reconciliation procedures performed between the UC and PUA
claimant benefit systems and bank activity, controls were not in place to report or reconcile claimant benefits paid per
UC and PUA systems with bank activity on a monthly or yearly basis.
Effect:
Lack of appropriate reconciliations between claimant benefit data and bank activity could allow misappropriation of
assets to go undetected.
Recommendation:
ALA staff recommend the Agency strengthen controls and procedures to ensure that monthly and yearly reconciliations
between claimant benefit data and bank activity are performed.
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 30 -
Finding Number:
2021-007 (Continued)
State/Educational Agency(s):
Arkansas Department of Commerce –
Division of Workforce Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
17.225 – Unemployment Insurance
17.225 – COVID-19: Unemployment Insurance
Federal Awarding Agency:
U.S. Department of Labor
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
Not Applicable
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Eligibility
Type of Finding:
Noncompliance and Material Weakness
Views of Responsible Officials and Planned Corrective Action:
There are 3 points of data required and related to the finding:
1)
A “claimant file” contains the claims paid data out of the UI system, which is managed by UI IT.
2)
A “payment file” contains the claims and is also produced automatically by the UI IT systems. This file is
sent by UI IT to the bank to generate the payments. UI Accounting is copied and reconciles to the actual
bank payments. (This is not part of the audit finding issue since it was reconciled by UI Accounting against
actual payments made by the bank).
3)
The bank statement reflects the actual payments made by the bank, based upon the payment file. UI
Accounting reconciled this.
The finding notes that the claimant benefit payments from regular UI and PUA did not reconcile to the bank payments
(therefore #1 did not reconcile to #2).
UI Program will get data pulls from their system to identify whether regular UI, PUA, or both systems had an issue and
did not balance to the UI system payment files that went to the bank. The problem seems to reside between the two
files produced by UI IT. Once the offending data is identified within the UI systems, this will need to be an on-going
process to monitor and reconcile the output from the UI systems in addition to what UI Accounting reconciles.
Anticipated Completion Date:
Mid-June 2022
Contact Person:
Tracii Laettner
Chief Financial Officer
Arkansas Division of Workforce Services
#2 Capitol Mall
Little Rock, AR 72201
(501) 682-3108
Tracii.L.Laettner@arkansas.gov
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 31 -
Finding Number:
2021-008
State/Educational Agency(s):
Arkansas Department of Commerce –
Division of Workforce Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
17.225 – COVID-19: Unemployment Insurance
Federal Awarding Agency:
U.S. Department of Labor
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
Not Applicable
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Eligibility
Type of Finding:
Noncompliance and Material Weakness
Repeat Finding:
Not applicable
Criteria:
In accordance with 2 CFR § 200.303, a non-federal entity must establish and maintain effective internal control over
the federal award that provides reasonable assurance that the non-federal entity is managing the federal award in
compliance with federal statutes, regulations, and the terms and conditions of the award.
Condition and Context:
Using data analytics, ALA staff discovered duplicate unemployment payments made out of the Pandemic
Unemployment Assistance (PUA) system for the same week. Further inquiry revealed that the Agency had discovered
1,846 duplicated claims paid in error for PUA, totaling $293,970, but had not yet submitted them to Benefit Payment
Control (BPC) for collection.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
$293,970
Cause:
The Agency performed redeterminations of claimants’ weekly-benefit amounts (WBA). When the claimants’ WBAs
were re-determined, the PUA system issued payments for the full WBAs in error, which caused duplicate payments of
benefits for the same week-ending dates.
Effect:
Lack of appropriate system controls resulted in overpayments of federal funds.
Recommendation:
ALA staff recommend the Agency continue to strengthen system controls over benefit payments to ensure that the
system does not issue duplicate payments for the same week-ending date. ALA staff also recommend the Agency
seek recoupment of the identified overpayments, returning them to the appropriate source.
Views of Responsible Officials and Planned Corrective Action:
Due to a vendor issue, weeks were paid in duplicate. Once the issue was found, all monetary redeterminations were
stopped until the issue was fixed. Overpayments or waivers will be issued to these claimants.
Anticipated Completion Date:
December 2022
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 32 -
Finding Number:
2021-008 (Continued)
State/Educational Agency(s):
Arkansas Department of Commerce –
Division of Workforce Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
17.225 – COVID-19: Unemployment Insurance
Federal Awarding Agency:
U.S. Department of Labor
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
Not Applicable
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Eligibility
Type of Finding:
Noncompliance and Material Weakness
Views of Responsible Officials and Planned Corrective Action (Continued):
Contact Person:
Ken Jennings
Program Administrator UI
Division of Workforce Services
2 Capitol Mall
Little Rock, AR 72201
501-682-3244
Kenneth.jennings@arkansas.gov
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 33 -
Finding Number:
2021-009
State/Educational Agency(s):
Arkansas Department of Commerce –
Division of Workforce Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
17.225 – Unemployment Insurance
17.225 – COVID-19: Unemployment Insurance
Federal Awarding Agency:
U.S. Department of Labor
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
Not Applicable
Compliance Requirement(s) Affected:
Reporting
Type of Finding:
Noncompliance and Material Weakness
Repeat Finding:
Not applicable
Criteria:
In accordance with 2 CFR § 200.302, the state’s financial management systems, including records documenting
compliance with federal statutes, regulations, and the terms and conditions of the federal award, must be sufficient to
permit the preparation of the reports required by general and program-specific terms and conditions.
In accordance with the U.S. Department of Labor Employment and Training Administration (ETA) Handbook 401,
Section II-4(B), all funds deposited into, transferred, or paid from the state unemployment fund (the state clearing
account, the state account in the Unemployment Trust Fund (UTF), and the state benefit payment account) should be
reflected on the monthly ETA 2112 report.
Condition and Context:
The Agency did not have appropriate controls in place to support the maintenance of documentation supporting the
ETA 2112 reports. Our review of 2 of the 12 monthly ETA 2112 reports submitted for fiscal year 2021 revealed the
following deficiencies:
The Agency did not provide support for amounts reported on the ETA 2112 for November 2020 as follows:
•
Deposits totaling $3,941,920 (line E15 Title IX/Spec Legislation).
•
Deposits totaling $53,884,587 (line F16 Intra-Acct. Tran).
•
Deposits totaling $9,318,993 (line E23 Fed Emergency Comp).
•
Disbursements totaling $11,336,047 (line F31 Net UI Benefits).
•
Disbursements totaling $53,884,587 (line E47 Intra-Acct. Trans).
The Agency did not provide support for amounts reported on the ETA 2112 for June 2021 as follows:
•
Disbursements totaling $8,436,929 (line F31 Net UI Benefits).
•
Disbursements totaling $614,856 (line F33 Reimb LocGov/IndTr).
•
Disbursements totaling $468,992 (line F34 Reimb State Gov).
•
Disbursements totaling $345,655 (line F35 Reimb Non-profit).
ALA also discovered a discrepancy between the balances reflected on the UTF statement and the June 2021 ETA
2112 report. The UTF statement balance was $823,906,769, while the balance reported on the ETA 2112 was
$812,466,324, an understatement totaling $11,440,445. The Agency was unable to provide a reconciliation between
the statement and the report.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
None
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 34 -
Finding Number:
2021-009 (Continued)
State/Educational Agency(s):
Arkansas Department of Commerce –
Division of Workforce Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
17.225 – Unemployment Insurance
17.225 – COVID-19: Unemployment Insurance
Federal Awarding Agency:
U.S. Department of Labor
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
Not Applicable
Compliance Requirement(s) Affected:
Reporting
Type of Finding:
Noncompliance and Material Weakness
Cause:
The failure of Agency controls was caused by employee turnover in key positions, increased reporting workloads, and
reduced oversight of reports.
Effect:
Lack of appropriate internal controls resulted in noncompliance with federal laws and regulations over reporting and
could allow misappropriation of assets to go undetected.
Recommendation:
ALA staff recommend the Agency strengthen controls over reporting to ensure that amounts reported are properly
supported by the appropriate records and documentation, in accordance with federal laws and regulations.
Views of Responsible Officials and Planned Corrective Action:
Agency controls have been improved as UI Accounting has returned to a normal level of staffing. Also, the workload
is returning closer to a normal level after it increased due to new pandemic unemployment programs, which had to be
implemented quickly. Additionally, the UI Assistant Controller was on medical leave and was not available to help the
other staff provide the information. Additionally, new daily reconciliation processes have been added that will help
ensure the accuracy of the numbers on the report. The new UI Program Operations Manager has been trained on the
daily reconciliations so that she will be able to provide the support in the future.
Anticipated Completion Date:
Completed
Contact Person:
Tracii Laettner
Chief Financial Officer
Arkansas Division of Workforce Services
#2 Capitol Mall
Little Rock, AR 72201
(501) 682-3108
Tracii.L.Laettner@arkansas.gov
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 35 -
Finding Number:
2021-010
State/Educational Agency(s):
Arkansas Department of Commerce –
Division of Workforce Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
17.225 – Unemployment Insurance
17.225 – COVID-19: Unemployment Insurance
Federal Awarding Agency:
U.S. Department of Labor
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
Not Applicable
Compliance Requirement(s) Affected:
Special Tests and Provisions –
UI Benefit Payments –
Benefits Accuracy Measurement (BAM) Program
Type of Finding:
Noncompliance and Material Weakness
Repeat Finding:
Not applicable
Criteria:
In accordance with 2 CFR § 200.303, a non-federal entity must establish and maintain effective control over the federal
award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with
the federal statutes, regulations, and the terms and conditions of the award.
The U.S. Department of Labor Employment and Training Administration (ETA) Handbook No. 395, 5th edition, and the
Arkansas – Benefit Accuracy Measurement (BAM) Methods and Procedures Guide establish requirements for the State
to follow in its administration of the Unemployment Insurance (UI) BAM program.
Condition and Context:
ALA staff reviewed 40 of the 482 case files for paid claims reviewed by the BAM unit and noted 11 case files with the
following exceptions:
•
Three case files did not contain any documentation of the BAM investigation, as required by Chapter VII
(2) of ETA Handbook No. 395.
•
Eight case files did not contain a summary of investigation, as required by Chapter VI (10) of ETA
Handbook No. 395 and Chapter II (A)(23) of Arkansas – BAM Methods and Procedures Guide.
•
In one case file, the Agency did not make the three required attempts to contact the claimant, as required
by Chapter II (A)(11) of Arkansas – BAM Methods and Procedures Guide.
•
In one case file, the Agency failed to document or take appropriate corrective action for misreported
wages that should have been detected by the review, as required by Chapter II (A)(4) of Arkansas – BAM
Methods and Procedures Guide.
•
In one case file, the Agency failed to notify Benefit Payment Control (BPC) of an overpayment that was
documented by the review, as required by Chapter II (A)(21)(b) of Arkansas – BAM Methods and
Procedures Guide.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
None
Cause:
The failure of Agency controls was caused by employee turnover in key positions, which increased worker caseloads
and reduced oversight of case reviews.
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 36 -
Finding Number:
2021-010 (Continued)
State/Educational Agency(s):
Arkansas Department of Commerce –
Division of Workforce Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
17.225 – Unemployment Insurance
17.225 – COVID-19: Unemployment Insurance
Federal Awarding Agency:
U.S. Department of Labor
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
Not Applicable
Compliance Requirement(s) Affected:
Special Tests and Provisions –
UI Benefit Payments –
Benefits Accuracy Measurement (BAM) Program
Type of Finding:
Noncompliance and Material Weakness
Effect:
Lack of appropriate internal controls resulted in noncompliance with both federal and state laws governing the BAM
program.
Recommendation:
ALA staff recommend the Agency strengthen controls over the BAM program to ensure that investigations are
completed and documented in accordance with federal and state laws.
Views of Responsible Officials and Planned Corrective Action:
Employee turnover in key positions (Workforce Specialists and the Program Operation Manager) increased worker
caseloads and reduced the review of the case documents in the case files. A Program Operations Manager and
Workforce Specialists have now been hired and are completing DOL BAM training. We are also instituting a new
imaging system for BAM that will stop the need for paper records, which are easily misplaced.
Anticipated Completion Date:
Completed
Contact Person:
Ken Jennings
Program Administrator UI
Division of Workforce Services
2 Capitol Mall
Little Rock, AR 72201
501-682-3244
Kenneth.jennings@arkansas.gov
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 37 -
Finding Number:
2021-011
State/Educational Agency(s):
Arkansas Department of Finance and Administration
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
21.019 – COVID-19: Coronavirus Relief Fund
(Cities, Towns, and Counties Coronavirus Relief Fund Project)
Federal Awarding Agency:
U.S. Department of Treasury
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Allowable Costs/Cost Principles;
Period of Performance
Type of Finding:
Noncompliance
Repeat Finding:
Not applicable
Criteria:
The Coronavirus Relief Fund was required by Sec. 5001, as amended, of the Coronavirus Aid, Relief, and Economic
Security Act (CARES Act) to be used to cover only those costs that were (1) necessary expenditures incurred due to
the public health emergency with respect to Coronavirus Disease 2019 (COVID-19) and (2) incurred during the period
that began March 1, 2020, and ended December 31, 2021.
In accordance with guidance provided in the Federal Register by the United States Department of Treasury, the State
of Arkansas was required to keep records sufficient to demonstrate that the funds were used in accordance with this
federal legislation.
Condition and Context:
Arkansas awarded approximately $145 million to local entities (cities, towns, and counties) to assist with additional
expenses related to COVID-19. Generally, disbursements were made by the Arkansas Department of Finance and
Administration (DFA) based on approved applications and after receipt and review of the expense detail provided by
the local entity.
Of 585 payments, ALA selected a sample of 62 payments made to local entities to determine if sufficient, appropriate
evidence (supporting documentation) was maintained. Our review revealed the following exceptions:
•
Five local entities submitted documentation for payroll expenses representing services rendered prior to
March 1, 2020, totaling $54,257.
•
One local entity had been reimbursed for payroll expenses, totaling $487, from another federal program
and submitted those same payroll expenses as detail for this program. In addition, a duplicate payroll
payment was discovered, totaling $280.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
$55,024
Cause:
The Agency failed to implement sufficient internal controls to identify and detect errors and duplication.
Effect:
The State of Arkansas could be subject to repayment of funds to the federal government.
Recommendation:
ALA staff recommend the Agency strengthen its review of documentation from local entities to ensure the expense
complies with the CARES Act.
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 38 -
Finding Number:
2021-011 (Continued)
State/Educational Agency(s):
Arkansas Department of Finance and Administration
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
21.019 – COVID-19: Coronavirus Relief Fund
(Cities, Towns, and Counties Coronavirus Relief Fund Project)
Federal Awarding Agency:
U.S. Department of Treasury
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Allowable Costs/Cost Principles;
Period of Performance
Type of Finding:
Noncompliance
Views of Responsible Officials and Planned Corrective Action:
DFA will review payroll expenses related to these payments. Entities that submitted payroll costs prior to March 1,
2020 will be allowed the opportunity to submit additional eligible expenses within the allowed period or return funds to
DFA. All returned funds will be applied to unreimbursed eligible expenses of the State of Arkansas first and any residual
balance returned to the U.S. Treasury.
Anticipated Completion Date:
September 30, 2022
Contact Person:
Melanie Hazeslip
Administrator
Arkansas Department of Finance and Administration
1515 West 7th Street, Suite 700
Little Rock, Arkansas, 72201
(501) 682-5229
Melanie.hazeslip@dfa.arkansas.gov
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 39 -
Finding Number:
2021-012
State/Educational Agency(s):
Arkansas Department of Finance and Administration
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
21.019 – COVID-19: Coronavirus Relief Fund
Federal Awarding Agency:
U.S. Department of Treasury
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Allowable Costs/Cost Principles;
Period of Performance
Type of Finding:
Noncompliance
Repeat Finding:
Not applicable
Criteria:
In accordance with 2 CFR § 200.516(a), auditors must report as an audit finding any known or likely fraud affecting a
federal award.
Condition and Context:
During fiscal year 2020, the Arkansas Department of Finance and Administration and the University of Arkansas for
Medical Services jointly paid $10,940,000 for the purchase of gowns, face shields, and ventilators from a particular
vendor. Of this amount, $8,600,000 was paid using Coronavirus Relief Fund monies. On October 27, 2021, the
Arkansas Attorney General, acting on behalf of the State of Arkansas, filed a civil complaint in the Pulaski County
Circuit Court of Arkansas alleging actual or constructive fraud. As of the end of December 2021, the vendor had not
delivered the goods or returned the funds to the State of Arkansas, and the litigation is still pending.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
$8,600,000
Cause:
Due to supply shortages and high demand for these type of products, disbursements were made in advance of the
receipt of the product, which is not customary for the purchase of tangible goods.
Effect:
The State of Arkansas could be subject to repayment of funds to the federal government.
Recommendation:
ALA staff recommend the Agency return any funds received from the litigation or allocate different, allowable expenses
to the Coronavirus Relief Fund.
Views of Responsible Officials and Planned Corrective Action:
DFA recognizes that the nature of these payments violated internal controls designed to mitigate the instances of
fraudulent activity on behalf of vendors for non-performance by pre-paying for goods or services prior to delivery.
However, the State of Arkansas acted in good faith with the current market trends because of a surge of activity related
to the purchase of personal protective equipment and ventilators at the onset of the pandemic and acted accordingly
to the market demands at the time. The State of Arkansas, in trying to mitigate the effect of fraudulent activity in this
environment, contracted these prepaid contracts with an escrow agent to ensure that both parties performed as
promised. But the State of Arkansas, in these instances, could not have foreseen or prevented collusion between the
escrow agent and the vendors mentioned. DFA and UAMS in conjunction with the Attorney General of the State of
Arkansas is currently pursuing all legal remedies to ensure that these fraudulent parties are held accountable for their
actions during the onset of the pandemic when the market forced all parties to act quickly. Any CRF funds recovered
through the legal process will be returned to the U.S. Treasury.
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 40 -
Finding Number:
2021-012 (Continued)
State/Educational Agency(s):
Arkansas Department of Finance and Administration
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
21.019 – COVID-19: Coronavirus Relief Fund
Federal Awarding Agency:
U.S. Department of Treasury
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Allowable Costs/Cost Principles;
Period of Performance
Type of Finding:
Noncompliance
Views of Responsible Officials and Planned Corrective Action (Continued):
Anticipated Completion Date:
September 30, 2022
Contact Person:
Melanie Hazeslip
Administrator
Arkansas Department of Finance and Administration
1515 West 7th Street, Suite 700
Little Rock, Arkansas, 72201
(501) 682-5229
Melanie.hazeslip@dfa.arkansas.gov
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 41 -
Finding Number:
2021-013
State/Educational Agency(s):
Arkansas Department of Finance and Administration
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
21.019 – COVID-19: Coronavirus Relief Fund
Federal Awarding Agency:
U.S. Department of Treasury
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Reporting
Type of Finding:
Noncompliance and Significant Deficiency
Repeat Finding:
Not applicable
Criteria:
In accordance with 42 USC § 801(f), the United States Department of the Treasury Office of Inspector General
(Treasury OIG) is responsible for monitoring and oversight of the receipt, disbursement, and use of Coronavirus Relief
Funds. Treasury OIG requires prime recipients (the State of Arkansas) to report quarterly, detailed information on any
loans issued, contracts and grants awarded, transfers made to other government entities, and direct payments made
by the recipient (the State of Arkansas) that are greater than $50,000. Additionally, the Treasury OIG requires a detailed
list of all projects or activities for which funds were expended, including the name and a description of the project or
activity.
Condition and Context:
Of 1,560 recipients who received funds for individual projects over $50,000, ALA selected a sample of 40 to determine
if the project information had been properly reported. Our review revealed the following exceptions:
•
One instance of inaccurate reporting of a recipient/awardee: an internet service provider that received
approximately $2.3 million for broadband expansion under Federal Project Identification Number 0790-
02. The amount was reported as being paid to a different provider.
•
Fourteen instances of inaccurate reporting of a project assignment, which consisted of the following:
o
Six hospital recipients under Federal Project Identification Number 0710-05 - Department of
Human Services - Arkansas Medicaid Program (also known as DHS Hospital Proposal or
Hospital Formula & Cluster Program) had payments misclassified into various other projects on
the federal report. This Project (0710-05) had approximately $100 million in expenditures by the
State of Arkansas, but no expenses were allocated to this Project on the federal reports.
o
Seven long-term care facilities/nursing home recipients had payments misclassified into the
Federal Project Identification Number 0710-13 (DHS - Enhance Nursing Facilities Capacity, also
known as Surge Payments). However, these payments should have been reported under the
0710-03 Project (Department of Human Services - Nursing Facility Payments). Approximately
$17 million in payments to subrecipients/awardees were misclassified into the 0710-13 Project,
instead of the 0710-03 Project.
o
One hospital recipient of funds under Federal Project Identification Number 0710-01 (Payments
to Healthcare and Non-Healthcare Personnel) had payments misclassified and reported into the
0710-03 (Nursing Facility Payments) Project.
•
Four instances of inaccurate cumulative expenditure amounts by vendor reported, which consisted of the
following:
o
Two payments, totaling $43,041, to separate recipients were not included in the cumulative total
of expenditures on a per-project basis due to the inaccurate project assignment of payments.
o
One recipient of payments had $6,885 in funds received under a contract not included in the
cumulative amount of expenditures reported.
o
One recipient did not report net expenditures, a result of a refund to the State of Arkansas in the
amount of $3,441.
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 42 -
Finding Number:
2021-013 (Continued)
State/Educational Agency(s):
Arkansas Department of Finance and Administration
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
21.019 – COVID-19: Coronavirus Relief Fund
Federal Awarding Agency:
U.S. Department of Treasury
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Reporting
Type of Finding:
Noncompliance and Significant Deficiency
Condition and Context (Continued):
•
Five instances of inaccurate reporting of costs for an expenditure category. These five businesses
received funds for Federal Project Identification Number 0900-02 (Business Interruption Grant) that were
used to pay small business assistance payments. However, these payments were classified as
“administrative expenses” for the expenditure category on the federal report. ALA’s understanding is that
all funds expended under Project 0900-02 (approximately $48 million) were improperly classified on the
federal report as administrative expenses instead of small business assistance.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
None
Cause:
The Agency failed to design internal controls to ensure that payments to subrecipients were reported within the
appropriate project on the federal reports. Additionally, it failed to adequately review reports for accuracy prior to
submission.
Effect:
Inaccurate information was provided to the federal Pandemic Response Accountability Committee (PRAC), which uses
this information to report pandemic-related programs to the public via its website.
Recommendation:
ALA staff recommend the Agency strengthen internal controls over the reporting of subrecipient information of the
Coronavirus Relief Fund. In addition, the Agency should correct previously reported inaccurate data.
Views of Responsible Officials and Planned Corrective Action:
DFA recognizes internal controls need to be strengthened as it relates to Federal reporting under special funding
sources related to COVID-19, to which DFA has added staff within the Office of Accounting - Financial Reporting
Section (OA-FRS). Notwithstanding, OA-FRS must rely on the qualifications and expertise of the various agency staff
assigned to the administration of these funds to properly report the expenses. Recognizing that need, OA-FRS will
ensure that the developed internal controls are communicated to the assigned staff as well as provide any training
necessary to ensure the accuracy of this reporting. Further difficulty arises in the review by OA-FRS of grant data due
to the lack of access to the data once uploaded to the US Treasury.
Anticipated Completion Date:
September 30, 2022
Contact Person:
Melanie Hazeslip
Administrator
Arkansas Department of Finance and Administration
1515 West 7th Street, Suite 700
Little Rock, Arkansas, 72201
(501) 682-5229
Melanie.hazeslip@dfa.arkansas.gov
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 43 -
Finding Number:
2021-014
State/Educational Agency(s):
Arkansas Department of Human Services
Arkansas Department of Commerce –
Arkansas Economic Development Commission
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
21.019 – COVID-19: Coronavirus Relief Fund
Federal Awarding Agency:
U.S. Department of Treasury
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Allowable Costs/Costs Principles;
Period of Performance
Type of Finding:
Noncompliance and Significant Deficiency
Repeat Finding:
Not applicable
Criteria:
The Coronavirus Relief Fund was required by Sec. 5001, as amended, of the Coronavirus Aid, Relief, and Economic
Security Act (CARES Act) to be used to cover only those costs that were (1) necessary expenditures incurred due to
the public health emergency with respect to Coronavirus Disease 2019 (COVID-19) and (2) incurred during the period
that began March 1, 2020, and ended December 31, 2021. In accordance with guidance provided in the Federal
Register by the United States Department of Treasury, the State of Arkansas was required to keep records sufficient
to demonstrate that the funds were used in accordance with this federal legislation.
Furthermore, the State of Arkansas was responsible for determining the level and detail of documentation needed from
subrecipients of small business assistance to satisfy compliance with this law.
Finally, in accordance with 2 CFR § 200.303, a non-federal entity must establish and maintain effective internal control
over the federal award that provides reasonable assurance that the non-federal entity is managing the federal award
in compliance with federal statutes, regulations, and the terms and conditions of the award.
Condition and Context:
Arkansas established various programs intended to reimburse beneficiaries or subrecipients for additional expenses
incurred as a result of COVID-19. The State of Arkansas established a state-level committee that approved the
programs and disbursements. The programs were established and administered at a departmental level. Each
department was responsible for establishing controls and acquiring sufficient, appropriate evidence (supporting
documentation) for expenditures. As such, ALA identified a risk of potential duplication of benefits for programs at more
than one department level.
ALA performed select procedures to determine if duplication of benefits had occurred. Our review revealed the
following exceptions:
•
ALA staff reviewed 43 recipients that received payments under both the Arkansas Department of Human
Services projects and the Arkansas Economic Development Commission (AEDC) Ready for Business
Grant Program (RBGP). We identified six recipients that submitted duplicate expenditure documentation
to both Agencies, totaling $47,488.
•
ALA staff reviewed 40 recipients receiving funding from the Business Interruption Grant Program (BIG)
and RBGP, both disbursed by AEDC. Three recipients provided inaccurate information regarding the
amount of funding previously received under RBGP, a required disclosure on the application for BIG. The
disclosure is key because the amount of RBGP received is used in calculating the award for BIG.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
$47,488
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 44 -
Finding Number:
2021-014 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Arkansas Department of Commerce –
Arkansas Economic Development Commission
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
21.019 – COVID-19: Coronavirus Relief Fund
Federal Awarding Agency:
U.S. Department of Treasury
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Allowable Costs/Costs Principles;
Period of Performance
Type of Finding:
Noncompliance and Significant Deficiency
Cause:
The Agencies failed to implement sufficient internal controls to identify and detect duplication of benefits between
funded programs.
Effect:
The State of Arkansas could be subject to repayment of funds to the federal government.
Recommendation:
ALA staff recommend the Agencies strengthen internal controls over the awarding of funds to recipients, receipt of
documentation from recipients, and reconciliation of submitted expense documentation to funds awarded to recipients
to ensure that duplication of benefits between funded programs is prevented, detected, and corrected.
Views of Responsible Officials and Planned Corrective Action:
Arkansas Department of Human Services:
DHS concurs with this finding. DHS and AEDC will collaboratively investigate the six instances in which duplicate
expenditure documentation was submitted to each agency. Both agencies will collaborate on appropriate action,
including recoupment, for any payments confirmed as duplicates.
Anticipated Completion Date:
August 31, 2022
Contact Person:
Elizabeth Pitman
Director, Division of Medical Services
Department of Human Services
700 Main Street
Little Rock, AR 72201
501-244-3944
Elizabeth.Pitman@dhs.arkansas.gov
Arkansas Economic Development Commission:
(Joint Response from All Agencies):
Benefits under the Ready for Business Grant Program were provided to the eligible businesses as an advance, with
the requirement that the business submit receipts at a later date to confirm that the grant amount was expensed for a
permissible purpose as outlined in the grant program terms.
The potential for duplication of benefits with a program administered by DHS was not foreseen at the time the Ready
for Business Grant Program was operational. AEDC will coordinate with DHS to recover the duplicate payments so that
they are returned to the State.
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 45 -
Finding Number:
2021-014 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Arkansas Department of Commerce –
Arkansas Economic Development Commission
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
21.019 – COVID-19: Coronavirus Relief Fund
Federal Awarding Agency:
U.S. Department of Treasury
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Allowable Costs/Costs Principles;
Period of Performance
Type of Finding:
Noncompliance and Significant Deficiency
Views of Responsible Officials and Planned Corrective Action (Continued):
Arkansas Economic Development Commission: (Continued)
(Joint Response from All Agencies) (Continued):
The Ready for Business Grant Program and the Business Interruption Grant Program (BIG) were both temporary
programs that are no longer operational. This should fully mitigate future control issues.
Response from Arkansas Department of Parks, Heritage and Tourism (BIG Only)
The auto-calculation of a qualified applicant’s BIG program award was based on the amount of other financial
assistance received by the applicant, as reported in the program’s online portal. The program’s intent in using third-
party records, as evidenced by the AEDC data, was to minimize fraud potential by gathering available and useable
electronic data from other government sources to cross-check and auto-validate the information that the program’s
over 5,000 applicants submitted. Most of the program’s auto-validation effort was employed during the initial application
stage of the process to help ensure only qualified Arkansas businesses would be considered for possible awards. For
example, during the application stage, the program extensively cross-checked identification data submitted by
applicants with records received from the Arkansas Secretary of State’s office. Tax identification numbers submitted
by applicants were also verified by DF&A.
Due to the time constraints imposed by the then federal payment deadline of December 30, 2020, neither auto-
validation nor a manual case-by-case review and resolution could be effectively employed in the latter stage of the
program for the small percentage of cases where data inconsistency occurred. As for any data that could not be timely
cross-checked or validated, the BIG program, like many other CARES Act assistance programs, had to necessarily rely
upon self-certification by the applicant. In the BIG program, the applicant submitted its data under penalty of perjury
and contractually agreed to a claw back provision whereby the state could recover any amounts erroneously awarded.
In the three cases referenced, which represent 7.5% of the sample size, ADPHT does not have reason to believe fraud
was committed. The award recipients in this finding misrepresented in total $6,000 in other financial assistance, a very
low percentage in comparison to the $48 million to be awarded. The applicants were eligible, had qualified expenses
and had a demonstrable need for this financial assistance. Due to the large amount of qualified expenses submitted by
all qualified applicants, the average grant award was paid out at a rate of approximately $.12 on the dollar. Accordingly,
we are confident that the awards paid to these three (3) recipients did cover qualified expenses and did not result in an
unfair advantage or create a material disadvantage to all other awardees.
For planned corrective action, ADPHT will develop a plan to conduct further review of more grant recipients beyond the
businesses reviewed in the audit sample. ADPHT will work with the Arkansas Department of Commerce to cross
reference data collected from businesses including grant award amounts. This further review will allow ADPHT to
ensure that the incorrect Ready for Business Grant award amounts reported was not a pervasive problem with the
grant program. For future grant programs, with more time allowed for development and distribution, ADPHT will:
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 46 -
Finding Number:
2021-014 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Arkansas Department of Commerce –
Arkansas Economic Development Commission
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
21.019 – COVID-19: Coronavirus Relief Fund
Federal Awarding Agency:
U.S. Department of Treasury
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Allowable Costs/Costs Principles;
Period of Performance
Type of Finding:
Noncompliance and Significant Deficiency
Views of Responsible Officials and Planned Corrective Action (Continued):
Response from Arkansas Department of Parks, Heritage and Tourism (BIG Only) (Continued)
1)
Increase staff participation to assist in the review and assurance that applicants are in compliance with
program requirements; and
2)
Design a program with more controls in place that allows for more time with the application process and
support of applicants to ensure accurate information and proper documentation is submitted with the grant
application.
Anticipated Completion Date:
August 31, 2022
Contact Person:
David Bell
Cabinet CFO
Arkansas Department of Commerce
1 Commerce Way
Little Rock, AR 72202
(501) 682-7355
david.bell@arkansas.gov
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 47 -
Finding Number:
2021-015
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
21.019 – COVID-19: Coronavirus Relief Fund
(COVID-19 Surge Capacity Enhancement Payment Program)
Federal Awarding Agency:
U.S. Department of Treasury
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Allowable Costs/Cost Principles
Type of Finding:
Noncompliance
Repeat Finding:
Not applicable
Criteria:
The Coronavirus Relief Fund (CRF) was required by Sec. 5001, as amended, of the Coronavirus Aid, Relief, and
Economic Security Act (CARES Act) to be used to cover only those costs that were (1) necessary expenditures incurred
due to the public health emergency with respect to Coronavirus Disease 2019 (COVID-19) and (2) incurred during the
period that began March 1, 2020, and ended December 31, 2021. In accordance with guidance provided in the Federal
Register by the United States Department of Treasury, the State of Arkansas was required to keep records sufficient
to demonstrate that the funds were used in accordance with this federal legislation.
Additionally, ineligible expenses from the CRF included workforce bonuses other than hazard pay or overtime, and
corresponding guidance interpreting this prohibition included employees substantially dedicated to mitigating or
responding to the COVID-19 public health emergency. Also, question #38, as published in the Federal Register in
January 2021, specifically provided that across-the-board hazard pay for employees working during a state of
emergency was not allowed.
Finally, an attestation form signed by the provider required the provider to submit records of expenses to the Arkansas
Department of Human Services (DHS) by January 31, 2021. This documentation requirement (records of expenses
by the providers) demonstrates that the expenses were for necessary expenditures during the allowable period.
Furthermore, while the attestation form specifically prohibited workforce bonuses other than hazard pay or overtime, it
allowed for “other workforce payments necessary to ensure continuity,” which provided discretion to the
providers/recipients that does not seem afforded by the guidance from the federal government.
Condition and Context:
Arkansas awarded approximately $50 million to hospitals and long-term care facilities to assist with additional expenses
related to the COVID-19 surge in Arkansas in the fall of 2020. Funds for approved provider locations were disbursed
by DHS, in full and in advance of the providers incurring allowable costs and submitting detailed support for the payment
received.
Of 308 payments to providers, ALA staff reviewed a sample of 60 payments and requested the supporting
documentation on hand with DHS to determine if sufficient, appropriate evidence (supporting documentation) was
maintained to provide assurance that the payroll expenses were eligible. Our review revealed 16 provider payments
contained ineligible expenses as follows:
•
Sample item 35: $2 per hour extra for “COVID Pay,” even though “COVID Hazard Payroll” was separately
listed and reimbursed.
•
Sample items 5, 7, 9, 20, 28, 30, 33, 39, 41, and 43: Payroll incentives for “essential admin incentives”
and “management incentives.”
•
Sample items 19 and 32: “COVID-19 incentive” and no additional explanation.
•
Sample items 31 and 56: “Hero pay” associated with positions including administrators, dietary
supervisors, housekeeping supervisors, bookkeepers, and billing coordinators.
•
Sample item 37: Described the additional payments as “employee payroll – appreciation and retention.”
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 48 -
Finding Number:
2021-015 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
21.019 – COVID-19: Coronavirus Relief Fund
(COVID-19 Surge Capacity Enhancement Payment Program)
Federal Awarding Agency:
U.S. Department of Treasury
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Allowable Costs/Cost Principles
Type of Finding:
Noncompliance
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
Unknown
Cause:
The Agency failed to ensure that the types of wage payments made to providers aligned with the corresponding federal
guidance.
Effect:
The State of Arkansas could be subject to repayment of funds to the federal government.
Recommendation:
ALA staff recommend the Agency review the corresponding guidance regarding allowable wage payments, review the
supporting documentation provided by the recipients for additional wage payments, and acquire additional support from
the providers, where needed, to determine whether funds were appropriately utilized for allowable wage payments.
Views of Responsible Officials and Planned Corrective Action:
DHS concurs with this finding. The agency will request documentation from providers that support payments were
made for eligible expenses. Any improperly expended funds will be recouped.
Anticipated Completion Date:
August 31, 2022
Contact Person:
Elizabeth Pitman
Director, Division of Medical Services
Department of Human Services
700 Main Street
Little Rock, AR 72201
501-244-3944
Elizabeth.Pitman@dhs.arkansas.gov
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 49 -
Finding Number:
2021-016
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
21.019 – COVID-19: Coronavirus Relief Fund
(COVID-19 Surge Capacity Enhancement Payment Program)
Federal Awarding Agency:
U.S. Department of Treasury
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Allowable Costs/Cost Principles;
Period of Performance
Type of Finding:
Noncompliance and Significant Deficiency
Repeat Finding:
Not applicable
Criteria:
The Coronavirus Relief Fund was required by Sec. 5001, as amended, of the Coronavirus Aid, Relief, and Economic
Security Act (CARES Act) to be used to cover only those costs that were (1) necessary expenditures incurred due to
the public health emergency with respect to Coronavirus Disease 2019 (COVID-19) and (2) incurred during the period
that began March 1, 2020, and ended December 31, 2021. In accordance with guidance provided in the Federal
Register by the United States Department of Treasury, the State of Arkansas was required to keep records sufficient
to demonstrate that the funds were used in accordance with this federal legislation.
Furthermore, the State of Arkansas was responsible for determining the level and detail of documentation needed from
subrecipients of small business assistance to satisfy compliance with this law. An attestation form signed by the
provider required the provider to submit records of expenses to the Arkansas Department of Human Services (DHS)
by January 31, 2021. This documentation requirement (records of expenses by the providers) demonstrates that the
expenses were for necessary expenditures during the allowable period.
Finally, in accordance with 2 CFR § 200.303, a non-federal entity must establish and maintain effective internal control
over the federal award that provides reasonable assurance that the non-federal entity is managing the federal award
in compliance with federal statutes, regulations, and the terms and conditions of the award.
Condition and Context:
Arkansas awarded approximately $50 million to hospitals and long-term care facilities to assist with additional expenses
related to the COVID-19 surge in Arkansas in the fall of 2020. Funds for approved provider locations were disbursed
by DHS, in full and in advance. As reported in finding 2021-019, DHS failed to implement sufficient controls to review
supporting documentation under this Program.
Of 308 payments made to providers, ALA selected a sample of 60 payments and requested the supporting
documentation on hand with DHS to determine if sufficient, appropriate evidence was maintained. Our review revealed
8 instances in which the documentation provided failed to demonstrate that the provider expended the entire payment
during the allowed period as follows:
•
Sample items 1, 21, 35, 48, and 54: Vendor account statements did not include supporting invoices or
purchase detail on the accounting software expense summaries. In addition, quotes were provided rather
than actual invoices for services rendered. Questioned costs totaled $206,416.
•
Sample item 4: Supporting documentation had not been submitted for any expenses at the time of audit.
DHS requested supporting documentation from the provider, who stated the intent to repay the funds
received instead of providing documentation. Questioned costs totaled $50,992.
•
Sample items 20, 21, 23, and 35: Documentation provided indicated that expenses incurred were less
than the total funds received. One provider (sample item 23) specifically requested to return funds to
DHS in January 2021, but the Agency failed to review the provider’s submission; therefore, the request
went unnoticed. As a result, the repayment had not been made as of the end of fieldwork. Questioned
costs totaled $121,715.
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 50 -
Finding Number:
2021-016 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
21.019 – COVID-19: Coronavirus Relief Fund
(COVID-19 Surge Capacity Enhancement Payment Program)
Federal Awarding Agency:
U.S. Department of Treasury
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Allowable Costs/Cost Principles;
Period of Performance
Type of Finding:
Noncompliance and Significant Deficiency
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
$379,123
Cause:
The Agency failed to implement sufficient internal controls to monitor the timely submission, reconciliation, and review
of provider expenses.
Effect:
The State of Arkansas could be subject to repayment of funds to the federal government.
Recommendation:
ALA staff recommend the Agency strengthen its internal controls regarding the awards to recipients, including the
review of supporting expense documentation, to ensure compliance.
Views of Responsible Officials and Planned Corrective Action:
DHS concurs with this finding. The agency will request documentation from providers that support expenditures
claimed. Any improperly expended funds will be recouped.
Anticipated Completion Date:
August 31, 2022
Contact Person:
Elizabeth Pitman
Director, Division of Medical Services
Department of Human Services
700 Main Street
Little Rock, AR 72201
501-244-3944
Elizabeth.Pitman@dhs.arkansas.gov
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 51 -
Finding Number:
2021-017
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
21.019 – COVID-19: Coronavirus Relief Fund
(DHS Hospital Proposal – Protect, Treat, and Transform
During the COVID-19 Emergency Program)
Federal Awarding Agency:
U.S. Department of Treasury
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Allowable Costs/Cost Principles;
Period of Performance
Type of Finding:
Noncompliance and Significant Deficiency
Repeat Finding:
Not applicable
Criteria:
The Coronavirus Relief Fund was required by Sec. 5001, as amended, of the Coronavirus Aid, Relief, and Economic
Security Act (CARES Act) to be used to cover only those costs that were (1) necessary expenditures incurred due to
the public health emergency with respect to Coronavirus Disease 2019 (COVID-19) and (2) incurred during the period
that began March 1, 2020, and ended December 31, 2021. In accordance with guidance provided in the Federal
Register by the United States Department of Treasury, the State of Arkansas was required to keep records sufficient
to demonstrate that the funds were used in accordance with this federal legislation.
Furthermore, the State of Arkansas was responsible for determining the level and detail of documentation needed from
subrecipients of small business assistance to satisfy compliance with this law.
Finally, in accordance with 2 CFR § 200.303, a non-federal entity must establish and maintain effective internal control
over the federal award that provides reasonable assurance that the non-federal entity is managing the federal award
in compliance with federal statutes, regulations, and the terms and conditions of the award.
Condition and Context:
Arkansas awarded approximately $100 million to hospitals to recover unreimbursed costs associated with treating
COVID-19 patients and other expenses necessary to ensure continued care during the Coronavirus pandemic. Funds
for approved hospitals were disbursed by the Arkansas Department of Human Services (DHS). Payments were based
on an initial attestation form where the provider chose either a formulaic maximum payment or a lesser amount. An
additional cluster payment was provided if positive cases of COVID were known at the particular facility.
Subsequent to payment, each provider was required to submit a cost form designed to assist in identifying and
quantifying qualifying expenses related to the formulaic payment. No additional documentation for expenses incurred
was required.
Of 149 payments, ALA selected a sample of 16 payments made to hospitals to determine if sufficient, appropriate
evidence (supporting documentation) was maintained. ALA review revealed that one provider received a $1,802,214
formula payment, but its cost form only identified expenses, totaling $1,568,812, indicating the provider was overpaid.
The cost form was certified by the Chief Executive Officer of the hospital as being correct, complete, and prepared from
the books and records of the provider.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
$233,402
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 52 -
Finding Number:
2021-017 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
21.019 – COVID-19: Coronavirus Relief Fund
(DHS Hospital Proposal – Protect, Treat, and Transform
During the COVID-19 Emergency Program)
Federal Awarding Agency:
U.S. Department of Treasury
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Allowable Costs/Cost Principles;
Period of Performance
Type of Finding:
Noncompliance and Significant Deficiency
Cause:
The Agency failed to establish and implement sufficient internal controls to ensure that providers incurred sufficient
eligible costs and that overpayments were recouped.
Effect:
The State of Arkansas could be subject to repayment of funds to the federal government.
Recommendation:
ALA staff recommend the Agency establish and implement internal controls to ensure overpayments are recognized
and appropriate measures are taken to initiate the refund process.
Additional Information:
ALA staff reviewed a report prepared by the Arkansas Department of Inspector General – Office of Internal Audit
(DIG - OIA) regarding this Program. Of the 91 hospitals that received funds, DIG - OIA reviewed a sample of 23
hospitals and requested hospital supporting documentation in addition to the cost forms (e.g., receipts or payroll
journals).
Of the 23 hospitals reviewed, 3 elected to return excess funds, totaling $2,545,000, instead of supplying the requested
documentation.
Views of Responsible Officials and Planned Corrective Action:
DHS concurs with this finding. The agency will request documentation from providers that support expenditures
claimed. Any improperly expended funds will be recouped.
Anticipated Completion Date:
August 31, 2022
Contact Person:
Elizabeth Pitman
Director, Division of Medical Services
Department of Human Services
700 Main Street
Little Rock, AR 72201
501-244-3944
Elizabeth.Pitman@dhs.arkansas.gov
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 53 -
Finding Number:
2021-018
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
21.019 – COVID-19: Coronavirus Relief Fund
(Skilled Nursing Facility Payments Due to COVID-19
Emergency Program)
Federal Awarding Agency:
U.S. Department of Treasury
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Allowable Costs/Cost Principles;
Period of Performance
Type of Finding:
Noncompliance and Significant Deficiency
Repeat Finding:
Not applicable
Criteria:
The Coronavirus Relief Fund was required by Sec. 5001, as amended, of the Coronavirus Aid, Relief, and Economic
Security Act (CARES Act) to be used to cover only those costs that were (1) necessary expenditures incurred due to
the public health emergency with respect to Coronavirus Disease 2019 (COVID-19) and (2) incurred during the period
that began March 1, 2020, and ended December 31, 2021. In accordance with guidance provided in the Federal
Register by the United States Department of Treasury, the State of Arkansas was required to keep records sufficient
to demonstrate that the funds were used in accordance with this federal legislation.
Furthermore, the State of Arkansas was responsible for determining the level and detail of documentation needed from
subrecipients of small business assistance to satisfy compliance with this law. An example of ineligible expenditures
in the Federal Register was workforce bonuses, other than hazard pay or overtime.
Funds for approved provider locations were disbursed by the Arkansas Department of Human Services (DHS) in two
separate rounds. Round 1 was for expenses incurred from March 1, 2020 through June 30, 2020, and Round 2 was
for expenses incurred from July 1, 2020 through October 31, 2020.
An attestation form signed by the provider required the provider to submit records of expenses to DHS by August 31,
2020, supporting Round 1 disbursements and by November 15, 2020, supporting Round 2 disbursements.
Disbursements that were not reasonably supported were to be returned to DHS.
Finally, in accordance with 2 CFR § 200.303, a non-federal entity must establish and maintain effective internal control
over the federal award that provides reasonable assurance that the non-federal entity is managing the federal award
in compliance with federal statutes, regulations, and the terms and conditions of the award.
Condition and Context:
Arkansas awarded approximately $40.7 million to qualified skilled nursing facilities to maintain capacity and recover
some of the costs associated with treating COVID-19 residents.
During the fall of 2021, DHS was performing the review of supporting expense documentation for Round 1 and had
completed the initial review of Round 2. In addition, DHS planned to perform follow-up procedures with Round 2
recipients, during the first quarter of calendar year 2022, to confirm expenses were incurred by the provider because
DHS had relied on quotes, proposals, and estimates during its initial review.
Of 373 payments made to providers, ALA selected a sample of 60 payments to determine if sufficient, appropriate
evidence (supporting documentation) was maintained. ALA staff requested the attestation forms and provider receipts
on hand with DHS. ALA’s review revealed 21 instances in which the documentation failed to demonstrate that the
provider had appropriate expenses incurred during the period allowed as follows:
•
Sample items 1, 3, 7, 11, 25, 42, 43, 58, and 59 (Round 1): Documentation submitted included bonus
payments or taxes on bonus payments. Questioned costs totaled $84,230.
•
Sample items 11, 23, 39, 42, 43, and 56 (Round 1): Expense receipts were less than the total payment
received by the provider. Questioned costs totaled $366,644.
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 54 -
Finding Number:
2021-018 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
21.019 – COVID-19: Coronavirus Relief Fund
(Skilled Nursing Facility Payments Due to COVID-19
Emergency Program)
Federal Awarding Agency:
U.S. Department of Treasury
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Allowable Costs/Cost Principles;
Period of Performance
Type of Finding:
Noncompliance and Significant Deficiency
Condition and Context (Continued):
•
Sample item 47 (Round 1): Receipts had not been submitted at the time of the audit. Questioned costs
totaled $125,000.
•
Sample item 24 (Round 1): Documentation submitted only included general ledger summaries, not
detailed invoices. Questioned costs totaled $111,560.
•
Sample items 14, 19, 26, 34, 35, 55, and 57 (Round 2): Expense receipts were less than the total payment
received by the provider. For example, the Agency had received quotes, not expense receipts, from
some providers. Quotes are not considered sufficient, appropriate evidence (supporting documentation)
for the actual expenses incurred. Questioned costs totaled $495,145.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
$1,182,579
Cause:
The Agency failed to establish and implement sufficient internal controls to monitor the review of expense
documentation submitted by the provider.
Effect:
The State of Arkansas could be subject to repayment of funds to the federal government.
Recommendation:
ALA staff recommend the Agency establish and implement internal controls for monitoring over the awards to ensure
providers submit appropriate documentation for expenses incurred to demonstrate compliance.
Views of Responsible Officials and Planned Corrective Action:
DHS concurs with this finding. The agency will request documentation from providers that support expenditures
claimed. Any improperly expended funds will be recouped.
Anticipated Completion Date:
August 31, 2022
Contact Person:
Elizabeth Pitman
Director, Division of Medical Services
Department of Human Services
700 Main Street
Little Rock, AR 72201
501-244-3944
Elizabeth.Pitman@dhs.arkansas.gov
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 55 -
Finding Number:
2021-019
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
21.019 – COVID-19: Coronavirus Relief Fund
(COVID-19 Surge Capacity Enhancement Payment Program)
Federal Awarding Agency:
U.S. Department of Treasury
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Allowable Costs/Cost Principles;
Period of Performance
Type of Finding:
Significant Deficiency
Repeat Finding:
Not applicable
Criteria:
The Coronavirus Relief Fund was required by Sec. 5001, as amended, of the Coronavirus Aid, Relief, and Economic
Security Act (CARES Act) to be used to cover only those costs that were (1) necessary expenditures incurred due to
the public health emergency with respect to Coronavirus Disease 2019 (COVID-19) and (2) incurred during the period
that began March 1, 2020, and ended December 31, 2021. In accordance with guidance provided in the Federal
Register by the United States Department of Treasury, the State of Arkansas was required to keep records sufficient
to demonstrate that the funds were used in accordance with this federal legislation.
Furthermore, the State of Arkansas was responsible for determining the level and detail of documentation needed from
sub-recipients of small business assistance to satisfy compliance with this law. An attestation form signed by the
provider required the provider to submit records of expenses to the Arkansas Department of Human Services (DHS)
by January 31, 2021. This documentation requirement (records of expenses by the providers) demonstrates that the
expenses were for necessary expenditures during the allowable period.
Finally, in accordance with 2 CFR § 200.303, a non-federal entity must establish and maintain effective internal control
over the federal award that provides reasonable assurance that the non-federal entity is managing the federal award
in compliance with federal statutes, regulations, and the terms and conditions of the award.
Condition and Context:
Arkansas awarded approximately $50 million to hospitals and long-term care facilities to assist with additional expenses
related to the COVID-19 surge in Arkansas in the fall of 2020. Funds for approved provider locations were disbursed
by DHS, in full and in advance of the providers incurring allowable costs and submitting detailed expense support.
ALA review revealed that, of the 308 providers that received funding, 64 providers failed to submit any of the
documentation required by the attestation form prior to ALA’s inquiry in September 2021.
In addition, 10 of 60 providers sampled did not properly complete the attestation form, which would document
acknowledgment of the Program requirements (e.g., checkboxes regarding Program restrictions were not completed).
As of the end of fieldwork, the Agency had not reviewed any supporting documentation for provider expenses.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
None
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 56 -
Finding Number:
2021-019 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
21.019 – COVID-19: Coronavirus Relief Fund
(COVID-19 Surge Capacity Enhancement Payment Program)
Federal Awarding Agency:
U.S. Department of Treasury
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Allowable Costs/Cost Principles;
Period of Performance
Type of Finding:
Significant Deficiency
Cause:
DHS failed to establish and implement sufficient internal controls for monitoring provider expenses.
Effect:
The State of Arkansas could be subject to repayment to the federal government.
Recommendation:
ALA staff recommend the Agency establish and implement internal controls for monitoring the awards to ensure
providers submit appropriate documentation for expenses incurred to demonstrate compliance.
Views of Responsible Officials and Planned Corrective Action:
DHS concurs with this finding. The agency has developed a multi-level control procedure for reviewing future
attestations.
Anticipated Completion Date:
Complete
Contact Person:
Elizabeth Pitman
Director, Division of Medical Services
Department of Human Services
700 Main Street
Little Rock, AR 72201
501-244-3944
Elizabeth.Pitman@dhs.arkansas.gov
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 57 -
Finding Number:
2021-020
State/Educational Agency(s):
Arkansas Department of Commerce –
Arkansas Economic Development Commission
Arkansas Department of Parks, Heritage and Tourism
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
21.019 – COVID-19: Coronavirus Relief Fund
(Business Interruption Grants Program)
Federal Awarding Agency:
U.S. Department of Treasury
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Allowable Costs/Costs Principles;
Period of Performance
Type of Finding:
Noncompliance and Significant Deficiency
Repeat Finding:
Not applicable
Criteria:
The Coronavirus Relief Fund was required by Sec. 5001, as amended, of the Coronavirus Aid, Relief, and Economic
Security Act (CARES Act) to be used to cover only those costs that were (1) necessary expenditures incurred due to
the public health emergency with respect to Coronavirus Disease 2019 (COVID-19) and (2) incurred during the period
that began March 1, 2020, and ended December 31, 2021. In accordance with guidance provided in the Federal
Register by the United States Department of Treasury, the State of Arkansas was required to keep records sufficient
to demonstrate that the funds were used in accordance with this federal legislation.
Furthermore, the State of Arkansas was responsible for determining the level and detail of documentation needed from
sub-recipients of small business assistance to satisfy compliance with this law. Small businesses could use the funding
for allowable expenses that were incurred during the time period beginning March 1, 2020 through September 30,
2020. The small businesses were required to submit proof for those expenses.
Finally, in accordance with 2 CFR § 200.303, a non-federal entity must establish and maintain effective internal control
over the federal award that provides reasonable assurance that the non-federal entity is managing the federal award
in compliance with federal statutes, regulations, and the terms and conditions of the award.
Condition and Context:
Arkansas awarded approximately $48 million to small businesses in specific industries to assist in covering expenses
associated with the negative impact of state orders directly related to COVID-19 mitigation. Funds for approved grants
were disbursed by the Arkansas Economic Development Commission, but the Program was managed under the
general operation of the Arkansas Department of Parks, Heritage, and Tourism (Parks). Parks did not review 100% of
the small businesses that submitted support for expenses. Instead, it developed a review process based on a risk
assessment approach.
Of 2,142 grant payments, ALA staff reviewed a sample of 60 payments, totaling $1,456,172, to determine if sufficient,
appropriate evidence (supporting documentation) was received. Our review revealed the following exceptions:
•
Four grant recipients failed to submit sufficient, appropriate evidence to support expenses totaling $6,040.
•
The Parks review process failed to identify an ineligible business type (automotive repair) for one of the
awards, totaling $1,310. However, Parks was able to recoup the erroneously paid funds because it was
notified by the applicant of an error in the banking information used for the transaction.
Statistically Valid Sample:
Not a statistically valid sample
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 58 -
Finding Number:
2021-020 (Continued)
State/Educational Agency(s):
Arkansas Department of Commerce –
Arkansas Economic Development Commission
Arkansas Department of Parks, Heritage and Tourism
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
21.019 – COVID-19: Coronavirus Relief Fund
(Business Interruption Grants Program)
Federal Awarding Agency:
U.S. Department of Treasury
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Allowable Costs/Costs Principles;
Period of Performance
Type of Finding:
Noncompliance and Significant Deficiency
Questioned Costs:
$6,040
(Known questioned costs greater than $25,000 are required to be reported. The auditor must also report known
questioned costs when likely costs are greater than $25,000).
Cause:
The Agency’s limited review of expenditure documentation and reduced award amounts failed to ensure that all
applicants submitted sufficient, appropriate expense documentation. In addition, Agency controls failed to identify an
ineligible business during its limited review.
Effect:
The State of Arkansas could be subject to repayment of funds to the federal government.
Recommendation:
ALA staff recommend the Agency strengthen its internal controls over monitoring the awards to ensure providers submit
appropriate documentation for expenses incurred to demonstrate compliance.
Views of Responsible Officials and Planned Corrective Action:
Arkansas Department of Parks, Heritage and Tourism:
(A) Four (4) Grant Recipients Failed to Submit Sufficient, Appropriate Evidence to Support Expenses Totaling
$6,040
Due to the time constraints imposed by the then federal payment deadline of December 30, 2020, there was not enough
time or human resources to perform a 100% manual review of each source document for the claims submitted by over
5,000 applicants. Accordingly, the program’s consultants employed review methodologies that included concentrating
on manual review on only the higher dollar amount claims. As the review methodology applies to the four businesses
that received $6,040 in awards, these businesses had lower valued claims in which our review methodology did not
include manual review by our team.
Additionally, applicants with the BIG program self-verified under penalty of perjury that all information supplied was
correct and accurate. A claw back provision was included in the program that can be triggered for material
misrepresentations when, and if, discovered. The BIG program rules required documentation to support all expenses
claimed. However, due to the wide variety of applicant business types and business sizes, the rules provided examples
of acceptable documents but did not provide specific document requirements. The BIG program paid an average of
$.12 on the dollar of total eligible expenses. Accordingly, there is a fair probability that these eligible businesses could
produce additional and acceptable documentation for these, or other expenses, in an amount that exceeds that in
question.
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 59 -
Finding Number:
2021-020 (Continued)
State/Educational Agency(s):
Arkansas Department of Commerce –
Arkansas Economic Development Commission
Arkansas Department of Parks, Heritage and Tourism
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
21.019 – COVID-19: Coronavirus Relief Fund
(Business Interruption Grants Program)
Federal Awarding Agency:
U.S. Department of Treasury
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Allowable Costs/Costs Principles;
Period of Performance
Type of Finding:
Noncompliance and Significant Deficiency
Views of Responsible Officials and Planned Corrective Action (Continued):
Arkansas Department of Parks, Heritage and Tourism (Continued):
ADPHT has corresponded via email to the four (4) businesses that did not supply appropriate documentation and
requested additional detailed information to support the award received. One business has replied to our request;
however, three (3) businesses have not. These businesses may be closed due to the pandemic. ADPHT will send
another email communication; if no response is received, then further action will be taken, including a certified letter
sent via the US Postal Service.
(B) The Parks Review Process Failed to Identify an Ineligible Business Type (Automotive Repair) for One Award
Totaling $1,310
ADPHT became aware of the error in deeming the business eligible for a grant when the applicant contacted ADPHT
regarding a payment issue. ADPHT properly notified the applicant of its lack of eligibility and the decision to not disburse
funds to the applicant. The business was not awarded any funds.
Planned Corrective Action:
Related to both (A) and (B), ADPHT will develop a plan to conduct further review of more grant recipients beyond the
businesses reviewed in the audit sample. This further review will allow ADPHT to ensure that deficient documentation
of claims and/or ineligible businesses were not a pervasive problem with the grant program. For future grant programs,
with more time allowed for development and distribution, ADPHT will:
1)
Increase staff participation to assist in the review and assurance that applicants are in compliance with
program requirements.
2)
Design a program with more controls in place that allows for more time with the application process and
support of applicants to ensure proper documentation is submitted for claims.
3)
Provide detailed requirements for submission of claims itemizing the documentation that must be
submitted in order to support a grant award.
4) Limit the number of qualified expenses that can be reimbursed to include the largest expenses that cause
economic injury to businesses while also limiting the different types of claims.
Anticipated Completion Date:
August 31, 2022
Contact Person:
Leslie Fisken
Chief of Legislative Affairs
Arkansas Department of Parks, Heritage and Tourism
1100 North Street
Little Rock, Arkansas 72201
501-324-9586
Leslie.fisken@arkansas.gov
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 60 -
Finding Number:
2021-020 (Continued)
State/Educational Agency(s):
Arkansas Department of Commerce –
Arkansas Economic Development Commission
Arkansas Department of Parks, Heritage and Tourism
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
21.019 – COVID-19: Coronavirus Relief Fund
(Business Interruption Grants Program)
Federal Awarding Agency:
U.S. Department of Treasury
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Allowable Costs/Costs Principles;
Period of Performance
Type of Finding:
Noncompliance and Significant Deficiency
Views of Responsible Officials and Planned Corrective Action (Continued):
Arkansas Economic Development Commission:
(Joint Response from All Agencies):
AEDC served as the paying agent for the Business Interruption Grant Program (BIG). However, payment amounts
were determined by the Arkansas Department of Parks, Heritage and Tourism (ADPHT). AEDC will coordinate with
ADPHT to review the awards to the four businesses in question and request replacement documentation that meets
program requirements or pursue recovery of the applicable grant amounts.
The Business Interruption Grant Program was a temporary program that is no longer operational. This should fully
mitigate future control issues.
Response from Arkansas Department of Parks, Heritage and Tourism
(A) Four (4) Grant Recipients Failed to Submit Sufficient, Appropriate Evidence to Support Expenses Totaling
$6,040
Due to the time constraints imposed by the then federal payment deadline of December 30, 2020, there was not enough
time or human resources to perform a 100% manual review of each source document for the claims submitted by over
5,000 applicants. Accordingly, the program’s consultants employed review methodologies that included concentrating
on manual review on only the higher dollar amount claims. As the review methodology applies to the four businesses
that received $6,040 in awards, these businesses had lower valued claims in which our review methodology did not
include manual review by our team.
Additionally, applicants with the BIG program self-verified under penalty of perjury that all information supplied was
correct and accurate. A claw back provision was included in the program that can be triggered for material
misrepresentations when, and if, discovered. The BIG program rules required documentation to support all expenses
claimed. However, due to the wide variety of applicant business types and business sizes, the rules provided examples
of acceptable documents but did not provide specific document requirements. The BIG program paid an average of
$.12 on the dollar of total eligible expenses. Accordingly, there is a fair probability that these eligible businesses could
produce additional and acceptable documentation for these, or other expenses, in an amount that exceeds that in
question.
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 61 -
Finding Number:
2021-020 (Continued)
State/Educational Agency(s):
Arkansas Department of Commerce –
Arkansas Economic Development Commission
Arkansas Department of Parks, Heritage and Tourism
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
21.019 – COVID-19: Coronavirus Relief Fund
(Business Interruption Grants Program)
Federal Awarding Agency:
U.S. Department of Treasury
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Allowable Costs/Costs Principles;
Period of Performance
Type of Finding:
Noncompliance and Significant Deficiency
Views of Responsible Officials and Planned Corrective Action (Continued):
Arkansas Economic Development Commission: (Continued)
(Joint Response from All Agencies):
As for corrective action, ADPHT contacted the four (4) businesses that did not supply appropriate documentation and
requested further detailed documentation to support the award received. One business replied to our request. ADPHT
has been unable to communicate with the other three (3) businesses. These businesses may have been closed due to
the pandemic. For future grant programs, with more time allowed for development and distribution, the state could
possibly create a program that includes an online validation process of qualified expenses for eligible businesses.
(A) The Parks Review Process Failed to Identify an Ineligible Business Type (Automotive Repair) for One
Award Totaling $1,310
ADPHT became aware of the error in deeming the business eligible for a grant when the applicant contacted ADPHT
regarding a payment issue. ADPHT properly notified the applicant of its lack of eligibility and the decision to not disburse
funds to the applicant. The business was not awarded any funds.
As for corrective action, no further action has been taken with the ineligible business as the business did not receive a
grant award. For future grant programs, with more time allowed for development and distribution, the state could
possibly create a program that includes an online validation process of eligible businesses.
1. ADPHT will continue to reach out to the three (3) businesses that have not responded to our request for
additional information.
2. No further action is required.
It should be noted that the Business Interruption Grant Program was a temporary grant program during the COVID
pandemic and is no longer in effect mitigating any future control issues.
Anticipated Completion Date:
August 31, 2022
Contact Person:
David Bell
Cabinet CFO
Arkansas Department of Commerce
1 Commerce Way
Little Rock, AR 72202
(501) 682-7355
david.bell@arkansas.gov
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 62 -
Finding Number:
2021-021
State/Educational Agency(s):
Arkansas Department of Commerce –
Arkansas Economic Development Commission
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
21.019 – COVID-19: Coronavirus Relief Fund
(Ready for Business Grant Program)
Federal Awarding Agency:
U.S. Department of Treasury
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Allowable Costs/Costs Principles;
Period of Performance
Type of Finding:
Noncompliance and Significant Deficiency
Repeat Finding:
Not applicable
Criteria:
The Coronavirus Relief Fund was required by Sec. 5001, as amended, of the Coronavirus Aid, Relief, and Economic
Security Act (CARES Act) to be used to cover only those costs that were (1) necessary expenditures incurred due to
the public health emergency with respect to Coronavirus Disease 2019 (COVID-19) and (2) incurred during the period
that began March 1, 2020, and ended December 31, 2021. In accordance with guidance provided in the Federal
Register by the United States Department of Treasury, the State of Arkansas was required to keep records sufficient
to demonstrate that the funds were used in accordance with this federal legislation.
Furthermore, the State of Arkansas was responsible for determining the level and detail of documentation needed from
subrecipients of small business assistance to satisfy compliance with this law. Subrecipients were required to submit
receipts prior to October 31, 2021, for expenses incurred between March 1, 2020, and September 30, 2021.
Finally, in accordance with 2 CFR § 200.303, a non-federal entity must establish and maintain effective internal control
over the federal award that provides reasonable assurance that the non-federal entity is managing the federal award
in compliance with federal statutes, regulations, and the terms and conditions of the award.
Condition and Context:
Arkansas awarded approximately $129 million to eligible sub-recipients (e.g., small businesses or nonprofits) to assist
in covering expenses associated with ensuring the health and safety of employees and patrons. Funds for approved
grants were disbursed by the Arkansas Economic Development Commission (AEDC), in full and in advance of the
subrecipients incurring allowable costs.
AEDC developed a review process for the expense documentation submitted by the subrecipients. All submitted
documentation was reviewed by its staff, and the grant was determined to be “complete” when sufficient documentation
had been reviewed and approved.
As of September 20, 2021, 3,216 grants, totaling approximately $49 million, were considered complete by AEDC. ALA
staff reviewed the supporting documentation for 60 completed grants, totaling $918,532, to determine if sufficient,
appropriate evidence (supporting documentation) was maintained.
ALA review revealed the following exceptions for 15 grants:
•
Although one grant subrecipient review was identified as complete, only $38,216 in receipts were
submitted. The subrecipient had received $38,500 in grant funds. Questioned costs totaled $284.
•
Documentation supporting 14 subrecipients was deemed insufficient because the support submitted was
(1) for unallowable items, (2) lacked details to determine what was purchased, (3) lacked dates to
determine whether the items were purchased within the required time period, or (4) included an invoice
previously submitted and, therefore, duplicated. Questioned costs totaled $59,646.
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 63 -
Finding Number:
2021-021 (Continued)
State/Educational Agency(s):
Arkansas Department of Commerce –
Arkansas Economic Development Commission
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
21.019 – COVID-19: Coronavirus Relief Fund
(Ready for Business Grant Program)
Federal Awarding Agency:
U.S. Department of Treasury
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Allowable Costs/Costs Principles;
Period of Performance
Type of Finding:
Noncompliance and Significant Deficiency
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
$59,930
Cause:
The Agency failed to properly review the submitted expense documentation as required.
Effect:
The State of Arkansas could be subject to repayment of funds to the federal government.
Recommendation:
ALA staff recommend the Agency strengthen its internal controls over monitoring the awards to ensure providers submit
appropriate documentation for expenses incurred to demonstrate compliance.
Views of Responsible Officials and Planned Corrective Action:
Benefits under the Ready for Business Grant Program were provided to the eligible businesses as an advance, with
the requirement that the business submit receipts at a later date to confirm that the grant amount was expensed for a
permissible purpose as outlined in the grant program terms.
AEDC will contact the identified businesses and request replacement documentation or repayment of benefits if
documentation is not available.
The Ready for Business Grant Program was a temporary program that is no longer operational. This should fully
mitigate future control issues.
Anticipated Completion Date:
August 31, 2022
Contact Person:
David Bell
Cabinet CFO
Arkansas Department of Commerce
1 Commerce Way
Little Rock, AR 72202
(501) 682-7355
david.bell@arkansas.gov
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 64 -
Finding Number:
2021-022
State/Educational Agency(s):
Arkansas Department of Commerce –
Arkansas Economic Development Commission
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
21.019 – COVID-19: Coronavirus Relief Fund
(Arkansas Rural Connect Program)
Federal Awarding Agency:
U.S. Department of Treasury
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Allowable Costs/Cost Principles;
Period of Performance
Type of Finding:
Significant Deficiency
Repeat Finding:
Not applicable
Criteria:
Coronavirus Relief Funds (CRF) were required by Sec. 5001, as amended, of the Coronavirus Aid, Relief, and
Economic Security Act (CARES Act) to be used to cover only those costs that were (1) necessary expenditures incurred
due to the public health emergency with respect to Coronavirus Disease 2019 (COVID-19) and (2) incurred during the
period that began March 1, 2020, and ended December 31, 2021. As per guidance provided in the Federal Register
by the United States Department of Treasury, the State of Arkansas was required to keep records sufficient to
demonstrate that the funds were used in accordance with this federal legislation.
Furthermore, the State of Arkansas was responsible for determining the level and detail of documentation needed from
subrecipients of small business assistance to satisfy compliance with this law. Grant agreements signed by the
subrecipient required submission of monthly reports of expenses in a form prescribed by the Arkansas Economic
Development Commission (AEDC).
Finally, in accordance with 2 CFR § 200.303, a non-federal entity must establish and maintain effective internal control
over the federal award that provides reasonable assurance that the non-federal entity is managing the federal award
in compliance with federal statutes, regulations, and the terms and conditions of the award.
Condition and Context:
Arkansas awarded approximately $114 million to internet service providers (ISPs) to expand rural broadband capacity.
Funds for approved projects were disbursed by AEDC, in full and in advance of the ISPs incurring allowable costs.
ALA staff requested a copy of the monthly expense report and was informed by AEDC that it had required all project
invoices be electronically submitted to the University of Arkansas for Medical Services (UAMS). AEDC had contracted
with UAMS to review, approve, and monitor reimbursable expenses for each project.
As of September 7, 2021, 44 funded projects were considered technically complete, with financial reviews pending.
ALA staff selected five projects to review to determine if sufficient, appropriate evidence (supporting documentation)
was maintained. This review revealed an exception with one ISP project that received $714,495.
On April 7, 2021, UAMS notified AEDC that the ISP had completed the project, but the reconciliation of receipts was
on-going. In October 2021, approximately six months after the project was complete, ALA staff requested a copy of
the expenditure information submitted to UAMS for this particular project. The original support provided by AEDC and
UAMS indicated that the ISP owed the State of Arkansas $314,889, and AEDC indicated that it would be requesting
reimbursement from the ISP within the next few weeks. In November 2021, the ISP was notified that it would either
need to provide all remaining support for expenses incurred or refund that balance. The ISP elected to provide the
remaining support for expenses incurred.
Statistically Valid Sample:
Not a statistically valid sample
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 65 -
Finding Number:
2021-022 (Continued)
State/Educational Agency(s):
Arkansas Department of Commerce –
Arkansas Economic Development Commission
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
21.019 – COVID-19: Coronavirus Relief Fund
(Arkansas Rural Connect Program)
Federal Awarding Agency:
U.S. Department of Treasury
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Allowable Costs/Cost Principles;
Period of Performance
Type of Finding:
Significant Deficiency
Questioned Costs:
Unknown
Cause:
The Agency failed to establish and implement sufficient internal controls over monitoring.
Effect:
The State of Arkansas could be subject to repayment of funds to the federal government.
In addition, future federal funding allocated to this project and other similar projects could be at risk if controls are not
developed and implemented immediately.
Recommendation:
ALA staff recommend the Agency strengthen its internal controls over monitoring the awards to ensure providers submit
appropriate documentation for expenses incurred to demonstrate compliance.
Views of Responsible Officials and Planned Corrective Action:
As indicated by ALA, receipts were ultimately provided by the Internet Service Provider. AEDC has modified the grant
payment methodology to a reimbursement model beginning with ARC grant appropriations approved by ALC on and
after November 19, 2021. The ISP must first upload invoices/receipts into the UAMS portal. UAMS staff will then review
the invoices/receipts and, if approved, forward approved expenses to AEDC for reimbursement.
Anticipated Completion Date
This reimbursement method is currently in effect.
Contact Person:
David Bell
Cabinet CFO
Arkansas Department of Commerce
1 Commerce Way
Little Rock, AR 72202
(501) 682-7355
david.bell@arkansas.gov
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 66 -
Finding Number:
2021-023
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-2005AR5021; 05-2105AR5021
(Children’s Health Insurance Program)
05-2005AR5MAP; 05-2105AR5MAP
(Medicaid Cluster)
Federal Award Year(s):
2020 and 2021
Compliance Requirement(s) Affected:
Allowable Costs/Cost Principles –
Managed Care Medical Loss Ratio (PASSE and Dental)
Type of Finding:
Noncompliance and Material Weakness
Repeat Finding:
A similar issue was reported in prior-year finding 2020-016.
Criteria:
In a final rule, published in the Federal Register on May 6, 2016 (81 FR 27498), the Centers for Medicare and Medicaid
Services (CMS) adopted Medical Loss Ratio (MLR) requirements for Medicaid and Children’s Health Insurance
Program (CHIP) managed care programs. One of the requirements is that a state must require each Medicaid managed
care plan to calculate and report an MLR for rating periods starting on or after July 1, 2017. Each CHIP managed care
plan is required to calculate and report an MLR for rating periods for state fiscal years beginning on or after July 1,
2018.
Also, per 42 CFR § 438.5(c)(1) states must provide audited financial reports to the actuary, who determines capitation
rates, for the three most recent and complete years for the managed care entities. These reports must be specific to
the Medicaid contract and in accordance with generally accepted accounting principles and generally accepted auditing
standards.
Finally, with regard to capitation rate setting for certain Managed Care Organization (MCO) plans, prior approval must
be obtained as required, in accordance with the regulations below:
•
42 CFR § 438.4(b) - Capitation rates for MCOs must be reviewed and approved by CMS as actuarially
sound and must be provided to CMS in an approved format and within a timeframe that meets the
requirements defined by 42 CFR § 438.7.
•
42 CFR § 438.7(a) - States must submit all MCO rate certifications concurrent with the review and
approval process for contracts as specified in 42 CFR § 438.3(a).
•
42 CFR § 438.3(a) - CMS must review and approve all contracts, including those contracts that are not
subject to the prior approval requirements in 42 CFR § 438.806. For states seeking approval of contracts
prior to a specific effective date, proposed final contracts must be submitted to CMS for review no later
than 90 days prior to the effective date of the contract.
•
42 CFR § 438.3(c) - The capitation rate and the receipt of capitation payments under the contract must
be specifically identified in the applicable contract submitted for CMS review and approval.
•
42 CFR § 438.806(b) - For MCO contracts, prior approval by CMS is a condition of Federal Financial
Participation (FFP) under any MCO contract that has a value equal to or greater than the following
threshold amounts: $1,000,000 for 1998 (the value for all subsequent years is increased by the
percentage increase in the consumer price index). FFP is not available in an MCO contract that does not
have prior approval from CMS.
Condition and Context:
ALA reviewed the Dental Managed Care program and the Provider-Led Arkansas Shared Savings Entity (PASSE)
managed care program for compliance with the various managed care MLR requirements. As a result of procedures
performed, the following deficiencies were noted:
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 67 -
Finding Number:
2021-023 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-2005AR5021; 05-2105AR5021
(Children’s Health Insurance Program)
05-2005AR5MAP; 05-2105AR5MAP
(Medicaid Cluster)
Federal Award Year(s):
2020 and 2021
Compliance Requirement(s) Affected:
Allowable Costs/Cost Principles –
Managed Care Medical Loss Ratio (PASSE and Dental)
Type of Finding:
Noncompliance and Material Weakness
Condition and Context (Continued):
Dental Managed Care:
•
Audited financial reports were not provided to the actuary for the three most recent and complete years
prior to the reporting period. As the Dental Managed Care program was effective beginning on January
1, 2018, audited financial reports from calendar years 2018 and 2019 should have been provided.
PASSE:
•
Audited financial reports were not provided to the actuary for the three most recent and complete years
prior to the reporting period. As the PASSE managed care program was effective beginning on March 1,
2019, an audited financial report from calendar year 2019 should have been provided.
•
No documentation was provided to substantiate that the Agency received prior approval from CMS for
the calendar year 2021 rates prior to implementing the rates in January 2021. (Approval was
subsequently received on August 17, 2021.)
•
No documentation was provided to substantiate that the Agency received prior approval from CMS for
the updated PASSE contracts that were effective January 1, 2021. (Approval was subsequently received
on August 17, 2021.)
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
Unknown
Cause:
The Agency did not adequately develop or implement procedures to ensure that the various managed care MLR
requirements were met.
Effect:
Failure to adequately develop and implement appropriate internal control procedures limits the Agency’s ability to
adequately monitor the program to ensure compliance.
Recommendation:
ALA staff recommend the Agency immediately develop and implement control procedures for managed care MLR
requirements for both the Dental and PASSE managed care programs to ensure the required audited financial reports
are provided and that current capitation rates paid received prior approval from CMS as required.
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 68 -
Finding Number:
2021-023 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-2005AR5021; 05-2105AR5021
(Children’s Health Insurance Program)
05-2005AR5MAP; 05-2105AR5MAP
(Medicaid Cluster)
Federal Award Year(s):
2020 and 2021
Compliance Requirement(s) Affected:
Allowable Costs/Cost Principles –
Managed Care Medical Loss Ratio (PASSE and Dental)
Type of Finding:
Noncompliance and Material Weakness
Views of Responsible Officials and Planned Corrective Action:
DHS concurs with this finding. The agency will update its documented controls to ensure appropriate review of audited
financial reports for PASSE and Dental Managed Care, and timely submission of PASSE rates and contracts to CMS.
Anticipated Completion Date:
Complete
Contact Person:
Elizabeth Pitman
Director, Division of Medical Services
Department of Human Services
700 Main Street
Little Rock, AR 72201
501-244-3944
Elizabeth.Pitman@dhs.arkansas.gov
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 69 -
Finding Number:
2021-024
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-2005AR5021; 05-2105AR5021
(Children’s Health Insurance Program)
05-2005AR5MAP; 05-2105AR5MAP
(Medicaid Cluster)
Federal Award Year(s):
2020 and 2021
Compliance Requirement(s) Affected:
Matching, Level of Effort, Earmarking
Type of Finding:
Material Noncompliance and Material Weakness
Repeat Finding:
A similar issue was reported in prior-year findings 2020-017 and 2019-017.
Criteria:
In accordance with 45 CFR § 95.507(4), the Agency’s established Cost Allocation Plan is required to contain sufficient
information in such detail to permit the Director - Division of Cost Allocation, after consulting with the Operating
Divisions, to make an informed judgment on the correctness and fairness of the State's procedures for identifying,
measuring, and allocating all costs to each of the programs operated by the Agency.
42 CFR § 433.10 and § 433.15 established rates to be used to calculate non-administrative and administrative state
match and require that the state pay part of the costs for providing and administering the Medical Assistance Program
(MAP).
In addition, 45 CFR § 75.303 states that a non-federal entity must “take prompt action when instances of noncompliance
are identified including noncompliance identified in audit findings.”
Condition and Context:
Procedures implemented by the Agency to monitor state general revenues and other non-federal revenues used to
“match” the federal grant award monies are not sufficiently detailed to determine the state match requirements were
met for the MAP and the Children’s Health Insurance Program (CHIP).
As a result, the Agency was again unable to provide sufficient documentation for ALA to complete testing to determine
if the State met the required match in accordance with federal regulations.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
Unknown
Cause:
The Agency does not maintain documentation identifying the original source of revenues for the category “other non-
federal.” Additionally, the Agency utilizes an outside accounting system, Lotus 1-2-3, to maintain and trace state
general revenue and other non-federal funds available. Agency staff manually key information into this system daily;
however, no reviews or other controls are in place to ensure the accuracy of the funding category balances. Agency
procedures implemented to monitor the use of state general revenue and other non-federal funding sources are
completed at the Division level and are not broken out to the federal program level.
Effect:
The Agency’s inadequate controls result in a failure to document the required State match and could limit the Agency’s
resources to ensure the State can continue to provide benefits.
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 70 -
Finding Number:
2021-024 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-2005AR5021; 05-2105AR5021
(Children’s Health Insurance Program)
05-2005AR5MAP; 05-2105AR5MAP
(Medicaid Cluster)
Federal Award Year(s):
2020 and 2021
Compliance Requirement(s) Affected:
Matching, Level of Effort, Earmarking
Type of Finding:
Material Noncompliance and Material Weakness
Recommendation:
ALA staff recommend the Agency immediately implement appropriate controls to allow the Agency to track funding
sources used to meet state match requirements for federal programs.
Views of Responsible Officials and Planned Corrective Action:
DHS disputes, in part, and concurs, in part, with this finding. While the agency maintains documentation identifying
funds classified as “other non-federal” in its fund control ledgers, the funds could be documented with greater specificity.
The agency is in the process of operationalizing its new general ledger system, which will provide greater specificity in
tracking general revenue and “other non-federal” funds.
Anticipated Completion Date:
June 15, 2022
Contact Person:
Misty Eubanks
Chief Financial Officer
Department of Human Services
700 Main Street
Little Rock, AR 72201
501-320-6327
Misty.eubanks@dhs.arkansas.gov
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 71 -
Finding Number:
2021-025
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
93.778 – Medicaid Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-2005AR5021; 05-2105AR5021
(Children’s Health Insurance Program)
05-2005AR5MAP; 05-2105AR5MAP
(Medicaid Cluster)
Federal Award Year(s):
2020 and 2021
Compliance Requirement(s) Affected:
Reporting
Type of Finding:
Noncompliance and Significant Deficiency
Repeat Finding:
A similar issue was reported in prior-year finding 2020-024.
Criteria:
42 CFR 430.30(c) requires submission of a quarterly statement of expenditures report (CMS-64) for the Medical
Assistance Program (MAP). Amounts reported on the CMS-64 must be an accurate and complete accounting of actual
expenditures.
Condition and Context:
ALA staff performed testing of expenditures reported on the CMS-64 for the quarters ending September 30, 2020, and
December 31, 2020, to confirm accuracy and completeness with the expenditures recorded in the Agency’s financial
management system. ALA review revealed the following errors:
•
From the September 30, 2020, CMS-64 report, 24 line items totaling $1,521,563,513 and representing
89.09% of MAP expenditures were selected. ALA identified an uncorrected error on one item, resulting
in an overstatement of the federal portion of expenditures totaling $853,817.
•
From the December 31, 2020, CMS-64 report, 26 line items totaling $1,726,378,270 and representing
90.89% of MAP expenditures were selected. ALA identified an uncorrected error on one item, resulting
in an overstatement of the federal portion of expenditures totaling $1,067,478.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
$1,921,295
Cause:
The State portion for some Medicaid and CHIP expenditures is paid from tobacco settlement funds. At the time these
funds are used, all expenditures are recorded in the Agency’s financial systems as Medicaid expenditures. During the
reporting process, the Agency identifies the CHIP portion of these expenditures and manually adjusts the amount
reported on the CMS-21 report. When making this adjustment, the Agency erroneously adjusted MCHIP expenditures
reported on the CMS-64.21U form instead of adjusting the MAP expenditures reported on the CMS-64.9 base form.
Effect:
Expenditure amounts reported on the quarterly statement of expenditures report (CMS-64) were overstated for the
Medical Assistance Program and understated for the MCHIP program; therefore, federal funding for the expenditures
was received from the incorrect grant award and at the incorrect rate.
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 72 -
Finding Number:
2021-025 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
93.778 – Medicaid Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-2005AR5021; 05-2105AR5021
(Children’s Health Insurance Program)
05-2005AR5MAP; 05-2105AR5MAP
(Medicaid Cluster)
Federal Award Year(s):
2020 and 2021
Compliance Requirement(s) Affected:
Reporting
Type of Finding:
Noncompliance and Significant Deficiency
Recommendation:
ALA staff recommend the Agency perform a thorough review of the supporting documentation for all manual
adjustments and verify the accuracy of these adjustments. ALA further recommends the Agency correct identified
errors by entering prior period adjustments on subsequent CMS-64 reports.
Views of Responsible Officials and Planned Corrective Action:
DHS concurs with this finding. The agency corrected the error made for the Tobacco Funded Adjustment in its CMS-
64 workbook and will make a prior period adjustment on the CMS-64 to correct the overstatement of expenditures.
Anticipated Completion Date:
July 31, 2022
Contact Person:
Jason Callan
Chief Financial Officer, Medicaid Services
Department of Human Services
700 Main Street
Little Rock, AR 72201
501-320-6540
Jason.callan@dhs.arkansas.gov
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 73 -
Finding Number:
2021-026
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-2005AR5021; 05-2105AR5021
(Children’s Health Insurance Program)
05-2005AR5MAP; 05-2105AR5MAP
(Medicaid Cluster)
Federal Award Year(s):
2020 and 2021
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Managed Care Medical Loss Ratio (PASSE and Dental)
Type of Finding:
Noncompliance and Material Weakness
Repeat Finding:
Not applicable
Criteria:
In a final rule, published in the Federal Register on May 6, 2016 (81 FR 27498), CMS adopted Medical Loss Ratio
(MLR) requirements for Medicaid and Children’s Health Insurance Program (CHIP) managed care programs. One of
the requirements is that a state must require each Medicaid managed care plan to calculate and report an MLR for
rating periods starting on or after July 1, 2017. Each CHIP managed care plan is required to calculate and report an
MLR for rating periods for state fiscal years beginning on or after July 1, 2018.
42 CFR § 438.8 contains various requirements related to the MLR report, including that that managed care entities
attest to the accuracy of the MLR reports. In addition, MLR reports must contain the 13 required data elements noted
below:
(i)
Total incurred claims.
(ii) Expenditures on quality improving activities.
(iii) Fraud prevention activities as defined at 42 CFR § 438.8 (e) (4).
(iv) Non-claims costs.
(v) Premium revenue.
(vi) Taxes, licensing, and regulatory fees.
(vii) Methodology for allocation of expenditures.
(viii) Any credibility adjustment applied.
(ix) The calculated MLR.
(x) Any remittance owed to the State, if applicable.
(xi) A comparison of the information reported in this paragraph with the audited financial report required under
42 CFR § 438.3 (m).
(xii) A description of the aggregation method used under 42 CFR § 438.8 (i).
(xiii) The number of member months.
Condition and Context:
ALA reviewed the Dental Managed Care program and the Provider-Led Arkansas Shared Savings Entity (PASSE)
managed care program for compliance with the various managed care MLR requirements. As result of procedures
performed, the following deficiencies were noted:
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 74 -
Finding Number:
2021-026 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-2005AR5021; 05-2105AR5021
(Children’s Health Insurance Program)
05-2005AR5MAP; 05-2105AR5MAP
(Medicaid Cluster)
Federal Award Year(s):
2020 and 2021
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Managed Care Medical Loss Ratio (PASSE and Dental)
Type of Finding:
Noncompliance and Material Weakness
Condition and Context (Continued):
Dental Managed Care:
•
The MLR report submission, for both entities that participate in the Dental Managed Care program, did
not contain 4 of the 13 data elements required. Items (iii), (vii), (xi), and (xii) were missing.
•
One of the Dental Managed Care entities submitted a revised MLR calculation, but the new MLR did not
include a new attestation of accuracy.
PASSE:
•
The MLR report submission, for the 3 entities that participate in the PASSE managed care program, did
not contain 4 of the 13 data elements required. Items (iii), (vii), (xi), and (xii) were missing.
Statistically Valid Sample:
Not applicable
Questioned Costs:
Unknown
Cause:
The Agency did not adequately develop or implement procedures to ensure that the various managed care MLR
requirements were met.
Effect:
Failure to develop and implement appropriate internal control procedures limits the Agency’s ability to adequately
monitor the programs to ensure compliance.
Recommendation:
ALA staff recommend the Agency develop and implement control procedures for managed care MLR requirements for
both the Dental and PASSE managed care programs to ensure compliance.
Views of Responsible Officials and Planned Corrective Action:
DHS concurs with this finding. The agency will update the MLR report used by PASSE and Dental Managed Care
entities to include all required data elements and an attestation of accuracy.
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 75 -
Finding Number:
2021-026 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-2005AR5021; 05-2105AR5021
(Children’s Health Insurance Program)
05-2005AR5MAP; 05-2105AR5MAP
(Medicaid Cluster)
Federal Award Year(s):
2020 and 2021
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Managed Care Medical Loss Ratio (PASSE and Dental)
Type of Finding:
Noncompliance and Material Weakness
Views of Responsible Officials and Planned Corrective Action (Continued):
Anticipated Completion Date:
Complete
Contact Person:
Elizabeth Pitman
Director, Division of Medical Services
Department of Human Services
700 Main Street
Little Rock, AR 72201
501-244-3944
Elizabeth.Pitman@dhs.arkansas.gov
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 76 -
Finding Number:
2021-027
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-2005AR5021; 05-2105AR5021
(Children’s Health Insurance Program)
05-2005AR5MAP; 05-2105AR5MAP
(Medicaid Cluster)
Federal Award Year(s):
2020 and 2021
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Managed Care Financial Audits (PASSE and Dental)
Type of Finding:
Noncompliance and Material Weakness
Repeat Finding:
Not applicable
Criteria:
42 CFR § 438.3 (m) states that managed care contracts must require Managed Care Organizations (MCOs), Prepaid
Inpatient Health Plans (PIHPs), and Prepaid Ambulatory Health Plans (PAHPs) to submit audited financial reports
conducted in accordance with generally accepted accounting principles and generally accepted auditing standards
specific to the Medicaid contract on an annual basis.
In addition, 42 CFR § 438.602 (e) states that an independent audit of the accuracy, truthfulness, and completeness of
the encounter and financial data submitted by, or on behalf of, any MCO, PIHP, or PAHP must be conducted at least
every three years.
Condition and Context:
ALA performed testing to ensure that both the annual audited financial reports as well as the periodic reviews were
performed for the applicable managed care program entities and that the reports and reviews were in compliance with
federal regulations.
Three managed care organizations participated in the Provider-Led Arkansas Shared Savings Entity (PASSE)
managed care program, and two dental managed care entities that participated in the Dental Managed Care program.
The results of our testing revealed that although audited financial reports were provided by all of the PASSE and Dental
Managed Care entities, they were not in accordance with generally accepted accounting principles. In addition, the
audits for the two dental managed care entities were not specific to the Medicaid contract.
Finally, the periodic reviews for the two dental managed care entities completed by the external quality review
organization did not include the required financial data.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
None
Cause:
The Agency did not adequately monitor the submission of reports to ensure they complied with federal regulations.
Effect:
Failure to monitor the adequacy of the reports submitted led to the Agency not identifying that the reports received did
not comply with federal regulations.
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 77 -
Finding Number:
2021-027 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-2005AR5021; 05-2105AR5021
(Children’s Health Insurance Program)
05-2005AR5MAP; 05-2105AR5MAP
(Medicaid Cluster)
Federal Award Year(s):
2020 and 2021
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Managed Care Financial Audits (PASSE and Dental)
Type of Finding:
Noncompliance and Material Weakness
Recommendation:
ALA staff recommend the Agency strengthen monitoring controls to ensure that all reports received are in compliance
with requirements included in the federal regulations.
Views of Responsible Officials and Planned Corrective Action:
DHS concurs with this finding. The agency has updated the Dental Managed Care (DMC) contract to require DMC
entities to perform and provide financial audit reports that have been audited in accordance with GAAP. The agency
will update financial reporting templates used by PASSE and DMC entities to include an attestation that the financial
reports were audited in accordance with GAAP. The agency will also provide the EQRO and its contracted actuary with
the audited financial statements for both PASSE and DMC entities.
Anticipated Completion Date:
July 1, 2022
Contact Person:
Elizabeth Pitman
Director, Division of Medical Services
Department of Human Services
700 Main Street
Little Rock, AR 72201
501-244-3944
Elizabeth.Pitman@dhs.arkansas.gov
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 78 -
Finding Number:
2021-028
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-2005AR5021; 05-2105AR5021
(Children’s Health Insurance Program)
05-2005AR5MAP; 05-2105AR5MAP
(Medicaid Cluster)
Federal Award Year(s):
2020 and 2021
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Managed Care Financial Audits (PASSE and Dental)
Type of Finding:
Material Weakness
Repeat Finding:
Not applicable
Criteria:
In accordance with 45 CFR § 75.302(b)(7), a non-federal entity must establish written procedures to implement and
determine the allowability of costs in accordance with Uniform Administrative Requirements, Cost Principles, and Audit
Requirements, as well as the terms and conditions of the federal award.
In addition, 45 CFR § 75.303 states that a non-federal entity must:
•
Establish and maintain effective internal control over the federal award that provides reasonable
assurance that the non-federal entity is managing the federal award in compliance with federal statutes,
regulations, and the terms and conditions of the award. These controls should comply with Green Book
or COSO guidance.
•
Evaluate and monitor its compliance with the award.
•
Take prompt action when instances of noncompliance are identified, including noncompliance identified
in audit findings.
Finally, 42 CFR § 438.3 (m) states that managed care contracts must require Managed Care Organizations (MCOs),
Prepaid Inpatient Health Plans (PIHPs), and Prepaid Ambulatory Health Plans (PAHPs) to submit audited financial
reports conducted in accordance with generally accepted accounting principles (GAAP) and generally accepted
auditing standards (GAAS) specific to the Medicaid contract on an annual basis.
Condition and Context:
The Agency failed to establish documented internal controls for this compliance area.
In addition, ALA performed testing to determine if there was sufficient, adequate language in the managed care
contracts and agreements for PASSE and Dental Managed Care regarding audited financial reports. Our review
revealed that adequate language was not included in the Dental Managed Care contract requiring that the annual
financial audit be performed.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
None
Cause:
The Agency did not adequately develop or document internal control procedures for its staff or ensure that adequate
language was contained in the Dental Managed Care contract regarding audited financial reports.
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 79 -
Finding Number:
2021-028 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-2005AR5021; 05-2105AR5021
(Children’s Health Insurance Program)
05-2005AR5MAP; 05-2105AR5MAP
(Medicaid Cluster)
Federal Award Year(s):
2020 and 2021
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Managed Care Financial Audits (PASSE and Dental)
Type of Finding:
Material Weakness
Effect:
Failure to adequately document and implement appropriate procedures for internal control limits the Agency’s ability to
adequately monitor the programs for possible noncompliance.
Recommendation:
ALA staff recommend the Agency develop and document internal controls for Managed Care Financial Audits for both
PASSE and Dental Managed Care to aid in ensuring compliance. In addition, the Agency should update the language
in the Dental Managed Care contract to require audited financial reports, in accordance with 42 CFR § 438.3 (m).
Views of Responsible Officials and Planned Corrective Action:
DHS concurs with this finding. The agency has updated the dental managed care (DMC) contract to require DMC
entities to perform and provide financial audit reports that have been audited in accordance with GAAP. The agency
will update financial reporting templates used by PASSE and DMC entities to include an attestation that the financial
reports were audited in accordance with GAAP.
Anticipated Completion Date:
July 1, 2022
Contact Person:
Elizabeth Pitman
Director, Division of Medical Services
Department of Human Services
700 Main Street
Little Rock, AR 72201
501-244-3944
Elizabeth.Pitman@dhs.arkansas.gov
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 80 -
Finding Number:
2021-029
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-2005AR5021; 05-2105AR5021
Federal Award Year(s):
2020 and 2021
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Provider Eligibility (Fee-for-Service)
Type of Finding:
Noncompliance and Material Weakness
Repeat Finding:
A similar issue was reported in prior-year findings 2020-019 and 2019-006.
Criteria:
According to Provider Manual Section 140.000, Provider Participation, any provider of health services must be enrolled
in the Arkansas Medicaid Program prior to reimbursement for any services provided to Arkansas Medicaid beneficiaries.
Enrollment is considered complete when a provider has signed and submitted the following forms:
•
Application.
•
W-9 tax form.
•
Medicaid provider contract.
•
PCP agreement, if applicable.
•
EPSDT agreement, if applicable.
•
Change in ownership control or conviction of crime form.
•
Disclosure of significant business transactions form.
•
Specific license or certification based on provider type and specialty, if applicable.
•
Participation in the Medicare program, if applicable.
42 CFR § 455.414 (effective March 25, 2011, with an extended deadline of September 25, 2016, for full compliance)
states that the State Medicaid Agency must revalidate the enrollment of all providers at least every five years.
Revalidation includes a new application; satisfactory completion of screening activities; and if applicable, fee payment.
Screening activities vary depending on the risk category of the provider as follows:
•
The limited-risk category includes database checks.
•
The moderate-risk category includes those required for limited plus site visits.
•
The high-risk category includes those required for moderate plus fingerprint background checks.
Condition and Context:
From a population of 5,853 providers, ALA staff reviewed files of 40 providers to ensure sufficient, appropriate evidence
was provided to support the determination of eligibility, including compliance with revalidation requirements. Our review
revealed deficiencies with 7 of the provider files as follows:
Moderate-risk category:
Sample item 23: The Agency failed to perform the additional screening requirement (site visit). In
addition, the Agency did not provide documentation of the provider’s licensure that covered the entire
enrollment period. Questioned costs totaled $264.
Sample item 35: The provider’s revalidation was due by September 25, 2016, but was not performed
until December 10, 2020. The Agency also failed to perform the additional screening requirement (site
visit). In addition, the Agency did not provide documentation of the provider’s contract, application, W-9,
licensure, disclosure forms, or background check that covered the entire enrollment period. Questioned
costs totaled $1,346.
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 81 -
Finding Number:
2021-029 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-2005AR5021; 05-2105AR5021
Federal Award Year(s):
2020 and 2021
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Provider Eligibility (Fee-for-Service)
Type of Finding:
Noncompliance and Material Weakness
Condition and Context (Continued):
Sample item 40: The Agency failed to perform the additional screening requirement (site visit). In
addition, the Agency did not provide documentation of the provider’s certification that covered the entire
enrollment period. Questioned costs totaled $7,422.
Limited-risk category:
Sample item 7: The provider’s revalidation was due by September 25, 2016, but was not performed until
April 12, 2021. In addition, the Agency did not provide documentation of the provider’s W-9 form,
disclosure forms, or background check that covered the entire enrollment period. Questioned costs
totaled $254.
Sample item 13: The provider’s revalidation was due by September 25, 2016, but was not performed
until April 18, 2019. Questioned costs totaled $1,631.
Sample item 14: The provider’s revalidation was due by September 25, 2016, but was not performed
until January 13, 2020. Questioned costs totaled $713.
Sample item 15: The provider’s revalidation was due by September 25, 2016, but was not performed until
April 15, 2021. In addition, the Agency did not provide documentation of the provider’s disclosure forms or a
background check that covered the entire enrollment period. Questioned costs totaled $194.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
$11,824
Due to the Coronavirus pandemic, the Centers for Medicare and Medicaid Services (CMS), under section 1135(b)(1)(B)
of the Social Security Act, approved Arkansas’s request to temporarily cease revalidation, including screening
requirements, of providers who are located in Arkansas or are otherwise directly impacted by the emergency. This was
effective beginning March 1, 2020, and continues until the termination of the public health emergency, including any
extensions. As a result, questioned costs were not calculated for the errors regarding late or overdue
revalidations for those payments made to providers on or after March 1, 2020.
Cause:
The Agency had asserted that, effective May 31, 2019, it established and implemented new procedures to improve the
following areas of provider enrollment: maintenance of provider enrollment application documents, provider
revalidation, site visits, and fingerprint background requirements. However, due to the timing of implementation of the
new procedures, deficiencies continued to exist during fiscal year 2021.
Effect:
Claims were processed and paid to providers that did not meet all the required elements and, therefore, were ineligible.
Recommendation:
ALA staff recommend the Agency review and strengthen controls to ensure required enrollment documentation is
maintained to support provider eligibility.
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 82 -
Finding Number:
2021-029 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-2005AR5021; 05-2105AR5021
Federal Award Year(s):
2020 and 2021
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Provider Eligibility (Fee-for-Service)
Type of Finding:
Noncompliance and Material Weakness
Views of Responsible Officials and Planned Corrective Action:
DHS concurs, in part, and disputes, in part, this finding.
Effective May 31, 2019, DMS established and implemented new procedures to improve the following areas of provider
enrollment: maintenance of provider application documents, provider revalidation, site visits and fingerprint background
requirements. Three of the seven deficient provider files relate to non-compliance with revalidation requirements pre-
dating May 31, 2019. The deficiencies noted that occurred prior to May 31, 2019, will be corrected upon revalidation of
the provider. The DHS Office of Payment Integrity and Internal Audit also conducts regular provider eligibility
compliance reviews and reports its findings to DMS.
Two of the seven deficient providers did not submit an application for revalidation or updated proof of certification. The
agency sent multiple notifications to the provider concerning the requirement to revalidate and provide proof of
certification. DHS has not terminated the providers due to the suspension of terminations during the COVID-19 federal
public health emergency.
The agency disputes two deficiencies in which it was noted that the agency failed to provide disclosure forms and proof
of background checks for providers. In these two instances, the agency relied upon screening of the providers
performed by Medicare as permitted by 42 CFR §455.410(c)(1).
Anticipated Completion Date:
Complete
Contact Person:
Elizabeth Pitman
Director, Division of Medical Services
Department of Human Services
700 Main Street
Little Rock, AR 72201
501-244-3944
Elizabeth.Pitman@dhs.arkansas.gov
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 83 -
Finding Number:
2021-030
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-2005AR5021; 05-2105AR5021
Federal Award Year(s):
2020 and 2021
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Provider Eligibility (Managed Care Organizations)
Type of Finding:
Noncompliance and Material Weakness
Repeat Finding:
A similar issue was reported in prior-year findings 2020-020 and 2019-007.
Criteria:
According to Provider Manual Section 140.000, Provider Participation, any provider of health services must be enrolled
in the Arkansas Medicaid Program prior to reimbursement for any services provided to Arkansas Medicaid beneficiaries.
Managed Care Network providers must also be enrolled in the Arkansas Medicaid Program. Enrollment is considered
complete when a provider has signed and submitted the following forms:
•
Application.
•
W-9 tax form.
•
Medicaid provider contract.
•
PCP agreement, if applicable.
•
EPSDT agreement, if applicable.
•
Change in ownership control or conviction of crime form.
•
Disclosure of significant business transactions form.
•
Specific license or certification based on provider type and specialty, if applicable.
•
Participation in the Medicare program, if applicable.
42 CFR § 455.414 (effective March 25, 2011, with an extended deadline of September 25, 2016, for full compliance)
states that the State Medicaid Agency must revalidate the enrollment of all providers at least every five years.
Revalidation includes a new application; satisfactory completion of screening activities; and if applicable, fee payment.
Screening activities vary depending on the risk category of the provider as follows:
•
The limited-risk category includes database checks.
•
The moderate-risk category includes those required for limited plus site visits.
•
The high-risk category includes those required for moderate plus fingerprint background checks.
Condition and Context:
To determine if Managed Care Network providers met all necessary criteria to participate in the Medicaid program, ALA
staff selected 40 provider files from a population of 2,843 for review. The providers selected participated in the Dental
Managed Care program, commonly referred to as Healthy Smiles, and the Provider-Led Arkansas Shares Savings
Entity, or PASSE, managed care program. ALA review revealed deficiencies with 7 of the provider files as follows:
Moderate-risk category:
Sample item 21: The Agency did not perform the additional screening requirement (site visit). In addition,
the Agency did not provide documentation of the required disclosure forms that covered the entire
enrollment period. Ineligible costs totaled $1,503.
Sample item 24: The Agency did not perform the additional screening requirement (site visit). In addition,
the Agency did not provide documentation of the application that covered the entire enrollment period.
Ineligible costs totaled $93.
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 84 -
Finding Number:
2021-030 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-2005AR5021; 05-2105AR5021
Federal Award Year(s):
2020 and 2021
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Provider Eligibility (Managed Care Organizations)
Type of Finding:
Noncompliance and Material Weakness
Condition and Context (Continued):
Sample item 31: The Agency did not perform the additional screening requirement (site visit). In addition,
the Agency did not provide documentation of the provider’s certification that covered the entire enrollment
period. Ineligible costs totaled $2,075.
Limited-risk category:
Sample item 4: The provider’s revalidation was due by September 25, 2016, but was not performed until
April 12, 2021. In addition, the Agency did not provide documentation of the required W-9 form, disclosure
forms, or the background check that covered the entire enrollment period. Ineligible costs totaled $100.
Sample item 12: The provider’s revalidation was due by September 25, 2016, but was never performed.
In addition, the Agency did not provide documentation of the disclosure forms or the background check
that covered the entire enrollment period. Ineligible costs totaled $97.
Sample item 25: The provider’s revalidation was due by September 25, 2016, but was never performed.
In addition, the Agency did not provide documentation of the disclosure forms or the background check
that covered the entire enrollment period. Ineligible costs totaled $119.
Sample item 28: The provider’s revalidation was due by December 7, 2016, but was not completed until
September 5, 2019. In addition, the Agency did not provide documentation of the provider’s licensure
covering the entire enrollment period. Ineligible costs totaled $781.
All ineligible costs identified above were PASSE payments totaling $4,768.
NOTE: Because these providers are participating in the managed care portion of CHIP, providers are reimbursed by
the managed care organizations, not the Agency. The managed care organizations receive a predetermined monthly
payment from the Agency in exchange for assuming the risk for the covered recipients.
These monthly payments are actuarially determined based, in part, upon historical costs data. Accordingly, the failure
to remove unallowable cost data from the amounts utilized by the actuary would lead to overinflated future rates, which
will be directly paid by the Agency.
In addition, due to the Coronavirus pandemic, the Centers for Medicare and Medicaid Services (CMS), under section
1135(b)(1)(B) of the Social Security Act, approved Arkansas’s request to temporarily cease revalidation, including
screening requirements, of providers who are located in Arkansas or are otherwise directly impacted by the emergency.
This was effective as of March 1, 2020, and will continue until the termination of the public health emergency, including
any extensions.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
Unknown
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 85 -
Finding Number:
2021-030 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-2005AR5021; 05-2105AR5021
Federal Award Year(s):
2020 and 2021
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Provider Eligibility (Managed Care Organizations)
Type of Finding:
Noncompliance and Material Weakness
Cause:
The Agency had asserted that, effective May 31, 2019, it established and implemented new procedures to improve the
following areas of provider enrollment: maintenance of provider enrollment application documents, provider
revalidation, site visits, and fingerprint background requirements. However, due to the timing of the implementation of
the new procedures, deficiencies continued to exist during fiscal year 2021.
Effect:
Claims were processed and paid to providers that did not meet all the required criteria.
Recommendation:
ALA staff recommend the Agency strengthen controls to ensure required enrollment documentation is maintained to
support provider eligibility.
Views of Responsible Officials and Planned Corrective Action:
DHS concurs, in part, and disputes, in part, this finding.
Effective May 31, 2019, DMS established and implemented new procedures to improve the following areas of provider
enrollment: maintenance of provider application documents, provider revalidation, site visits and fingerprint background
requirements. Three of the seven deficient provider files relate to non-compliance with revalidation requirements pre-
dating May 31, 2019. The deficiencies noted that occurred prior to May 31, 2019, will be corrected upon revalidation of
the provider. The DHS Office of Payment Integrity and Internal Audit also conducts regular provider eligibility
compliance reviews and reports its findings to DMS.
Three of the seven deficient providers did not submit an application for revalidation or updated proof of certification.
The agency sent multiple notifications to the provider concerning the requirement to revalidate and provide proof of
certification. DHS has not terminated the providers due to the suspension of terminations during the COVID-19 federal
public health emergency.
The agency disputes one deficiency in which it was noted that the agency failed to provide disclosure forms and a proof
of background check for the provider. In this instance, the agency relied upon screening of the provider performed by
Medicare as permitted by 42 CFR §455.410(c)(1).
Anticipated Completion Date:
Complete
Contact Person:
Elizabeth Pitman
Director, Division of Medical Services
Department of Human Services
700 Main Street
Little Rock, AR 72201
501-244-3944
Elizabeth.Pitman@dhs.arkansas.gov
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 86 -
Finding Number:
2021-031
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-2005AR5MAP; 05-2105AR5MAP
Federal Award Year(s):
2020 and 2021
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed –
Home and Community-Based Services
(ARChoices Waiver)
Type of Finding:
Noncompliance and Material Weakness
Repeat Finding:
A similar issue was reported in prior-year findings 2020-021 and 2019-011.
Criteria:
On January 1, 2019, the Arkansas Independent Assessment (ARIA) tool was used to determine the ARChoices level
of care and aided in developing the beneficiary Patient-Centered Service Plan (PCSP). Attendant Care hours are
determined utilizing the Task and Hour Standards (THS), which is the written methodology used by the Arkansas
Department of Human Services (DHS) Registered Nurses (RNs) as the basis for calculating the number of attendant
care hours that are reasonably and medically necessary. In addition, an Individual Service Budget (ISB) sets the
maximum dollar amount for all waiver services received by an individual. Services must be provided according to the
beneficiary’s PCSP, with reimbursement limited to the monthly provision reflected on the PCSP.
Condition and Context:
ALA staff reviewed data for 40 beneficiaries to determine if a valid PCSP was in effect for all dates of service for which
claims were paid and if attendant care services were provided in accordance with the beneficiary’s PCSP and did not
exceed the frequency or the maximum amount allowed. Our review revealed the following deficiencies regarding 14
beneficiaries:
•
Sample item 3: Claims totaling $13,096 were paid without a valid PCSP for dates of service beginning
June 1, 2020 through January 27, 2021.
•
Sample item 4: Claims totaling $685 were paid without a valid PCSP for dates of service beginning June
8, 2020 through July 31, 2020.
•
Sample item 9: Claims totaling $16,879 were paid without a valid PCSP for dates of service beginning
June 15, 2020 through June 4, 2021.
•
Sample item 12: Claims totaling $10,655 were paid without a valid PCSP for dates of service beginning
June 15, 2020 through June 11, 2021.
•
Sample item 14: Claims totaling $918 were paid without a valid PCSP for dates of service beginning
January 1, 2021 through May 7, 2021.
•
Sample item 17: Claims totaling $3,928 were paid without a valid PCSP for dates of service beginning
June 25, 2020 through September 11, 2020.
•
Sample item 20: Claims totaling $1,314 were paid without a valid PCSP for dates of service beginning
June 1, 2020 through June 29, 2020.
•
Sample item 21: Claims totaling $31,375 were paid without a valid PCSP for dates of service beginning
June 14, 2020 through February 28, 2021.
•
Sample item 22: Claims totaling $16,159 were paid without a valid PCSP for dates of service beginning
May 31, 2020 through June 10, 2021.
•
Sample item 26: Claims totaling $ 4,766 were paid without a valid PCSP for dates of service beginning
June 16, 2020 through August 11, 2020.
•
Sample item 28: Claims totaling $3,418 were paid without a valid PCSP for dates of service beginning
June 22, 2020 through March 15, 2021.
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 87 -
Finding Number:
2021-031 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-2005AR5MAP; 05-2105AR5MAP
Federal Award Year(s):
2020 and 2021
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed –
Home and Community-Based Services
(ARChoices Waiver)
Type of Finding:
Noncompliance and Material Weakness
Condition and Context (Continued):
•
Sample item 29: Claims totaling $1,653 were paid without a valid PCSP for dates of service beginning
June 15, 2020 through March 15, 2021.
•
Sample item 36: Claims totaling $6,573 were paid without a valid PCSP for dates of service beginning
June 15, 2020 through October 24, 2020.
•
Sample item 39: Claims totaling $15,524 were paid without a valid PCSP for dates of service beginning
April 1, 2020 through November 27, 2020.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
In accordance with the Families First Coronavirus Response Act (FFCRA), states must provide continuous coverage,
through the end of the month in which the emergency period ends, to all Medicaid beneficiaries who were enrolled in
Medicaid on or after March 18, 2020, regardless of any changes in circumstances or redeterminations at scheduled
renewals that otherwise would result in termination. As a result, questioned costs were not calculated for the claims
paid without a valid PCSP.
Cause:
Prior to January 1, 2021, the Division of Aging, Adult, and Behavioral Health Services (DAABHS) provided OPTUM,
the Agency contractor responsible for performing the independent assessments for the ARChoices program, with the
referrals for the ARIAs based upon the month of expiration. Once the ARIAs were completed by OPTUM, they were
forwarded to the Office of Long Term Care (OLTC) under Provider Services & Quality Assurance so that a DHS RN
could review the assessment results to determine if the individual’s assessed needs were consistent with services
available through the ARChoices program. This determination was documented on a DHS Form 704. This form was
then forwarded onto the Division of County Operations (DCO) to aid in determining recipient eligibility (medical
necessity). Once this was done, the DHS Form 704 was then sent to DAABHS so that the process for completing a
new PCSP could be started.
Effective January 1, 2021, unless identified as needed, ARIAs are not required to be performed for existing ARChoices
recipients in order to develop a new PCSP. Reevaluations will continue to be performed on at least an annual basis,
with the functional eligibility reaffirmed or revised and a written determination issued by the Office of Long Term Care,
and an updated PCSP will be generated.
Delays in requesting, performing, and utilizing the information necessary to complete the PCSP as described above
contributed to deficiencies noted with the beneficiaries’ PCSP.
Effect:
Amounts paid were in excess of amounts authorized.
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 88 -
Finding Number:
2021-031 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-2005AR5MAP; 05-2105AR5MAP
Federal Award Year(s):
2020 and 2021
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed –
Home and Community-Based Services
(ARChoices Waiver)
Type of Finding:
Noncompliance and Material Weakness
Recommendation:
ALA staff recommend the Agency review and strengthen its policies and procedures to ensure that all amounts paid
are in accordance with amounts authorized and that amounts authorized are supported by both a current and valid
PCSP and the CMS approved assessment tools, which are currently the ARIA assessment and THS.
Views of Responsible Officials and Planned Corrective Action:
DHS concurs with this finding. The agency has implemented a workflow management system and strategy to track and
report re-evaluation activities that will ensure timely completion of Person-Centered Service Plan for ARChoices
beneficiaries. Assessments are also being documented electronically, which allows for more effective tracking and
planning.
Anticipated Completion Date:
Complete
Contact Person:
Jay Hill
Director, Division of Aging, Adult, and Behavioral Health Services
Department of Human Services
700 Main Street
Little Rock, AR 72201
501-686-9981
Jay.hill@dhs.arkansas.gov
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 89 -
Finding Number:
2021-032
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-2005AR5MAP; 05-2105AR5MAP
(Medicaid Cluster)
Federal Award Year(s):
2020 and 2021
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Provider Eligibility (Fee-for-Service)
Type of Finding:
Noncompliance and Material Weakness
Repeat Finding:
A similar issue was reported in prior-year findings 2020-026 and 2019-006.
Criteria:
According to Provider Manual Section 140.000, Provider Participation, any provider of health services must be enrolled
in the Arkansas Medicaid Program prior to reimbursement for any services provided to Arkansas Medicaid beneficiaries.
Enrollment is considered complete when a provider has submitted the following forms:
•
Application.
•
W-9 tax form.
•
Medicaid provider contract.
•
PCP agreement, if applicable.
•
EPSDT agreement, if applicable.
•
Change in ownership control or conviction of crime form.
•
Disclosure of significant business transactions form.
•
Specific license or certification based on provider type and specialty, if applicable.
•
Participation in the Medicare program, if applicable.
42 CFR § 455.414 (effective March 25, 2011, with an extended deadline of September 25, 2016, for full compliance)
states that the State Medicaid Agency must revalidate the enrollment of all providers at least every five years.
Revalidation includes a new application; satisfactory completion of screening activities; and, if applicable, fee payment.
Screening activities vary depending on the risk category of the provider as follows:
•
The limited-risk category includes database checks.
•
The moderate-risk category includes those required for limited, plus site visits.
•
The high-risk category includes those required for moderate, plus fingerprint background checks.
Condition and Context:
From a population of 10,664, ALA staff reviewed files of 40 providers to ensure sufficient, appropriate evidence was
provided to support the determination of eligibility, including compliance with revalidation requirements. Our review
revealed deficiencies with 10 of the provider files as follows:
High-risk category:
Sample item 38: The Agency failed to perform the additional screening requirements (site visit or
fingerprint background check). In addition, the Agency did not provide documentation of the provider’s
professional certification that covered the entire engagement period. Questioned costs totaled $105.
Sample item 40: The Agency failed to perform the additional screening requirements (site visit or
fingerprint background check). In addition, the Agency did not provide documentation of the provider’s
professional certification that covered the entire engagement period. Questioned costs totaled $45,640.
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 90 -
Finding Number:
2021-032 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-2005AR5MAP; 05-2105AR5MAP
(Medicaid Cluster)
Federal Award Year(s):
2020 and 2021
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Provider Eligibility (Fee-for-Service)
Type of Finding:
Noncompliance and Material Weakness
Condition and Context (Continued):
Moderate-risk category:
Sample item 16: The Agency failed to perform the additional screening requirement (site visit) that
coincided with the revalidation performed on September 18, 2015. Questioned costs totaled $8,529.
Sample item 21: The Agency failed to perform the additional screening requirement (site visit) that was
due by September 25, 2016, until the revalidation was performed on November 5, 2019. Questioned
costs totaled $371.
Sample item 24: The Agency failed to perform the additional screening requirement (site visit) that was
due by September 25, 2016, until the revalidation was performed on May 14, 2019. Questioned costs
totaled $56.
Sample item 30: The Agency failed to perform the additional screening requirement (site visit) that
coincided with its 2017 enrollment. Questioned costs totaled $53.
Sample item 32: The provider’s revalidation was due by September 25, 2016, but was not performed
until January 3, 2020. Questioned costs totaled $24.
Sample item 35: The provider’s revalidation was due by September 25, 2016, but was not performed
until March 20, 2020. Questioned costs totaled $11,336.
Limited-risk category:
Sample item 8: The provider’s revalidation was due by September 25, 2016, but was not performed until
May 2, 2019. Questioned costs totaled $65.
Sample item 31: The provider’s revalidation was due by September 25, 2016, but was not performed
until September 10, 2020. In addition, disclosure forms and standard background checks that covered
the entire engagement period were not provided. Questioned costs totaled $5,435.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
$71,614
Due to the Coronavirus pandemic, the Centers for Medicare and Medicaid Services (CMS), under section 1135(b)(1)(B)
of the Social Security Act, approved Arkansas’s request to temporarily cease revalidation, including screening
requirements, of providers who are located in Arkansas or are otherwise directly impacted by the emergency. This was
effective beginning March 1, 2020, and continues until the termination of the public health emergency, including any
extensions. As a result, questioned costs were not calculated for the errors regarding late or overdue
revalidations for those payments made to providers on or after March 1, 2020.
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 91 -
Finding Number:
2021-032 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-2005AR5MAP; 05-2105AR5MAP
(Medicaid Cluster)
Federal Award Year(s):
2020 and 2021
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Provider Eligibility (Fee-for-Service)
Type of Finding:
Noncompliance and Material Weakness
Cause:
The Agency had asserted that, effective May 31, 2019, it established and implemented new procedures to improve the
following areas of provider enrollment: maintenance of provider enrollment application documents, provider
revalidation, site visits, and fingerprint background requirements. However, due to the timing of the implementation of
the new procedures, deficiencies continued to exist during fiscal year 2021.
Effect:
Claims were processed and paid to providers that did not meet all the required elements and, therefore, were ineligible.
Recommendation:
ALA staff recommend the Agency strengthen controls to ensure required enrollment documentation is maintained to
support provider eligibility.
Views of Responsible Officials and Planned Corrective Action:
DHS concurs with this finding. Effective May 31, 2019, DMS established and implemented new procedures to improve
the following areas of provider enrollment: maintenance of provider application documents, provider revalidation, site
visits and fingerprint background requirements. Eight of the ten deficient provider files relate to non-compliance with
revalidation requirements pre-dating May 31, 2019. The deficiencies noted that occurred prior to May 31, 2019, will be
corrected upon revalidation of the provider. The DHS Office of Payment Integrity and Internal Audit also conducts
regular provider eligibility compliance reviews and reports its findings to DMS.
One of the ten deficient providers revalidated after the established revalidation deadline in SFY20. This provider
submitted an application for revalidation which was not able to be processed by the revalidation deadline, due to
incomplete information on the application. The provider was not terminated as the missing documentation was
submitted to the agency.
One of the ten deficient providers did not submit an application for revalidation or proof of licensure and certification.
The agency sent multiple notifications to this provider concerning the requirement to revalidate and produce proof of
licensure and certification. DHS has not terminated the provider due to the suspension of terminations during the
COVID-19 federal public health emergency.
Anticipated Completion Date:
May 31, 2019
Contact Person:
Elizabeth Pitman
Director, Division of Medical Services
Department of Human Services
700 Main Street
Little Rock, AR 72201
501-244-3944
Elizabeth.Pitman@dhs.arkansas.gov
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 92 -
Finding Number:
2021-033
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1905AR5MAP; 05-2005AR5MAP
Federal Award Year(s):
2020 and 2021
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Provider Eligibility (Managed Care Organizations)
Type of Finding:
Noncompliance and Material Weakness
Repeat Finding:
A similar issue was reported in prior-year findings 2020-027 and 2019-007.
Criteria:
According to Provider Manual Section 140.000, Provider Participation, any provider of health services must be enrolled
in the Arkansas Medicaid Program prior to reimbursement for any services provided to Arkansas Medicaid beneficiaries.
Managed Care Network providers must also be enrolled in the Arkansas Medicaid Program. Enrollment is considered
complete when a provider has submitted the following forms:
•
Application.
•
W-9 tax form.
•
Medicaid provider contract.
•
PCP agreement, if applicable.
•
EPSDT agreement, if applicable.
•
Change in ownership control or conviction of crime form.
•
Disclosure of significant business transactions form.
•
Specific license or certification based on provider type and specialty, if applicable.
•
Participation in the Medicare program, if applicable.
42 CFR § 455.414 (effective March 25, 2011, with an extended deadline of September 25, 2016, for full compliance)
states that the State Medicaid Agency must revalidate the enrollment of all providers at least every five years.
Revalidation includes a new application; satisfactory completion of screening activities; and if applicable, fee payment.
Screening activities vary depending on the risk category of the provider as follows:
•
The limited-risk category includes database checks.
•
The moderate-risk category includes those required for limited, plus site visits.
•
The high-risk category includes those required for moderate, plus fingerprint background checks.
Condition and Context:
To determine if Managed Care Network providers met all necessary criteria to participate in the Medicaid program, ALA
staff selected 40 provider files from a population of 5,912 for review. The providers selected participated in the Dental
Managed Care program, commonly referred to as Healthy Smiles, and the Provider-Led Arkansas Shared Savings
Entity (PASSE) managed care program. ALA review revealed deficiencies with 6 of the provider files as follows:
Moderate-risk category:
Sample item 21: The provider’s revalidation was due by September 25, 2016, but was not performed
until March 3, 2020. In addition, the Agency failed to perform the additional screening requirement (site
visit) until the revalidation was performed on March 3, 2020, and did not provide documentation of the
provider’s certification that covered the entire engagement period. Ineligible costs totaled $4,377.
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 93 -
Finding Number:
2021-033 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1905AR5MAP; 05-2005AR5MAP
Federal Award Year(s):
2020 and 2021
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Provider Eligibility (Managed Care Organizations)
Type of Finding:
Noncompliance and Material Weakness
Condition and Context (Continued):
Limited-risk category:
Sample item 1: The provider’s revalidation was due by September 25, 2016, but was not performed until
April 5, 2019. In addition, the Agency could not provide the required W-9 that covered the entire
enrollment period. Ineligible costs totaled $2,015.
Sample item 8: The provider’s revalidation was due by September 25, 2016, but was never performed.
In addition, the Agency could not provide the required W-9, disclosure forms, or documentation of a
standard background check for review. Ineligible costs totaled $23.
Sample item 14: The provider’s revalidation was due by September 25, 2016, but was not performed
until May 23, 2019. In addition, the Agency could not provide the required W-9 that covered the entire
enrollment period. Ineligible costs totaled $9,669,741.
Sample item 23: The provider’s revalidation was due by September 25, 2016, but was not performed
until September 5, 2019. In addition, The Agency could not provide documentation of provider licensure
that covered the entire enrollment period. Ineligible costs totaled $2,766.
Sample item 38: The provider’s revalidation was due by September 25, 2016, but was never performed.
In addition, the Agency could not provide the required disclosure forms or documentation of a standard
background check that covered the entire enrollment period. Ineligible costs totaled $292.
All ineligible costs identified above were PASSE payments totaling $9,679,214.
NOTE: Because these providers are participating in the managed care portion of Medicaid, providers are reimbursed
by the managed care organizations, not the Agency. The managed care organizations receive a predetermined
monthly payment from the Agency in exchange for assuming the risk for the covered recipients.
These monthly payments are actuarially determined based, in part, upon historical costs data. Accordingly, the failure
to remove unallowable cost data from the amounts utilized by the actuary would lead to overinflated future rates, which
will be directly paid by the Agency.
In addition, due to the Coronavirus pandemic, the Centers for Medicare and Medicaid Services (CMS), under section
1135(b)(1)(B) of the Social Security Act, approved Arkansas’s request to temporarily cease revalidation, including
screening requirements, of providers who are located in Arkansas or are otherwise directly impacted by the emergency.
This was effective as of March 1, 2020, and will continue until the termination of the public health emergency, including
any extensions.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
Unknown
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 94 -
Finding Number:
2021-033 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1905AR5MAP; 05-2005AR5MAP
Federal Award Year(s):
2020 and 2021
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Provider Eligibility (Managed Care Organizations)
Type of Finding:
Noncompliance and Material Weakness
Cause:
The Agency had asserted that, effective May 31, 2019, it established and implemented new procedures to improve the
following areas of provider enrollment: maintenance of provider enrollment application documents, provider
revalidation, site visits, and fingerprint background requirements. However, due to the timing of the implementation of
the new procedures, deficiencies continued to exist during fiscal year 2021.
Effect:
Claims were processed and paid to providers that did not meet all the required elements.
Recommendation:
ALA staff recommend the Agency strengthen controls to ensure required enrollment documentation is maintained to
support provider eligibility.
Views of Responsible Officials and Planned Corrective Action:
DHS concurs, in part, and disputes, in part, this finding.
Three of the six deficient providers did not submit an application for revalidation or updated proof of certification. The
agency sent multiple notifications to the provider concerning the requirement to revalidate and provide proof of
certification. DHS has not terminated the providers due to the suspension of terminations during the COVID-19 federal
public health emergency.
The agency disputes three deficiencies in which it was noted that the agency failed to provide disclosure forms and
proof of licensure for providers. In these three instances, the agency relied upon screening of the providers performed
by Medicare as permitted by 42 CFR §455.410(c)(1).
Anticipated Completion Date:
Complete
Contact Person:
Elizabeth Pitman
Director, Division of Medical Services
Department of Human Services
700 Main Street
Little Rock, AR 72201
501-244-3944
Elizabeth.Pitman@dhs.arkansas.gov
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 95 -
Finding Number:
2021-034
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-2005AR5MAP; 05-2105AR5MAP
Federal Award Year(s):
2020 and 2021
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Medicaid Fraud Control Unit
Type of Finding:
Noncompliance and Significant Deficiency
Repeat Finding:
A similar issue was reported in prior-year findings 2020-014 and 2019-014.
Criteria:
42 CFR § 433, Subpart F, establishes requirements for identifying overpayments to Medicaid providers and for
refunding the federal portion of identified overpayments to the federal awarding agency. The provisions apply to
overpayments discovered by a state, by a provider and made known to the state, or through federal review.
Also, in accordance with 42 CFR § 433.320, an agency must refund the federal share of overpayments that are subject
to recovery by recording a credit on its Quarterly Statement of Expenditures (Form CMS-64). An agency must credit
the federal share of overpayments on the earlier of (1) the CMS-64 submission due for the quarter in which the
overpayment is recovered from the provider or (2) the quarter in which the one-year period following discovery,
established in accordance with 42 CFR § 433.316, ends. A credit on the CMS-64 must be made whether or not the
state has recovered the overpayment from the provider.
Additionally, as stated in a CMS letter to the State Health Official, SHO #08-004, in accordance with Sections
1903(d)(2)(A) and (d)(3)(A) of the Social Security Act, states are required to return “the federal share of Medicaid
overpayments, damages, fines, penalties, and any other component of a legal judgment or settlement when a State
recovers pursuant to legal action under its State False Claims Act (SFCA).”
Condition and Context:
ALA performed procedures to verify overpayments identified by the Medicaid Fraud Control Unit (MFCU) were properly
reported on the quarterly CMS-64 report. The following errors were discovered:
•
Payment for one settlement was made directly to the U.S. Department of Justice (DOJ). DOJ
subsequently transferred the State’s portion of the settlement, totaling $680,847, to the Agency. In error,
the Agency applied the FMAP and reported $527,180 in overpayments on its CMS-64 report. As a result,
the federal portion of MFCU related overpayments reported was overstated.
•
Payment for one settlement, totaling $1,544,368, was not included on the CMS-64 report. The federal
share that should have been reported for MFCU related overpayments was $1,195,804, resulting in an
understatement.
•
Payment representing a fine for a criminal conviction, totaling $250, was not reported on the CMS-64
report. The federal share that should have been reported for MFCU related overpayments was $194,
resulting in an understatement.
•
Unpaid restitution balances from previous fiscal years, totaling $270,201, were not included on the CMS-
64. The federal share that should have been reported was $209,217, resulting in an understatement.
The net effect of the errors is an understatement totaling $878,035.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
$878,035
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 96 -
Finding Number:
2021-034 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-2005AR5MAP; 05-2105AR5MAP
Federal Award Year(s):
2020 and 2021
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Medicaid Fraud Control Unit
Type of Finding:
Noncompliance and Significant Deficiency
Cause:
The Agency’s Accounts Receivable staff, who are responsible for monitoring balances and payments received
representing Medicaid overpayments, do not have a full understanding of the reporting requirements. As a result,
supporting documents compiled for the MFCU overpayments were not properly prepared.
Effect:
The Agency failed to report all required restitution and other judgments on its CMS-64 reports.
Recommendation:
ALA staff recommend the Agency review and strengthen its accounts receivable procedures and provide adequate
training to all individuals involved in the collecting, recording, and reporting of provider overpayments identified by
MFCU.
Views of Responsible Officials and Planned Corrective Action:
DHS concurs with this finding. The agency is updating its process for tracking Medicaid provider overpayments and will
begin tracking all overpayments and corresponding collections in the Medicaid Management Information System, which
will provide greater continuity in overpayment tracking, collection, and reporting.
Anticipated Completion Date:
June 30, 2022
Contact Person:
Jason Callan
Chief Financial Officer, Medicaid Services
Department of Human Services
700 Main Street
Little Rock, AR 72201
501-320-6540
Jason.callan@dhs.arkansas.gov
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 97 -
Finding Number:
2021-035
State/Educational Agency(s):
Arkansas Department of Commerce –
Division of Workforce Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
97.050 – COVID-19: Presidential Declared Disaster
Assistance to Individuals and Households – Other Needs
(Supplemental Payments for Lost Wages)
Federal Awarding Agency:
Federal Emergency Management Agency
Federal Award Number(s):
4518DRARSPLW
Federal Award Year(s):
Not Applicable
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Eligibility
Type of Finding:
Material Noncompliance and Material Weakness
Repeat Finding:
Not applicable
Criteria:
In accordance with 2 CFR § 200.303, a non-federal entity must establish and maintain effective internal control over
the federal award that provides reasonable assurance that the non-federal entity is managing the federal award in
compliance with federal statutes, regulations, and the terms and conditions of the award.
Unemployment Insurance Program Letter (UIPL) No. 27-20 established Lost Wages Assistance (LWA), which provided
a $300 supplemental benefit for six weeks beginning with the weeks ending August 1, 2020 through September 5,
2020. Claimants from both the regular Unemployment Compensation (UC) system and the Pandemic Unemployment
Assistance (PUA) system were eligible for LWA, if eligible for weekly benefits of at least $100 from their respective
programs.
Condition and Context:
456,575 weekly LWA benefits payments, totaling $129,580,530, were made during the year ended June 30, 2021. In
a random sample of 60 weekly LWA benefits payments to 60 different claimants totaling $18,000, ALA noted 8
claimants, with payments totaling $2,100, who were deemed ineligible at a later date by caseworkers.
In order to determine the severity of the noncompliance, likely questioned costs must be calculated. As a result of this
calculation, the $2,100 identified as known questioned costs were projected to the population, resulting in likely
questioned costs totaling $15,117,729.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
$2,100
Cause:
In response to the increase in demand for services/benefits, the State relaxed controls over identity verification and
income verification for the Unemployment Insurance program during fiscal year 2021.
Effect:
Lack of appropriate internal controls resulted in overpayments of federal funds.
Recommendation:
ALA staff recommend the Agency maintain and implement internal controls over benefit payments to ensure that
payments are made in the correct amount and to eligible claimants. In addition, ALA staff recommend the Agency
continue to pursue recovery of the overpayments of funds, returning them to the appropriate source.
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 98 -
Finding Number:
2021-035 (Continued)
State/Educational Agency(s):
Arkansas Department of Commerce –
Division of Workforce Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
97.050 – COVID-19: Presidential Declared Disaster
Assistance to Individuals and Households – Other Needs
(Supplemental Payments for Lost Wages)
Federal Awarding Agency:
Federal Emergency Management Agency
Federal Award Number(s):
4518DRARSPLW
Federal Award Year(s):
Not Applicable
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Eligibility
Type of Finding:
Material Noncompliance and Material Weakness
Views of Responsible Officials and Planned Corrective Action:
During the Pandemic, many businesses did not respond to information being sent to them by the agency. Later, they
would respond, and the issues discovered were adjudicated and many created overpayments.
During 2020, the waiting week was waived, and claims filed were paid the following week. The waiting week allows
the employer to respond before the claimant is paid. This allows issues that are undetected to be set prior to claimants
receiving payment. The waiting week was reinstated in January of 2021.
Overpayments have been identified and sent to Benefit Payment Control to have the overpayment created or, if
qualified, a waiver of the amount due.
Anticipated Completion Date:
Completed
Contact Person:
Ken Jennings
Program Administrator UI
Division of Workforce Services
2 Capitol Mall
Little Rock, AR 72201
501-682-3244
Kenneth.jennings@arkansas.gov
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 99 -
Finding Number:
2021-036
State/Educational Agency(s):
Arkansas Department of Commerce –
Division of Workforce Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
97.050 – COVID-19: Presidential Declared Disaster
Assistance to Individuals and Households – Other Needs
(Supplemental Payments for Lost Wages)
Federal Awarding Agency:
Federal Emergency Management Agency
Federal Award Number(s):
4518DRARSPLW
Federal Award Year(s):
Not Applicable
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Eligibility
Type of Finding:
Noncompliance and Material Weakness
Repeat Finding:
Not applicable
Criteria:
In accordance with 2 CFR § 200.303, a non-federal entity must establish and maintain effective internal control over
the federal award that provides a reasonable assurance that the non-federal entity is managing the federal award in
compliance with federal statutes, regulations, and the terms and conditions of the award.
Unemployment Insurance Program Letter (UIPL) No. 14-20 established Pandemic Unemployment Assistance (PUA)
for the self-employed, those seeking part-time employment, or those who otherwise would not qualify for regular
Unemployment Compensation (UC) under state or federal law. As such, the UC and PUA programs are mutually
exclusive, and it is not allowable for claims to be paid for the same week of unemployment out of both systems.
In addition, UIPL No. 27-20 established Lost Wages Assistance (LWA), which provided a $300 supplemental benefit
for 6 weeks starting with weeks ending August 1, 2020 through September 5, 2020, and required claimants to self-
certify that they were unemployed or partially unemployed due to disruptions caused by the COVID-19 pandemic. LWA
supplemental benefits were payable for either regular UC and PUA claims, out of each respective system, but not both.
Condition and Context:
Using data analytics, ALA staff identified 81 claimants who received a total of 294 duplicate payments for the same
week of LWA in both the regular UC system and the new PUA system. Payments from the regular UC system and the
PUA system totaled $88,200, respectively.
ALA staff reviewed the case files of 30 claimants to determine which of the two mutually exclusive benefits they may
have been eligible to receive. Our review revealed the following:
•
29 claimants, or 96.7%, were not eligible for the PUA-LWA benefits received totaling $42,600.
•
1 claimant, or 3.3%, was not eligible for the Regular UC-LWA benefits received totaling $1,500.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
$44,100
Cause:
Appropriate communication between the two systems administering the regular UC LWA benefits and the PUA LWA
benefits was lacking.
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 100 -
Finding Number:
2021-036 (Continued)
State/Educational Agency(s):
Arkansas Department of Commerce –
Division of Workforce Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
97.050 – COVID-19: Presidential Declared Disaster
Assistance to Individuals and Households – Other Needs
(Supplemental Payments for Lost Wages)
Federal Awarding Agency:
Federal Emergency Management Agency
Federal Award Number(s):
4518DRARSPLW
Federal Award Year(s):
Not Applicable
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Eligibility
Type of Finding:
Noncompliance and Material Weakness
Effect:
Benefit payments from two separate systems issued for the same week of unemployment for the same claimant,
resulting in overpayments of federal funds.
Recommendation:
ALA staff recommend the Agency work to strengthen internal controls over the establishment of eligibility in both
systems for regular UC and PUA, as well as the payment of benefits. In addition, ALA staff recommend the Agency
continue to pursue the recovery of overpayments of funds, returning them to the appropriate source.
Views of Responsible Officials and Planned Corrective Action:
The Unemployment System and the Pandemic Unemployment Assistance system were different systems and did not
communicate at the beginning of the pandemic period. There are instances of claimants being paid on both systems.
Enhancements were made to the systems to allow them to start communicating beginning in November 2020. The
overpayments have been identified and are being investigated. Overpayments or waivers will be issued to these
claimants.
Anticipated Completion Date:
July 2022
Contact Person:
Ken Jennings
Program Administrator UI
Division of Workforce Services
2 Capitol Mall
Little Rock, AR 72201
501-682-3244
Kenneth.jennings@arkansas.gov
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 101 -
Finding Number:
2021-037
State/Educational Agency(s):
Arkansas Department of Commerce –
Division of Workforce Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
97.050 – COVID-19: Presidential Declared Disaster
Assistance to Individuals and Households – Other Needs
(Supplemental Payments for Lost Wages)
Federal Awarding Agency:
Federal Emergency Management Agency
Federal Award Number(s):
4518DRARSPLW
Federal Award Year(s):
Not Applicable
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Eligibility
Type of Finding:
Noncompliance and Material Weakness
Repeat Finding:
Not applicable
Criteria:
In accordance with 2 CFR § 200.303, a non-federal entity must establish and maintain effective internal control over
the federal award that provides reasonable assurance that the non-federal entity is managing the federal award in
compliance with federal statutes, regulations, and the terms and conditions of the award.
In addition, 2 CFR § 200.516(a)(6) requires the auditor to report known or likely fraud affecting a federal award.
Condition and Context:
In state fiscal year 2021, the Division of Workforce Services (DWS) identified 464 claims paid for Lost Wages Assistance
(LWA) totaling $524,400 as likely fraud.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
$524,400
Cause:
In response to the increase in demand for services/benefits, the State relaxed controls over identity verification and
income verification for the program during fiscal year 2021.
Effect:
Lack of appropriate internal controls resulted in overpayments of federal funds.
Recommendation:
ALA staff recommend the Agency continue to strengthen controls over benefit payments to ensure that payments are
made in the correct amount and to eligible claimants. ALA staff also recommend the Agency seek recoupment of the
identified overpayments, returning them to the appropriate source.
Views of Responsible Officials and Planned Corrective Action:
These claims were sent to the Internal Audit/Fraud Unit for investigation for fraud. The amounts will be sent to Benefit
Payment Control for overpayment if the perpetrator is found. ID verification on all unemployment claims filed was
restarted January 2021 and the PUA claims started using UIdentify at that time.
Anticipated Completion Date:
July 2024
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 102 -
Finding Number:
2021-037 (Continued)
State/Educational Agency(s):
Arkansas Department of Commerce –
Division of Workforce Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
97.050 – COVID-19: Presidential Declared Disaster
Assistance to Individuals and Households – Other Needs
(Supplemental Payments for Lost Wages)
Federal Awarding Agency:
Federal Emergency Management Agency
Federal Award Number(s):
4518DRARSPLW
Federal Award Year(s):
Not Applicable
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Eligibility
Type of Finding:
Noncompliance and Material Weakness
Views of Responsible Officials and Planned Corrective Action (Continued):
Contact Person:
Ken Jennings
Program Administrator UI
Division of Workforce Services
2 Capitol Mall
Little Rock, AR 72201
501-682-3244
Kenneth.jennings@arkansas.gov
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 103 -
Finding Number:
2021-038
State/Educational Agency(s):
Arkansas Department of Commerce –
Division of Workforce Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
97.050 – COVID-19: Presidential Declared Disaster
Assistance to Individuals and Households – Other Needs
(Supplemental Payments for Lost Wages)
Federal Awarding Agency:
Federal Emergency Management Agency
Federal Award Number(s):
4518DRARSPLW
Federal Award Year(s):
Not Applicable
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Eligibility
Type of Finding:
Noncompliance and Material Weakness
Repeat Finding:
Not applicable
Criteria:
20 CFR § 604.3 and Ark. Code Ann. § 11-10-507(3)(A)(i), individuals must be unemployed, physically and mentally
able to perform suitable work, and available for the work to be eligible for Unemployment Insurance (UI) benefits. Lost
Wages Assistance payments are supplemental payments to individuals eligible for at least $100 per week in UI benefits.
Incarcerated individuals are generally not available for work, making them ineligible for both UI and Lost Wages
Assistance (LWA) benefits.
Condition and Context:
Using data analytics, ALA staff identified $117,000 in LWA awards paid to 188 incarcerated individuals who do not
appear to be eligible for benefits. As of June 30, 2021, $3,000 of these benefits to 4 of these claimants had been
identified by the Agency as likely fraud.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
$114,000
Cause:
Due to increased demand for services/benefits during the Coronavirus pandemic and turnover of key personnel, the
control that cross-matched DWS's claimant data with Department of Corrections' inmate data was not properly
performed.
Effect:
Lack of appropriate internal controls resulted in overpayments of federal funds.
Recommendation:
ALA staff also recommend the Agency seek recoupment of identified overpayments, returning them to the appropriate
source.
Views of Responsible Officials and Planned Corrective Action:
The regular UI system gets a DOC crossmatch weekly and is worked by staff. The PUA system was set up to get the
crossmatch and has been checked and are up to date. The list provided by the DOC also contains incorrect SSN
numbers, and some of the instances identified by the audit staff were in fact incorrect as the individual with the claim
was not incarcerated. There were also individuals that were incarcerated on the list that were paid weeks of PUA
outside of the time they were incarcerated and no change was needed. The fraudulently filed claims have been turned
over to the Internal Audit/Fraud Unit. Some claims were found to be legitimate claims and the others have been turned
in for overpayment.
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 104 -
Finding Number:
2021-038 (Continued)
State/Educational Agency(s):
Arkansas Department of Commerce –
Division of Workforce Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
97.050 – COVID-19: Presidential Declared Disaster
Assistance to Individuals and Households – Other Needs
(Supplemental Payments for Lost Wages)
Federal Awarding Agency:
Federal Emergency Management Agency
Federal Award Number(s):
4518DRARSPLW
Federal Award Year(s):
Not Applicable
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed;
Eligibility
Type of Finding:
Noncompliance and Material Weakness
Views of Responsible Officials and Planned Corrective Action (Continued):
Anticipated Completion Date:
Completed
Contact Person:
Ken Jennings
Program Administrator UI
Division of Workforce Services
2 Capitol Mall
Little Rock, AR 72201
501-682-3244
Kenneth.jennings@arkansas.gov
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 105 -
Finding Number:
2021-039
State/Educational Agency(s):
Arkansas Department of Commerce –
Division of Workforce Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
97.050 – COVID-19: Presidential Declared Disaster
Assistance to Individuals and Households – Other Needs
(Supplemental Payments for Lost Wages)
Federal Awarding Agency:
Federal Emergency Management Agency
Federal Award Number(s):
4518DRARSPLW
Federal Award Year(s):
Not Applicable
Compliance Requirement(s) Affected:
Matching, Level of Effort, Earmarking
Type of Finding:
Material Noncompliance and Material Weakness
Repeat Finding:
Not applicable
Criteria:
Unemployment Insurance Program Letter (UIPL) No. 27-20 provides guidance on administering the Presidential
Memorandum, Authorizing the Other Needs Assistance Program for Major Disaster Declarations Related to
Coronavirus Disease 2019, issued on August 8, 2020. UIPL No. 27-20 requires a 25% state match for the Lost Wages
Assistance (LWA) program. According to the FEMA Supplemental Lost Wages Payments under Other Needs
Assistance Frequently Asked Questions, the state match could be funded by both Department of Treasury Coronavirus
Relief Funds and total benefits paid with state unemployment funds to eligible LWA claimants.
Condition and Context:
The State did not meet the 25% match required for the LWA program. Based on reported federal expenditures totaling
$136,888,251, the state expenditures required to achieve the 25% match would be $45,629,417. State match
expenditures totaled $34,204,967, resulting in a deficit of $11,424,450.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
None
Cause:
The methodologies used to calculate the required state match contained an error, and the State’s share was calculated
as 25% of the federal expenditures, instead of 25% of the total expenditures. In addition, the Agency did not have
controls in place to properly review the methodologies behind the calculations.
Effect:
Lack of appropriate internal controls resulted in a liability due back to the federal awarding agency.
Recommendation:
ALA staff recommend the Agency strengthen internal controls over compliance with state matching provisions of grant
agreements. In addition, ALA staff recommend the Agency contact FEMA for guidance on resolving the liability.
Views of Responsible Officials and Planned Corrective Action:
ADWS discussed this issue with former agency management involved with the initial planning and implementation of
this program, extensively reviewed agency workpapers and reviewed documentation published by FEMA for the Lost
Wages Assistance Program. The calculations were reviewed daily by several layers of management and approved,
based on their understanding. Several other states have acknowledged the same issues with their calculations. If
there are similar programs in the future, ADWS will seek additional guidance on these matters before deciding the
appropriate course of action.
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 106 -
Finding Number:
2021-039 (Continued)
State/Educational Agency(s):
Arkansas Department of Commerce –
Division of Workforce Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
97.050 – COVID-19: Presidential Declared Disaster
Assistance to Individuals and Households – Other Needs
(Supplemental Payments for Lost Wages)
Federal Awarding Agency:
Federal Emergency Management Agency
Federal Award Number(s):
4518DRARSPLW
Federal Award Year(s):
Not Applicable
Compliance Requirement(s) Affected:
Matching, Level of Effort, Earmarking
Type of Finding:
Material Noncompliance and Material Weakness
Views of Responsible Officials and Planned Corrective Action (Continued):
Subsequent legislation, H.R. 2471, “Consolidated Appropriations Act of 2022”, which was signed into law March 15,
2022, has retroactively changed the state match from 25% to 10%, so there is no shortfall, by either calculation.
Anticipated Completion Date:
Completed
Contact Person:
Tracii Laettner
Chief Financial Officer
Arkansas Division of Workforce Services
#2 Capitol Mall
Little Rock, AR 72201
(501) 682-3108
Tracii.L.Laettner@arkansas.gov
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 107 -
Finding Number:
2021-040
State/Educational Agency(s):
Arkansas Department of Commerce –
Division of Workforce Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
97.050 – COVID-19: Presidential Declared Disaster
Assistance to Individuals and Households – Other Needs
(Supplemental Payments for Lost Wages)
Federal Awarding Agency:
Federal Emergency Management Agency
Federal Award Number(s):
4518DRARSPLW
Federal Award Year(s):
Not Applicable
Compliance Requirement(s) Affected:
Reporting
Type of Finding:
Noncompliance and Material Weakness
Repeat Finding:
Not applicable
Criteria:
Unemployment Insurance Program Letter (UIPL) No. 27-20 requires a 25% state match (i.e., recipient share of
expenditures) for the LWA program. According to the FEMA Lost Wages Supplemental Payment Assistance
Guidelines, the Agency is required to report the amount it is required to spend for match (i.e., total recipient share
required) on Line 10i of the SF-425 federal financial report and the amount it actually spent toward match (i.e., recipient
share of expenditures) on Line 10j of the SF-425 report.
Condition and Context:
ALA review of the June 30, 2021, SF-425 report revealed that the Agency failed to accurately report the amount it was
required to spend for match and the amount it actually spent toward match. The Agency reported “zero” in both fields
of the report resulting in an understatement totaling $45,629,417 and $34,204,967, respectively.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
None
Cause:
The Agency did not have adequate controls in place to properly report state match amounts required and expended for
the award.
Effect:
Lack of appropriate controls resulted in noncompliance with the reporting requirements of the federal award.
Recommendation:
ALA staff recommend the Agency strengthen internal controls over its compliance with federal reporting requirements.
Views of Responsible Officials and Planned Corrective Action:
ADWS has had other discussions with FEMA to obtain more and better information on this new pandemic
unemployment program which was through a federal funding agency that ADWS does not normally receive funding
through. In the course of those discussions, ADWS was told to re-submit the final report. ADWS will be submitting the
adjusted report soon. The new ADWS CFO will provide an additional layer of review for the report.
Anticipated Completion Date:
May 13, 2022
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 108 -
Finding Number:
2021-040 (Continued)
State/Educational Agency(s):
Arkansas Department of Commerce –
Division of Workforce Services
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
97.050 – COVID-19: Presidential Declared Disaster
Assistance to Individuals and Households – Other Needs
(Supplemental Payments for Lost Wages)
Federal Awarding Agency:
Federal Emergency Management Agency
Federal Award Number(s):
4518DRARSPLW
Federal Award Year(s):
Not Applicable
Compliance Requirement(s) Affected:
Reporting
Type of Finding:
Noncompliance and Material Weakness
Views of Responsible Officials and Planned Corrective Action (Continued):
Contact Person:
Tracii Laettner
Chief Financial Officer
Arkansas Division of Workforce Services
#2 Capitol Mall
Little Rock, AR 72201
(501) 682-3108
Tracii.L.Laettner@arkansas.gov
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 109 -
FINDINGS COVERING PROGRAMS AUDITED BY OTHER EXTERNAL AUDITORS
Finding Number:
2021-041
State/Educational Agency(s):
University of Arkansas for Medical Sciences
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
Various – Research and Development Cluster
Federal Awarding Agency:
Various
Federal Award Number(s):
Unknown*
Federal Award Year(s):
July 1, 2020 to June 30, 2021
Compliance Requirement(s) Affected:
Cash Management
Type of Finding:
Material Noncompliance and Material Weakness
Repeat Finding:
A similar finding was not reported in prior year audit
Criteria:
The requirements for cash management are contained in Section 200.305 of Title 2 U.S. Code of Federal Regulations
Part 200 (2 CFR 200), Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal
Awards (the Uniform Guidance), the A-102 Common Rule (§_.21), 0MB Circular A-110 (2 CFR section 215.22),
Treasury regulations at 31 CFR part 205, program legislation, Federal awarding agency regulations, and the terms and
conditions of the award. When entities are funded on a reimbursement basis, program costs must be paid for by entity
funds before reimbursement is requested from the Federal Government.
Additionally, Section 200.303 of the Uniform Guidance indicates that the nonfederal entity must establish and maintain
effective internal control over the federal award that provides reasonable assurance that the nonfederal entity is
managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal
award. The Uniform Guidance also indicates that these internal controls should be in compliance with guidance in
“Standards for Internal Control in the Federal Government” (Green Book) issued by the Comptroller General of the
United States or the “Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of
the Treadway Commission (COSO). The Office of Management and Budget (0MB) has clarified that the references to
the Green Book and COSO were only provided as best practices and not requirements.
Condition and Context:
During our test work over the Research and Development Cluster, we selected a sample of expenditures and cash
draws/issued invoices to sponsors to verify the expenditures were paid prior to the date of the reimbursement request.
For the Research and Development Cluster, we noted 1 expenditure of our sample of 25 was not paid prior to the
reimbursement request. We further extended our sample by 15 expenditures and noted 3 additional expenditures were
not paid prior to the reimbursement request. Amounts in question were requested for reimbursement by UAMS from
between 1 day and 11 days prior to being paid. We noted that UAMS’ internal controls over cash management include
process-level controls in place that ensure invoices or personnel costs are incurred before draw requests are made.
However, there were no controls to ensure that the incurred costs have also been paid before an invoice to the sponsor
is issued. This deficiency is isolated to grants in which an invoice is issued to the sponsor for reimbursement, rather
than a cash draw.
Statistically Valid Sample:
The sample was not intended to be, and was not, a statistically valid sample
Questioned Costs:
Questioned costs are not determinable
Cause:
The review of program costs ensures costs are incurred before a draw request is made. This review does not include
a determination of whether the incurred costs have also been paid to the vendor.
Effect:
Material weakness in internal control and material noncompliance with the cash management requirement.
FINDINGS COVERING PROGRAMS AUDITED BY OTHER EXTERNAL AUDITORS (Continued)
State of Arkansas
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2021
- 110 -
Finding Number:
2021-041 (Continued)
State/Educational Agency(s):
University of Arkansas for Medical Sciences
Pass-Through Entity:
Not Applicable
AL Number(s) and Program Title(s):
Various – Research and Development Cluster
Federal Awarding Agency:
Various
Federal Award Number(s):
Unknown*
Federal Award Year(s):
July 1, 2020 to June 30, 2021
Compliance Requirement(s) Affected:
Cash Management
Type of Finding:
Material Noncompliance and Material Weakness
Recommendation:
We recommend that management design and implement internal controls that will ensure that program costs are paid
before a request for reimbursement is made.
* Federal Award Number(s) not provided in report received from other external auditor.
Views of Responsible Officials and Planned Corrective Action:
We concur with the finding. The current process for invoicing utilizes a report that does not identify the date an expense
has been paid. Beginning immediately, we will utilize the draw report that identifies cleared expenses by period and
reconcile it to the invoicing report to ensure only cleared expenses are invoiced. UAMS is implementing a new financial
system on July 5, 2022. With the implementation of the new system, expenses will be categorized so that the billing
process for cash draws and invoicing will only allow cleared expenses.
Anticipated Completion Date:
July 5, 2022
Contact Person:
Amanda George, CPA, MHSA
Vice Chancellor for Finance & Chief Financial Officer
University of Arkansas for Medical Sciences
UAMS, 4301 W. Markham St, Slot 545
Little Rock, AR 72205
(501) 686-5670
adgeorge@uams.edu
Kristy L. Walters, MBA, CPA, CHFP, CISA
Associate Vice Chancellor for Finance & Treasurer
University of Arkansas for Medical Sciences
UAMS, 4301 W. Markham St, Slot 632
Little Rock, AR 72205
(501) 686-6836, (501) 686-8137
walterskristy@uams.edu
Linda Cavin, BA MACC
Assistant Vice Chancellor & Controller
University of Arkansas for Medical Sciences
UAMS, 4301 W. Markham St, Slot 545
Little Rock, AR 72205
(501) 603-1844
LCavin@uams.edu
St at e of Arkansas Single Audit
____________________________________________________________________________________________________
Schedule of Expendit ures of Federal Aw ards
For t he Year Ended June 30, 2021
___________________________________________
- 111 -
Cluster Name/Federal Grantor/Program Name/Pass-Through Entity
ALN
Other Identifying
Number
Pass-Through Identifying
Number
Expenditure
Amount
Provided to
Subrecipients
SNAP Cluster
US Department of Agriculture
Supplemental Nutrition Assistance Program
10.551
$
545,527,745
COVID-19: Supplemental Nutrition Assistance Program
10.551
295,310,596
State Administrative Matching Grants for the Supplemental Nutrition
Assistance Program
10.561
47,698,091
$
308,705
US Department of Agriculture Total
888,536,432
308,705
SNAP Cluster Total
888,536,432
308,705
Child Nutrition Cluster
US Department of Agriculture
School Breakfast Program
10.553
67,529,128
67,507,353
National School Lunch Program
10.555
180,353,427
148,512,064
Summer Food Service Program for Children
10.559
4,224,165
Child Nutrition Discretionary Grants Limited Availability
10.579
339,390
328,043
US Department of Agriculture Total
252,446,110
216,347,460
Child Nutrition Cluster Total
252,446,110
216,347,460
Food Distribution Cluster
US Department of Agriculture
Commodity Supplemental Food Program
10.565
2,509,855
559,375
Emergency Food Assistance Program (Administrative Costs)
10.568
3,374,605
2,601,342
COVID-19: Emergency Food Assistance Program (Administrative Costs)
10.568
1,591,854
Emergency Food Assistance Program (Food Commodities)
10.569
11,709,655
COVID-19: Emergency Food Assistance Program (Food Commodities)
10.569
5,342,510
US Department of Agriculture Total
24,528,479
3,160,717
Food Distribution Cluster Total
24,528,479
3,160,717
Forest Service Schools and Roads Cluster
US Department of Agriculture
Schools and Roads - Grants to States
10.665
5,118,565
5,118,565
US Department of Agriculture Total
5,118,565
5,118,565
Forest Service Schools and Roads Cluster Total
5,118,565
5,118,565
Community Facilities Loans and Grants Cluster
US Department of Agriculture
Community Facilities Loans and Grants
10.766
20,000
US Department of Agriculture Total
20,000
Community Facilities Loans and Grants Cluster Total
20,000
State of Arkansas
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2021
- 112 -
Cluster Name/Federal Grantor/Program Name/Pass-Through Entity
ALN
Other Identifying
Number
Pass-Through Identifying
Number
Expenditure
Amount
Provided to
Subrecipients
State of Arkansas
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2021
Economic Development Cluster
US Department of Commerce
Economic Adjustment Assistance
11.307
$
346,072
COVID-19: Economic Adjustment Assistance
11.307
50,692
US Department of Commerce Total
396,764
Economic Development Cluster Total
396,764
CDBG – Entitlement Grants Cluster
US Department of Housing and Urban Development
Community Development Block Grants/Entitlement Grants
14.218
103,923
US Department of Housing and Urban Development Total
103,923
CDBG – Entitlement Grants Cluster Total
103,923
Fish and Wildlife Cluster
US Department of the Interior
Sport Fish Restoration
15.605
5,344,357
$
58,517
Wildlife Restoration and Basic Hunter Education
15.611
9,495,224
236,482
Enhanced Hunter Education and Safety
15.626
66,258
US Department of the Interior Total
14,905,839
294,999
Fish and Wildlife Cluster Total
14,905,839
294,999
Employment Service Cluster
US Department of Labor
Employment Service/Wagner-Peyser Funded Activities
17.207
4,061,395
Jobs for Veterans State Grants
17.801
984,149
Local Veterans' Employment Representative Program
17.804
108,195
US Department of Labor Total
5,153,739
Employment Service Cluster Total
5,153,739
WIOA Cluster
US Department of Labor
WIOA Adult Program
17.258
4,410,239
3,691,736
WIOA Youth Activities
17.259
6,389,073
5,519,788
WIOA Dislocated Worker Formula Grants
17.278
4,680,010
3,079,342
US Department of Labor Total
15,479,322
12,290,866
WIOA Cluster Total
15,479,322
12,290,866
- 113 -
Cluster Name/Federal Grantor/Program Name/Pass-Through Entity
ALN
Other Identifying
Number
Pass-Through Identifying
Number
Expenditure
Amount
Provided to
Subrecipients
State of Arkansas
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2021
Highway Planning and Construction Cluster
US Department of Transportation
Highway Planning and Construction
20.205
$
767,358,447
$
16,582,179
Recreational Trails Program
20.219
1,505,112
1,309,166
Federal Lands Access Program
20.224
209,997
199,679
US Department of Transportation Total
769,073,556
18,091,024
Highway Planning and Construction Cluster Total
769,073,556
18,091,024
FMCSA Cluster
US Department of Transportation
Motor Carrier Safety Assistance
20.218
4,655,106
US Department of Transportation Total
4,655,106
FMCSA Cluster Total
4,655,106
Federal Transit Cluster
US Department of Transportation
Federal Transit Formula Grants
20.507
227,836
Buses and Bus Facilities Formula, Competitive, and Low or No
Emissions Programs
20.526
922,075
225,346
US Department of Transportation Total
1,149,911
225,346
Federal Transit Cluster Total
1,149,911
225,346
Transit Services Programs Cluster
US Department of Transportation
Enhanced Mobility of Seniors and Individuals with Disabilities
20.513
1,416,559
US Department of Transportation Total
1,416,559
Transit Services Programs Cluster Total
1,416,559
Highway Safety Cluster
US Department of Transportation
State and Community Highway Safety
20.600
2,903,650
626,932
National Priority Safety Programs
20.616
5,319,897
499,965
US Department of Transportation Total
8,223,547
1,126,897
Highway Safety Cluster Total
8,223,547
1,126,897
Clean Water State Revolving Fund Cluster
Environmental Protection Agency
Capitalization Grants for Clean Water State Revolving Funds
66.458
7,108,936
6,711,294
Environmental Protection Agency Total
7,108,936
6,711,294
Clean Water State Revolving Fund Cluster Total
7,108,936
6,711,294
- 114 -
Cluster Name/Federal Grantor/Program Name/Pass-Through Entity
ALN
Other Identifying
Number
Pass-Through Identifying
Number
Expenditure
Amount
Provided to
Subrecipients
State of Arkansas
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2021
Drinking Water State Revolving Fund Cluster
Environmental Protection Agency
Capitalization Grants for Drinking Water State Revolving Funds
66.468
$
11,176,700
$
7,350,594
Environmental Protection Agency Total
11,176,700
7,350,594
Drinking Water State Revolving Fund Cluster Total
11,176,700
7,350,594
Special Education Cluster (IDEA)
US Department of Education
Special Education Grants to States
84.027
114,973,835
111,978,439
Special Education Preschool Grants
84.173
6,079,570
6,074,492
US Department of Education Total
121,053,405
118,052,931
Special Education Cluster (IDEA) Total
121,053,405
118,052,931
TRIO Cluster
US Department of Education
TRIO Student Support Services
84.042
7,766,938
TRIO Student Support Services
84.042A
55,097
TRIO Talent Search
84.044
4,133,977
TRIO Upward Bound
84.047
7,372,219
TRIO Educational Opportunity Centers
84.066
2,238,214
TRIO McNair Post-Baccalaureate Achievement
84.217
362,185
US Department of Education Total
21,928,630
TRIO Cluster Total
21,928,630
Aging Cluster
US Department of Health and Human Services
Special Programs for the Aging, Title III, Part B, Grants for Supportive
Services and Senior Centers
93.044
3,487,696
3,062,462
COVID-19: Special Programs for the Aging, Title III, Part B, Grants for
Supportive Services and Senior Centers
93.044
1,695,215
1,695,215
Special Programs for the Aging, Title III, Part C, Nutrition Services
93.045
9,250,643
9,250,643
COVID-19: Special Programs for the Aging, Title III, Part C, Nutrition
Services
93.045
4,732,458
4,732,458
Nutrition Services Incentive Program
93.053
2,433,683
2,433,682
US Department of Health and Human Services Total
21,599,695
21,174,460
Aging Cluster Total
21,599,695
21,174,460
- 115 -
Cluster Name/Federal Grantor/Program Name/Pass-Through Entity
ALN
Other Identifying
Number
Pass-Through Identifying
Number
Expenditure
Amount
Provided to
Subrecipients
State of Arkansas
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2021
CCDF Cluster
US Department of Health and Human Services
Child Care and Development Block Grant
93.575
$
57,875,286
COVID-19: Child Care and Development Block Grant
93.575
85,588,744
Child Care Mandatory and Matching Funds of the Child Care and
Development Fund
93.596
31,140,216
US Department of Health and Human Services Total
174,604,246
CCDF Cluster Total
174,604,246
Head Start Cluster
US Department of Health and Human Services
Head Start
93.600
12,541,876
$
2,389,241
COVID-19: Head Start
93.600
471,223
US Department of Health and Human Services Total
13,013,099
2,389,241
Head Start Cluster Total
13,013,099
2,389,241
Medicaid Cluster
US Department of Health and Human Services
State Medicaid Fraud Control Units
93.775
2,100,670
State Survey and Certification of Health Care Providers and Suppliers
(Title XVIII) Medicare
93.777
5,319,417
Medical Assistance Program
93.778
6,018,449,775
US Department of Health and Human Services Total
6,025,869,862
Medicaid Cluster Total
6,025,869,862
Foster Grandparent/Senior Companion Cluster
Corporation for National and Community Service
Foster Grandparent Program
94.011
216,840
Corporation for National and Community Service Total
216,840
Foster Grandparent/Senior Companion Cluster Total
216,840
Disability Insurance/SSI Cluster
Social Security Administration
Social Security Disability Insurance
96.001
661,717
Social Security Administration Total
661,717
Disability Insurance/SSI Cluster Total
661,717
Research and Development Cluster
US Department of Agriculture
Agricultural Research Basic and Applied Research
10.001
2,333,364
125,000
Pass-through from Agricultural Research Service (USDA ARS)
10.001
59-6070-1-007
46,612
Pass-through from Arkansas Children's Research Institute
10.001
58-6026-7-001
29,620
- 116 -
Cluster Name/Federal Grantor/Program Name/Pass-Through Entity
ALN
Other Identifying
Number
Pass-Through Identifying
Number
Expenditure
Amount
Provided to
Subrecipients
State of Arkansas
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2021
Research and Development Cluster (Continued)
US Department of Agriculture (Continued)
Plant and Animal Disease, Pest Control, and Animal Care
10.025
$
381,007
Pass-through from Cary Institute
10.025
AP19PPQFO000C552
12,740
Specialty Crop Block Grant Program - Farm Bill
10.170
125,375
Grants for Agricultural Research, Special Research Grants
Pass-through from Mississippi State University
10.200
2018-38500-28888
6,566
Payments to 1890 Land-Grant Colleges and Tuskegee University
10.205
2,097,815
Small Business Innovation Research
Pass-through from Applied Microwave Technology, Inc.
10.212
2019-33610-29821
17,306
Sustainable Agriculture Research and Education
Pass-through from University of Georgia
10.215
2016-38640-25382
37,851
$
4,309
Pass-through from University of Georgia
10.215
2018-38640-28417
78,474
3,435
Pass-through from University of Georgia
10.215
2019-38640-29878
564
1890 Institution Capacity Building Grants
10.216
479,923
70,502
Higher Education - Institution Challenge Grants Program
10.217
80,785
38,751
Agricultural and Rural Economic Research, Cooperative Agreements
and Collaborations
10.250
16,642
Consumer Data and Nutrition Research
10.253
26,798
Pass-through from Arizona State University
10.253
ASUB00000384
5,116
Research Innovation and Development Grants in Economic (RIDGE)
Pass-through from Trustees of Tufts College
10.255
59-5000-6-0070-R
15,959
Agricultural and Food Policy Research Centers
Pass-through from Board of Curators of the University of Missouri
10.291
58-0111-20-016
39,110
Organic Agriculture Research and Extension Initiative
Pass-through from North Carolina State University
10.307
2019-51300-30247
43,837
Pass-through from University of Georgia
10.307
2018-51300-28434
778
Specialty Crop Research Initiative
10.309
522,619
121,095
Pass-through from Texas A&M AgriLife Extension Service
10.309
2020-51181-32156
6,310
Pass-through from Virginia Polytechnic Institute and State University
10.309
2018-51181-28384
99,000
Agriculture and Food Research Initiative (AFRI)
10.310
3,384,950
1,267,669
Pass-through from Board of Trustees of Michigan State University
10.310
2015-68003-23415
93,016
Pass-through from Board of Trustees of Michigan State University
10.310
2020-68012-31822
4,466
Pass-through from California Polytechnic State University
10.310
2020-67017-31272
14,415
Pass-through from Cornell University
10.310
90875-20338
28,425
Pass-through from North Carolina A&T State University
10.310
2020-67018-30847
45,197
Pass-through from Texas A & M University
10.310
2019-68012-29818
17,298
Pass-through from The Regents of University of California
10.310
2017-67007-25939
21,568
Pass-through from University of Connecticut
10.310
2020-69012-31823
631
Pass-through from University of Delaware
10.310
49553
41,405
Pass-through from University of Florida
10.310
UFDSP00011815
25,805
- 117 -
Cluster Name/Federal Grantor/Program Name/Pass-Through Entity
ALN
Other Identifying
Number
Pass-Through Identifying
Number
Expenditure
Amount
Provided to
Subrecipients
State of Arkansas
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2021
Research and Development Cluster (Continued)
US Department of Agriculture (Continued)
Agriculture and Food Research Initiative (AFRI) (Continued)
Pass-through from Virginia Polytechnic Institute and State
University
10.310
2019-67023-29341
$
37,979
Beginning Farmer and Rancher Development Program
10.311
82,269
$
45,723
Pass-through from Appalachian State University
10.311
2020-49400-32401
38,635
Capacity Building for Non-Land Grant Colleges of Agriculture (NLGCA)
10.326
334,479
22,173
National Food Safety Training, Education, Extension, Outreach, and
Technical Assistance Competitive Grants Program
10.328
204,202
93,852
Crop Protection and Pest Management Competitive Grants Program
Pass-through from North Carolina State University
10.329
2018-70006-28884
8,532
Cooperative Extension Service
Pass-through from Regents of the University of Minnesota
10.500
2018-70027-28584
16,666
Centers of Excellence at 1890 Institutions
Pass-through from 1890 Universities Foundation
10.523
2020-38427-31514
2,596
Team Nutrition Grants
10.574
192
Wood Utilization Assistance
10.674
5,878
Forest Health Protection
10.680
729
Partnership Agreements
10.699
89,219
Delta Health Care Services Grant Program
10.874
149,806
14,775
Pass-through from Winrock International
10.874
6918-19-A-02
129,217
Pass-through from Winrock International
10.874
6918-19-A-03
14,364
Rural Development Cooperative Agreement Program
Pass-through from Winrock International
10.890
6973-21-A-01
13,975
Soil and Water Conservation
10.902
464,901
Environmental Quality Incentives Program
10.912
87,782
Pass-through from Maus Farms
10.912
82369
8,673
Pass-through from Natural Resources Conservation Service
(USDA NRCS)
10.912
69-7103-174-004
6,929
4,697
Pass-through from S & R Farms
10.912
EQIP 2008 74710313B4H
(5,320)
Pass-through from Wildy Farms South, Inc.
10.912
82412
21
Agricultural Conservation Easement Program
10.931
48,546
Miscellaneous US Department of Agriculture Programs
10.RD
12FPC319P0317/20-JV-11111137-
046/15-JV-11330129-032
79,195
Pass-through from Aero-graphics
10.RD
20133/GS-000F-269GA
144,089
US Department of Agriculture Total
12,144,901
1,811,981
US Department of Commerce
Center for Sponsored Coastal Ocean Research Coastal Ocean Program
Pass-through from University of Wyoming
11.478
1004495-UA
11,279
Measurement and Engineering Research and Standards
11.609
72,812
US Department of Commerce Total
84,091
- 118 -
Cluster Name/Federal Grantor/Program Name/Pass-Through Entity
ALN
Other Identifying
Number
Pass-Through Identifying
Number
Expenditure
Amount
Provided to
Subrecipients
State of Arkansas
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2021
Research and Development Cluster (Continued)
US Department of Defense
Issue of Department of Defense excess equipment
12.000
$
187,458
Pass-through from Arktonics
12.000
FA864921P0722
7,830
Pass-through from Galois, Inc.
12.000
No 2021-002
12,580
Pass-through from Georgia Institute of Technology
12.000
D8162-S3
214,389
Pass-through from Nanomatronix, LLC
12.000
FA864920P0341-UA1
46,583
Pass-through from Nanomatronix, LLC
12.000
FA864921P0139-UA1
47,511
Pass-through from Nanomatronix, LLC
12.000
FA864921P1089
16,393
Pass-through from Northrop Grumman Corporation
12.000
FA8650-20-C-7017
180,191
Pass-through from Pennington Biomedical Research Center
(US Army)
12.000
CO1962-19178-UAM
238,996
Pass-through from Radiance Technologies, Inc.
12.000
19T-1069
32,860
Pass-through from Rejuvenics Technologies, LLC
12.000
75N91020C00054
23,860
Pass-through from Rochester Institute of Technology
12.000
003890-00001A0
2,560
Pass-through from University of Dayton
12.000
RSC19026
631
Pass-through from US DOD (Air Force) pt Children and Families
Eval Serv (CAFES)
12.000
FA864921P1392
12,088
Collaborative Research and Development
12.114
456
Basic and Applied Scientific Research
12.300
518,980
Pass-through from Carnegie-Mellon University
12.300
1141302-387586
106,071
Scientific Research - Combating Weapons of Mass Destruction
12.351
2,828
Military Medical Research and Development
12.420
2,942,675
$
396,627
Pass-through from Armed Forces Radiobiology Research Institute
12.420
854770
362,256
Pass-through from Radiance Technologies, Inc.
12.420
18S-1308
159,262
Pass-through from Rutgers University
12.420
419
16,631
Pass-through from University of California - San Diego
12.420
116138032
23,503
Pass-through from University of North Carolina - Chapel Hill
12.420
W81XWH1920046 Sub 5115674
14,779
Pass-through from University of Pittsburgh
12.420
W81XWH2010745
37,423
Pass-through from US DOD SUNY
12.420
SUB # 116404-904
11,213
Basic Scientific Research
12.431
671,772
Basic, Applied, and Advanced Research in Science and Engineering
12.630
610,830
Air Force Defense Research Sciences Program
12.800
1,443,953
749,464
Pass-through from Battelle Memorial Institute
12.800
US001-0000573091-1
273,160
Pass-through from MacAulay-Brown, Inc.
12.800
FA650-18-D-1060
43,160
Pass-through from Ozark Integrated Circuits, Inc.
12.800
SL 2602
137,089
Pass-through from Universal Energy Systems, Inc.
12.800
FA8650-14-D-6516
39,809
Pass-through from UT-Battelle, LLC
12.800
US001-0000573091
1,575
CyberSecurity Core Curriculum
12.905
84,152
Pass-through from University of Louisville Research Foundation
12.905
ULRF_20-1034-01
99,000
Research and Technology Development
12.910
485,988
53,911
US Department of Defense Total
9,110,495
1,200,002
- 119 -
Cluster Name/Federal Grantor/Program Name/Pass-Through Entity
ALN
Other Identifying
Number
Pass-Through Identifying
Number
Expenditure
Amount
Provided to
Subrecipients
State of Arkansas
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2021
Research and Development Cluster (Continued)
US Department of the Interior
Threatened and Endangered Species
15.246
$
26,271
SECURE Water Act - Research Agreements
15.560
267,272
Fish and Wildlife Management Assistance
15.608
49,046
Wildlife Restoration and Basic Hunter Education
15.611
103,817
Cooperative Endangered Species Conservation Fund
15.615
10,443
State Wildlife Grants
15.634
345,403
$
6,547
Pass-through from Oklahoma Department of Wildlife Conservation
15.634
F19AF00904 (T-115-R-1)
20,964
Fish and Wildlife Coordination and Assistance
15.664
7,568
Youth Engagement, Education, and Employment
15.676
15,978
Cooperative Ecosystem Studies Units
15.678
71,801
Assistance to State Water Resources Research Institutes
15.805
198,298
U.S. Geological Survey_ Research and Data Collection
15.808
178,155
4,524
Pass-through from AmericaView
15.808
AV18--AR-01 MOD 001-1
20,676
Cooperative Research Units
15.812
44,303
Preservation of Japanese American Confinement Sites
15.933
74,396
Challenge Cost Share
Pass-through from Ouachita National Forest
15.943
20-CS-11080900-392
438
Cooperative Research and Training Programs - Resources of the
National Park System
15.945
34,987
US Department of the Interior Total
1,469,816
11,071
US Department of Justice
Juvenile Justice and Delinquency Prevention
16.540
34,883
National Institute of Justice Research, Evaluation, and Development
Project Grants
16.560
111,493
42,311
Crime Victim Assistance
16.575
191,606
Crime Victim Assistance/Discretionary Grants
16.582
833,476
Drug Court Discretionary Grant Program
Pass-through from Washington County Veteran's Treatment Court
16.585
2020-VC-BX-0049
39,264
16,648
Violence Against Women Formula Grants
16.588
160,908
STOP School Violence
16.839
58,488
Miscellaneous US Department of Justice Programs
16.RD
15DDHQ20P0000085
47,113
US Department of Justice Total
1,477,231
58,959
US Department of Transportation
Highway Research and Development Program
Pass-through from National Cooperative Highway Research Program
20.200
DTFH61-13-H-00024
69,826
24,313
Highway Planning and Construction
20.205
297,508
26,873
State and Community Highway Safety
20.600
172,537
National Priority Safety Programs
20.616
189,294
- 120 -
Cluster Name/Federal Grantor/Program Name/Pass-Through Entity
ALN
Other Identifying
Number
Pass-Through Identifying
Number
Expenditure
Amount
Provided to
Subrecipients
State of Arkansas
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2021
Research and Development Cluster (Continued)
US Department of Transportation (Continued)
University Transportation Centers Program
20.701
$
1,700,428
$
820,457
Pass-through from Louisiana State University
20.701
19BASU02
19,534
Pass-through from Louisiana State University
20.701
19CASU03
20,857
Pass-through from Louisiana State University
20.701
19GTASU01
10,448
Pass-through from Louisiana State University
20.701
20ASU044-A
23,232
Pass-through from Louisiana State University
20.701
20ASU083-A
31,280
Pass-through from Louisiana State University
20.701
20CLSU07
18,153
Miscellaneous US Department of Transportation Programs
20.RD
692M15-20-C-00010
111,022
81,241
Pass-through from Kansas State University
20.RD
693JJ618C000016
4,474
Pass-through from Kansas State University
20.RD
A21-0193-S001
57,528
US Department of Transportation Total
2,726,121
952,884
Federal Communications Commission
COVID-19: COVID-19 Telehealth Program
32.006
905,294
Federal Communications Commission Total
905,294
National Aeronautics and Space Administration
Science
43.001
525,904
2,102
Pass-through from Massachusetts Institute of Technology
43.001
NNX15AL48G
6,060
Pass-through from Universities Space Research Association
43.001
80NSSC17K0742
26,224
Pass-through from University of Central Florida
43.001
NNX11AD87G
12,933
Aeronautics
Pass-through from University of Illinois Urbana-Champaign
43.002
80NSSC19M0125
140,095
Exploration
43.003
228,116
89,190
Pass-through from Baylor College of Medicine
43.003
7000000807
112,940
Space Operations
43.007
2,703
Office of Stem Engagement (OSTEM)
43.008
1,008,048
26,240
Pass-through from Oklahoma State University
43.008
SPOCS-ASU
3,133
Miscellaneous National Aeronautics and Space Administration Programs
Pass-through from Nanomatronix, LLC
43.RD
80NSSC19C0565
23,423
National Aeronautics and Space Administration Total
2,089,579
117,532
National Endowment for the Arts
Promotion of the Arts Grants to Organizations and Individuals
45.024
88,902
National Endowment for the Arts Total
88,902
National Endowment for the Humanities
Promotion of the Humanities Public Programs
45.164
120,605
National Endowment for the Humanities Total
120,605
- 121 -
Cluster Name/Federal Grantor/Program Name/Pass-Through Entity
ALN
Other Identifying
Number
Pass-Through Identifying
Number
Expenditure
Amount
Provided to
Subrecipients
State of Arkansas
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2021
Research and Development Cluster (Continued)
National Science Foundation
Engineering
47.041
$
2,719,662
$
113,625
Pass-through from Ambots
47.041
2019 UA NSF FED#1914249
6,298
Pass-through from Clemson University
47.041
2057-206-2012848-1
8,930
Pass-through from Nanomatronix, LLC
47.041
2014280-UA1
109,840
Pass-through from SolaRid AR, LLC
47.041
2015057
8,237
Pass-through from Telli Technologies, Inc.
47.041
TTI-001-1
2,386
Pass-through from University of Illinois Urbana-Champaign
47.041
073708-16164
902,790
Pass-through from University of Illinois Urbana-Champaign
47.041
073708-16496
188,770
Pass-through from University of Illinois Urbana-Champaign
47.041
073708-16520 RET
21,635
Pass-through from University of Illinois Urbana-Champaign
47.041
088653-17019 REU
8,571
Pass-through from University of Illinois Urbana-Champaign
47.041
EEC-1449548
548
Pass-through from Utah State University
47.041
1922719
29,559
Pass-through from West Virginia University
47.041
19-473-UA
19,070
COVID-19: Engineering
47.041
56,398
Mathematical and Physical Sciences
47.049
1,333,983
131,611
Pass-through from Baylor University
47.049
1903450
20,668
Geosciences
47.050
577,030
17,780
Computer and Information Science and Engineering
47.070
965,360
836
Pass-through from The Board of Supervisors of Louisiana State
University and A&M College
47.070
1842679
4,040
Pass-through from Washington State University
47.070
1934725
69,764
Biological Sciences
47.074
2,414,190
103,174
Social, Behavioral, and Economic Sciences
47.075
442,205
14,919
Pass-through from University of Colorado - Boulder
47.075
1554392
120,148
Education and Human Resources
47.076
2,365,146
242,134
Pass-through from Baylor University
47.076
1001131-03
880
Pass-through from The Concord Consortium
47.076
1503196
13,507
Pass-through from University of Nebraska - Lincoln
47.076
25-6321-0333-003-1
12,076
Office of International Science and Engineering
47.079
310,579
Integrative Activities
47.083
4,247,911
209,189
Pass-through from Louisiana Tech University
47.083
OIA-1632891
101,319
Pass-through from University of Hawaii
47.083
2104126
4,406
Pass-through from University of Nebraska - Lincoln
47.083
25-6222-0852-002
293,936
Pass-through from University of Nebraska - Lincoln
47.083
25-6238-0980-003
6,719
Pass-through from University of North Carolina
47.083
20190852-01-UAR
62,649
Pass-through from West Virginia University
47.083
19-473-UA
16,602
Pass-through from West Virginia University
47.083
19-473-UALR
123,918
Pass-through from West Virginia University
47.083
OIA-1920920
57,210
Miscellaneous National Science Foundation Programs
47.RD
PHY-1949610-001
105,904
National Science Foundation Total
17,752,844
833,268
- 122 -
Cluster Name/Federal Grantor/Program Name/Pass-Through Entity
ALN
Other Identifying
Number
Pass-Through Identifying
Number
Expenditure
Amount
Provided to
Subrecipients
State of Arkansas
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2021
Research and Development Cluster (Continued)
Small Business Administration
Small Business Development Centers
59.037
$
195,408
State Trade Expansion
59.061
14,051
Small Business Administration Total
209,459
US Department of Veterans Affairs
Research and Development
Pass-through from Geriatric Research, Education & Clinical Center
64.054
N/A
14,593
US Department of Veterans Affairs Total
14,593
Environmental Protection Agency
Water Pollution Control State, Interstate, and Tribal Program Support
66.419
39,203
Nonpoint Source Implementation Grants
66.460
958,082
Environmental Protection Consolidated Grants for the Insular Areas -
Program Support
Pass-through from GBMc & Associates
66.600
EPA and ANRC Sub SGA 20-1200
2,423
Environmental Protection Agency Total
999,708
US Department of Energy
Cybersecurity, Energy Security & Emergency Response (CESER)
81.008
222,146
$
28,125
Office of Science Financial Assistance Program
81.049
967,500
3,697
Pass-through from Giner, Inc.
81.049
402418
5,884
Pass-through from Ozark Integrated Circuits, Inc.
81.049
DE-SC0017732
67,978
Conservation Research and Development
81.086
481,608
Pass-through from North Carolina State University
81.086
2014-0654-84
19,867
8,200
Renewable Energy Research and Development
81.087
1,385,536
600,075
Pass-through from Texas Tech University
81.087
210437-01
72,726
Pass-through from United Technologies Research Center
81.087
1229257
70,650
Fossil Energy Research and Development
81.089
2,584
Pass-through from Siemens Corporation
81.089
DE-FE0026348
191,827
National Industrial Competitiveness through Energy, Environment, and
Economics
Pass-through from Honeywell Federal Manufacturing &
Technologies, LLC
81.105
DE-NA0002839
1,105
Pass-through from Honeywell Federal Manufacturing &
Technologies, LLC
81.105
N000321009
58,153
Pass-through from Honeywell Federal Manufacturing &
Technologies, LLC
81.105
N000341165
94,393
Electricity Research, Development and Analysis
81.122
907,479
444,351
Pass-through from NextWatt, LLC
81.122
NW-DE-OE0000909
247,979
- 123 -
Cluster Name/Federal Grantor/Program Name/Pass-Through Entity
ALN
Other Identifying
Number
Pass-Through Identifying
Number
Expenditure
Amount
Provided to
Subrecipients
State of Arkansas
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2021
Research and Development Cluster (Continued)
US Department of Energy (Continued)
Advanced Research Projects Agency- Energy
81.135
$
883,209
$
295,565
Pass-through from The Regents of the University of California -
Berkeley
81.135
DEAR0000900
139,724
Miscellaneous US Department of Energy Programs
81.RD
7540598
19,762
Pass-through from Argonne National Laboratory
81.RD
DE-AC02-06CH11357
54,347
Pass-through from Oak Ridge National Laboratory
81.RD
DE-AC05-00OR22725
114,836
Pass-through from Sandia National Laboratories
81.RD
P.O. 2177972
384,627
Pass-through from UT-Battelle, LLC
81.RD
4000177869
37,788
US Department of Energy Total
6,431,708
1,380,013
US Department of Education
Special Education Grants to States
84.027
444,903
Career and Technical Education - Basic Grants to States
84.048
3,800
Rehabilitation Long-Term Training
84.129
75,909
Graduate Assistance in Areas of National Need
84.200
165,157
Education Research, Development and Dissemination
84.305
44,107
English Language Acquisition State Grants
84.365
601,682
Promoting Readiness of Minors in Supplemental Security Income
84.418
34,840
COVID-19: Education Stabiliazation Fund - Elementary and Secondary
School Emergency Relief (ESSER) Fund
84.425D
177,100
COVID-19: Education Stabilization Fund - HEERF Institutional Portion
Pass-through from Santa Fe College
84.425F
TAA122422
20,388
US Department of Education Total
1,567,886
US Department of Health and Human Services
Special Programs for the Aging Title IV and Title II, Discretionary Projects
93.048
7,412
Innovations in Applied Public Health Research
93.061
388,267
Birth Defects and Developmental Disabilities - Prevention and
Surveillance
93.073
964,236
41,933
Family Smoking Prevention and Tobacco Control Act Regulatory
Research
Pass-through from Virginia Commonwealth University
93.077
FP00006477-SA002
116,456
Healthy Marriage Promotion and Responsible Fatherhood Grants
93.086
584,418
Food and Drug Administration Research
93.103
35,083
Maternal and Child Health Federal Consolidated Programs
93.110
706,909
Oral Diseases and Disorders Research
Pass-through from Indiana University
93.121
IN4678404UA
9,749
Injury Prevention and Control Research and State and Community
Based Programs
93.136
357,871
Community Programs to Improve Minority Health Grant Program
93.137
54,237
Rural Health Research Centers
93.155
466,428
- 124 -
Cluster Name/Federal Grantor/Program Name/Pass-Through Entity
ALN
Other Identifying
Number
Pass-Through Identifying
Number
Expenditure
Amount
Provided to
Subrecipients
State of Arkansas
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2021
Research and Development Cluster (Continued)
US Department of Health and Human Services (Continued)
COVID-19: Rural Health Research Centers
93.155
$
82,474
Human Genome Research
93.172
104,013
Research Related to Deafness and Communication Disorders
Pass-through from Appalachian State University
93.173
7R15DC013137-02
3,086
Telehealth Programs
93.211
18,740
Research on Healthcare Costs, Quality and Outcomes
93.226
324,711
$
78,425
Pass-through from Indiana University - Purdue University at
Indianapolis
93.226
11000850-024
47,181
National Center on Sleep Disorders Research
93.233
109,587
Mental Health Research Grants
93.242
326,692
101,451
Pass-through from Brown University
93.242
1577
54,294
Pass-through from Duke University
93.242
A031076
6,407
Pass-through from University of Rochester
93.242
417724G UR FAO G
21,030
Pass-through from University of Washington
93.242
UWSC11556
15,946
Pass-through from Washington/Madison County Adult Drug Court
93.242
1H79TI080136-01
10,504
Substance Abuse and Mental Health Services Projects of Regional and
National Significance
93.243
430,812
256,644
Pass-through from Benton County Drug Court
93.243
5H79TI080172-03
64,277
Pass-through from Empact-Suicide Prevention Center
93.243
1H79T108165-02
764
Pass-through from Empact-Suicide Prevention Center
93.243
TAA1904125
11,688
Pass-through from Sebastian County Veterans Drug Treatment Court
93.243
TAA2108138
37,188
21,677
Pass-through from Washington/Madison County Adult Drug Court
93.243
T1082976
63,622
COVID-19: Poison Center Support and Enhancement Grant
93.253
44,749
Alcohol Research Programs
93.273
941,224
212,930
Pass-through from Palo Alto Inst for Research & Education
93.273
R01 AA024136-01A
36,704
Pass-through from University of Oklahoma - Health Science Center
93.273
7 R01 AA012207-1
8,202
Drug Abuse and Addiction Research Programs
93.279
2,683,594
50,668
Pass-through from InterveXion Therapeutics, LLC
93.279
53890
212,374
Pass-through from InterveXion Therapeutics, LLC
93.279
53043, 54787
79,197
Pass-through from InterveXion Therapeutics, LLC
93.279
U01DA045366
238,421
Pass-through from The Miriam Hospital
93.279
5R25DA037190-04
3,897
Pass-through from The Miriam Hospital
93.279
7109993MZ-2
2,957
Pass-through from The Miriam Hospital
93.279
7147185NDZ
2,934
Pass-through from University of California - Los Angeles
93.279
1550 G YA607
3,268
Pass-through from University of Texas - Dallas
93.279
GMO 200606 PO#00
35,705
- 125 -
Cluster Name/Federal Grantor/Program Name/Pass-Through Entity
ALN
Other Identifying
Number
Pass-Through Identifying
Number
Expenditure
Amount
Provided to
Subrecipients
State of Arkansas
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2021
Research and Development Cluster (Continued)
US Department of Health and Human Services (Continued)
Discovery and Applied Research for Technological Innovations to
Improve Human Health
93.286
$
149,642
Pass-through from Rensselear Polytechnic Institute
93.286
1R56EB026490-01A1 Sub A20-0049
31,061
$
21,342
Pass-through from Rensselear Polytechnic Institute
93.286
R01EB025241 A18-0135-S001
15,948
15,948
Pass-through from Vanderbilt University Medical Center
93.286
R21EB025258
13,207
Minority Health and Health Disparities Research
93.307
2,315,352
98,365
Pass-through from Arkana Laboratories
93.307
R43 MD014110
170
Pass-through from University of North Carolina - Chapel Hill
93.307
5R01MD013573-04
5,540
COVID-19: Minority Health and Health Disparities Research
93.307
41,960
Trans-NIH Research Support
93.310
5,527,223
739,063
Pass-through from Duke University
93.310
A03-2484
9,207
Pass-through from Duke University
93.310
A03-2484 AND A03
55,626
Pass-through from Duke University
93.310
A03-3943
174,952
Pass-through from Duke University
93.310
A03-3944
405,264
Pass-through from Regents of the University of New Mexico
93.310
3RGH1
21,554
COVID-19: Trans-NIH Research Support
93.310
641,103
Pass-through from Washington State University
93.310
1 R01 MD016526-0
126,528
Pass-through from Washington State University
93.310
101615(SUB 00000
148,899
60,307
Outreach Programs to Reduce the Prevalence of Obesity in High Risk
Rural Areas
93.319
67,065
COVID-19: Epidemiology and Laboratory Capacity for Infectious
Diseases (ELC)
93.323
45,829
National Center for Advancing Translational Sciences
93.350
5,528,073
202,852
Pass-through from Duke University
93.350
5 UL1 TR002553-0
45,225
Pass-through from Duke University
93.350
A030662
(213,598)
Pass-through from National Center for Advancing Translational
Sciences
93.350
3UL1TR002243-04S
54,749
Pass-through from University of Pittsburgh
93.350
0055353 (129324
34,677
Pass-through from University of Southern California
93.350
119679618
(2)
Research Infrastructure Programs
Pass-through from University of Utah
93.351
10051759-ARK
104,571
Nursing Research
93.361
204,524
3,655
Cancer Cause and Prevention Research
93.393
945,963
275,824
Pass-through from University of California - Berkeley
93.393
7456431
55,765
Cancer Detection and Diagnosis Research
93.394
2,593,832
1,391,661
Pass-through from CytoAstra, LLC
93.394
CYTOASTRA
59,966
Pass-through from Fred Hutchison Cancer Research Center
93.394
0001025931
99,275
Pass-through from Massachusetts General Hospital
93.394
227914
21,508
COVID-19: Cancer Detection and Diagnosis Research
93.394
182,737
- 126 -
Cluster Name/Federal Grantor/Program Name/Pass-Through Entity
ALN
Other Identifying
Number
Pass-Through Identifying
Number
Expenditure
Amount
Provided to
Subrecipients
State of Arkansas
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2021
Research and Development Cluster (Continued)
US Department of Health and Human Services (Continued)
Cancer Treatment Research
93.395
$
1,386,039
$
29,225
Pass-through from Rensselear Polytechnic Institute
93.395
A12785 1R01CA197491
4,157
Pass-through from The EMMS Corporation
93.395
2UM1CA121947-09
2,921
Pass-through from The EMMS Corporation
93.395
UM1CA121947-EMMS
423,566
Pass-through from University of California - Los Angeles
93.395
2 UM ICAI21947-0
125,517
Pass-through from University of California - San Francisco
93.395
UCSF
142,879
Pass-through from University of Florida
93.395
UFDSP00012380
10,645
Pass-through from University of Texas - MD Anderson Cancer
93.395
3001355557
91,443
Cancer Biology Research
93.396
623,604
39,315
Pass-through from Medical College of Wisconsin
93.396
7R01CA151354-08
14,524
Cancer Centers Support Grants
Pass-through from Mayo Clinic
93.397
5 P50 CA136393-0
5,469
Pass-through from Mayo Clinic
93.397
5P50CA136393-10
5,532
Cancer Research Manpower
93.398
466,015
ACL National Institute on Disability, Independent Living, and
Rehabilitation Research
Pass-through from Memorial Hermann Health System d/b/a
TIRR Memorial Hermann
93.433
90DP0092-04-00
33,431
Pass-through from Pennsylvania State University
93.433
90REGE0014-01-00
15,240
Teaching Health Center Graduate Medical Education Payment
93.530
425,466
Community-Based Child Abuse Prevention Grants
93.590
31,123
Developmental Disabilities Basic Support and Advocacy Grants
Pass-through from Arkansas Governor's Council on
Developmental Disabilities
93.630
21-UAP-010-1920-SG
81,600
University Centers for Excellence in Developmental Disabilities
Education, Research, and Service
93.632
471
Children's Justice Grants to States
93.643
67,949
COVID-19: Emergency Grants to Address Mental and Substance Use
Disorders During COVID-19
93.665
1,023,004
Medical Student Education
Pass-through from University of South Alabama
93.680
A19-0189-S001
284,850
COVID-19: PPHF: Racial and Ethnic Approaches to Community Health
Program financed solely by Public Prevention and Health Funds
93.738
49,814
Opioid STR
93.788
1,030,875
Pass-through from University of Texas - Austin
93.788
1H79TI080203 Sub UTA17-000811
7,541
Organized Approaches to Increase Colorectal Cancer Screening
93.800
320,059
153,549
Section 223 Demonstration Programs to Improve Community Mental
Health Services
Pass-through from Western Arkansas Counseling and
Guidance Center
93.829
TAA2108137
120,991
107,361
- 127 -
Cluster Name/Federal Grantor/Program Name/Pass-Through Entity
ALN
Other Identifying
Number
Pass-Through Identifying
Number
Expenditure
Amount
Provided to
Subrecipients
State of Arkansas
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2021
Research and Development Cluster (Continued)
US Department of Health and Human Services (Continued)
Cardiovascular Diseases Research
93.837
$
498,938
$
19,171
Pass-through from Rutgers University
93.837
PO#1434208_SUB A
107,161
COVID-19: Lung Diseases Research
Pass-through from RTI International
93.838
34-312-0217571-6
114,767
Blood Diseases and Resources Research
Pass-through from University of Kentucky Research Foundation
93.839
1R01HL138179-01
804
Pass-through from University of Kentucky Research Foundation
93.839
3200003129-20-27
36,163
Pass-through from University of Pennsylvania
93.839
1-R01-HL-141408-
44,447
Pass-through from University of Pennsylvania
93.839
P01HL146373
44,478
Arthritis, Musculoskeletal and Skin Diseases Research
93.846
1,374,229
2,664
Pass-through from Kitware, Inc.
93.846
4R44AR075481-002 Sub K002704-00
173,458
8,382
Pass-through from Kitware, Inc.
93.846
K002704-00-S02
5,580
Pass-through from Kitware, Inc.
93.846
R44AR075481
34,301
6,614
Pass-through from Northeastern University
93.846
500730-78050
55,074
Pass-through from University of Memphis
93.846
5 R01 AR066050-0
28,569
Pass-through from University of Tennessee
93.846
9500074677
21,233
Diabetes, Digestive, and Kidney Diseases Extramural Research
93.847
643,796
165,016
Pass-through from University of Alabama - Birmingham
93.847
000518751-SP008
65,929
Pass-through from University of Alabama - Birmingham
93.847
000526855-006
8,926
Extramural Research Programs in the Neurosciences and
Neurological Disorders
93.853
714,655
Pass-through from Emory University
93.853
A394752
37,984
Pass-through from Stanford University
93.853
CONTRACT 6186550
13,525
Pass-through from University of Cincinnati
93.853
IRB # 260036
960
Allergy and Infectious Diseases Research
93.855
3,355,897
666,299
Pass-through from East Carolina University
93.855
AWD-20-1838-S002
31,966
Pass-through from East Coast University
93.855
A20-0051-S002
(2,364)
Pass-through from Indiana University
93.855
87813
20,238
Pass-through from Indiana University
93.855
8441_UA
67,109
Pass-through from Innovation Pathways
93.855
UAMS 001
24,500
Pass-through from Johns Hopkins University
93.855
U01 AI138897
5,000
Pass-through from National Scientific Labs, LLC
93.855
NSL0001
87,103
Pass-through from The Miriam Hospital
93.855
7147159SAM
47,975
Pass-through from University of California - San Diego
93.855
124519281
57,638
Biomedical Research and Research Training
93.859
13,474,236
580,215
Pass-through from Arkansas Children's Hospital
93.859
P20GM121293
233,270
Pass-through from Arkansas Children's Research Institute
93.859
034516 - UAMS EN
28,715
Pass-through from Arkansas Children's Research Institute
93.859
034976-SWINDLE
100,369
Pass-through from Arkansas Children's Research Institute
93.859
1P20GM109096
6,668
Pass-through from Arkansas Children's Research Institute
93.859
5P20GM109096-05,
12,099
Pass-through from Arkansas Children's Research Institute
93.859
ACRI # 034488
238,839
- 128 -
Cluster Name/Federal Grantor/Program Name/Pass-Through Entity
ALN
Other Identifying
Number
Pass-Through Identifying
Number
Expenditure
Amount
Provided to
Subrecipients
State of Arkansas
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2021
Research and Development Cluster (Continued)
US Department of Health and Human Services (Continued)
Biomedical Research and Research Training (Continued)
Pass-through from Arkansas Children's Research Institute
93.859
GR034487
$
68,187
Pass-through from Arkansas Children's Research Institute
93.859
GR034974
14,014
Pass-through from Arkansas Children's Research Institute
93.859
P20GM109096
69,015
Pass-through from Johns Hopkins University
93.859
R01M118760
19,689
Pass-through from Purilogics, LLC
93.859
2R44GM117685-02
177
Pass-through from University of Kentucky Research Foundation
93.859
3200003706-21-24
4,190
Pass-through from University of New Mexico
93.859
3REY1
23,140
Pass-through from Washington University
93.859
WU-21-238
76,827
Child Health and Human Development Extramural Research
93.865
4,776,567
$
1,828,254
Pass-through from National Institute of Health
93.865
3R01HD090180-05S
34,068
Pass-through from University of Alabama - Birmingham
93.865
000507132-SC001
(387)
Pass-through from University of Minnesota
93.865
ADVANCE ACCOUNT
516
Aging Research
93.866
2,577,696
137,227
Pass-through from Neurotrack Technologies, Inc.
93.866
R44AG063672
261,557
Pass-through from Oregon Health & Science University
93.866
1013624_UAMS
47,277
Pass-through from Oregon Health & Science University
93.866
1R01AG055681-01A
36,708
Pass-through from The Medical University of South Carolina
93.866
3R01AG046543-04S
365
Pass-through from The Medical University of South Carolina
93.866
MUSC14-076
297
Pass-through from University of California - San Francisco
93.866
11658SC
30,417
Medical Library Assistance
93.879
129,538
65,708
Pass-through from University of North Texas - Health Science Center
93.879
HS763-0000151538
148
Pass-through from University of North Texas - Health Science Center
93.879
RF00194-2020-023
24,515
Pass-through from University of North Texas - Health Science Center
93.879
RF00194-2021-006
19,644
Pass-through from University of North Texas - Health Science Center
93.879
RF00194-2020-023
8,559
Pass-through from University of Pennsylvania
93.879
572635
49,086
Pass-through from University of Washington
93.879
5R01LM012222-04
83,793
Primary Care Training and Enhancement
93.884
322,005
COVID-19: National Bioterrorism Hospital Preparedness Program
93.889
46,298
Rural Health Care Services Outreach, Rural Health Network Development
and Small Health Care Provider Quality Improvement
93.912
3,571
Pass-through from Arkansas Rural Health Partnership
93.912
G25RH32922
13,349
HIV Prevention Activities Health Department Based
93.940
36,698
COVID-19: PPHF Geriatric Education Centers
93.969
89,683
Preventive Health and Health Services Block Grant
93.991
58,691
- 129 -
Cluster Name/Federal Grantor/Program Name/Pass-Through Entity
ALN
Other Identifying
Number
Pass-Through Identifying
Number
Expenditure
Amount
Provided to
Subrecipients
State of Arkansas
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2021
Research and Development Cluster (Continued)
US Department of Health and Human Services (Continued)
COVID-19: Miscellaneous US Department of Health and Human Services
Programs
Pass-through from Duke University
93.RD
HHSO10020140002I
$
42,029
Miscellaneous US Department of Health and Human Services Programs
93.RD
53446
24,956
Pass-through from Alliance for Clinical Trials in Oncology
93.RD
IRB # 239368
3,575
Pass-through from Arkansas Research Alliance
93.RD
CLIN 0002- BIO3
343,878
Pass-through from Capital Consulting Corporation
93.RD
HHSH25020170038G
26,500
Pass-through from Centers for Disease Control & Prevention
93.RD
PO 4501924081
18,478
Pass-through from CYTO Wave Technology, LLC
93.RD
ADVANCE ACCOUNT
32,103
Pass-through from ECOG-ACRIN Cancer Research Group
93.RD
IRB#260064
11,200
Pass-through from Leidos Biomedical Research, Inc.
93.RD
16X011
577,884
Pass-through from Leidos Biomedical Research, Inc.
93.RD
20X023F
789,954
Pass-through from Leidos Biomedical Research, Inc.
93.RD
20X023F TO 2
244,502
$
39,113
Pass-through from Leidos Biomedical Research, Inc.
93.RD
20X023F TO3
27,070
Pass-through from Leidos Biomedical Research, Inc.
93.RD
20X023F TO5
51,425
Pass-through from Leidos Biomedical Research, Inc.
93.RD
SUB # 20X023F
17,047
Pass-through from Massachusetts General Hospital
93.RD
ADVANCE ACCOUNT
8,308
Pass-through from NRG Oncology Foundation
93.RD
205541
400
Pass-through from NRG Oncology Foundation
93.RD
IRB # 260043
250
Pass-through from NRG Oncology Foundation
93.RD
MCTR:ZORN:216;PR
26,514
Pass-through from Rensselear Polytechnic Institute
93.RD
2R01EB005807-09A1 Sub A20-
138-S002
44,630
14,002
Pass-through from Southwest Oncology Group
93.RD
IRB # 239482
18,000
Pass-through from Southwest Oncology Group
93.RD
S1815:PROTOCOL#2
2,950
Pass-through from Southwest Oncology Group
93.RD
S1914
4,549
Pass-through from Southwest Oncology Group
93.RD
SWOG 1404
13,000
Pass-through from XlerateHealth, LLC
93.RD
3UT2GM130174-02S1
29,968
US Department of Health and Human Services Total
69,124,731
7,434,860
Corporation for National and Community Service
AmeriCorps
94.006
64,192
Corporation for National and Community Service Total
64,192
Department of Homeland Security
Pre-Disaster Mitigation
97.047
63,157
Homeland Security Research, Development, Testing, Evaluation, and
Demonstration of Technologies Related to Nuclear Threat Detection
97.077
6,172
Department of Homeland Security Total
69,329
Research and Development Cluster Total
126,451,485
13,800,570
- 130 -
Cluster Name/Federal Grantor/Program Name/Pass-Through Entity
ALN
Other Identifying
Number
Pass-Through Identifying
Number
Expenditure
Amount
Provided to
Subrecipients
State of Arkansas
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2021
Student Financial Assistance Cluster
US Department of Education
Federal Supplemental Educational Opportunity Grants
84.007
$
6,233,243
Federal Work-Study Program
84.033
4,169,850
Federal Perkins Loan Program_Federal Capital Contributions
84.038
4,914,903
Federal Pell Grant Program
84.063
204,581,207
Federal Direct Student Loans
84.268
471,155,909
Teacher Education Assistance for College and Higher Education Grants
(TEACH Grants)
84.379
856,464
US Department of Education Total
691,911,576
US Department of Health and Human Services
Nurse Faculty Loan Program (NFLP)
93.264
5,490
Health Professions Student Loans, Including Primary Care Loans/Loans
for Disadvantaged Students
93.342
4,744,214
Nursing Student Loans
93.364
370,196
Scholarships for Health Professions Students from Disadvantaged
Backgrounds
93.925
502,770
US Department of Health and Human Services Total
5,622,670
Student Financial Assistance Cluster Total
697,534,246
US Department of Agriculture
Agricultural Research Basic and Applied Research
10.001
30,365
Plant and Animal Disease, Pest Control, and Animal Care
10.025
1,325,481
Wildlife Services
Pass-through from Texas A & M University
10.028
TFS-20-sar-422237
16,327
Conservation Reserve Program
Pass-through from National Fish and Wildlife Foundation
10.069
0801.17.060806
52,316
Wetlands Reserve Program
10.072
14,777
Voluntary Public Access and Habitat Incentive Program
10.093
656,998
Market News
10.153
10,000
Wholesale Farmers and Alternative Market Development
10.164
2,269
Specialty Crop Block Grant Program - Farm Bill
10.170
259,089
$
65,859
Organic Certification Cost Share Programs
10.171
2,801
2,801
Local Food Promotion Program
10.172
125,605
Trade Mitigation Program Eligible Recipient Agency Operational Funds
10.178
7,087,975
359,001
Cooperative Forestry Research
10.202
338,268
Payments to Agricultural Experiment Stations Under the Hatch Act
10.203
2,835,428
Animal Health and Disease Research
10.207
43,456
Small Business Innovation Research
Pass-through from Stratcor, Inc.
10.212
USDA-NIFA-SBIR-006790
18,225
Sustainable Agriculture Research and Education
10.215
14,807
Pass-through from University of Georgia
10.215
2019-38640-29878
22,423
- 131 -
Cluster Name/Federal Grantor/Program Name/Pass-Through Entity
ALN
Other Identifying
Number
Pass-Through Identifying
Number
Expenditure
Amount
Provided to
Subrecipients
State of Arkansas
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2021
US Department of Agriculture (Continued)
1890 Institution Capacity Building Grants
10.216
$
9,807
Higher Education - Institution Challenge Grants Program
10.217
19,983
Homeland Security Agricultural
10.304
33,533
Specialty Crop Research Initiative
10.309
42,254
Agriculture and Food Research Initiative (AFRI)
10.310
5,359
Pass-through from University of Florida
10.310
12020-67037-31555
4,311
Beginning Farmer and Rancher Development Program
10.311
181,954
$
32,000
National Food Safety Training, Education, Extension, Outreach, and
Technical Assistance Competitive Grants Program
10.328
3,008
Crop Protection and Pest Management Competitive Grants Program
10.329
189,559
Veterinary Services Grant Program
10.336
25,985
Rural Business Development Grant
10.351
1,925
Value-Added Producer Grants
Pass-through from Iowa State University
10.352
Sub#23108B
4,115
Rural Rental Housing Loans
10.415
3,910,871
State Mediation Grants
10.435
57,019
Cooperative Extension Service
10.500
3,602,236
728,933
Pass-through from Kansas State University
10.500
2018-48661-28954
2,281
Smith-Lever Funding (Various Programs)
10.511
3,426,804
Agriculture Extension at 1890 Land-grant Institutions
10.512
657,223
Renewable Resources Extension Act and National Focus Fund Projects
10.515
111,374
Centers of Excellence at 1890 Institutions
Pass-through from North Carolina A&T State University
10.523
2020-38427-31516
1,000
Scholarships for Students at 1890 Institutions
10.524
181,003
COVID-19: Pandemic EBT Food Benefits
10.542
1,123,837
WIC Special Supplemental Nutrition Program for Women, Infants, and
Children
10.557
42,897,893
Child and Adult Care Food Program
10.558
29,826,417
State Administrative Expenses for Child Nutrition
10.560
4,008,790
WIC Farmers' Market Nutrition Program (FMNP)
10.572
64,196
Senior Farmers Market Nutrition Program
10.576
65,434
63,422
Fresh Fruit and Vegetable Program
10.582
2,491,896
2,427,522
Child Nutrition Direct Certification Performance Awards
10.589
30,303
Forestry Research
10.652
390,680
Cooperative Forestry Assistance
10.664
2,840,245
119,975
Forest Legacy Program
10.676
2,459,126
Forest Stewardship Program
10.678
278,662
Pass-through from American Forest Foundation
10.678
NR203A750001C040
12,840
Forest Health Protection
10.680
142,461
63,632
Good Neighbor Authority
10.691
56,074
State & Private Forestry Hazardous Fuel Reduction Program
10.697
13,300
- 132 -
Cluster Name/Federal Grantor/Program Name/Pass-Through Entity
ALN
Other Identifying
Number
Pass-Through Identifying
Number
Expenditure
Amount
Provided to
Subrecipients
State of Arkansas
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2021
US Department of Agriculture (Continued)
Soil and Water Conservation
10.902
$
2,244,239
$
1,096,691
Pass-through from Alcorn State University
10.902
68-3A75-18-004
62,132
15,000
Pass-through from American Forest Foundation
10.902
NR183A750013C004
24,165
Pass-through from Natural Resources Conservation Service
(USDA NRCS)
10.902
NR203A750001G006
77,265
Environmental Quality Incentives Program
10.912
223,957
Feral Swine Eradication and Control Pilot Program
10.934
693,004
668,574
US Department of Agriculture Total
115,355,130
5,643,410
US Department of Commerce
Cluster Grants
11.020
(3,973)
Economic Development Technical Assistance
11.303
193,813
Manufacturing Extension Partnership
11.611
920,304
COVID-19: Manufacturing Extension Partnership
11.611
365,707
US Department of Commerce Total
1,475,851
US Department of Defense
Issue of Department of Defense Excess Equipment
12.000
2,984,694
Procurement Technical Assistance For Business Firms
12.002
463,317
Payments to States in Lieu of Real Estate Taxes
12.112
1,172,885
1,172,885
Military Construction, National Guard
12.400
2,061,696
National Guard Military Operations and Maintenance (O&M) Projects
12.401
54,437,965
COVID-19: National Guard Military Operations and Maintenance
(O&M) Projects
12.401
350,139
National Guard ChalleNGe Program
12.404
2,772,280
Basic, Applied, and Advanced Research in Science and Engineering
Pass-through from National Science Teaching Association
12.630
21-871-003
3,463
Pass-through from Technology Student Association
12.630
AWD-100034-1
36,127
GenCyber Grants Program
12.903
16,847
US Department of Defense Total
64,299,413
1,172,885
US Department of Housing and Urban Development
Manufactured Home Dispute Resolution
14.171
95,689
Community Development Block Grants/State's program and
Non-Entitlement Grants in Hawaii
14.228
26,911,267
26,164,099
COVID-19: Community Development Block Grants/State's program and
Non-Entitlement Grants in Hawaii
14.228
3,724,663
Emergency Solutions Grant Program
14.231
1,486,225
1,477,470
COVID-19: Emergency Solutions Grant Program
14.231
2,226,342
2,192,642
Home Investment Partnerships Program
14.239
4,376,021
423,708
Housing Opportunities for Persons with AIDS
14.241
869,045
852,999
COVID-19: Housing Opportunities for Persons with AIDS
14.241
90,615
90,615
- 133 -
Cluster Name/Federal Grantor/Program Name/Pass-Through Entity
ALN
Other Identifying
Number
Pass-Through Identifying
Number
Expenditure
Amount
Provided to
Subrecipients
State of Arkansas
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2021
US Department of Housing and Urban Development (Continued)
Housing Trust Fund
14.275
$
4,395,543
Fair Housing Assistance Program State and Local
14.401
665,584
COVID-19: Education and Outreach Initiatives
Pass-through from Pulaski County Arkansas
14.416
PULASKI COUNTY
417,761
US Department of Housing and Urban Development Total
45,258,755
$
31,201,533
US Department of the Interior
Indian Education Higher Education Grant
15.114
193,680
Regulation of Surface Coal Mining and Surface Effects of Underground
Coal Mining
15.250
42,412
Abandoned Mine Land Reclamation (AMLR)
15.252
1,316,310
Flood Control Act Lands
15.433
132,292
132,292
Minerals Leasing Act
15.437
354,420
198,069
National Forest Acquired Lands
15.438
387,910
387,910
Fish and Wildlife Management Assistance
15.608
139,258
57,775
Cooperative Endangered Species Conservation Fund
15.615
820,017
31,932
Clean Vessel Act.
15.616
1,280,472
1,144,824
Sportfishing and Boating Safety Act
15.622
54,100
54,100
State Wildlife Grants
15.634
299,066
83,632
Federal Junior Duck Stamp Conservation and Design
15.644
1,942
White-nose Syndrome National Response Implementation
15.684
20,000
U.S. Geological Survey Research and Data Collection
15.808
53,885
National Cooperative Geologic Mapping
15.810
49,357
National Geological and Geophysical Data Preservation
15.814
3,263
Historic Preservation Fund Grants-In-Aid
15.904
678,677
61,658
Outdoor Recreation Acquisition, Development and Planning
15.916
994,682
Cooperative Research and Training Programs - Resources of the
National Park System
15.945
33,135
Water Use and Data Research
15.981
69,289
US Department of the Interior Total
6,924,167
2,152,192
US Department of Justice
Sexual Assault Services Formula Program
16.017
382,159
382,146
COVID-19: Coronavirus Emergency Supplemental Funding Program
16.034
985,984
456,261
Grants to Reduce Domestic Violence, Dating Violence, Sexual Assault,
and Stalking on Campus
16.525
303,754
Juvenile Justice and Delinquency Prevention Allocation
16.540
122,103
116,787
Missing Children's Assistance
16.543
179,600
National Criminal History Improvement Program (NCHIP)
16.554
673,232
Crime Victim Assistance
16.575
25,010,400
24,432,287
Crime Victim Compensation
16.576
121,282
Crime Victim Assistance/Discretionary Grants
16.582
71,320
- 134 -
Cluster Name/Federal Grantor/Program Name/Pass-Through Entity
ALN
Other Identifying
Number
Pass-Through Identifying
Number
Expenditure
Amount
Provided to
Subrecipients
State of Arkansas
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2021
US Department of Justice (Continued)
Drug Court Discretionary Grant Program
16.585
$
275,372
Pass-through from Mid South Health Systems
16.585
N/A
13,079
Violence Against Women Formula Grants
16.588
2,011,215
$
1,724,493
Residential Substance Abuse Treatment for State Prisoners
16.593
269,370
136,436
Project Safe Neighborhoods
16.609
194,148
155,582
Juvenile Mentoring Program
16.726
34,866
Edward Byrne Memorial Justice Assistance Grant Program
16.738
1,960,413
1,827,256
DNA Backlog Reduction Program
16.741
820,241
Paul Coverdell Forensic Sciences Improvement Grant Program
16.742
368,342
Criminal and Juvenile Justice and Mental Health Collaboration Program
Pass-through from Mid South Health Systems
16.745
N/A
3,673
Edward Byrne Memorial Competitive Grant Program
16.751
119,041
Harold Rogers Prescription Drug Monitoring Program
16.754
658,838
230,198
John R. Justice Prosecutors and Defenders Incentive Act
16.816
36,345
Comprehensive Opioid, Stimulant, and Substance Abuse Program
16.838
878,493
427,730
Equitable Sharing Program
16.922
183,709
US Department of Justice Total
35,676,979
29,889,176
US Department of Labor
Labor Force Statistics
17.002
747,458
Compensation and Working Conditions
17.005
111,484
Registered Apprenticeship
17.201
129,536
129,536
Unemployment Insurance
17.225
73,540,097
COVID-19: Unemployment Insurance
17.225
1,735,649,337
Senior Community Service Employment Program
17.235
1,534,168
1,410,652
Trade Adjustment Assistance
17.245
3,104,928
H-1B Job Training Grants
17.268
1,032,672
851,352
Pass-through from GMACW
17.268
HG-30131-17-60-A-47
121,734
Work Opportunity Tax Credit Program (WOTC)
17.271
76,118
YouthBuild
17.274
336,310
WIOA National Dislocated Worker Grants/WIA National Emergency
Grants
17.277
883,632
526,636
WIOA Dislocated Worker National Reserve Demonstration Grants
17.280
471,617
Apprenticeship USA Grants
17.285
646,397
390,553
Occupational Safety and Health Susan Harwood Training Grants
17.502
92,639
Consultation Agreements
17.504
1,076,205
Mine Health and Safety Grants
17.600
136,299
US Department of Labor Total
1,819,690,631
3,308,729
- 135 -
Cluster Name/Federal Grantor/Program Name/Pass-Through Entity
ALN
Other Identifying
Number
Pass-Through Identifying
Number
Expenditure
Amount
Provided to
Subrecipients
State of Arkansas
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2021
US Department of State
Academic Exchange Programs - Undergraduate Programs
Pass-through from World Learning, Inc.
19.009
SL 3319
$
4,279
US Department of State Total
4,279
US Department of Transportation
Highway Research and Development Program
20.200
100,000
Commercial Driver's License Program Implementation Grant
20.232
422,063
Railroad Development
20.314
1,662
Metropolitan Transportation Planning and State and Non-Metropolitan
Planning and Research
20.505
2,065,398
$
1,694,250
Formula Grants for Rural Areas and Tribal Transit Program
20.509
3,738,941
3,582,990
COVID-19: Formula Grants for Rural Areas and Tribal Transit Program
20.509
21,319,230
20,179,376
Rail Fixed Guideway Public Transportation System State Safety
Oversight Formula Grant Program
20.528
166,744
155,449
National Highway Traffic Safety Administration (NHTSA) Discretionary
Safety Grants and Cooperative Agreements
20.614
100,551
Pipeline Safety Program State Base Grant
20.700
663,266
Interagency Hazardous Materials Public Sector Training and
Planning Grants
20.703
187,909
US Department of Transportation Total
28,765,764
25,612,065
US Department of the Treasury
Low Income Taxpayer Clinics
21.008
103,372
COVID-19: Coronavirus Relief Fund
21.019
904,193,999
179,326,165
COVID-19: Emergency Rental Assistance Program
21.023
5,052,299
COIVD-19: Homeowner Assistance Fund
21.026
1,258,480
US Department of the Treasury Total
910,608,150
179,326,165
General Services Administration
Donation of Federal Surplus Personal Property
39.003
6,248,534
General Services Administration Total
6,248,534
National Aeronautics and Space Administration
Office of Stem Engagement (OSTEM)
43.008
46,129
National Aeronautics and Space Administration Total
46,129
Institute of Museum and Library Services
Museum Grants for African American History and Culture
45.309
248,000
Grants to States
45.310
1,887,128
COVID-19: Grants to States
45.310
48,092
Institute of Museum and Library Services Total
2,183,220
- 136 -
Cluster Name/Federal Grantor/Program Name/Pass-Through Entity
ALN
Other Identifying
Number
Pass-Through Identifying
Number
Expenditure
Amount
Provided to
Subrecipients
State of Arkansas
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2021
National Endowment for the Arts
Promotion of the Arts Grants to Organizations and Individuals
45.024
$
441,500
$
441,500
Promotion of the Arts Partnership Agreements
45.025
547,502
447,954
Pass-through from Mid-America Alliance
45.025
#FY2021-00108108
4,000
National Endowment for the Arts Total
993,002
889,454
National Endowment for the Humanities
Promotion of the Humanities Federal/State Partnership
45.129
919
Pass-through from Arkansas Humanities Council
45.129
F0029563 FY19
100
Pass-through from Arkansas Humanities Council
45.129
N/A
14,787
Promotion of the Humanities Challenge Grants
45.130
8,567
Promotion of the Humanities Division of Preservation and Access
45.149
149,863
COVID-19: Promotion of the Humanities Division of Preservation and
Access
45.149
51,921
Promotion of the Humanities Research
45.161
14,067
Promotion of the Humanities Professional Development
45.163
69,121
Promotion of the Humanities Public Programs
Pass-through from National Endowment for the Humanities
45.164
N/A
929
Promotion of the Humanities Office of Digital Humanities
45.169
27,857
National Endowment for the Humanities Total
338,131
National Science Foundation
Education and Human Resources
47.076
1,730,029
Integrative Activities
47.083
599,791
81,951
Pass-through from Arkansas Science & Technology Authority
47.083
20-EPS3-0013
112,374
Pass-through from University of Alaska
47.083
PO539384
518
National Science Foundation Total
2,442,712
81,951
Small Business Administration
Small Business Development Centers
59.037
1,340,312
COVID-19: Small Business Development Centers
59.037
766,867
Federal and State Technology Partnership Program
59.058
112,032
1,250
State Trade Expansion
59.061
62,387
Small Business Administration Total
2,281,598
1,250
US Department of Veterans Affairs
Veterans State Nursing Home Care
64.015
14,100,657
Post-9/11 Veterans Educational Assistance
64.027
115,107
Post-9/11 Veterans Educational Assistance
64.028
148,142
Burial Expenses Allowance for Veterans
64.101
452,068
Vocational Rehabilitation for Disabled Veterans
64.116
3,429
All-Volunteer Force Educational Assistance
64.124
286,843
- 137 -
Cluster Name/Federal Grantor/Program Name/Pass-Through Entity
ALN
Other Identifying
Number
Pass-Through Identifying
Number
Expenditure
Amount
Provided to
Subrecipients
State of Arkansas
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2021
US Department of Veterans Affairs (Continued)
Veterans Cemetery Grants Program
64.203
$
1,206,005
Miscellaneous US Department of Veterans Affairs Programs
64.U01
N/A
90,078
US Department of Veterans Affairs Total
16,402,329
Environmental Protection Agency
Air Pollution Control Program Support
66.001
1,076,692
Surveys, Studies, Research, Investigations, Demonstrations, and
Special Purpose Activities Relating to the Clean Air Act
66.034
500,015
Diesel Emissions Reduction Act (DERA) State Grants
66.040
280,795
$
262,866
Multipurpose Grants to States and Tribes
66.204
136,064
71,500
Water Pollution Control State, Interstate, and Tribal Program Support
66.419
2,148,670
State Public Water System Supervision
66.432
861,588
State Underground Water Source Protection
66.433
74,333
Lead Testing in School and Child Care Program Drinking Water
(SDWA 1464(d))
66.444
264
Water Quality Management Planning
66.454
80,157
Nonpoint Source Implementation Grants
66.460
1,865,495
1,030,165
Environmental Information Exchange Network Grant Program and
Related Assistance
66.608
171,600
Consolidated Pesticide Enforcement Cooperative Agreements
66.700
517,008
Toxic Substances Compliance Monitoring Cooperative Agreements
66.701
54,020
TSCA Title IV State Lead Grants Certification of Lead-Based Paint
Professionals
66.707
152,808
Research, Development, Monitoring, Public Education, Training,
Demonstrations, and Studies
66.716
11,161
Pass-through from Extension Foundation
66.716
SA-2021-57
9,026
Hazardous Waste Management State Program Support
66.801
379,438
Superfund State, Political Subdivision, and Indian Tribe Site-Specific
Cooperative Agreements
66.802
7,630
Underground Storage Tank (UST) Prevention, Detection, and Compliance
Program
66.804
637,108
Leaking Underground Storage Tank Trust Fund Corrective Action
Program
66.805
567,609
State and Tribal Response Program Grants
66.817
94,745
Superfund State and Indian Tribe Combined Cooperative Agreements
(Site-Specific and Core)
66.961
295,870
Environmental Protection Agency Total
9,922,096
1,364,531
- 138 -
Cluster Name/Federal Grantor/Program Name/Pass-Through Entity
ALN
Other Identifying
Number
Pass-Through Identifying
Number
Expenditure
Amount
Provided to
Subrecipients
State of Arkansas
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2021
US Department of Energy
Weatherization Assistance for Low-Income Persons
81.042
$
1,902,224
$
1,792,602
Conservation Research and Development
81.086
845
State Energy Program Special Projects
81.119
46,995
US Department of Energy Total
1,950,064
1,792,602
Federal Emergency Management Administration
COVID-19: Miscellaneous Federal Emergency Management
Administration Programs
83.U01
11,875,720
Federal Emergency Management Administration Total
11,875,720
US Department of Education
Adult Education - Basic Grants to States
84.002
5,638,375
2,407,067
Title I Grants to Local Educational Agencies
84.010
154,076,830
152,987,797
Migrant Education State Grant Program
84.011
5,430,151
5,133,522
Title I State Agency Program for Neglected and Delinquent Children
and Youth
84.013
266,463
63,890
Overseas Programs - Group Projects Abroad
84.021
280,851
Higher Education Institution Aid
84.031
9,071,532
Federal Family Education Loans
84.032
146,116,692
Career and Technical Education - Basic Grants to States
84.048
12,484,933
7,839,880
Pass-through from Jonesboro Public School System
84.048
V048A200004
100,350
Rehabilitation Services Vocational Rehabilitation Grants to States
84.126
30,278,499
Rehabilitation Long-Term Training
84.129
157,048
Migrant Education Coordination Program
84.144
51,946
49,936
Rehabilitation Services Independent Living Services for Older Individuals
Who are Blind
84.177
459,903
Special Education - Grants for Infants and Families
84.181
4,144,237
Safe and Drug-Free Schools and Communities_State Grants
84.186
(2,771)
(2,771)
Supported Employment Services for Individuals with the Most Significant
Disabilities
84.187
301,306
Education for Homeless Children and Youth
84.196
729,539
625,406
Javits Gifted and Talented Students Education
84.206
344,958
18,635
Innovative Approaches to Literacy; Promise Neighborhoods; and Full-
Service Community School
84.215
(1,957)
(1,957)
Twenty-First Century Community Learning Centers
84.287
6,060,743
5,431,472
Special Education - State Personnel Development
84.323
584,802
575,702
Pass-through from Great Rivers Educational Coop
84.323
H323A150013
173,927
Pass-through from Great Rivers Educational Coop
84.323
H323A200017
9,112
Special Education - Personnel Development to Improve Services and
Results for Children with Disabilities
84.325
894,450
276,929
Special Education - Technical Assistance and Dissemination to Improve
Services and Results for Children with Disabilities
84.326
129,601
- 139 -
Cluster Name/Federal Grantor/Program Name/Pass-Through Entity
ALN
Other Identifying
Number
Pass-Through Identifying
Number
Expenditure
Amount
Provided to
Subrecipients
State of Arkansas
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2021
US Department of Education (Continued)
Gaining Early Awareness and Readiness for Undergraduate Programs
84.334
$
927,993
Child Care Access Means Parents in School
84.335
206,238
School Renovation Grants
84.352
(73) $
(73)
Rural Education
84.358
2,842,073
2,797,913
Rural Education
84.358A
31,317
English Language Acquisition State Grants
84.365
4,463,121
3,324,222
Supporting Effective Instruction State Grants (formerly Improving Teacher
Quality State Grants)
84.367
19,895,546
19,186,128
Pass-through from National Writing Project
84.367
U367O150004
6,313
Grants for State Assessments and Related Activities
84.369
3,833,460
Comprehensive Literacy Development
84.371
5,008,946
4,388,318
School Improvement Grants
84.377
798,704
758,130
Strengthening Minority-Serving Institutions
84.382
1,474,441
Student Support and Academic Enrichment Program
84.424
11,615,377
11,615,361
COVID-19: Education Stabilization Fund - Governor's Emergency
Education Relief (GEER) Fund
84.425C
20,157,838
3,887,274
COVID-19: Education Stabilization Fund - Elementary and Secondary
School Emergency Relief (ESSER) Fund
84.425D
263,041,250
252,122,443
COVID-19: Education Stabilization Fund - Higher Education Emergency
Relief Fund (HEERF) Student Aid Portion
84.425E
61,880,508
COVID-19: Education Stabilization Fund - HEERF Institutional Portion
84.425F
106,338,141
COVID-19: Education Stabilization Fund - Discretionary Grants:
Reimagining Workforce Preparation Grants
84.425G
342,418
COVID-19: Education Stabilization Fund - HEERF Historically Black
Colleges and Universities (HBCUs)
84.425J
6,111,932
COVID-19: Education Stabilization Fund - HEERF Minority Serving
Institutions (MSIs)
84.425L
315,792
COVID-19: Education Stabilization Fund - HEERF Strengthening
Institutions Program (SIP)
84.425M
4,586,252
COVID-19: Education Stabilization Fund - HEERF Fund for the
Improvement of Postsecondary Education (FIPSE) Formula Grant
84.425N
62,783
COVID-19:CRRSAA: Education Stabilization Fund -Higher Education
Emergency Relief Fund (HEERF II)
84.425R
298,951
238,005
COVID19 - Education Stabilization Fund - CARES Act Subtotal
463,135,865
256,247,722
American Printing House for the Blind
84.906
52,233
Disaster Recovery Assistance for Education
84.938
39
39
COVID-19: Miscellaneous US Department of Education Programs
84.U01
N/A
15,770
US Department of Education Total
892,088,883
473,723,268
- 140 -
Cluster Name/Federal Grantor/Program Name/Pass-Through Entity
ALN
Other Identifying
Number
Pass-Through Identifying
Number
Expenditure
Amount
Provided to
Subrecipients
State of Arkansas
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2021
Delta Regional Authority
Delta Regional Development
90.200
$
69,188
States' Economic Development Assistance Program
90.204
34,975
Delta Regional Authority Total
104,163
US Election Assistance Commission
2018 HAVA Election Security Grants
90.404
587,767
COVID-19: 2018 HAVA Election Security Grants
90.404
1,407,916
US Election Assistance Commission Total
1,995,683
US Department of Health and Human Services
Special Programs for the Aging, Title VII, Chapter 2, Long Term Care
Ombudsman Services for Older Individuals
93.042
136,420
$
132,755
COVID-19: Special Programs for the Aging, Title VII, Chapter 2, Long
Term Care Ombudsman Services for Older Individuals
93.042
128,289
128,289
Special Programs for the Aging, Title III, Part D Disease Prevention, and
Health Promotion Services
93.043
176,247
176,247
Special Programs for the Aging, Title IV, and Title II Discretionary Projects
93.048
609,130
35,000
National Family Caregiver Support, Title III, Part E
93.052
1,734,196
1,734,196
COVID-19: National Family Caregiver Support, Title III, Part E
93.052
852,682
852,682
Sexual Risk Avoidance Education
93.060
265,236
135,572
Public Health Emergency Preparedness
93.069
5,909,778
19,626
Medicare Enrollment Assistance Program
93.071
332,049
50,441
Lifespan Respite Care Program
93.072
29,790
Cooperative Agreements to Promote Adolescent Health through School-
Based HIV/STD Prevention and School-Based Surveillance
93.079
85,411
Sodium Reduction in Communities
93.082
342,872
Guardianship Assistance
93.090
776,892
Affordable Care Act (ACA) Personal Responsibility Education Program
93.092
230,034
157,299
Food and Drug Administration Research
93.103
1,085,468
1,227
Area Health Education Centers
93.107
1,267,936
Maternal and Child Health Federal Consolidated Programs
93.110
879,655
100,701
Project Grants and Cooperative Agreements for Tuberculosis Control
Programs
93.116
590,551
Acquired Immunodeficiency Syndrome (AIDS) Activity
93.118
38,438
Emergency Medical Services for Children
93.127
188,636
Cooperative Agreements to States/Territories for the Coordination and
Development of Primary Care Offices
93.130
140,350
Injury Prevention and Control Research and State and Community Based
Programs
93.136
2,209,956
107,662
COVID-19: Injury Prevention and Control Research and State and
Community Based Programs
93.136
27,386
Community Programs to Improve Minority Health Grant Program
93.137
24,937
- 141 -
Cluster Name/Federal Grantor/Program Name/Pass-Through Entity
ALN
Other Identifying
Number
Pass-Through Identifying
Number
Expenditure
Amount
Provided to
Subrecipients
State of Arkansas
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2021
US Department of Health and Human Services (Continued)
Projects for Assistance in Transition from Homelessness (PATH)
93.150
$
212,885
$
212,885
Disabilities Prevention
93.184
358,512
Graduate Psychology Education
93.191
316,468
Telehealth Programs
93.211
383,696
COVID-19: Telehealth Programs
93.211
581,433
Family Planning Services
93.217
4,709,814
Traumatic Brain Injury State Demonstration Grant Program
93.234
129,065
Title V State Sexual Risk Avoidance Education (Title V State SRAE)
Program
93.235
695,697
687,718
State Capacity Building
93.240
44,111
State Rural Hospital Flexibility Program
93.241
213,319
91,939
Substance Abuse and Mental Health Services Projects of Regional
and National Significance
93.243
7,172,945
1,722,958
Pass-through from Mid South Health Systems
93.243
1H79SM061557-01
166
Pass-through from Mid South Health Systems
93.243
N/A
38,777
Advanced Nursing Education Workforce Grant Program
93.247
673,086
Early Hearing Detection and Intervention
93.251
246,895
51,890
Poison Center Support and Enhancement Grant
93.253
162,927
Immunization Cooperative Agreements
93.268
47,240,612
78,959
COVID-19: Immunization Cooperative Agreements
93.268
1,763,634
83,415
Viral Hepatitis Prevention and Control
93.270
131,971
69,340
Drug-Free Communities Support Program Grants
93.276
82,043
Pass-through from Out of the Dark, Inc.
93.276
N/A
6,602
State Partnership Grant Program to Improve Minority Health
93.296
18,570
Small Rural Hospital Improvement Grant Program
93.301
370,036
323,939
COVID-19: Small Rural Hospital Improvement Grant Program
93.301
1,732,690
1,732,690
PPHF2018: Office of Smoking and Health - National State-Based
Tobacco Control Programs - Financed in part by 2018 Prevention
and Public Health funds (PPHF)
93.305
108,889
Early Hearing Detection and Intervention Information System (EHDI-IS)
Surveillance Program
93.314
129,143
Outreach Programs to Reduce the Prevalence of Obesity in High Risk
Rural Areas
93.319
572,990
Epidemiology and Laboratory Capacity for Infectious Diseases (ELC)
93.323
2,134,807
COVID-19: Epidemiology and Laboratory Capacity for Infectious
Diseases (ELC)
93.323
40,230,395
State Health Insurance Assistance Program
93.324
694,645
Behavioral Risk Factor Surveillance System
93.336
143,987
Public Health Emergency Response: Cooperative Agreement for
Emergency Response: Public Health Crisis Response
93.354
(4,100)
COVID-19: Public Health Emergency Response: Cooperative
Agreement for Emergency Response: Public Health Crisis Response
93.354
2,892,571
- 142 -
Cluster Name/Federal Grantor/Program Name/Pass-Through Entity
ALN
Other Identifying
Number
Pass-Through Identifying
Number
Expenditure
Amount
Provided to
Subrecipients
State of Arkansas
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2021
US Department of Health and Human Services (Continued)
State Actions to Improve Oral Health Outcomes and Partner Actions to
Improve Oral Health Outcomes
93.366
$
304,805
$
121,398
Flexible Funding Model - Infrastructure Development and Maintenance
for State Manufactured Food Regulatory Programs
93.367
185,240
ACL Independent Living State Grants
93.369
338,964
National and State Tobacco Control Program
93.387
999,249
The State Flexibility to Stabilize the Market Grant Program
93.413
80,480
Improving the Health of Americans through Prevention and Management
of Diabetes and Heart Disease and Stroke
93.426
1,681,249
607,098
ACL National Institute on Disability, Independent Living, and
Rehabilitation Research
Pass-through from The University of Texas at Dallas
93.433
20-1688
166
Pass-through from Memorial Hermann Health System d/b/a
TIRR Memorial Hermann
93.433
20-1688-1
8,811
Every Student Succeeds Act/Preschool Development Grants
93.434
2,663,776
Well-Integrated Screening and Evaluation for Women Across the
Nation (WISEWOMAN)
93.436
326,317
State Physical Activity and Nutrition (SPAN)
93.439
635,159
15,411
Food Safety and Security Monitoring Project
93.448
34,211
ACL Assistive Technology
93.464
506,179
Title IV-E Prevention Program
93.472
4,119,162
COVID-19: Provider Relief Fund
93.498
16,916,110
MaryLee Allen Promoting Safe and Stable Families Program
93.556
1,909,123
Temporary Assistance for Needy Families
93.558
58,448,714
16,590,748
Child Support Enforcement
93.563
23,271,181
Refugee and Entrant Assistance State/Replacement Designee
Administered Programs
93.566
5,771
Low-Income Home Energy Assistance
93.568
32,442,282
32,305,775
COVID-19: Low-Income Home Energy Assistance
93.568
7,269,584
7,269,584
Community Services Block Grant
93.569
8,294,025
7,984,777
COVID-19: Community Services Block Grant
93.569
4,390,973
4,302,236
Refugee and Entrant Assistance Discretionary Grants
93.576
11,814
State Court Improvement Program
93.586
283,292
Community-Based Child Abuse Prevention Grants
93.590
334,856
Grants to States for Access and Visitation Programs
93.597
102,360
Chafee Education and Training Vouchers Program (ETV)
93.599
144,147
Adoption and Legal Guardianship Incentive Payments
93.603
291,844
Developmental Disabilities Basic Support and Advocacy Grants
93.630
732,032
432,548
University Centers for Excellence in Developmental Disabilities
Education, Research, and Service
93.632
454,393
Children's Justice Grants to States
93.643
86,870
Stephanie Tubbs Jones Child Welfare Services Program
93.645
2,811,577
- 143 -
Cluster Name/Federal Grantor/Program Name/Pass-Through Entity
ALN
Other Identifying
Number
Pass-Through Identifying
Number
Expenditure
Amount
Provided to
Subrecipients
State of Arkansas
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2021
US Department of Health and Human Services (Continued)
COVID-19: Stephanie Tubbs Jones Child Welfare Services Program
93.645
$
281,392
Child Welfare Research Training or Demonstration
Pass-through from The Research for the State of University -
University of Albany
93.648
12-89268
99,915
Foster Care Title IV-E
93.658
42,019,318
Adoption Assistance
93.659
34,063,151
COVID-19: Emergency Grants to Address Mental and Substance Use
Disorders During COVID-19
93.665
106,366
$
19,738
Social Services Block Grant
93.667
13,492,177
Child Abuse and Neglect State Grants
93.669
997,961
Family Violence Prevention and Services/Domestic Violence Shelter
and Supportive Services
93.671
1,209,875
1,155,061
COVID-19: Family Violence Prevention and Services/Domestic Violence
Shelter and Supportive Services
93.671
116,729
107,160
John H. Chafee Foster Care Program for Successful Transition to
Adulthood
93.674
642,862
COVID-19: John H. Chafee Foster Care Program for Successful
Transition to Adulthood
93.674
130,672
Medical Student Education
93.680
2,781,652
799,206
Ending the HIV Epidemic: A Plan for America - Ryan White HIV/AIDS
Programs Parts A and B
93.686
122,320
Mental and Behavioral Health Education and Training Grants
93.732
378,876
State Public Health Approaches for Ensuring Quitline Capacity - Funded
in part by Prevention and Public Health Funds (PPHF)
93.735
54,819
PPHF: Racial and Ethnic Approaches to Community Health Program
financed solely by Public Prevention and Health Funds
93.738
927,018
PPHF: Health Care Surveillance/Health Statistics - Surveillance Program
Announcement: Behavioral Risk Factor Surveillance System Financed
in Part by Prevention and Public Health Fund
93.745
27,794
Elder Abuse Prevention Interventions Program
93.747
85,256
Children's Health Insurance Program
93.767
179,283,792
Pass-through from Arkansas Children's Hospital
93.767
D89MC23141-02-00
(231)
Opioid STR
93.788
6,055,039
1,672,670
Money Follows the Person Rebalancing Demonstration
93.791
427,002
State Survey Certification of Health Care Providers and Suppliers
(Title XIX) Medicaid
93.796
3,226,979
Organized Approaches to Increase Colorectal Cancer Screening
93.800
40,243
16,036
Section 223 Demonstration Programs to Improve Community Mental
Health Services
Pass-through from Mid South Health Systems
93.829
N/A
112,220
Arthritis, Musculoskeletal and Skin Diseases Research
93.846
143,952
- 144 -
Cluster Name/Federal Grantor/Program Name/Pass-Through Entity
ALN
Other Identifying
Number
Pass-Through Identifying
Number
Expenditure
Amount
Provided to
Subrecipients
State of Arkansas
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2021
US Department of Health and Human Services (Continued)
Biomedical Research and Research Training
93.859
$
54,340
Pass-through from University of Kentucky Research Foundation
93.859
UT2GM130174
18,804
Pass-through from XlerateHealth, LLC
93.859
1UT2GM130174-01
2,782
Maternal, Infant and Early Childhood Home Visiting Grant
93.870
7,944,509
National Bioterrorism Hospital Preparedness Program
93.889
1,947,006
$
1,533,131
COVID-19: National Bioterrorism Hospital Preparedness Program
93.889
1,287,882
1,287,882
Cancer Prevention and Control Programs for State, Territorial and Tribal
Organizations
93.898
2,603,569
183,750
Rural Health Care Services Outreach, Rural Health Network Development
and Small Health Care Provider Quality Improvement
Pass-through from Greater Delta Alliance for Health, Inc.
93.912
1 D60 RH25757-04
515
Grants to States for Operation of State Offices of Rural Health
93.913
168,791
HIV Care Formula Grants
93.917
6,770,738
2,119,364
COVID-19: HIV Care Formula Grants
93.917
186,675
Healthy Start Initiative
93.926
1,311,193
HIV Prevention Activities Health Department Based
93.940
1,699,993
191,835
Assistance Programs for Chronic Disease Prevention and Control
93.945
206,725
Cooperative Agreements to Support State-Based Safe Motherhood and
Infant Health Initiative Programs
93.946
99,680
Block Grants for Community Mental Health Services
93.958
6,276,293
6,239,134
Block Grants for Prevention and Treatment of Substance Abuse
93.959
7,784,794
3,909,949
PPHF Geriatric Education Centers
93.969
840,336
87,993
Sexually Transmitted Diseases (STD) Prevention and Control Grants
93.977
981,936
Improving Student Health and Academic Achievement through Nutrition,
Physical Activity and the Management of Chronic Conditions in
Schools
93.981
369,655
116,529
COVID-19: Improving Student Health and Academic Achievement
through Nutrition, Physical Activity and the Management of Chronic
Conditions in Schools
93.981
146,808
136,682
Mental Health Disaster Assistance and Emergency Mental Health
93.982
1,633,449
1,593,660
Preventive Health and Health Services Block Grant
93.991
1,047,943
144,019
Maternal and Child Health Services Block Grant to the States
93.994
6,515,011
3,627
Autism and Other Developmental Disabilities, Surveillance, Research,
and Prevention
93.998
534,509
Test for Suppression Effects of Advanced Energy
93.999
76,135
Miscellaneous US Department of Health and Human Services Programs
93.U01
N/A
3,561,701
US Department of Health and Human Services Total
643,235,257
99,634,431
- 145 -
Cluster Name/Federal Grantor/Program Name/Pass-Through Entity
ALN
Other Identifying
Number
Pass-Through Identifying
Number
Expenditure
Amount
Provided to
Subrecipients
State of Arkansas
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2021
Corporation for National and Community Service
State Commissions
94.003
$
232,944
AmeriCorps
94.006
1,610,386
$
1,302,605
Commission Investment Fund
94.008
231,802
11,575
Volunteers in Service to America
94.013
119,346
Corporation for National and Community Service Total
2,194,478
1,314,180
Department of Homeland Security
State and Local Homeland Security National Training Program
97.005
339,801
Homeland Security Preparedness Technical Assistance Program
97.007
137,334
Non-Profit Security Program
97.008
71,114
71,114
Boating Safety Financial Assistance
97.012
1,278,295
Community Assistance Program State Support Services Element
(CAP-SSSE)
97.023
21,144
5,000
Flood Mitigation Assistance
97.029
37,037
36,782
COVID-19: Crisis Counseling
97.032
529,445
Disaster Grants - Public Assistance (Presidentially Declared Disasters)
97.036
24,121,456
19,067,003
Hazard Mitigation Grant
97.039
1,468,414
1,256,797
National Dam Safety Program
97.041
2,960
Emergency Management Performance Grants
97.042
3,968,167
1,568,236
COVID-19: Emergency Management Performance Grants
97.042
245,155
State Fire Training Systems Grants
97.043
15,715
Cooperating Technical Partners
97.045
954,927
BRIC: Building Resilient Infrastructure and Communities
97.047
1,651,515
1,530,865
COVID-19: Presidential Declared Disaster Assistance to Individuals and
Households - Other Needs
97.050
136,888,251
Homeland Security Grant Program
97.067
4,162,501
3,521,363
Earthquake Consortium
97.082
32,230
11,241
COVID-19: Miscellaneous Department of Homeland Security Programs
97.U01
N/A
2,062,160
Department of Homeland Security Total
177,987,621
27,068,401
Total Expenditures of Federal Awards
$
14,012,775,452
$
1,310,619,892
St at e of Arkansas Single Audit
____________________________________________________________________________________________________
Not es t o Schedule of Expendit ures
of Federal Aw ards
For t he Year Ended June 30, 2021
___________________________________________
State of Arkansas
Notes to Schedule of Expenditures of Federal Awards
For The Year Ended June 30, 2021
- 146 -
(1)
Summary of Significant Accounting Policies
(a)
Reporting Entity
The Schedule of Expenditures of Federal Awards (the “Schedule”) includes the activity of all federal
award programs administered by the State of Arkansas. Arkansas Legislative Audit did not audit the
entities, their federal financial assistance, or major federal programs listed below. This report, insofar as
it relates to these entities, is based solely on the report of other auditors.
State/Educational Agency and Program Name
Assistance
Listing
Number(s)
Expenditures
Arkansas Development Finance Authority:
HOME Investment Partnerships Program
14.239
$4,376,021
COVID-19: Homeowner Assistance Fund
21.026
$1,258,480
Federal Family Education Loans
84.032
$146,116,692
State of Arkansas Construction Assistance
Revolving Loan Fund:
Clean Water State Revolving Fund Cluster
66.458
$7,108,936
State of Arkansas Drinking Water Revolving
Loan Fund:
Drinking Water State Revolving Fund Cluster
66.468
$11,176,700
University of Arkansas for Medical Sciences:
Research and Development Cluster
various
$72,292,758
Provider Relief Fund
$16,129,864
Federal award programs include expenditures, pass-throughs to non-state agencies (i.e., payments to
subrecipients), non-monetary assistance, and loan programs.
State of Arkansas
Notes to Schedule of Expenditures of Federal Awards
For The Year Ended June 30, 2021
- 147 -
(1)
Summary of Significant Accounting Policies (Continued)
(b)
Basis of Presentation
The Schedule presents total federal awards expended for each individual federal program in accordance
with Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost
Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Federal award program
titles are reported as presented in the Federal Assistance Listing (FAL).
The Schedule presents both Type A and Type B federal assistance programs administered by the State
of Arkansas. Uniform Guidance establishes the formula for determining the level of expenditures or
disbursements to be used in defining Type A and Type B federal financial assistance programs. For the
State of Arkansas, Type A programs are those that exceed $30,000,000 in disbursements, expenditures,
or distributions. Major and non-major programs are determined using the risk-based approach outlined
in Uniform Guidance.
(c)
Basis of Accounting
Most expenditures presented in the Schedule are reported on the cash basis of accounting, while some
are presented on the modified accrual basis of accounting. Such expenditures are recognized following
the cost principles contained in Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative
Requirements, Cost Principles, and Audit Requirements for Federal Awards, wherein certain types of
expenditures are not allowable or are limited as to reimbursement. Those federal programs presenting
negative amounts on the Schedule are the result of prior-year expenditures being overstated and/or
reimbursements due back to the grantor.
(d)
Indirect Cost Rate
The State has elected not to use the 10 percent de minimis indirect cost rate allowed under the Uniform
Guidance.
(2)
Relationship to Federal Financial Reports
The regulations and guidelines governing the preparation of federal financial reports vary by federal agency and
among programs administered by the same agency. Accordingly, the amounts reported in the federal financial
reports do not necessarily agree with the amounts reported in the accompanying Schedule, which is prepared
on the basis explained in Note 1(c).
(3)
Federally Funded Loan Programs
The expenditures reported in the Schedule include previous year loan balances, for which the federal
government imposes continuing compliance requirements, and current year disbursements. The outstanding
loan balances as of June 30, 2021, for these loans are as follows:
Assistance
Listing
Number
Program Name
Amount
84.038
Federal Perkins Loan Program_Federal Capital
Contributions
$430,592
93.264
Nurse Faculty Loan Program (NFLP)
110,543
93.342
Health Professions Student Loans, Including Primary
Care Loans/Loans for Disadvantaged Students
4,744,214
93.364
Nursing Student Loans
370,196
Total
$5,655,545
State of Arkansas
Notes to Schedule of Expenditures of Federal Awards
For The Year Ended June 30, 2021
- 148 -
(3)
Federally Funded Loan Programs (Continued)
The State also participates in the Federal Direct Loans (Direct Loan) Program, FAL 84.268, and the Federal
Family Education Loans Program (FFEL), FAL 84.032, which includes the Federal Stafford Loan Program and
the Federal Parents’ Loans for Undergraduate Students Program. The programs do not require the Universities
to disburse the funds. The proceeds are disbursed by the federal government for direct loans and by lending
institutions for FFEL. Loan guarantees are issued by the Arkansas Guaranteed Student Loan Corporation and
other for-profit and not-for-profit guarantee agencies. The federal government reinsures these guarantee
agencies. During the year ended June 30, 2021, Direct Loans totaling $471,155,909 and FFEL loans totaling
$0 were made to students enrolled at higher educational agencies in the State. These loans are included in the
Schedule. The outstanding loan balance for FAL 84.032 at June 30, 2021, was $132,448,398.
Education loans made or purchased by the Arkansas Student Loan Authority, a division of Arkansas
Development Finance Authority, are guaranteed by the Great Lakes Higher Education Corporation (Great
Lakes), United Student Aid Funds (USAF), or the U.S. Department of Education (USDE). Student loans
guaranteed by the USDE are considered noncash awards, which amounted to $145,729,453 at July 1, 2020.
The Great Lakes, USAF, and USDE guarantees are contingent upon the loans being serviced within the due
diligence requirements of the guarantors and loan services.1
Expenditures reflected in FAL 10.415, Preservation Revolving Loan Fund, include loans to contractors for
development of multi-family housing. The funding sources for these loans are two $2,125,000 promissory notes
executed between Arkansas Development Finance Authority and U.S. Department of Agriculture Rural
Development during fiscal year 2013 and fiscal year 2016. When received, these funds will be used to make
new loans for program activities. The outstanding loan receivable balance was $3,422,922 for the year ended
June 30, 2021. Total disbursements for loans made totaled $796,973 during the year ended June 30, 2021. 1
Expenditures reflected in FAL 14.228, Neighborhood Stabilization Programs, include loans to contractors for
redevelopment of foreclosed or abandoned homes for sale or rent in order to stabilize neighborhoods and stem
the decline of house values in neighboring homes. The funding source for these loans is federal grant funds.
The funds are disbursed after expenses have been incurred as forgiveness of principal and repayable loans.
The outstanding loan receivable balance was $18,390,281 for the year ended June 30, 2021. No disbursements
were made for repayable loans during the year ended June 30, 2021. 1
Expenditures reflected in FAL 14.218, Community Development Block Grant, include loans to contractors for
development or redevelopment of affordable rental housing. The funding source for these loans is federal grant
funds. The funds are disbursed after expenses have been incurred as forgiveness of principal and repayable
loans. The outstanding loan receivable was $7,700,000 for the year ended June 30, 2021. No disbursements
were made for repayable loans during the year ended June 30, 2021.1
Expenditures reflected in FAL 14.239, HOME Investment Partnerships Program, include loans to contractors
and borrowers for development of single-family and multi-family housing. The funding source for these loans
includes federal grant funds and revolving program funds. The funds are disbursed after expenses have been
incurred as forgiveness of principal and repayable loans. The outstanding loan receivable balance was
$110,896,382 for the year ended June 30, 2021. Total disbursements of federal funds for repayable loans
totaled $2,912,472 during the year ended June 30, 2021.1
Expenditures reflected in FAL 14.275, Housing Trust Fund, include loans to contractors for development or
redevelopment of affordable housing, particularly rental housing, for extremely low-income and very low-income
households. The funding source for these loans is federal grant funds. The funds are disbursed after expenses
have been incurred as forgiveness of principal and repayable loans. The outstanding loan receivable balance
was $4,491,426 for the year ended June 30, 2021. Total disbursements for loans made totaled $3,139,963
during the year ended June 30, 2021.1
Expenditures reflected in FAL 66.458, Capitalization Grants for the Clean Water State Revolving Funds, include
loans to municipalities and other public entities for construction of water treatment facilities. The funding source
for these loans includes federal grant funds, state match funds, bond funds, and revolving Program funds. The
funds are disbursed to the subrecipients after expenses have been incurred as forgiveness of principal and
repayable loans. The Program’s outstanding loan receivable balance from subrecipients from all funding
sources was $325.8 million for the year ended June 30, 2021. During fiscal 2021, approximately $695,000 of
loans were forgiven. Total federal disbursements totaled approximately $6.7 million during fiscal year 2021,
which represented funding for principal forgiveness and repayable loans. For the year ended June 30, 2021,
the Program received $398,000 in federal funds for administrative costs.1
State of Arkansas
Notes to Schedule of Expenditures of Federal Awards
For The Year Ended June 30, 2021
- 149 -
(3)
Federally Funded Loan Programs (Continued)
Expenditures reflected in FAL 66.468, Capitalization Grants for Drinking Water State Revolving Funds, include
loans to counties, municipalities and other tax-exempt water system entities for construction of new water
systems, expansion or repair of existing water systems, and/or consolidation of new or existing water systems.
The funding source for these loans includes federal grant funds, state match funds, bond funds, and revolving
Program funds. The funds are disbursed to the subrecipients after expenses have been incurred as forgiveness
of principal and repayable loans. The Program’s outstanding loan receivable balance from subrecipients from
all funding sources was $204.3 million for the year ended June 30, 2021. Total federal loan disbursements
totaled $7.4 million during fiscal year 2021. Total loans forgiven totaled $4.5 million during fiscal year 2021. For
the year ended June 30, 2021, the Program received $3.8 million in federal funds for administrative costs, which
were disbursed to the administration agencies.1
The U.S. Department of Energy allowed the state of Arkansas to use ARRA-State Energy Program (FAL 81.041)
funds to create the Energy Revolving Loan Program. The loan program was created to encourage the
development, implementation, and deployment of cost-effective energy efficiency and renewable energy projects
in the state and to support the creation of additional employment opportunities and other economic development
benefits. Of the total amount of program funds expended and reported on the accompanying SEFA for fiscal
years 2011 and 2012, $11,370,000 was transferred to the revolving loan fund and made available for future
loans. There were no program funds transferred to the revolving loan fund for fiscal year 2021. The outstanding
loan receivable balance from subrecipients for the year ended June 30, 2021, totaled $3,200,046. Total
disbursements for new loans made during fiscal year 2021 totaled $141,801.
(4)
Non-Monetary Assistance
The State is the recipient of federal financial assistance programs that do not result in cash receipts or
disbursements. Non-Cash awards received by the State are included in the Schedule as follows:
Assistance
Listing
Number
Program Name
Amount
10.178
Trade Mitigation Program Eligible Recipient Operational Funds
$ 6,728,974
10.555
National School Lunch Program (Child Nutrition Cluster)
17,451,592
10.558
Child and Adult Care Food Program
13,195
10.565
Commodity Supplemental Food Program
1,947,729
10.569
COVID-19: Emergency Food Assistance Program (Food
Commodities)
5,342,510
10.569
Emergency Food Assistance Program (Food Commodities)
11,709,655
12.000
Issue of Department of Defense excess equipment
2,982,886
39.003
Donation of Federal Surplus Personal Property
6,248,534
83.000
COVID-19: Miscellaneous Federal Emergency Management
Administration Programs
11,875,720
84.906
American Printing House for the Blind
52,233
93.268
COVID-19: Immunizations Cooperative Agreements
164,250
93.268
Immunizations Cooperative Agreements
44,098,941
93.498
COVID-19: Provider Relief Fund
74,412
97.000
Miscellaneous Department of Homeland Security Programs
2,062,160
Total
$ 110,752,791
(5)
Rebates from the Special Supplemental Food Program for Women, Infants, and Children (WIC)
During fiscal year 2021, the State received cash rebates totaling $18,080,139 from infant formula manufacturers
on sales of formula to participants in the WIC program (FAL 10.557), which are netted against total expenditures
included in the Schedule. Rebate contracts with infant formula manufacturers are authorized by 7 CFR §
246.16a as a cost containment measure. Rebates represent a reduction of expenditures previously incurred for
WIC food benefit costs. Applying the rebates received to such costs enabled the State to extend program
benefits to 284,690 more persons than could be served this fiscal year in the absence of the rebate contract.
State of Arkansas
Notes to Schedule of Expenditures of Federal Awards
For The Year Ended June 30, 2021
- 150 -
(6) Disability Determination for Social Security
External auditors other than Arkansas Legislative Audit have been engaged to audit Disability Determination for
Social Security Administration (DDSSA) included in the State of Arkansas Annual Comprehensive Financial
Report (ACFR) for the year ended June 30, 2021. This entity is not included in the Schedule of Expenditures
of Federal Awards because the audit is based on the federal fiscal year, which ends September 30. The audit
firm was Stan Parks, CPA, which issued an audit report for October 1, 2019, through September 30, 2020. The
audit for the period ended September 30, 2021, has been procured by DDSSA.
(7)
Unemployment Insurance
State unemployment tax revenues, and the government and nonprofit contributions in lieu of State taxes (State
UI funds), must be deposited into the Unemployment Trust Fund in the U.S. Treasury. Use of these funds is
restricted to pay benefits under the federally approved State Unemployment Law. State UI funds as well as
federal funds are reported on the Schedule under FAL 17.225. The $1,809,189,434 of expenditures reported
on the Schedule is comprised of $1,768,522,000 of federal funds and $40,667,434 of State UI funds.
(8)
Notes Payable
The federal loan programs listed subsequently are administered directly by Arkansas Development Finance
Authority (the Authority), and balances and transactions relating to the programs are included in the Authority’s
basic combined financial statements. Notes payable outstanding at the beginning of the year and federal
expenditures during the year are included in the federal expenditures presented in the Schedule. The balance
of the notes payable outstanding at June 30, 2021, consists of: 1
Assistance
Listing
Number
Program Name
Outstanding Balance
at June 30, 2021
10.415
Preservation Revolving Loan Fund
$ 3,427,737
(9)
Coronavirus Relief Fund
In March 2020, the Federal government enacted the Coronavirus Aid, Relief, and Economic Security Act
(CARES Act). The CARES Act provided funding for several economic assistance programs to address the
impact of the COVID-19 outbreak. The CARES Act established the Coronavirus Relief Fund (CRF) to provide
assistance to states and other local and tribal governments with necessary expenditures incurred to address
the public health emergency. The assistance had to be applied to allowable expenditures incurred in the period
beginning March 1, 2020, and ending December 30, 2020. The State of Arkansas received CRF assistance in
the amount of $1.25 billion. In December 2020, the federal government enacted the Consolidated Appropriations
Act, 2021, that included an extension of the timeframe to expend CRF funds through December 31, 2021. Any
CRF funds not expended by December 31, 2021, must be returned to the U. S. Treasury. Because of the
requirement to return unexpended CRF funds, the State accrued a liability of $67.6 million for CRF funds
unexpended as of June 30, 2021. In the period from July 1, 2021 through December 1, 2021, the State of
Arkansas expended an additional $41.9 million of CRF funding, resulting in a remaining liability of $25.7 million.
(10) State and Local Fiscal Recovery Fund
On March 11, 2021, the federal government enacted the American Rescue Plan Act (ARPA). ARPA provided
funding for several economic assistance programs to address the impact of the COVID-19 outbreak. ARPA
established the State and Local Fiscal Recovery Fund (SLFRF) to provide assistance to states and other local
and tribal governments with necessary expenditures incurred to address the public health emergency. The
assistance must be applied to allowable expenditures incurred in the period beginning March 3, 2021, and
ending December 31, 2024. In June 2021, the State of Arkansas received the first of two equal distributions of
SLFRF assistance in the amount of $786.6 million, of the $1.6 billion total allocated to the State of Arkansas.
Any SLFRF funds not expended by December 31, 2024, must be returned to the U. S. Treasury. Because of
the requirement to return unexpended SLFRF funds, the State accrued a liability of $786.6 million for SLFRF
funds unexpended as of June 30, 2021. In the period from July 1, 2021 through December 10, 2021, the State
of Arkansas expended $431.0 million of SLFRF funding, resulting in a remaining liability of $355.6 million.
State of Arkansas
Notes to Schedule of Expenditures of Federal Awards
For The Year Ended June 30, 2021
- 151 -
(11) Temporary Increase is Federal Medical Assistance Percentage
During the year ended June 30, 2021, certain federal programs listed in the Schedule received a temporary
increase in the Federal Medical Assistance Percentage (FMAP) or Enhanced Federal Medical Assistance
Percentage (E-FMAP), authorized through the Family First Coronavirus Response Act. The programs affected
by this increase include the following:
Assistance Listing Number
Program Name
93.090
Guardianship Assistance
93.596
Child Care Mandatory and Matching Funds of the Child
Care and Development Fund
93.658
Foster Care_Title IV-E
93.659
Adoption Assistance
93.767
Children’s Health Insurance Program
93.778
Medical Assistance Program
1 This note is based solely on the Single Audit Reports issued by other external auditors. See entities listed
in Note (1)(a).
St at e of Arkansas Single Audit
____________________________________________________________________________________________________
Sum m ary Schedule of Prior Audit Findings
For t he Year Ended June 30, 2021
___________________________________________
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
- 152 -
In accordance with 2 CFR § 200.511 of the Uniform Administrative Requirements, Cost Principles, and Audit
Requirements for Federal Awards, commonly referred to as Uniform Guidance, the auditee is responsible for follow-
up and corrective action on all audit findings. As part of this responsibility, the auditee must prepare a summary
schedule of prior audit findings. The schedule must report the status of all audit findings included in the prior audit that
are not listed as corrected or no longer valid or warranting further action.
The schedule for the year ended June 30, 2021 is located on page 153 and includes all findings from the prior audit,
June 30, 2020, and certain findings from previous audits, including the years ended June 30, 2019 and 2018.
Financial Statement Findings
Page Number(s)
Division of Workforce Services
154 - 155
Federal Program Name
Page Number(s)
Unemployment Insurance
156 - 160
Adoption Assistance
161 - 162
Medicaid Cluster
163 - 172; 184 - 231
Children’s Health Insurance Program
163 – 183; 209 - 214
Student Financial Assistance Cluster
232 – 239; 242 - 249
COVID-19: Education Stabilization Fund – CARES ACT
(Higher Education Emergency Relief Fund (HEERF)
Institutional Portion)
240 - 241
- 153 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Financial Statement Finding Number 2020-001
Auditee reported status as of June 30, 2021: Corrective action was taken.
Division of Workforce Services
The Committee of Sponsoring Organizations of the Treadway Commission (COSO) framework of internal controls,
adopted by the State of Arkansas in DFA's Financial Management Guide, states that communications related to both
operational and financial data are needed at all levels of an agency in a relevant, reliable, and timely fashion. The
State did not have the policies and procedures in place to appropriately record the financial effects of the new
unemployment insurance pandemic programs authorized under the CARES Act of 2020. As a result, we noted the
following:
•
Operating revenues were overstated by $52,930,508 when a portion of federal grant receipts were
erroneously coded to a general ledger account related to Operating revenues, as opposed to the more
appropriate general ledger account related to Non-operating revenues. The State made an attempt to
correct the misstatement, but the modification was not made for the correct amount, or to the correct
general ledger account. As a result, the correcting entry also caused a $19,299,223 overstatement of
Non-operating revenues and a $72,229,731 overstatement of Operating expenses.
•
A federal receivable of $170,564,947 related to the new pandemic programs [Federal Pandemic
Unemployment Assistance (FPUC), Pandemic Extended Unemployment Compensation (PEUC), and
Pandemic Unemployment Assistance (PUA)] was not recorded.
•
Unemployment benefits payable of $293,784,718 for the new pandemic programs (FPUC, PEUC, and
PUA) were not recorded until auditors inquired about the lack of such an entry. Additionally, auditors
recalculated this payable to be $303,090,396, a difference of $9,305,678.
Lack of appropriate controls over financial reporting could cause financial statements to be misstated.
Upon notifying DFA-CAFR of the potential misstatements, an entry was made in AASIS to correct the amounts listed
above.
We recommend the State work to improve its controls over financial reporting, creating policies and procedures that
encourage more accurate reporting of its programs.
Views of Responsible Officials and Planned Corrective Action:
ADWS management concurs with the finding.
•
The State made an attempt to correct the misstatement, but the modification was not made for the correct
amount, or to the correct general ledger account. As a result, the correcting entry also caused a $19,299,223
overstatement of Non‐operating revenues and a $72,229,731 overstatement of Operating expenses.
Accounting staff unintentionally copied the posting templates from employer contributions, instead of other
program revenues. To eliminate the risk, the Assistant Controller will review all new templates before posting.
•
The root cause was breakdowns in communications and the lateness in calculating and posting the payable
that caused this receivable. The Controller Unit will develop SOP’s to ensure all appropriate entries are posted.
•
Under normal circumstances, UI Program Unit uses a prescribed formula to calculate the payable for UI
Regular Benefits. That formula is: Average Duration divided by 2, times compensable claims, times Average
Weekly Benefit.
- 154 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Financial Statement Finding Number 2020-001 (Continued)
Views of Responsible Officials and Planned Corrective Action (Continued):
At the seven (7) day period ending June 30, 2020; ADWS paid 83,088 compensable UI claims. The average weekly
benefit amount for the quarter ending June 30, 2020 was $223.0 and the average claim duration was 8.8 weeks. Using
these numbers, the UI Benefits payable at June 30, 2020 equals: $81,525,946.
There are differences in the regular benefits and new programs, such as duration, timing, and the very nature of the
program. ADWS reviewed each of the programs for these issues, as well as for trends in the total payouts, and
calculated our estimate.
Adjusted procedure: financial management will discuss all programs existing at year end, internally and with the
program unit, and develop best estimates, as appropriate that must be approved by both program and fiscal leadership.
Anticipated Completion Date:
Complete
Contact Person:
Kristopher Jones
Assistant Director, FMAS
Arkansas Division of Workforce Services
2 Capitol Mall
Little Rock, AR 72201
501-682-3108
Kris.jones@arkansas.gov
- 155 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-002
State/Educational Agency(s):
Department of Commerce –
Division of Workforce Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
17.225 – Unemployment Insurance
Federal Awarding Agency:
U.S. Department of Labor
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
Not Applicable
Compliance Requirement(s) Affected:
Allowable Costs/Cost Principles;
Eligibility
Type of Finding:
Noncompliance and Material Weakness
Auditee reported status as of June 30, 2021: Partially corrected: ADWS will be reaching out to the AR Department
of Health to discuss options for checking UI claims against their database of death certificates. ADWS has already
taken action on other planned corrective actions below.
Repeat Finding:
Not applicable
Criteria:
In accordance with 2 CFR § 200.303, a non-federal entity must establish and maintain effective internal control over
the federal award that provides reasonable assurance that the non-federal entity is managing the federal award in
compliance with federal statutes, regulations, and the terms and conditions of the award.
Condition and Context:
Our review of claimant data revealed overpayments as follows:
•
Comparing claimant data to the death list provided by the Department of Health, ALA staff identified
unemployment benefits totaling $15,220 that were paid for claims on behalf of four deceased individuals.
•
Using data analytics, ALA staff identified $8,152,235 in post-pandemic-period payments to 3,384
claimants as suspicious due to the consistent wages reported for those employees by their employers in
quarters 1 and 2 of calendar year 2020. In a random sample of 60 claimants, with benefits totaling
$154,217, ALA noted:
a)
One claimant was paid 13 weeks of regular Unemployment Compensation (UC) and Federal
Pandemic Unemployment Compensation (FPUC) totaling $12,298, between April 4, 2020 and
June 27, 2020, for an unemployment claim on a part-time job lost when the business closed.
The claimant still maintained gainful employment with a local university, earning wages of
$16,491 in both quarters 1 and 2 of the calendar year 2020. If the wages had been correctly
reported by the claimant in her weekly claims for unemployment, she would not have been
eligible for any benefits; therefore, the entire $12,298 was an overpayment. The university
disputed the unemployment claim with the Division of Workforce Services, which failed to
properly consider the income and erroneously upheld the eligibility of the individual.
b)
Of the 60 claimants in the sample, 10 claimants, with benefit payments totaling $14,981, were
victims of identity theft, who had claims filed fictitiously using their names and Social Security
numbers. If projected to the population of $8,152,235 suspicious payments in this test, the result
would be $791,927 in UC overpayments due to identity theft.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
$42,499
Cause:
In response to the increase in demand for services/benefits, the State relaxed controls over identity verification and
income verification for the program during the fourth quarter of fiscal year 2020.
- 156 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-002 (Continued)
State/Educational Agency(s):
Department of Commerce –
Division of Workforce Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
17.225 – Unemployment Insurance
Federal Awarding Agency:
U.S. Department of Labor
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
Not Applicable
Compliance Requirement(s) Affected:
Allowable Costs/Cost Principles;
Eligibility
Type of Finding:
Noncompliance and Material Weakness
Effect:
Lack of appropriate internal controls resulted in overpayments of both state and federal funds.
Recommendation:
ALA staff recommend the Agency maintain and strengthen internal controls over benefit payments to ensure that
payments are made in the correct amount and to eligible claimants. ALA staff also recommend the Agency seek
recoupment of the identified overpayments.
Views of Responsible Officials and Planned Corrective Action:
ADWS management concurs with the finding.
1.
To reduce the risk of improper payments due to weak controls around identify verification, ADWS has implemented
or planned the following:
a.
Beginning in July 2020, PUA claimants whose applications were flagged as suspicious (i.e. “Internal
Review” status) were mailed a letter requesting additional documentation including state-issued
identification be submitted electronically to the PUA.Review@arkansas.gov email address or via fax or
mail. In-person identity verification was not mandatory; in-person verification was the alternative method
to the email, fax, and mail options. Claimants who successfully provided the requested documentation
were released from Internal Review status and resumed normal claim activity.
b.
In December 2020, ADWS implemented the UIdentify solution from OnPoint Technology as another
alternate method of identity verification. UIdentify sends an email to the claimant with a link for the
claimant to scan the barcode on the back of their driver’s license. The solution then cross matches the
barcode information against national Department of Motor Vehicles (DMV) databases and returns a
“Match” or “Mismatch” result to ADWS.
From December 4, 2020 thru January 11, 2021, a total of 60,757 emails were sent to claimants in
Internal Review status. All applications for claimants who successfully verified their identity were
released to resume normal claim activity.
c.
Data Analytics – Several data analytics techniques are currently utilized including a robust fraud algorithm,
which identifies claims meeting certain parameters (i.e. multiple claims with common data elements,
invalid email domains, high-risk banks, etc.).
d.
Tips/Leads – ADWS provides multiple methods to report suspected fraud including a fraud hotline and an
online reporting option. Daily leads are also received from the IDH fraud alerts and regular communication
regarding fraud is shared with the public.
e.
Although ADWS does not currently cross match against local death records, Regular UC has over 32
cross match processes some of which cross match national databases for death records and PUA has
moved 17 of the same processes into production.
f.
ADWS is also planning to leverage the NASWA Integrity Hub Suspicious Actor Repository to further
improve this process.
g.
Further, ADWS is currently implementing a “Fact-Finding for ID Theft Questionnaire” that requires
clarification/attestation from a claimant that resolves duplicate claims.
- 157 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-002 (Continued)
State/Educational Agency(s):
Department of Commerce –
Division of Workforce Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
17.225 – Unemployment Insurance
Federal Awarding Agency:
U.S. Department of Labor
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
Not Applicable
Compliance Requirement(s) Affected:
Allowable Costs/Cost Principles;
Eligibility
Type of Finding:
Noncompliance and Material Weakness
Views of Responsible Officials and Planned Corrective Action (Continued):
2.
Regarding the recoupment of identified overpayments, ADWS has implemented or planned the following:
a.
ADWS has a Benefits Payment Control Unit that pursues overpayments.
b.
Regarding overpayments due to Identity Theft specifically, ADWS must identify the perpetrator and proper
claimant before attempting collections. ADWS actively works with OIG, FBI, and other organizations to
coordinate this effort.
Anticipated Completion Date:
Complete
Contact Person:
Kristopher Jones
Assistant Director, FMAS
Arkansas Division of Workforce Services
2 Capitol Mall
Little Rock, AR 72201
501-682-3108
Kris.jones@arkansas.gov
- 158 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-003
State/Educational Agency(s):
Department of Commerce –
Division of Workforce Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
17.225 – Unemployment Insurance
Federal Awarding Agency:
U.S. Department of Labor
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
Not Applicable
Compliance Requirement(s) Affected:
Allowable Costs/Cost Principles;
Eligibility
Type of Finding:
Noncompliance and Material Weakness
Auditee reported status as of June 30, 2021: Corrective action was taken.
Repeat Finding:
Not applicable
Criteria:
In accordance with 2 CFR § 200.303, a non-federal entity must establish and maintain effective internal control over
the federal award that provides reasonable assurance that the non-federal entity is managing the federal award in
compliance with federal statutes, regulations, and the terms and conditions of the award.
Unemployment Insurance Program Letter No. 14-20 establishes Pandemic Unemployment Assistance (PUA) for
individuals who are self-employed, who are seeking part-time employment, or who otherwise would not qualify for
regular Unemployment Compensation (UC) under state or federal law. As such, the programs are mutually exclusive,
and it is not allowable for claims to be paid for the same week of unemployment out of both programs.
Condition and Context:
Using data analytics, ALA staff identified 1,820 claimants who received a total of 3,761 payments for the same week of
unemployment in both the regular UC system and the new PUA system. The duplicate payments paid from the regular
UC system totaled $1,291,245, and those paid from the PUA system totaled $1,304,451.
ALA staff reviewed the case files of 30 claimants, sampled from the population of 1,820 claimants, receiving duplicate
payments and noted the following:
•
21 of the 30 claimants (70%) were not eligible for the PUA benefits received.
•
7 of the 30 claimants (23.3%) were not eligible for the regular UC benefits received.
•
2 of the 30 claimants (6.7%) were not eligible for either the PUA or the regular UC benefits received.
•
Of the $100,883 PUA benefits sampled, ALA identified questioned costs totaling $88,174. If projected to
the population of duplicate payments, likely questioned costs could total $1,139,770.
•
Of the $98,288 regular UC benefits sampled, ALA identified questioned costs totaling $15,264. If
projected to the population of duplicate payments, likely questioned costs could total $200,529.
Statistically Valid Sample:
Not at statistically valid sample
Questioned Costs:
$103,438
Cause:
The duplicate payments appear to be due to a lack of appropriate communication between the two systems
administering the regular UC benefits and the PUA benefits.
Effect:
A lack of adequate controls allowed benefit payments from two separate systems to be issued for the same week of
unemployment for the same claimant, resulting in overpayments of state and federal funds.
- 159 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-003 (Continued)
State/Educational Agency(s):
Department of Commerce –
Division of Workforce Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
17.225 – Unemployment Insurance
Federal Awarding Agency:
U.S. Department of Labor
Federal Award Number(s):
Not Applicable
Federal Award Year(s):
Not Applicable
Compliance Requirement(s) Affected:
Allowable Costs/Cost Principles;
Eligibility
Type of Finding:
Noncompliance and Material Weakness
Recommendation:
ALA staff recommend the Agency work to strengthen internal controls over the establishment of eligibility for regular
UC and PUA, as well as the payment of benefits, in a way that considers the information in both systems. In addition,
ALA staff recommend the Agency continue to pursue the recovery of overpayments of funds, returning them to their
appropriate source.
Views of Responsible Officials and Planned Corrective Action:
ADWS management concurs with the finding.
1.
To reduce the risk of improper payments due to duplicate payments between UC and PUA, ADWS has
implemented the following:
a.
ADWS sent a quarterly and now daily list to Protech that identifies claimants that are monetarily eligible
to collect regular UC. Those claims are flagged as not entitled in the PUA system.
2.
In terms of recouping Identified Overpayments, ADWS has implemented or planned the following improvements:
a.
This response is the same as that found in the response to Finding 2020-002.
Anticipated Completion Date:
Complete
Contact Person:
Kristopher Jones
Assistant Director, FMAS
Arkansas Division of Workforce Services
2 Capitol Mall
Little Rock, AR 72201
501-682-3108
Kris.jones@arkansas.gov
- 160 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-013
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.659 – Adoption Assistance
Federal Awarding Agency:
U.S. Department of Human Services
Federal Award Number(s):
2001ARADPT; 1901ARADPT; 1801ARADPT
Federal Award Year(s):
2018, 2019, and 2020
Compliance Requirement(s) Affected:
Eligibility
Type of Finding:
Significant Deficiency
Auditee reported status as of June 30, 2021: Partially corrected. The agency updated its internal control
procedures to include procedures for processing adoption subsidy overpayments in April 2021. A new report has been
developed to identify termination of parent’s rights. An internal monitoring review of the finding is pending.
Repeat Finding:
Not applicable
Criteria:
In accordance with 42 USC § 673(a)(4)(A) and (B), a payment may not be made to parents, with respect to a child, if
the state determines that the parents are no longer legally responsible for the support of the child or the child is no
longer receiving any support from the parents. Parents who have been receiving adoption assistance payments shall
keep the state responsible for administering the program informed of circumstances that would make them ineligible
for the payments.
In accordance with 45 CFR § 75.303, a non-federal entity must:
•
Establish and maintain effective internal control over the federal award that provides reasonable
assurance that the non-federal entity is managing the federal award in compliance with federal statutes,
regulations, and the terms and conditions of the award. These controls should be in compliance with
Green Book or COSO guidance.
•
Evaluate and monitor its compliance with the award.
•
Take prompt action when instances of noncompliance are identified, including noncompliance identified
in audit findings.
Condition and Context:
When an adoptive parent is no longer legally responsible for the support of the child (i.e., death of parent, termination
of parental rights, child no longer receiving support from parent), the Adoption Unit must be notified in order to end the
adoption subsidy. However, the notifications are not always timely, and the required information entered into the
Children’s Reporting and Information System (CHRIS) is delayed, resulting in payments made to parents past the
subsidy end date. As a result, the Agency established internal control procedures to identify these types of payments
and forward the overpayment information to the accounts receivable department for collection.
ALA obtained a report from CHRIS staff that contained all subsidy overpayments for the year ended June 30, 2020.
The report contained subsidy overpayments for 33 clients. ALA reviewed documentation for 5 clients to ensure the
overpayments were researched and properly submitted for collection.
The following deficiencies were noted:
•
For 2 clients, the adoption subsidy continued for six months following the death of the adoptive parent.
Agency staff were unaware that the six monthly checks had been cashed and did not perform research
procedures to determine if the accounts receivable department should be notified of an overpayment.
Questioned costs totaled $3,610.
•
For 2 clients, the Agency was not notified timely that parental rights had been terminated. Additionally,
when the termination was discovered, the overpayment information sent to the accounts receivable
department was not complete because it did not include the entire overpayment period, voided warrants,
or uncashed warrants. Questioned costs totaled $10,467.
- 161 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-013 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.659 – Adoption Assistance
Federal Awarding Agency:
U.S. Department of Human Services
Federal Award Number(s):
2001ARADPT; 1901ARADPT; 1801ARADPT
Federal Award Year(s):
2018, 2019, and 2020
Compliance Requirement(s) Affected:
Eligibility
Type of Finding:
Significant Deficiency
Condition and Context (Continued):
Further discussion with the Agency revealed that required overpayment adjustments have not been made on the
quarterly federal financial reports or communicated with the federal awarding agency.
In addition, the Agency acknowledged that its documented internal control procedures have not been updated since
2015.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
State fiscal year 2020 - $5,604
State fiscal year 2019 - $5,492
State fiscal year 2018 - $2,981
Cause:
The internal control process for identifying, researching, calculating, and submitting overpayments to accounts
receivable is inadequate. Additionally, the Adoption Unit is not notified timely of events requiring an adoption subsidy
to end.
Effect:
The Agency does not have an adequate process in place to accurately identify and calculate overpayments and
properly notify the accounts receivable department that an overpayment has occurred. Additionally, the federal
awarding agency may require a refund.
Recommendation:
ALA staff recommend the Agency immediately update its documented internal control procedures regarding the
overpayment process and provide relevant training to staff. In addition, ALA staff recommend the Agency immediately
develop procedures for notifying the Adoption Unit regarding termination of adoptive parent parental rights to ensure
subsidy end date information is processed timely.
Views of Responsible Officials and Planned Corrective Action:
DHS concurs with this finding. The Division of Children and Family Services (DCFS) has reviewed and updated the
internal control procedures to include overpayment processes. Additional training has been provided to the adoption
staff responsible for reviewing overpayments. DCFS has also worked with the Office of Information Technology to
create a new report to identify when the termination of parental rights has been entered in CHRIS for a dissolved
adoption. The report will allow the adoption staff to complete the subsidy end date in CHRIS and review for any
overpayment.
Anticipated Completion Date:
April 30, 2021
Contact Person:
Mischa Martin
Director, Division of Children and Family Services
Department of Human Services
700 Main Street
Little Rock, AR 72201
501-320-6331
Mischa.martin@dhs.arkansas.gov
- 162 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-014
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1905AR5021; 05-2005AR5021
(Children’s Health Insurance Program)
05-1905AR5MAP; 05-2005AR5MAP
(Medicaid Cluster)
Federal Award Year(s):
2019 and 2020
Compliance Requirement(s) Affected:
Allowable Costs/Cost Principles
Type of Finding:
Noncompliance and Significant Deficiency
Auditee reported status as of June 30, 2021: Partially corrected. The agency updated its procedures for
processing overpayments in February 2021 and will attach funding codes to overpayments that can be identified as
Medicaid/CHIP in June 2021. An internal monitoring review of the finding is pending.
Repeat Finding:
A similar issue was reported in prior-year finding 2019-014.
Criteria:
42 CFR § 433, Subpart F, establishes requirements for identifying overpayments to Medicaid providers and for
refunding the federal portion of identified overpayments to the federal awarding agency. The provisions apply to
overpayments discovered by a state, by a provider and made known to the state, or through federal review.
Also, in accordance with 42 CFR § 433.320, an agency must refund the federal share of overpayments that are subject
to recovery by recording a credit on its Quarterly Statement of Expenditures (Form CMS-64). An agency must credit
the federal share of overpayments on the earlier of (1) the CMS-64 submission due for the quarter in which the
overpayment is recovered from the provider or (2) the quarter in which the one-year period following discovery,
established in accordance with 42 CFR § 433.316, ends. A credit on the CMS-64 must be made whether or not the
state has recovered the overpayment from the provider.
Finally, 42 CFR § 457.628(a) states that the requirements for the Medicaid program under 42 CFR §§ 433.312 - 433.322
also apply to the Children’s Health Insurance Program (CHIP).
Condition and Context:
ALA review of the Agency’s process for reporting provider overpayments due to fraud resulted in the discovery of four
overpayments, totaling $72,686, that were not reported on the CMS-64 as required. In addition, three of the four
overpayments were never entered into the Agency’s QuickBooks system, intended to be the Agency’s monitoring
mechanism for its receivables.
The Agency confirmed that it does not identify the program from which overpayments were originally paid (i.e., Medicaid
or CHIP). Therefore, ALA was unable to determine that all reported overpayments, which were not recouped through
ICN level adjustments in MMIS, were appropriately applied to the Medicaid program.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
Medicaid - $72,686
CHIP - Unknown
Cause:
Individuals involved in the collecting and reporting of provider overpayments did not have an adequate understanding
of the federal regulations governing the reporting of identified overpayments.
- 163 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-014 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1905AR5021; 05-2005AR5021
(Children’s Health Insurance Program)
05-1905AR5MAP; 05-2005AR5MAP
(Medicaid Cluster)
Federal Award Year(s):
2019 and 2020
Compliance Requirement(s) Affected:
Allowable Costs/Cost Principles
Type of Finding:
Noncompliance and Significant Deficiency
Effect:
The Agency failed to report all identified overpayments and to report the overpayments timely. 42 CFR § 433.320(a)(4)
states that if the federal share of an overpayment is not refunded, the state will be liable for interest on the amount
equal to the federal share of the non-recovered, non-refunded overpayment amount. Interest during this period will be
at the Current Value of Funds Rate and will accrue beginning on the day after the end of the one-year period following
discovery until the last day of the quarter for which the CMS-64 is submitted, refunding the federal share of the
overpayment.
Recommendation:
ALA staff recommend the Agency provide adequate training to ensure staff responsible for identifying and reporting
provider overpayments fully understand the reporting requirements for overpayments that are identified by the Office
of Medicaid Inspector General and the Medicaid Fraud Control Unit. ALA further recommends the Agency strengthen
controls to ensure all identified overpayments are included on the appropriate CMS-64 and reported timely.
Views of Responsible Officials and Planned Corrective Action:
DHS concurs with this finding. The agency updated its procedures for processing Medicaid provider overpayments
received from OMIG and MFCU on February 19, 2020. The payments noted in the findings were received from MFCU
prior to the agency’s implementation of corrective action.
The agency will attach funding codes to overpayments that can be identified as Medicaid or CHIP for reporting.
Anticipated Completion Date:
June 30, 2021
Contact Person:
Jason Callan
Deputy Chief Financial Officer, Medicaid Services
Department of Human Services
700 Main Street
Little Rock, AR 72201
501-320-6540
Jason.callan@dhs.arkansas.gov
- 164 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-015
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1905AR5021; 05-2005AR5021
(Children’s Health Insurance Program)
05-1905AR5MAP; 05-2005AR5MAP
(Medicaid Cluster)
Federal Award Year(s):
2019 and 2020
Compliance Requirement(s) Affected:
Allowable Costs/Cost Principles –
Managed Care Medical Loss Ratio (PASSE and Dental)
Type of Finding:
Material Weakness
Auditee reported status as of June 30, 2021: Partially corrected. The agency developed internal controls
addressing the actuarial review, submission, and completion of MLR reports for PASSE and Dental Managed Care in
May 2021. An internal monitoring review for this finding is pending.
Repeat Finding:
Not applicable
Criteria:
In accordance with 45 CFR § 75.302(b)(7), a non-federal entity must establish written procedures to implement and
determine the allowability of costs in accordance with Uniform Administrative Requirements, Cost Principles, and Audit
Requirements, as well as the terms and conditions of the federal award.
In addition, 45 CFR § 75.303 states that a non-federal entity must:
•
Establish and maintain effective internal control over the federal award that provides reasonable
assurance that the non-federal entity is managing the federal award in compliance with federal statutes,
regulations, and the terms and conditions of the award. These controls should be in compliance with
Green Book or COSO guidance.
•
Evaluate and monitor its compliance with the award.
•
Take prompt action when instances of noncompliance are identified, including noncompliance identified
in audit findings.
Condition and Context:
The Agency failed to establish documented Medical Loss Ratio (MLR) internal controls for the Dental managed care
program. After further inquiry to gain an understanding of the Agency’s control processes, ALA was unable to identify
any internal controls and could not perform MLR control testing on the Dental managed care program.
ALA was able to identify and test MLR controls for the Provider-Led Arkansas Shared Savings Entity (PASSE) managed
care program. MLR reports are a requirement of each PASSE. These reports must be submitted to the Agency by
April 30 and meet certain requirements outlined in the PASSE agreement as follows:
a)
Total incurred claims.
b)
Expenditures on quality improving activities.
c)
Expenditures related to activities compliant with program integrity requirements.
d)
Non-claims costs.
e)
Premium revenue.
f)
Taxes.
g)
Licensing fees.
h)
Regulatory fees.
i)
Methodologies for allocation of expenditures.
- 165 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-015 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1905AR5021; 05-2005AR5021
(Children’s Health Insurance Program)
05-1905AR5MAP; 05-2005AR5MAP
(Medicaid Cluster)
Federal Award Year(s):
2019 and 2020
Compliance Requirement(s) Affected:
Allowable Costs/Cost Principles –
Managed Care Medical Loss Ratio (PASSE and Dental)
Type of Finding:
Material Weakness
Condition and Context (Continued):
j)
Any credibility adjustment applied.
k)
The calculated MLR.
l)
Any remittance owed to the state, if applicable.
m) A comparison of the information reported with the audited financial report.
n)
A description of the aggregation method used to calculate total incurred claims.
o)
The number of member months.
Our testing revealed that adequate documentation was not provided to support that the required MLR reports were
submitted timely and contained complete and accurate information. As a result, ALA was unable to determine if there
was sufficient, appropriate evidence documenting that this control was operating effectively.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
None
Cause:
The Agency did not adequately develop or document internal control procedures for its staff regarding MLR for the
Dental managed care program. Adequate oversight was not in place regarding MLR for PASSE.
Effect:
Failure to adequately document and implement appropriate internal control procedures limits the Agency’s ability to
adequately monitor the program to ensure compliance.
Recommendation:
ALA staff recommend the Agency develop and document internal controls regarding MLR for the Dental managed care
program. In addition, ALA recommends the Agency strengthen the PASSE internal controls for MLR to ensure
consistent operating effectiveness of the controls.
Views of Responsible Officials and Planned Corrective Action:
DHS concurs with this finding. The agency contracts with a vendor to perform an actuarial analysis of Medical Loss
Ratio (MLR reports) for PASSE and Dental Managed Care. The vendor produces a report of this analysis. The agency
will develop written controls addressing the actuarial review, submission, and completion of MLR reports for PASSE
and Dental Managed Care.
Anticipated Completion Date:
April 30, 2021
- 166 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-015 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1905AR5021; 05-2005AR5021
(Children’s Health Insurance Program)
05-1905AR5MAP; 05-2005AR5MAP
(Medicaid Cluster)
Federal Award Year(s):
2019 and 2020
Compliance Requirement(s) Affected:
Allowable Costs/Cost Principles –
Managed Care Medical Loss Ratio (PASSE and Dental)
Type of Finding:
Material Weakness
Views of Responsible Officials and Planned Corrective Action (Continued):
Contact Person:
Janet Mann
Director, Division of Medical Services
Department of Human Services
700 Main Street
Little Rock, AR 72201
501-320-6270
Janet.mann@dhs.arkansas.gov
- 167 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-016
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1905AR5021; 05-2005AR5021
(Children’s Health Insurance Program)
05-1905AR5MAP; 05-2005AR5MAP
(Medicaid Cluster)
Federal Award Year(s):
2019 and 2020
Compliance Requirement(s) Affected:
Allowable Costs/Cost Principles –
Managed Care Medical Loss Ratio (PASSE and Dental)
Type of Finding:
Noncompliance and Material Weakness
Auditee reported status as of June 30, 2021: Partially corrected. The agency developed internal controls
addressing the actuarial review, submission, and completion of MLR reports for PASSE and Dental Managed Care in
May 2021. An internal monitoring review for this finding is pending.
Repeat Finding:
Not applicable
Criteria:
In a final rule, published in the Federal Register on May 6, 2016 (81 FR 27498), CMS adopted Medical Loss Ratio
(MLR) requirements for Medicaid and CHIP managed care programs. One of the requirements is that a state must
require each Medicaid managed care plan to calculate and report an MLR for rating periods starting on or after July 1,
2017. Each CHIP managed care plan is required to calculate and report an MLR for rating periods for state fiscal years
beginning on or after July 1, 2018.
Additionally, 42 CFR § 438.8(e)(4) defines the requirements regarding fraud prevention activities for the numerator of
the MLR calculation.
Finally, with regard to capitation rate setting for certain Managed Care Organization (MCO) plans, prior approval must
be obtained as required in accordance with the regulations below:
•
42 CFR § 438.4(b) - Capitation rates for MCOs must be reviewed and approved by CMS as actuarially
sound and must be provided to CMS in an approved format and within a timeframe that meets the
requirements defined by 42 CFR § 438.7.
•
42 CFR § 438.7(a) - States must submit all MCO rate certifications concurrent with the review and
approval process for contracts as specified in 42 CFR § 438.3(a).
•
42 CFR § 438.3(a) - CMS must review and approve all contracts, including those contracts that are not
subject to the prior approval requirements in 42 CFR § 438.806. For states seeking approval of contracts
prior to a specific effective date, proposed final contracts must be submitted to CMS for review no later
than 90 days prior to the effective date of the contract.
•
42 CFR § 438.3(c) - The capitation rate and the receipt of capitation payments under the contract must
be specifically identified in the applicable contract submitted for CMS review and approval.
•
42 CFR § 438.806(b) - For MCO contracts, prior approval by CMS is a condition of Federal Financial
Participation (FFP) under any MCO contract that has a value equal to or greater than the following
threshold amounts: $1,000,000 for 1998 (the value for all subsequent years is increased by the
percentage increase in the consumer price index). FFP is not available in an MCO contract that does not
have prior approval from CMS.
Condition and Context:
ALA reviewed the Dental managed care program and the Provider-Led Arkansas Shared Savings Entity (PASSE)
managed care program for compliance with the various managed care MLR requirements. As result of procedures
performed, the following deficiencies were noted:
- 168 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-016 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1905AR5021; 05-2005AR5021
(Children’s Health Insurance Program)
05-1905AR5MAP; 05-2005AR5MAP
(Medicaid Cluster)
Federal Award Year(s):
2019 and 2020
Compliance Requirement(s) Affected:
Allowable Costs/Cost Principles –
Managed Care Medical Loss Ratio (PASSE and Dental)
Type of Finding:
Noncompliance and Material Weakness
Condition and Context (Continued):
Dental Managed Care:
Two entities participate in the Dental managed care program: Delta Dental and Managed Care of North America
(MCNA). ALA review of the MLR requirements regarding these entities revealed the following:
•
No documentation was provided to substantiate that the MLR calculation for calendar year 2018 was
performed by MCNA and provided to the Agency.
•
Although fraud prevention expenses were included in the numerator of the MLR calculation for Delta
Dental for both calendar years 2018 and 2019, there was no Agency review of the calculation; therefore,
whether the amounts included were in accordance with the amounts allowed could not be determined.
•
Although it is assumed that the MLR reported for a rating period was calculated by using data from that
rating period, this could not be verified as there was no Agency review of the accuracy/appropriateness
of the MLR calculations performed by Delta Dental and MCNA for calendar years 2018 and 2019.
PASSE:
•
No documentation was provided to substantiate that the Agency received prior approval from CMS for
the revised calendar year 2019 rates prior to implementing the revised rates in October 2019.
•
No documentation was provided to substantiate that the Agency received prior approval from CMS for
the revised calendar year 2020 rates prior to implementing the revised rates in June 2020.
Statistically Valid Sample:
Not applicable
Questioned Costs:
Unknown
Cause:
The Agency did not adequately develop or implement procedures to ensure that the various managed care MLR
requirements were met.
Effect:
Failure to adequately develop and implement appropriate internal control procedures limits the Agency’s ability to
adequately monitor the program to ensure compliance.
Recommendation:
ALA staff recommend the Agency develop and implement control procedures for managed care MLR requirements for
both the Dental and PASSE managed care programs to ensure compliance.
- 169 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-016 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1905AR5021; 05-2005AR5021
(Children’s Health Insurance Program)
05-1905AR5MAP; 05-2005AR5MAP
(Medicaid Cluster)
Federal Award Year(s):
2019 and 2020
Compliance Requirement(s) Affected:
Allowable Costs/Cost Principles -
Managed Care Medical Loss Ratio (PASSE and Dental)
Type of Finding:
Noncompliance and Material Weakness
Views of Responsible Officials and Planned Corrective Action:
DHS concurs with this finding. The agency contracts with a vendor to perform an actuarial analysis of Medical Loss
Ratio (MLR reports) for PASSE and Dental Managed Care. The vendor produces a report of this analysis. The agency
will develop written controls addressing the actuarial review, submission, and completion of MLR reports for PASSE
and Dental Managed Care.
The agency timely submitted capitation rates to CMS pursuant to 42 CFR § 438.3 for calendar years 2019 and 2020.
The agency will work with the CMS to avoid any future delays in rate approval.
Anticipated Completion Date:
April 30, 2021
Contact Person:
Janet Mann
Director, Division of Medical Services
Department of Human Services
700 Main Street
Little Rock, AR 72201
501-320-6270
Janet.mann@dhs.arkansas.gov
- 170 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-017
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
US Department of Health and Human Services
Federal Award Number(s):
05-1905AR5021; 05-2005AR5021
(Children’s Health Insurance Program)
05-1905AR5MAP; 05-2005AR5MAP
(Medicaid Cluster)
Federal Award Year(s):
2019 and 2020
Compliance Requirement(s) Affected:
Matching, Level of Effort, Earmarking
Type of Finding:
Material Noncompliance and Material Weakness
Auditee reported status as of June 30, 2021: Partially corrected. The agency has improved its ability to provide
greater specificity in tracking “other non-federal funds” through the purchase of a new general ledger system that is to
be implemented by 9/1/21. Internal monitoring for this finding is pending.
Repeat Finding:
A similar issue was reported in prior-year finding 2019-017.
Criteria:
In accordance with 45 CFR § 95.507(4), the Agency’s established Cost Allocation Plan is required to contain sufficient
information in such detail to permit the Director - Division of Cost Allocation, after consulting with the Operating
Divisions, to make an informed judgment on the correctness and fairness of the State's procedures for identifying,
measuring, and allocating all costs to each of the programs operated by the Agency.
42 CFR § 433.10 and § 433.15 established rates to be used to calculate non-administrative and administrative state
match and require that the State pay part of the costs for providing and administering the Medical Assistance Program
(MAP).
In addition, 45 CFR § 75.303 states that a non-federal entity must “take prompt action when instances of
noncompliance are identified including noncompliance identified in audit findings.”
Condition and Context:
Procedures implemented by the Agency to monitor state general revenues and other non-federal revenues used to
“match” the federal grant award monies are not sufficiently detailed to determine that state match requirements were
met for the MAP and CHIP.
The Agency does not maintain documentation identifying the original source of revenues categorized as other non-
federal. State general revenues used to meet match requirements are transferred to the paying funds once available.
The Agency utilizes an outside accounting system, Lotus 1-2-3, to maintain and trace state general revenue and other
non-federal funds available. Agency staff manually key information into this system daily; however, no reviews or
controls are in place to ensure the accuracy of this information or the funding category balances.
ALA’s prior-year testing revealed that accounting records maintained in the Lotus 1-2-3 system included one-sided
adjustments to state general revenue and other non-federal funds, causing the ending balances of both funding
categories to be inaccurate. Periodic reconciliations of fund balances in the Lotus 1-2-3 system were only performed
“in total” and not by the funding source (i.e., federal, state, or other non-federal).
Finally, Agency procedures implemented to monitor the use of state general revenue and other non-federal funding
sources are completed at the Division level instead of the federal program level (i.e., Medicaid, CHIP, etc.).
As a result, sufficient, appropriate evidence could not be provided for ALA to perform testing to determine if the State
met the required match in accordance with federal regulations.
Statistically Valid Sample:
Not a statistically valid sample
- 171 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-017 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
US Department of Health and Human Services
Federal Award Number(s):
05-1905AR5021; 05-2005AR5021
(Children’s Health Insurance Program)
05-1905AR5MAP; 05-2005AR5MAP
(Medicaid Cluster)
Federal Award Year(s):
2019 and 2020
Compliance Requirement(s) Affected:
Matching, Level of Effort, Earmarking
Type of Finding:
Material Noncompliance and Material Weakness
Questioned Costs:
Unknown
Cause:
Internal controls and monitoring procedures regarding the identification of revenue sources used for matching are
inadequate to effectively monitor state match requirements at the federal program level.
Effect:
Compliance with the matching compliance requirement cannot be determined.
Recommendation:
ALA recommends the Agency review and strengthen internal controls to allow the Agency to appropriately identify
funding sources used to meet state match requirements.
Views of Responsible Officials and Planned Corrective Action:
DHS disputes in part and concurs in part with this finding. While the agency maintains documentation identifying funds
classified as “other non-federal” in its fund control ledgers, the funds and sources could be documented with greater
specificity. The agency will update its process to provider greater specificity in tracking “other non-federal” funds.
The agency is in the process of reviewing general ledger systems to replace Lotus 1-2-3. This system will contain
enhanced controls to support maintaining and documenting the accuracy of fund balances.
While the agency is not able to provide the level of detail requested by ALA, we maintain that the current process meets
the State match obligation and complies with GAAP and state and federal law.
Anticipated Completion Date:
December 31, 2021
Contact Person:
Misty Eubanks
Interim Chief Financial Officer
Department of Human Services
700 Main Street
Little Rock, AR 72201
501-320-6327
Misty.BowenEubanks@dhs.arkansas.gov
- 172 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-018
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1905AR5021; 05-2005AR5021
Federal Award Year(s):
2019 and 2020
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed –
Managed Care (PASSE)
Type of Finding:
Material Noncompliance and Material Weakness
Auditee reported status as of June 30, 2021: Corrective action was taken. The agency updated its independent
assessment process in January 2020. Internal monitoring was completed in June 2021.
Repeat Finding:
Not applicable
Criteria:
The Provider-Led Arkansas Shared Savings Entity (PASSE) program transitioned to a full-risk Managed Care
Organization (MCO) model on March 1, 2019. The program covers services for behavioral health (BH) recipients and
developmentally disabled (DD) recipients. To receive services through PASSE, individuals must have an independent
assessment (IA) performed that designates them at the appropriate level of need to participate in the program.
The 1915(c) Home and Community-Based Services Waiver, applicable to the DD population, requires that an IA be
performed at least every three years.
Section 1915(i) of the Social Security Act, applicable to the BH population, which provides states the option to offer
home and community-based services through the state’s plan, requires that an IA be performed at least every 12
months. In addition, 42 CFR § 441.720(b) states that for reassessments, the IA of need must be conducted at least
every 12 months and as needed when the individual’s support needs or circumstances change significantly, in order to
revise the service plan.
Condition and Context:
From a population of over 7,000 PASSE recipients, ALA selected a sample of 60 (classified as BH) to determine if the
following attributes had been met:
•
An open eligibility segment for the recipient during the dates of service.
•
A valid IA on file in effect for the dates of service.
•
Appropriate amount paid in accordance with the actuarially determined rates.
ALA’s review revealed exceptions affecting payments for 29 recipients as detailed below:
The following 11 exceptions occurred because the Agency could not provide documentation supporting that an IA was
updated or in effect for the payments made representing all dates of service. As a result, payments were made outside
an approved/updated IA.
Sample item 1: The IA expired on July 2, 2019, and payments for this recipient continued for dates of
service through September 30, 2019. Questioned costs totaled $8,187.
Sample item 3: The IA expired on May 31, 2019, and payments for this recipient continued for dates of
service through December 31, 2019. Questioned costs totaled $8,138.
Sample item 12: The IA expired on July 22, 2019, and payments for this recipient continued for dates of
service through December 31, 2019. Questioned costs totaled $6,431.
Sample item 14: The IA expired on April 19, 2019, and payments for this recipient continued for dates of
service through August 31, 2019. Questioned costs totaled $1,998.
Sample item 25: The IA expired on March 8, 2019, and payments for this recipient continued for dates
of service through August 31, 2019. Questioned costs totaled $2,798.
Sample item 26: The IA expired on March 29, 2019, and payments for this recipient continued for dates
of service through August 31, 2019. Questioned costs totaled $3,129.
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State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-018 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1905AR5021; 05-2005AR5021
Federal Award Year(s):
2019 and 2020
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed –
Managed Care (PASSE)
Type of Finding:
Material Noncompliance and Material Weakness
Condition and Context (Continued):
Sample item 31: The IA expired on May 2, 2019, and payments for this recipient continued for dates of
service through August 31, 2019. Questioned costs totaled $2,996.
Sample item 38: The IA expired on April 22, 2019, and payments for this recipient continued for dates of
service through June 4, 2019. Questioned costs totaled $133.
Sample item 40: The IA for this recipient became effective on June 28, 2019, and a payment for this
recipient was made representing dates of service that were prior to the effective date of the IA.
Questioned costs totaled $899.
Sample item 42: The IA expired on May 31, 2019, and payments for this recipient continued for dates of
service through December 31, 2019. Questioned costs totaled $8,138.
Sample item 49: The IA expired on November 20, 2019, and payments for this recipient continued for
dates of service through December 31, 2019. Questioned costs totaled $1,710.
The following 18 exceptions occurred because an IA was not updated timely, resulting in payments made for dates of
service outside an approved/updated IA.
Sample item 2: The IA expired on August 12, 2019, and was not updated until November 12, 2019.
Payments for this recipient continued for dates of service from August 13, 2019 through November 11,
2019. Questioned costs totaled $9,093.
Sample item 4: The IA expired on September 4, 2019, and was not updated until January 2, 2020.
Payments for this recipient continued for dates of service from September 5, 2019 through January 1,
2020. Questioned costs totaled $5,009.
Sample item 7: The IA expired on June 21, 2019, and was not updated until August 22, 2019. Payments
for this recipient continued for dates of service from June 22, 2019 through August 21, 2019. Questioned
costs totaled $1,845.
Sample item 9: The IA expired on August 9, 2019, and was not updated until January 13, 2020. Payments
for this recipient continued for dates of service from August 10, 2019 through January 12, 2020.
Questioned costs totaled $5,851.
Sample item 11: The IA expired on May 29, 2019, and was not updated until August 23, 2019. Payments
for this recipient continued for dates of service from May 30, 2019 through August 22, 2019. Questioned
costs totaled $2,707.
Sample item 13: The IA expired on March 15, 2019, and was not updated until July 10, 2019. Payments
for this recipient continued for dates of service from March 16, 2019 through July 9, 2019. Questioned
costs totaled $1,289.
Sample item 17: The IA expired on June 19, 2019, and was not updated until July 11, 2019. Payments
for this recipient continued for dates of service from June 20, 2019 through July 10, 2019. Questioned
costs totaled $643.
Sample item 21: The IA expired on August 5, 2019, and was not updated until October 17, 2019.
Payments for this recipient continued for dates of service from August 6, 2019 through October 16, 2019.
Questioned costs totaled $1,837.
Sample item 24: The IA expired on March 21, 2019, and was not updated until August 28, 2019.
Payments for this recipient continued for dates of service from March 22, 2019 through August 27, 2019.
Questioned costs totaled $2,678.
- 174 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-018 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1905AR5021; 05-2005AR5021
Federal Award Year(s):
2019 and 2020
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed –
Managed Care (PASSE)
Type of Finding:
Material Noncompliance and Material Weakness
Condition and Context (Continued):
Sample item 29: The IA expired on May 24, 2019, and was not updated until July 3, 2019. Payments for
this recipient continued for dates of service from May 25, 2019 through July 2, 2019. Questioned costs
totaled $1,058.
Sample item 36: The IA expired on August 23, 2019, and was not updated until August 30, 2019.
Payments for this recipient continued for dates of service from August 24, 2019 through August 29, 2019.
Questioned costs totaled $193.
Sample item 39: The IA expired on May 15, 2019, and was not updated until July 12, 2019. Payments
for this recipient continued for dates of service from May 16, 2019 through July 11, 2019. Questioned
costs totaled $1,253.
Sample item 44: The IA expired on June 13, 2019, and was not updated until November 25, 2019.
Payments for this recipient continued for dates of service from June 14, 2019 through November 24,
2019. Questioned costs totaled $6,048.
Sample item 55: The IA expired on June 6, 2019, and was not updated until July 8, 2019. Payments for
this recipient continued for dates of service from June 7, 2019 through July 7, 2019. Questioned costs
totaled $1,025.
Sample item 56: The IA expired on July 25, 2019, and was not updated until October 9, 2019. Payments
for this recipient continued for dates of service from July 26, 2019 through October 8, 2019. Questioned
costs totaled $2,377.
Sample item 57: The IA expired on July 12, 2019, and was not updated until July 22, 2019. Payments
for this recipient continued for dates of service from July 13, 2019 through July 21, 2019. Questioned
costs totaled $290.
Sample item 59: The IA expired on April 25, 2019, and was not updated until July 18, 2019. Payments
for this recipient continued for dates of service from April 26, 2019 through July 17, 2019. Questioned
costs totaled $3,966.
Sample item 60: The IA expired on April 30, 2019, and was not updated until September 17, 2019.
Payments for this recipient continued for dates of service from May 1, 2019 through September 16, 2019.
Questioned costs totaled $2,996.
Questioned Costs:
$94,715
Cause:
The full-risk PASSE program began in March 2019. Rather than being performed evenly throughout the year, the
majority of the BH assessments were performed by the Agency’s contractor, Optum, in large groupings during calendar
year 2018. To more evenly distribute the assessment workload throughout the year, the Agency and its contractor
spread the assessments out over the full 12 months. Due to the timing of this process, there were still instances of late
BH assessments noted during fiscal year 2020.
Effect:
Gaps were revealed in the performance of the required independent assessments for the BH population. As a result,
payments were made outside the approved/updated dates of service for numerous recipients.
- 175 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-018 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1905AR5021; 05-2005AR5021
Federal Award Year(s):
2019 and 2020
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed –
Managed Care (PASSE)
Type of Finding:
Material Noncompliance and Material Weakness
Recommendation:
ALA staff recommend the Agency review and strengthen its independent assessment procedures to ensure they are
completed timely and in accordance with federal regulations.
Views of Responsible Officials and Planned Corrective Action:
DHS concurs with the finding. As of January 1, 2020, the agency has updated its independent assessment process to
ensure timely completion of reassessments. The scheduling process for assessments begins 60 days from the due
date of assessment and beneficiaries may call to schedule an assessment up to six months prior to the assessment
due date. Members that are not assessed prior to their reassessment date will be removed from the PASSE. (Note:
Members are not being removed from the PASSE for lack of reassessment during the COVID-19 federal public health
emergency).
Anticipated Completion Date:
Complete
Contact Person:
Janet Mann
Director, Division of Medical Services
Department of Human Services
700 Main Street
Little Rock, AR 72201
501-320-6270
Janet.mann@dhs.arkansas.gov
- 176 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-019
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1905AR5021; 05-2005AR5021
Federal Award Year(s):
2019 and 2020
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Provider Eligibility (Fee-for-Service)
Type of Finding:
Material Noncompliance and Material Weakness
Auditee reported status as of June 30, 2021: Corrective action was taken. The agency updated its process for
performing provider eligibility reviews in May 2019 and completed regular compliance reviews during fiscal year 2021.
Repeat Finding:
A similar issue was reported in prior-year finding 2019-006.
Criteria:
According to section 140.000, Provider Participation, any provider of health services must be enrolled in the Arkansas
Medicaid Program prior to reimbursement for any services provided to Arkansas Medicaid beneficiaries. Enrollment is
considered complete when a provider has signed and submitted the following forms:
•
Application.
•
W-9 tax form.
•
Medicaid provider contract.
•
PCP agreement, if applicable.
•
EPSDT agreement, if applicable.
•
Change in ownership control or conviction of crime form.
•
Disclosure of significant business transactions form.
•
Specific license or certification based on provider type and specialty, if applicable.
•
Participation in the Medicare program, if applicable.
42 CFR § 455.414 (effective March 25, 2011, with an extended deadline of September 25, 2016, for full compliance)
states that the State Medicaid Agency must revalidate the enrollment of all providers at least every five years.
Revalidation includes a new application; satisfactory completion of screening activities; and if applicable, fee payment.
Screening activities vary depending on the risk category of the provider as follows:
•
The limited-risk category includes database checks.
•
The moderate-risk category includes those required for limited, plus site visits.
•
The high-risk category includes those required for moderate, plus fingerprint background checks.
Condition and Context:
ALA staff reviewed 40 paid providers to ensure sufficient, appropriate evidence was provided to support the
determination of eligibility, including compliance with revalidation requirements. ALA review revealed deficiencies with
11 of the provider files as follows:
Moderate-risk category:
Sample item 23: The Agency failed to perform the additional screening requirement (site visit).
Questioned costs totaled $1,978.
Sample item 29: The provider’s revalidation was due by February 19, 2020, but was not performed until
April 13, 2020. In addition, a site visit was never performed supporting the 2015 revalidation.
(Subsequent site visits were suspended on March 4, 2020, due to the COVID-19 pandemic.) Questioned
costs totaled $5,155.
- 177 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-019 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1905AR5021; 05-2005AR5021
Federal Award Year(s):
2019 and 2020
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Provider Eligibility (Fee-for-Service)
Type of Finding:
Material Noncompliance and Material Weakness
Condition and Context (Continued):
Sample item 30: The Agency failed to perform the additional screening requirement (site visit).
Questioned costs totaled $523.
Sample item 33: The provider’s revalidation was due by June 25, 2016, but was not performed until June
6, 2019. Questioned costs totaled $1,120.
Sample item 36: The provider’s revalidation was due by September 25, 2016, but was not performed
until May 7, 2019. Questioned costs totaled $280.
Limited-risk category:
Sample item 9: The provider’s revalidation was due by September 25, 2016, but was never performed.
According to the Agency, the provider was to be terminated, but due to the COVID-19 pandemic, no
providers have been terminated. Questioned costs totaled $126.
Sample item 24: The provider’s revalidation was due by April 30, 2017, but was not performed until May
3, 2019. Questioned costs totaled $480.
Sample item 25: The provider’s revalidation was due by September 25, 2016, but was not performed
until August 29, 2019. In addition, there was not an application on file that covered the entire enrollment
period. Questioned costs totaled $2,206.
Sample item 26: The provider’s revalidation was due by September 25, 2016, but was not performed
until August 29, 2019. In addition, there was not an application on file that covered the entire enrollment
period. Questioned costs totaled $5,607.
Sample item 34: The provider’s revalidation was due by June 21, 2017, but was not performed until
October 25, 2019. Questioned costs totaled $570.
Sample item 38: The Agency did not provide documentation of the provider’s certification that covered
the entire enrollment period. Questioned costs totaled $2,665.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
$20,710
Cause:
The Agency had asserted that, effective May 31, 2019, it established and implemented new procedures to improve the
following areas of provider enrollment: maintenance of provider enrollment application documents, provider
revalidation, site visits, and fingerprint background requirements. However, due to timing of the implementation of the
new procedures, deficiencies continued to exist during fiscal year 2020.
Effect:
Claims were processed and paid to providers that did not meet all the required elements and, therefore, were ineligible.
Recommendation:
ALA staff recommend the Agency review and strengthen controls to ensure required enrollment documentation is
maintained to support provider eligibility.
- 178 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-019 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1905AR5021; 05-2005AR5021
Federal Award Year(s):
2019 and 2020
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Provider Eligibility (Fee-for-Service)
Type of Finding:
Material Noncompliance and Material Weakness
Views of Responsible Officials and Planned Corrective Action:
DHS concurs with this finding. Effective May 31, 2019, DMS established and implemented new procedures to improve
the following areas of provider enrollment: maintenance of provider enrollment application documents, provider
revalidation, site visits, and fingerprint background requirements. The DHS Office of Payment Integrity and Internal
Audit also conducts regular provider eligibility compliance reviews and reports its findings to DMS.
Eight of the eleven deficient provider files relate to non-compliance with revalidation requirements pre-dating May 31,
2019. The deficiencies noted that occurred prior to May 31, 2019 will be corrected upon revalidation for the provider.
Two of the eleven deficient providers revalidated after the established revalidation deadline in SFY2020. These
providers submitted applications for revalidation which were not able to be processed by the revalidation deadline due
to incomplete information on the application. The providers were not terminated as they submitted the missing
information at the request of the agency.
One of the eleven deficient providers did not have the required proof of grant award required for eligibility. The agency
sends an automatic notification when a provider’s grant award on file expires. If the updated award is not received
within 60 days of the expiration date the provider is terminated. This provider was not terminated as the expiration of
award occurred during the federal COVID-19 public health emergency.
Anticipated Completion Date:
Complete
Contact Person:
Janet Mann
Director, Division of Medical Services
Department of Human Services
700 Main Street
Little Rock, AR 72201
501-320-6270
Janet.mann@dhs.arkansas.gov
- 179 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-020
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1905AR5021; 05-2005AR5021
Federal Award Year(s):
2019 and 2020
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Provider Eligibility (Managed Care Organizations)
Type of Finding:
Material Noncompliance and Material Weakness
Auditee reported status as of June 30, 2021: Corrective action was taken. The agency updated its provider
eligibility internal controls in May 2019 and completed regular compliance reviews during fiscal year 2021.
Repeat Finding:
A similar issue was reported in prior-year finding 2019-007.
Criteria:
According to section 140.000, Provider Participation, any provider of health services must be enrolled in the Arkansas
Medicaid Program prior to reimbursement for any services provided to Arkansas Medicaid beneficiaries. Managed
Care Network providers must also be enrolled in the Arkansas Medicaid Program. Enrollment is considered complete
when a provider has signed and submitted the following forms:
•
Application.
•
W-9 tax form.
•
Medicaid provider contract.
•
PCP agreement, if applicable.
•
EPSDT agreement, if applicable.
•
Change in ownership control or conviction of crime form.
•
Disclosure of significant business transactions form.
•
Specific license or certification based on provider type and specialty, if applicable.
•
Participation in the Medicare program, if applicable.
42 CFR § 455.414 (effective March 25, 2011, with an extended deadline of September 25, 2016, for full compliance)
states that the State Medicaid Agency must revalidate the enrollment of all providers at least every five years.
Revalidation includes a new application; satisfactory completion of screening activities; and, if applicable, fee payment.
Screening activities vary depending on the risk category of the provider as follows:
•
The limited-risk category includes database checks.
•
The moderate-risk category includes those required for limited, plus site visits.
•
The high-risk category includes those required for moderate, plus fingerprint background checks.
Condition and Context:
To determine if Managed Care Network providers met all necessary criteria to participate in the Medicaid program, ALA
staff selected 60 paid provider files for review. The providers selected participated in the Dental managed care program,
commonly referred to as Healthy Smiles, and the Provider-Led Arkansas Shares Savings Entity (PASSE) managed
care program. ALA review revealed deficiencies with 19 of the provider files as follows:
High-risk category:
Sample item 38: The Agency did not perform the additional screening requirements (site visit and
fingerprint background check) or provide documentation of the provider’s certification that covered the
entire enrollment period. Ineligible costs totaled $65,070.
- 180 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-020 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1905AR5021; 05-2005AR5021
Federal Award Year(s):
2019 and 2020
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Provider Eligibility (Managed Care Organizations)
Type of Finding:
Material Noncompliance and Material Weakness
Condition and Context (Continued):
Moderate-risk category:
Sample item 18: The Agency did not perform the additional screening requirement (site visit) or provide
documentation of the provider’s certification that covered the entire enrollment period. Ineligible costs
totaled $183.
Sample item 19: The Agency did not perform the additional screening requirement (site visit). Ineligible
costs totaled $80.
Sample item 20: The Agency did not perform the additional screening requirement (site visit). Ineligible
costs totaled $2,352.
Sample item 21: The Agency did not perform the additional screening requirement (site visit). Ineligible
costs totaled $309.
Sample item 23: The Agency did not perform the additional screening requirement (site visit) or provide
documentation of the provider’s certification that covered the entire enrollment period. Ineligible costs
totaled $3,568.
Sample item 30: The provider’s revalidation was due by December 12, 2019, but was not performed until
February 4, 2020. In addition, the Agency did not perform the additional screening requirement (site visit)
for the 2014 re-enrollment. Ineligible costs totaled $18,466.
Sample item 39: The provider’s revalidation was due by September 25, 2016, but was not performed
until October 31, 2019. Ineligible costs totaled $1,598.
Limited-risk category:
Sample item 2: The provider’s revalidation was due by September 25, 2016, but was not performed until
May 22, 2019. In addition, the Agency could not provide the required W-9 that covered the entire
enrollment period. Ineligible costs totaled $153.
Sample item 3: The provider’s revalidation was due by September 25, 2016, but was not performed until
July 26, 2019. Ineligible costs totaled $213.
Sample item 4: The provider’s revalidation was due by September 17, 2017, but was not performed until
August 2, 2019. Ineligible costs totaled $58.
Sample item 7: No documentation was provided for this testing item. Ineligible costs totaled $304.
Sample item 8: The provider’s revalidation was due by September 25, 2016, but was not performed until
July 8, 2019. Ineligible costs totaled $65.
Sample item 12: The provider’s revalidation was due by September 25, 2016, but was not performed
until March 4, 2020. Ineligible costs totaled $330.*
Sample item 22: The provider’s revalidation was due by September 25, 2016, but was not performed
until August 22, 2019. In addition, the Agency could not provide documentation of the provider’s
certification that covered the entire enrollment period. Ineligible costs totaled $1,082.
Sample item 24: The provider’s revalidation was due by September 25, 2016, but was not performed
until June 19, 2019. Ineligible costs totaled $60.
Sample item 27: The provider’s revalidation was due by May 22, 2017, but was not performed until
August 16, 2019. Ineligible costs totaled $50.
Sample item 31: The provider’s revalidation was due by September 25, 2019, but was not performed
until December 11, 2019. Ineligible costs totaled $31.
- 181 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-020 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1905AR5021; 05-2005AR5021
Federal Award Year(s):
2019 and 2020
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Provider Eligibility (Managed Care Organizations)
Type of Finding:
Material Noncompliance and Material Weakness
Condition and Context (Continued):
Sample item 34: The provider’s revalidation was due by September 25, 2016, but was not performed
until August 14, 2019. Ineligible costs totaled $1,808.*
Dental Managed Care* payments for the deficiencies noted above totaled $2,138. PASSE payments totaled $93,642.
NOTE: Because these providers are participating in the managed care portion of CHIP, providers are reimbursed by
the managed care organizations, not the Agency. The managed care organizations receive a predetermined monthly
payment from the Agency in exchange for assuming the risk for the covered recipients.
These monthly payments are actuarially determined based, in part, upon historical costs data. Accordingly, the failure
to remove unallowable cost data from the amounts utilized by the actuary would lead to overinflated future rates, which
will be directly paid by the Agency.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
Unknown
Cause:
The Agency had asserted that, effective May 31, 2019, it established and implemented new procedures to improve the
following areas of provider enrollment: maintenance of provider enrollment application documents, provider
revalidation, site visits, and fingerprint background requirements. However, due to timing of the implementation of the
new procedures, deficiencies continued to exist during fiscal year 2020.
Effect:
Claims were processed and paid to the managed care entities for providers that did not meet all required criteria.
Recommendation:
ALA staff recommend the Agency strengthen controls to ensure required enrollment documentation is maintained to
support provider eligibility.
Views of Responsible Officials and Planned Corrective Action:
DHS concurs with this finding. Effective May 31, 2019, DMS established and implemented new procedures to improve
the following areas of provider enrollment: maintenance of provider enrollment application documents, provider
revalidation, site visits, and fingerprint background requirements. Fifteen of the nineteen deficient provider files relate
to non-compliance with revalidation requirements pre-dating May 31, 2019. The deficiencies noted that occurred prior
to May 31, 2019 will be corrected upon revalidation for the provider. The DHS Office of Payment Integrity and Internal
Audit also conducts regular provider eligibility compliance reviews and reports its findings to DMS.
Two of the nineteen deficient providers revalidated after the established revalidation deadline in SFY2020. These
providers submitted applications for revalidation which were not able to be processed by the revalidation deadline due
to incomplete information on the application. The providers were not terminated as they submitted the missing
information at the request of the agency.
- 182 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-020 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1905AR5021; 05-2005AR5021
Federal Award Year(s):
2019 and 2020
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Provider Eligibility (Managed Care Organizations)
Type of Finding:
Material Noncompliance and Material Weakness
Views of Responsible Officials and Planned Corrective Action (Continued):
Two of the nineteen deficient providers did not have the required proof of certification on file. The agency sends an
automatic notification when a provider’s certification on file expires. If the certification is not received within 60 days of
the expiration date the provider is terminated. One provider submitted the requested certification during SFY20. The
other provider has not submitted the requested certification but was not terminated due to the federal COVID-19 public
health emergency.
Anticipated Completion Date:
Complete
Contact Person:
Janet Mann
Director, Division of Medical Services
Department of Human Services
700 Main Street
Little Rock, AR 72201
501-320-6270
Janet.mann@dhs.arkansas.gov
- 183 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-021
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1905AR5MAP; 05-2005AR5MAP
Federal Award Year(s):
2019 and 2020
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed –
Home and Community-Based Services
(ARChoices Waiver)
Type of Finding:
Noncompliance and Material Weakness
Auditee reported status as of June 30, 2021: Partially corrected. The agency developed a workflow management
strategy to ensure timely completion of PCSP’s for ARChoices beneficiaries in July 2020. Internal monitoring for this
finding is pending.
Repeat Finding:
A similar issue was reported in prior-year finding 2019-011.
Criteria:
Prior to January 1, 2019, the ARChoices waiver was governed by Section 212.300 of the ARChoices provider manual.
It stated that each beneficiary must have an individualized Person-Centered Service Plan (PCSP) and that attendant
care hours are based on the Resource Utilization Group (RUG) score produced from the ARPath assessment. Services
must be provided according to the beneficiary’s PCSP, with reimbursement limited to the amount and frequency
authorized in the PCSP.
On January 1, 2019, the Arkansas Independent Assessment (ARIA) tool was used to determine the ARChoices level
of care and aided in developing the beneficiary PCSP. Attendant care hours are determined utilizing the Task and
Hour Standards (THS), which is the written methodology used by the Arkansas Department of Human Services (DHS)
Registered Nurses (RNs) as the basis for calculating the number of attendant care hours that are reasonably and
medically necessary. In addition, an Individual Service Budget (ISB) sets the maximum dollar amount for all waiver
services received by an individual. Services must be provided according to the beneficiary’s PCSP, with reimbursement
limited to the amount and frequency authorized on the PCSP.
Condition and Context:
ALA staff reviewed data for 40 beneficiaries to determine if a valid PCSP was in effect for all dates of service for which
claims were paid and if attendant care services were provided in accordance with the beneficiary’s PCSP and did not
exceed the frequency or the maximum amount allowed. This review revealed the following deficiencies regarding 28
beneficiaries:
•
Sample item 2: Claims were paid without a valid PCSP for dates of service beginning May 27, 2019
through October 25, 2019. Questioned costs totaled $3,053.
•
Sample item 3: Claims were paid without a valid PCSP for dates of service beginning June 17, 2019
through January 21, 2020. Questioned costs totaled $6,187.
•
Sample item 6: Claims were paid without a valid PCSP for dates of service beginning June 4, 2019
through February 13, 2020. Questioned costs totaled $1,373.
•
Sample item 7: Claims were paid without a valid PCSP for dates of service beginning June 1, 2019
through May 30, 2020. Questioned costs totaled $19,274 but were only calculated through March 17,
2020, to ensure adherence to the guidance contained in the note below.
•
Sample item 9: Claims were paid without a valid PCSP for dates of service beginning May 27, 2019
through August 22, 2019. Questioned costs totaled $1,840.
•
Sample item 10: Claims were paid without a valid PCSP for dates of service beginning June 4, 2019
through May 29, 2020. Questioned costs totaled $11,857 but were only calculated through March 17,
2020, to ensure adherence to the guidance contained in the note below.
•
Sample item 11: Claims were paid without a valid PCSP for dates of service beginning June 17, 2019
through October 18, 2019. Questioned costs totaled $4,828.
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State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-021 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1905AR5MAP; 05-2005AR5MAP
Federal Award Year(s):
2019 and 2020
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed –
Home and Community-Based Services
(ARChoices Waiver)
Type of Finding:
Noncompliance and Material Weakness
Condition and Context (Continued):
•
Sample item 13: Claims were paid without a valid PCSP for dates of service beginning April 3, 2019
through April 28, 2020. Questioned costs totaled $14,444 but were only calculated through March 17,
2020, to ensure adherence to the guidance contained in the note below.
•
Sample item 14: Claims were paid without a valid PCSP for dates of service beginning February 6, 2019
through June 5, 2020. Questioned costs totaled $7,097 but were only calculated through March 17, 2020,
to ensure adherence to the guidance contained in the note below.
•
Sample item 15: Claims were paid without a valid PCSP for dates of service beginning October 22, 2019
through January 24, 2020. Questioned costs totaled $268.
•
Sample item 16: Claims were paid without a valid PCSP for dates of service beginning June 18, 2019
through November 4, 2019. Questioned costs totaled $1,119.
•
Sample item 19: Claims were paid without a valid PCSP for dates of service beginning June 17, 2019
through October 25, 2019. Questioned costs totaled $4,338.
•
Sample item 21: Claims were paid without a valid PCSP for dates of service beginning June 17, 2019
through September 9, 2019. Questioned costs totaled $2,350.
•
Sample item 22: Claims were paid without a valid PCSP for dates of service beginning June 10, 2019
through August 17, 2019. Questioned costs totaled $2,153.
•
Sample item 23: Claims were paid without a valid PCSP for dates of service beginning October 15, 2018
through June 12, 2020. Questioned costs totaled $7,106 but were only calculated through March 17,
2020, to ensure adherence to the guidance contained in the note below.
•
Sample item 24: Claims were paid without a valid PCSP for dates of service beginning June 17, 2019
through January 2, 2020. Questioned costs totaled $11,581.
•
Sample item 26: Claims were paid without a valid PCSP for dates of service beginning June 17, 2019
through February 7, 2020. Questioned costs totaled $13,090.
•
Sample item 27: Claims were paid without a valid PCSP for dates of service beginning May 1, 2019
through November 25, 2019. Questioned costs totaled $12,678.
•
Sample item 28: Claims were paid without a valid PCSP for dates of service beginning May 1, 2019
through October 25, 2019. Questioned costs totaled $5,957.
•
Sample item 29: Claims were paid without a valid PCSP for dates of service beginning June 10, 2019
through June 12, 2020. Questioned costs totaled $9,221 but were only calculated through March 17,
2020, to ensure adherence to the guidance contained in the note below.
•
Sample item 30: Claims were paid without a valid PCSP for dates of service beginning August 9, 2019
through October 4, 2019. Questioned costs totaled $1,252.
•
Sample item 31: Claims were paid without a valid PCSP for dates of service beginning April 19, 2019
through October 28, 2019. Questioned costs totaled $6,090.
•
Sample item 32: Claims were paid without a valid PCSP for dates of service beginning October 16, 2019
through March 11, 2020. Questioned costs totaled $3,412.
•
Sample item 33: Claims were paid without a valid PCSP for dates of service beginning January 28, 2020
through February 28, 2020. Questioned costs totaled $506.
- 185 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-021 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1905AR5MAP; 05-2005AR5MAP
Federal Award Year(s):
2019 and 2020
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed –
Home and Community-Based Services
(ARChoices Waiver)
Type of Finding:
Noncompliance and Material Weakness
Condition and Context (Continued):
•
Sample item 34: Claims were paid without a valid PCSP for dates of service beginning June 16, 2019
through June 13, 2020. Questioned costs totaled $14,222 but were only calculated through March 17,
2020, to ensure adherence to the guidance contained in the note below.
•
Sample item 37: Claims were paid without a valid PCSP for dates of service beginning June 1, 2019
through September 8, 2019. Questioned costs totaled $908.
•
Sample item 38: Claims were paid without a valid PCSP for dates of service beginning June 17, 2019
through June 12, 2020. Questioned costs totaled $16,577 but were only calculated through March 17,
2020, to ensure adherence to the guidance contained in the note below.
•
Sample item 39: Claims were paid without a valid PCSP for dates of service beginning June 16, 2019
through February 17, 2020. Questioned costs totaled $14,563.
NOTE: In accordance with the Families First Coronavirus Response Act (FFCRA), states must provide continuous
coverage, through the end of the month in which the emergency period ends, to all Medicaid beneficiaries who
were enrolled in Medicaid on or after March 18, 2020, regardless of any changes in circumstances or
redeterminations at scheduled renewals that otherwise would result in termination.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
$197,344
Cause:
The Agency failed to ensure that attendant care hour claims for ARChoices wavier beneficiaries were adequately
supported by current and valid agreements (PCSP, RUG score, or ARIA assessment).
Effect:
Amounts paid were in excess of amounts authorized.
Recommendation:
ALA staff recommend the Agency review and strengthen its policies and procedures to ensure that all amounts paid
are in accordance with amounts authorized and that amounts authorized are supported by both a current and valid
PCSP and the CMS approved assessment tools, which are currently the ARIA assessment and THS.
Views of Responsible Officials and Planned Corrective Action:
DHS concurs with the finding. On July 20, 2020, the agency implemented a workflow management system and strategy
to track and report re-evaluation activities that will ensure timely completion of Person-Centered Service Plans for
ARChoices beneficiaries.
Anticipated Completion Date:
Complete
- 186 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-021 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1905AR5MAP; 05-2005AR5MAP
Federal Award Year(s):
2019 and 2020
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed –
Home and Community-Based Services
(ARChoices Waiver)
Type of Finding:
Noncompliance and Material Weakness
Views of Responsible Officials and Planned Corrective Action (Continued):
Contact Person:
Jay Hill
Director, Division of Aging, Adult, and Behavioral Health Services
Department of Human Services
700 Main Street
Little Rock, AR 72201
501-686-9981
Jay.hill@dhs.arkansas.gov
- 187 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-022
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1905AR5MAP; 05-2005AR5MAP
Federal Award Year(s):
2019 and 2020
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed –
Managed Care (PASSE)
Type of Finding:
Noncompliance and Material Weakness
Auditee reported status as of June 30, 2021: Corrective action was taken. The agency updated its independent
assessment process in January 2020. The agency completed internal monitoring in June 2021.
Repeat Finding:
A similar issue was reported in prior-year finding 2019-012.
Criteria:
The Provider-Led Arkansas Shared Savings Entity (PASSE) program transitioned to a full-risk Managed Care
Organization (MCO) model on March 1, 2019. The program covers services for behavioral health (BH) recipients and
developmentally disabled (DD) recipients. To receive services through PASSE, individuals must have an independent
assessment performed that designates them at the appropriate level of need to participate in the program.
The 1915(c) Home and Community-Based Services Waiver, applicable to the DD population, requires that an IA be
performed at least every three years.
Section 1915(i) of the Social Security Act, applicable to the BH population, provides states the option to offer home and
community-based services through the state’s plan and requires that an IA be performed at least every 12 months. In
addition, 42 CFR § 441.720(b) states that, for reassessments, the IA of need must be conducted at least every 12
months and as needed when the individual’s support needs or circumstances change significantly, in order to revise
the service plan.
Condition and Context:
ALA selected 60 PASSE recipients (50 BH recipients and 10 DD recipients) to determine if the following attributes had
been met:
•
An open eligibility segment for the recipient during the dates of service.
•
A valid IA on file in effect for the dates of service.
•
Appropriate amount paid in accordance with the actuarially determined rates.
Our review revealed exceptions affecting payments for 22 BH recipients as detailed below:
The following six exceptions occurred because the Agency could not provide documentation supporting that an IA was
updated or in effect for the payments made representing all dates of service. As a result, payments were made outside
an approved/updated IA.
Sample item 6: The IA expired on May 9, 2019, and payments for this recipient continued for dates of
service through August 31, 2019. Questioned costs totaled $1,973.
Sample item 19: The IA expired on May 14, 2019, and payments for this recipient continued for dates of
service through August 31, 2019. Questioned costs totaled $1,973.
Sample item 25: The IA expired on April 18, 2019, and payments for this recipient continued for dates of
service through August 31, 2019. Questioned costs totaled $1,973.
Sample item 36: The IA expired on October 11, 2019, and payments for this recipient continued for dates
of service through December 31, 2019. Questioned costs totaled $2,852.
Sample item 45: The IA expired on December 9, 2019, and payments for this recipient continued for
dates of service through December 31, 2019. Questioned costs totaled $1,863.
Sample item 52: The IA expired on June 11, 2019, and payments for this recipient continued for dates of
service through December 31, 2019. Questioned costs totaled $5,793.
- 188 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-022 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1905AR5MAP; 05-2005AR5MAP
Federal Award Year(s):
2019 and 2020
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed –
Managed Care (PASSE)
Type of Finding:
Noncompliance and Material Weakness
Condition and Context (Continued):
The following 16 exceptions occurred because an IA was not updated timely, resulting in payments made for dates of
service outside an approved/updated IA.
Sample item 1: The IA expired on December 19, 2019, and was not updated until February 19, 2020.
Payments for this recipient continued for dates of service from December 20, 2019 through February 18,
2020. Questioned costs totaled $417.
Sample item 8: The IA expired on February 26, 2019, and was not updated until May 11, 2020. Payments
for this recipient continued for dates of service from February 27, 2019 through May 10, 2020. Questioned
costs, totaling $9,037, were calculated beginning February 27, 2019 through March 17, 2020, to ensure
adherence to the guidance contained in the note below.
Sample item 10: The IA expired on June 10, 2019, and was not updated until June 1, 2020. Payments
for this recipient continued for dates of service from June 11, 2019 through May 31, 2020. Questioned
costs, totaling $18,882, were calculated beginning June 11, 2019 through March 17, 2020, to ensure
adherence to the guidance contained in the note below.
Sample item 14: The IA expired on September 17, 2019, and was not updated until December 6, 2019.
Payments for this recipient continued for dates of service from September 18, 2019 through December
5, 2019. Questioned costs totaled $6,524.
Sample item 15: The IA expired on August 1, 2019, and was not updated until September 23, 2019.
Payments for this recipient continued for dates of service from August 2, 2019 through September 22,
2019. Questioned costs totaled $8,129.
Sample item 22: The IA expired on October 17, 2019, and was not updated until October 30, 2019.
Payments for this recipient continued for dates of service from October 18, 2019 through October 29,
2019. Questioned costs totaled $1,124.
Sample item 31: The IA expired on June 3, 2019, and was not updated until July 2, 2019. Payments for
this recipient continued for dates of service from June 4, 2019 through July 1, 2019. Questioned costs
totaled $4,211.
Sample item 35: The IA expired on June 14, 2019, and was not updated until September 20, 2019.
Payments for this recipient continued for dates of service from June 15, 2019 through September 19,
2019. Questioned costs totaled $1,620.
Sample item 40: The IA expired on March 28, 2019, and was not updated until June 21, 2019. Payments
for this recipient continued for dates of service from March 29, 2019 through June 20, 2019. Questioned
costs totaled $470.
Sample item 44: The IA expired on May 24, 2019, and was not updated until August 22, 2019. Payments
for this recipient continued for dates of service from May 25, 2019 through August 21, 2019. Questioned
costs totaled $5,265.
Sample item 46: The IA expired on September 4, 2019, and was not updated until November 26, 2019.
Payments for this recipient continued for dates of service from September 5, 2019 through November 25,
2019. Questioned costs totaled $2,587.
Sample item 50: The IA expired on August 29, 2019, and was not updated until November 18, 2019.
Payments for this recipient continued for dates of service from August 30, 2019 through November 17,
2019. Questioned costs totaled $9,636.
- 189 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-022 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1905AR5MAP; 05-2005AR5MAP
Federal Award Year(s):
2019 and 2020
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed –
Managed Care (PASSE)
Type of Finding:
Noncompliance and Material Weakness
Condition and Context (Continued):
Sample item 54: The IA expired on June 25, 2019, and was not updated until July 29, 2019. Payments
for this recipient continued for dates of service from June 26, 2019 through July 28, 2019. Questioned
costs totaled $753.
Sample item 55: The IA expired on July 22, 2019, and was not updated until February 13, 2020.
Payments for this recipient continued for dates of service from July 23, 2019 through February 12, 2020.
Questioned costs totaled $18,613.
Sample item 58: The IA expired on October 23, 2019, and was not updated until December 23, 2019.
Payments for this recipient continued for dates of service from October 24, 2019 through December 22,
2019. Questioned costs totaled $3,553.
Sample item 60: The IA expired on October 11, 2019, and was not updated until December 3, 2019.
Payments for this recipient continued for dates of service from October 12, 2019 through December 2,
2019. Questioned costs totaled $1,712.
NOTE: In accordance with the Families First Coronavirus Response Act (FFCRA), states must provide continuous
coverage, through the end of the month in which the emergency period ends, to all Medicaid beneficiaries who were
enrolled in Medicaid on or after March 18, 2020, regardless of any changes in circumstances or redeterminations at
scheduled renewals that otherwise would result in termination.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
$108,960
Cause:
The full-risk PASSE program began in March 2019. Rather than being performed evenly throughout the year, the
majority of the BH assessments were performed by the Agency’s contractor, Optum, in large groupings during calendar
year 2018. To more evenly distribute the assessment workload throughout the year, the Agency and its contractor
spread the assessments out over the full 12 months. Due to the timing of this process, there were still instances of late
BH assessments noted during fiscal year 2020.
Effect:
Gaps were revealed in the performance of the required independent assessments for the BH population. As a result,
payments were made outside the approved/updated dates of service for numerous recipients.
Recommendation:
ALA staff recommend the Agency review and strengthen its independent assessment procedures to ensure they are
completed timely and in accordance with federal regulations.
- 190 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-022 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1905AR5MAP; 05-2005AR5MAP
Federal Award Year(s):
2019 and 2020
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed –
Managed Care (PASSE)
Type of Finding:
Noncompliance and Material Weakness
Views of Responsible Officials and Planned Corrective Action:
DHS concurs with this finding. As of January 1, 2020, the agency has updated its independent assessment process to
ensure timely completion of reassessments. The scheduling process for assessments begins 60 days from the due
date of assessment and beneficiaries may call to schedule an assessment up to six months prior to the assessment
due date. Members that are not assessed prior to their reassessment date will be removed from the PASSE. (Note:
Members are not being removed from the PASSE for lack of reassessment during the COVID-19 federal public health
emergency).
Anticipated Completion Date:
Complete
Contact Person:
Janet Mann
Director, Division of Medical Services
Department of Human Services
700 Main Street
Little Rock, AR 72201
501-320-6270
Janet.mann@dhs.arkansas.gov
- 191 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-023
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1805AR5MAP; 05-1905AR5MAP; 05-2005ARMAP
Federal Award Year(s):
2018, 2019, and 2020
Compliance Requirement(s) Affected:
Eligibility
Type of Finding:
Noncompliance and Significant Deficiency
Auditee reported status as of June 30, 2021: Partially corrected. The agency conducted staff training focusing on
the deficiencies noted in the findings. in May 2021. An internal monitoring review of the finding is pending.
Repeat Finding:
A similar issue was reported in prior-year finding 2019-016.
Criteria:
It is the State’s responsibility to determine that Medicaid applicants meet the eligibility criteria as specified in the
approved State Plan. Eligibility requirements for the Medicaid program are outlined in the Arkansas Medical Services
(MS) manual. The MS manual is specific to Medicaid eligibility policies and procedures and is, in addition to the
approved State Plan, required in accordance with 45 CFR § 75.206.
In addition, case documentation is governed by 42 CFR § 435.914 that states, “The Agency must include in each
applicant’s case record facts to support the Agency’s decision....”
Guidance for timely eligibility determinations is outlined in 42 CFR § 435.912, which states that initial determinations
should be made within 45 days unless the applicant is applying upon the basis of disability, and in that case, the initial
determination should be made within 90 days. Also, 42 CFR § 435.916 requires that eligibility redeterminations be
performed at least once every 12 months.
States are required, per Section 1940 of the Social Security Act (42 USC 139w), to have a mechanism in place to verify
assets by accessing information held by financial institutions. This information is to be used to determine or renew
Medicaid eligibility for aged, blind, and disabled Medicaid applicants or recipients when an asset test is required.
Condition and Context:
ALA staff reviewed 19 traditional Medicaid recipient files in the ANSWER system and 41 Modified Adjusted Gross
Income (MAGI) Medicaid recipient files in the Curam system to ensure sufficient, appropriate evidence was provided
to support the Agency’s determination of eligibility. The review revealed deficiencies as summarized below:
•
One client file, with 108 claims totaling $47,578, did not contain a DCO-704 signed by a registered nurse
verifying medical necessity, affecting 80 claims. Questioned costs totaled $25,478.
The annual reevaluation was also not completed timely. The 2020 reevaluation, due in August 2019, was
not completed until November 8, 2019. (Aid to the Aged) (Non-MAGI/ANSWER)
•
One client file, with 46 claims totaling $131, was for an individual who was deceased at the time of the
claims and, therefore, not eligible, affecting all 46 claims. Questioned costs totaled $98.
In addition, 33 claims paid in 2019 and 2018 were also affected. Questioned costs totaled $89 and $20,
respectively. (Aid to the Aged) (Non-MAGI/ANSWER)
•
One client file, with 62 claims totaling $1,029, did not contain disability verification, affecting 2 claims.
Questioned costs totaled less than $1.
In addition, 13 claims paid in 2019 were also affected. Questioned costs totaled $565. (Disabled Tax
Equity and Fiscal Responsibility Act [TEFRA] Child) (Non-MAGI/ANSWER)
•
One client file, with 117 claims totaling $14,940, did not contain a DCO-704 signed by a registered nurse
verifying medical necessity, affecting 58 claims. Questioned costs totaled $5,481. (Aid to the Aged) (Non-
MAGI/ANSWER)
- 192 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-023 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1805AR5MAP; 05-1905AR5MAP; 05-2005ARMAP
Federal Award Year(s):
2018, 2019, and 2020
Compliance Requirement(s) Affected:
Eligibility
Type of Finding:
Noncompliance and Significant Deficiency
Condition and Context (Continued):
•
One client file, with 19 claims totaling $32,962, did not contain adequate documentation supporting the
income and resources criteria, affecting 3 claims. Questioned costs totaled $12,090.
The initial eligibility determination was also not completed timely. The application was received on
September 26, 2019, but not approved until April 29, 2020, exceeding the 45-day limit. (Aid to the Aged)
(Non-MAGI/ANSWER)
•
One client file, with 341 claims totaling $19,289, did not contain a DCO-704 signed by a registered nurse
verifying medical necessity, affecting 55 claims. Questioned costs totaled $2,837. (Disabled Tax Equity
and Fiscal Responsibility Act [TEFRA] Child) (Non-MAGI/ANSWER)
•
One client file, with 15 claims totaling $1,679, did not contain documentation proving income eligibility,
affecting all 15 claims. Questioned costs totaled $1,561.
The annual reevaluation was also not completed timely. The 2020 reevaluation, due in September 2019
was not completed until December 17, 2019. (Adult Expansion) (MAGI/CURAM)
Deficiencies related to eligible recipients with late initial determinations (no questioned costs):
•
One client file did not have a timely eligibility determination. The application was received on July 5,
2019, but was not approved until September 19, 2019, exceeding the 45-day limit. (Aid to the Aged) (Non-
MAGI/ANSWER)
•
One client file did not have a timely eligibility determination. The application was received on November
5, 2019, but was not approved until February 18, 2020, exceeding the 90-day limit. (Aid to the Disabled)
(Non-MAGI/ANSWER)
Deficiencies related to eligible recipients with late re-determinations. Although there are no questioned costs
associated with these recipients, the total amount of claims paid (state and federal) for dates of services between the
time the reevaluation was due and the day before it was performed is noted below to show what could have been paid
in error if the recipient had ultimately been deemed ineligible:
•
One client file did not have a timely reevaluation, as it was due in January 2020 but was not completed
until February 12, 2020. The claims paid for dates of services between when the reevaluation was due
and the day before it was performed totaled $5,492 in state fiscal year 2020. (Aid to the Aged) (Non-
MAGI/ANSWER)
•
One client file did not have a timely reevaluation, as it was due in July 2019 but was not completed until
October 11, 2019. The claims paid for dates of services between when the reevaluation was due and the
day before it was performed totaled $15,768 in state fiscal year 2020. (Aid to the Aged) (Non-
MAGI/ANSWER)
•
One client file did not have a timely reevaluation, as it was due in October 2019 but was not completed
until November 13, 2019. The claims paid for dates of services between when the reevaluation was due
and the day before it was performed totaled $5,955 in state fiscal year 2020. (Aid to the Aged) (Non-
MAGI/ANSWER)
•
One client file did not have a timely reevaluation, as it was due in June 2019 but was not completed until
July 19, 2019. The claims paid for dates of services between when the reevaluation was due and the day
before it was performed totaled $2,243 in state fiscal year 2020. (Aid to the Aged) (Non-MAGI/ANSWER)
- 193 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-023 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1805AR5MAP; 05-1905AR5MAP; 05-2005ARMAP
Federal Award Year(s):
2018, 2019, and 2020
Compliance Requirement(s) Affected:
Eligibility
Type of Finding:
Noncompliance and Significant Deficiency
Condition and Context (Continued):
Additionally, for 1 of 19 traditional Medicaid determinations reviewed, there was no evidence in the file to show that the
Asset Verification System was utilized during the eligibility determination.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
State fiscal year 2020 - $47,546
State fiscal year 2019 - $654
State fiscal year 2018 - $20
Cause:
The Agency had previously asserted that the root cause of the deficiencies resulted from the Division of Aging, Adult,
and Behavioral Health Services and the Agency’s contractor, Optum, being unable to complete the reassessments
timely. Although the Agency asserted that a new business process was being developed to ensure timely eligibility
determinations, deficiencies continued to exist during fiscal year 2020.
Although the Agency has designed internal control procedures to review recipient files to ensure sufficient, appropriate
evidence is provided to support the Agency’s determination of eligibility, certain areas still require continued
communication with and training of the appropriate Agency personnel.
Effect:
Payments to providers were made on behalf of ineligible recipients.
Recommendation:
ALA staff recommend the Agency continue providing adequate communication with and training to appropriate
personnel to ensure compliance with all program requirements as defined in the MS manual.
Views of Responsible Officials and Planned Corrective Action:
DHS concurs with this finding. These deficiencies were a result of staff’s non-compliance with agency eligibility
processes and policy. Staff will receive training focused on correcting the noted deficiencies and compliance with policy
will be monitored.
Anticipated Completion Date:
April 30, 2021
Contact Person:
Mary Franklin
Director, Division of County Operations
Department of Human Services
700 Main Street
Little Rock, AR 72201
501-682-8377
Mary.franklin@dhs.arkansas.gov
- 194 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-024
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
US Department of Health and Human Services
Federal Award Number(s):
05-1905AR5ADM; 05-2005AR5ADM
Federal Award Year(s):
2019 and 2020
Compliance Requirement(s) Affected:
Reporting
Type of Finding:
Noncompliance and Significant Deficiency
Auditee reported status as of June 30, 2021: Partially corrected. The agency corrected errors to formulas used
to allocated expenditures on the CMS-64 and made prior period adjustments on the CMS-64 in April 2021. An internal
monitoring review of the finding is pending.
Repeat Finding:
A similar issue was reported in prior-year finding 2019-018.
Criteria:
42 CFR 430.30(c) requires submission of a quarterly statement of expenditures report (CMS-64) for the Medical
Assistance Program (MAP) no later than 30 days after the end of each quarter. Amounts reported on the CMS-64 must
be an accurate and complete accounting of actual expenditures.
Condition and Context:
ALA staff performed testing of expenditures reported on the CMS-64 for the quarters ended December 31, 2019, and
March 31, 2020, to confirm accuracy and completeness with the expenditures recorded in the Agency’s financial
management system. ALA review revealed the following errors:
•
From the December 31, 2019, CMS-64 report, six line items totaling $67,693,380 and representing 92%
of administrative expenditures were selected. ALA identified uncorrected errors on four items, resulting
in an overstatement of the federal portion of expenditures totaling $357,875.
•
From the March 31, 2020, CMS-64 report, seven line items totaling $98,034,106 and representing 92%
of administrative expenditures were selected. ALA identified uncorrected errors on 3 items, resulting in
an overstatement of the federal portion of expenditures totaling $137,546.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
$495,421
Cause:
The Agency implemented new procedures for calculating amounts to be reported on the quarterly CMS-64 expenditure
reports. When designing this process, the Agency failed to adequately review and verify the accuracy of formulas used
to determine the expenditure amounts for each report line. Additionally, the Agency failed to adequately review report
calculations for accuracy prior to submitting the quarterly reports.
Effect:
The Agency failed to properly report expenditures on the CMS-64 quarterly reports, resulting in the Agency claiming
excess federal funds.
Recommendation:
ALA staff recommend the Agency review the Excel workbooks used to assist in completing the CMS-64 reports and
verify the accuracy and necessity of formulas used to allocate expenditures to the appropriate report lines. ALA further
recommends the Agency correct identified errors by entering prior period adjustments on subsequent CMS-64 reports.
- 195 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-024 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
US Department of Health and Human Services
Federal Award Number(s):
05-1905AR5ADM; 05-2005AR5ADM
Federal Award Year(s):
2019 and 2020
Compliance Requirement(s) Affected:
Reporting
Type of Finding:
Noncompliance and Significant Deficiency
Views of Responsible Officials and Planned Corrective Action:
DHS concurs with this finding. The agency has corrected the errors to the formulas used to allocate expenditures on
the CMS-64 and will correct the identified errors by making prior period adjustments on the upcoming quarterly
submission of the CMS-64. There will be no impact to federal financial participation with these adjustments.
Anticipated Completion Date:
April 30, 2021
Contact Person:
Jason Callan
Deputy Chief Financial Officer, Medicaid Services
Department of Human Services
700 Main Street
Little Rock, AR 72201
501-320-6540
Jason.callan@dhs.arkansas.gov
- 196 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-025
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1505AR5MAP; 05-1605AR5MAP;
05-1705AR5MAP; 05-1805AR5MAP;
05-1905AR5MAP; 05-2005AR5MAP
Federal Award Year(s):
2015, 2016, 2017, 2018, 2019 and 2020
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Capitation Payments Paid Subsequent to Recipient Death
Type of Finding:
Noncompliance and Significant Deficiency
Auditee reported status as of June 30, 2021: Partially corrected. The agency completion of Medicaid rollout for
ARIES was competed in April 2021. The process for activating review and reconciliation for PCCM payments will be
completed in July 2021. An internal monitoring review of the finding is pending.
Repeat Finding:
A similar issue was reported in prior-year finding 2019-019.
Criteria:
It is the State’s responsibility to ensure that capitation payments are only paid for eligible Medicaid recipients and that
any changes to a recipient’s eligibility are updated timely. According to Section I-600 of the Medical Service Policy
Manual, the Arkansas Department of Human Services (DHS) is required to act on any change that may alter eligibility
within 10 days of receiving the change. One of the changes listed that could affect eligibility is death of the recipient.
Additionally, Section I-610 of the manual indicates that a recipient loses eligibility upon death.
Condition and Context:
The Arkansas Department of Health provided ALA with a listing of deceased individuals, which ALA used to identify
individuals who had capitation payments paid or adjusted in state fiscal year 2020 with dates of service after their date
of death.
ALA staff review of 40 recipients with capitation payments for dates of service subsequent to the date of death revealed
the following:
•
Twenty-nine recipients had capitation payments paid representing dates of service after their date of
death. These payments had not been recouped as of fieldwork date November 16, 2020. Questioned
costs totaled $7,239.
•
For seven recipients, MMIS did not have a date of death recorded, or the date of death was not correct
as of fieldwork date December 2, 2020.
•
For eight recipients, capitation payments were paid more than six months past the date of death and
ranged from 9 to 63 months.
As a result of testing performed, a system issue with the Arkansas’s Network System for Welfare, Eligibility and
Reporting (ANSWER) was revealed. The ANSWER system automatically opened a non-SSI eligibility segment for one
recipient after the SSI eligibility segment for that recipient was closed due to the recipient’s death. As a result, capitation
payments began again for that recipient at the beginning of the next calendar year, months after the recipient’s death.
Statistically Valid Sample:
Not a statistically valid sample
- 197 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-025 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1505AR5MAP; 05-1605AR5MAP;
05-1705AR5MAP; 05-1805AR5MAP;
05-1905AR5MAP; 05-2005AR5MAP
Federal Award Year(s):
2015, 2016, 2017, 2018, 2019 and 2020
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Capitation Payments Paid Subsequent to Recipient Death
Type of Finding:
Noncompliance and Significant Deficiency
Questioned Costs:
State fiscal year 2020 - $698
State fiscal year 2019 - $6,311
State fiscal year 2018 - $154
State fiscal year 2017 - $31
State fiscal year 2016 - $36
State fiscal year 2015 - $9
Cause:
The Agency is not receiving timely notification of recipient deaths. Additional delays involve the time required to confirm
the date of death after receiving notification. An automatic retrospective review is completed in MMIS to identify
payments for recoupment that were made subsequent to the date of death. However, if an eligibility segment is closed
for another reason prior to receiving notification of date of death and the date of death is not updated in MMIS, the
payments will not be recouped. Although the Agency has indicated that it is reviewing all date of death discrepancies
between the eligibility systems and MMIS, these deficiencies continued to exist during fiscal year 2020.
Effect:
Capitation payments were made on behalf of deceased recipients.
Recommendation:
ALA staff recommend the Agency strengthen controls to ensure recipient files are updated timely when a recipient dies
so that capitation payments for dates of service subsequent to the date of death are not paid.
Views of Responsible Officials and Planned Corrective Action:
DHS concurs with the finding. The deficiencies noted can be attributed to the following factors:
-
The incorrect date of death was received from the Social Security Administration
-
The agency did not receive the date of death file prior to case closure
-
The ANSWER system automatically opened an eligibility segment in error
The agency’s new integrated eligibility system (ARIES) will prevent many system errors with dates of death related to
the transfer of information between multiple eligibility systems. The entire Medicaid population for the state will be
operational in ARIES by April 12, 2021.
It was also identified that claims were paid subsequent to a recipient’s death when MMIS contained a date of death.
Capitation payments were paid subsequent to the date of death due to the agency not receiving timely notification of
death and the span of time required to confirm date of death after receiving notification. An automatic retrospective
review and reconciliation is completed in the MMIS to identify claims for recoupment that were paid subsequent to date
of death. All deficiencies identified are NET and PCCM capitation payments. The retrospective review and
reconciliation for NET is completed on annual basis in January and the agency is in the process of activating the review
and reconciliation for PCCM. The PCCM review and reconciliation will be completed annually in June.
Anticipated Completion Date:
June 30, 2021
- 198 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-025 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1505AR5MAP; 05-1605AR5MAP;
05-1705AR5MAP; 05-1805AR5MAP;
05-1905AR5MAP; 05-2005AR5MAP
Federal Award Year(s):
2015, 2016, 2017, 2018, 2019 and 2020
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Capitation Payments Paid Subsequent to Recipient Death
Type of Finding:
Noncompliance and Significant Deficiency
Views of Responsible Officials and Planned Corrective Action (Continued):
Contact Person:
Janet Mann
Director, Division of Medical Services
Department of Human Services
700 Main Street
Little Rock, AR 72201
501-320-6270
Janet.mann@dhs.arkansas.gov
- 199 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-026
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1905AR5MAP; 05-2005AR5MAP
Federal Award Year(s):
2019 and 2020
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Provider Eligibility (Fee-for-Service)
Type of Finding:
Material Noncompliance and Material Weakness
Auditee reported status as of June 30, 2021: Corrective action was taken. The agency updated its process for
performing provider eligibility reviews in May 2019 and completed regular compliance reviews during fiscal year 2021.
Repeat Finding:
A similar issue was reported in prior-year finding 2019-006.
Criteria:
According to section 140.000, Provider Participation, any provider of health services must be enrolled in the Arkansas
Medicaid Program prior to reimbursement for any services provided to Arkansas Medicaid beneficiaries. Enrollment is
considered complete when a provider has submitted the following forms:
•
Application.
•
W-9 tax form.
•
Medicaid provider contract.
•
PCP agreement, if applicable.
•
EPSDT agreement, if applicable.
•
Change in ownership control or conviction of crime form.
•
Disclosure of significant business transactions form.
•
Specific license or certification based on provider type and specialty, if applicable.
•
Participation in the Medicare program, if applicable.
42 CFR § 455.414 (effective March 25, 2011, with an extended deadline of September 25, 2016, for full compliance)
states that the State Medicaid Agency must revalidate the enrollment of all providers at least every five years.
Revalidation includes a new application; satisfactory completion of screening activities; and, if applicable, fee payment.
Screening activities vary depending on the risk category of the provider as follows:
•
The limited-risk category includes database checks.
•
The moderate-risk category includes those required for limited, plus site visits.
•
The high-risk category includes those required for moderate, plus fingerprint background checks.
Condition and Context:
ALA staff reviewed 40 paid providers to ensure sufficient, appropriate evidence was provided to support the
determination of eligibility, including compliance with revalidation requirements. ALA review revealed deficiencies with
24 of the provider files as follows:
High-risk category:
Sample item 34: The Agency failed to perform the additional screening requirements (site visit or finger
print background check). Questioned costs totaled $31,205.
Sample item 35: The Agency failed to perform the additional screening requirements (site visit or finger
print background check). In addition, the Agency did not provide documentation of the provider’s
certification that covered the entire enrollment period. Questioned costs totaled $13,321.
- 200 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-026 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1905AR5MAP; 05-2005AR5MAP
Federal Award Year(s):
2019 and 2020
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Provider Eligibility (Fee-for-Service)
Type of Finding:
Material Noncompliance and Material Weakness
Condition and Context (Continued):
Sample item 36: The provider’s revalidation was due by October 30, 2019, but was not performed until
December 12, 2019. In addition, the Agency did not perform the additional screening requirements (site
visit or finger print background check). Questioned costs totaled $66,177.
Sample item 39: The Agency failed to perform the additional screening requirements (site visit or finger
print background check). Questioned costs totaled $132,732.
Sample item 40: The provider’s revalidation was due by March 23, 2020, but was not performed until
July 29, 2020. In addition, the Agency did not perform the additional screening requirements (site visit or
finger print background check). Questioned costs totaled $620,884.
Moderate-risk category:
Sample item 19: The Agency failed to perform the additional screening requirement (site visit). In
addition, the Agency did not provide documentation of the provider’s certification that covered the entire
enrollment period. Questioned costs totaled $7,399.
Sample item 20: The Agency failed to perform the additional screening requirement (site visit). In
addition, the Agency did not provide documentation of the provider’s certification that covered the entire
enrollment period. Questioned costs totaled $4,405.
Sample item 21: The Agency failed to perform the additional screening requirement (site visit).
Questioned costs totaled $1,825.
Sample item 22: The Agency failed to perform the additional screening requirement (site visit).
Questioned costs totaled $9,999.
Sample item 28: The Agency failed to perform the additional screening requirement (site visit). In
addition, the Agency did not provide documentation of the provider’s professional license that covered
the entire enrollment period. Questioned costs totaled $550,058.
Sample item 29: The Agency failed to perform the additional screening requirement (site visit).
Questioned costs totaled $3,394.
Sample item 31: The provider’s revalidation was due by March 8, 2018, but was not performed until
August 20, 2019. In addition, the Agency was unable to provide the Lexis Nexis reports associated with
the provider’s initial 2013 enrollment. Questioned costs totaled $1,543.
Sample item 38: The provider’s revalidation was due by July 15, 2019, but was never performed. In
addition, the Agency did not perform the additional screening requirement (site visit). Questioned costs
totaled $590.
Limited-risk category:
Sample item 2: The provider’s revalidation was due by April 21, 2020, but was not performed until October
19, 2020. Questioned costs totaled $70.
Sample item 8: The provider’s revalidation was due by September 25, 2016, but was not performed until
August 17, 2019. Questioned costs totaled $128,381.
Sample item 9: The provider’s revalidation was due by September 25, 2016, but was not performed until
July 20, 2019. Questioned costs totaled $9,540.
Sample item 10: The provider’s revalidation was due by September 25, 2016, but was not performed
until September 5, 2019. Questioned costs totaled $152.
- 201 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-026 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1905AR5MAP; 05-2005AR5MAP
Federal Award Year(s):
2019 and 2020
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Provider Eligibility (Fee-for-Service)
Type of Finding:
Material Noncompliance and Material Weakness
Condition and Context (Continued):
Sample item 12: The provider’s revalidation was due by September 25, 2016, but was not performed
until February 18, 2020. In addition, the provider did not have a contract on file covering the entire
enrollment period. Questioned costs totaled $167,374.
Sample item 13: The provider’s revalidation was due by September 25, 2016, but was not performed
until January 29, 2020. Questioned costs totaled $251,559.
Sample item 16: The provider’s revalidation was due by September 10, 2018, but was not performed
until January 10, 2019. Questioned costs totaled $27,302.
Sample item 24: The provider’s revalidation was due by September 25, 2016, but was not performed
until May 2, 2019. Questioned costs totaled $6.
Sample item 25: The provider’s revalidation was due by September 25, 2016, but was not performed
until May 3, 2019. In addition, the Agency failed to provide the required W-9 tax form associated with the
2019 revalidation. Questioned costs totaled $50,946.
Sample item 27: The provider’s revalidation was due by September 25, 2016, but was not performed
until January 28, 2020. Questioned costs totaled $393,991.
Sample item 33: The provider’s revalidation was due by September 25, 2016, but was not performed
until September 25, 2019. In addition, the Agency failed to provide the required W-9 tax form associated
with the 1990 enrollment and disclosures associated with the 2019 revalidation. Questioned costs totaled
$4,545.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
$2,477,398
Cause:
The Agency had asserted that, effective May 31, 2019, it established and implemented new procedures to improve the
following areas of provider enrollment: maintenance of provider enrollment application documents, provider
revalidation, site visits, and fingerprint background requirements. However, due to timing of the implementation of the
new procedures, deficiencies continued to exist during fiscal year 2020.
Effect:
Claims were processed and paid to providers that did not meet all the required elements and, therefore, were ineligible.
Recommendation:
ALA staff recommend the Agency strengthen controls to ensure required enrollment documentation is maintained to
support provider eligibility.
- 202 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-026 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1905AR5MAP; 05-2005AR5MAP
Federal Award Year(s):
2019 and 2020
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Provider Eligibility (Fee-for-Service)
Type of Finding:
Material Noncompliance and Material Weakness
Views of Responsible Officials and Planned Corrective Action:
DHS concurs with this finding. Effective May 31, 2019, DMS established and implemented new procedures to improve
the following areas of provider enrollment: maintenance of provider enrollment application documents, provider
revalidation, site visits, and fingerprint background requirements. Fifteen of the twenty-four deficient provider files relate
to non-compliance with revalidation requirements pre-dating May 31, 2019. The deficiencies noted that occurred prior
to May 31, 2019 will be corrected upon revalidation for the provider. The DHS Office of Payment Integrity and Internal
Audit also conducts regular provider eligibility compliance reviews.
Five of the twenty-four deficient providers did not have the required proof of certification or licensure. The agency
sends an automatic notification when a provider’s licensure or certification on file expires. If the licensure or certification
is not received within 60 days of the expiration date the provider is terminated. One provider submitted the requested
certification during SFY20. The other providers have not submitted the requested proof license or certification but were
not terminated due to the COVID-19 federal public health emergency.
Three of the twenty-four deficient providers revalidated after the established revalidation deadline in SFY2020. These
providers submitted applications for revalidation which were not able to be processed by the revalidation deadline due
to incomplete information on the application. The providers were not terminated as they submitted the missing
information at the request of the agency.
One of twenty-four deficient providers failed to complete revalidation requirements in SFY2020. The provider submitted
an incomplete application and did not respond to requests for additional information requested by DHS. DHS has not
terminated the provider due to the suspension of terminations during the COVID-19 federal public health emergency.
Anticipated Completion Date:
Complete
Contact Person:
Janet Mann
Director, Division of Medical Services
Department of Human Services
700 Main Street
Little Rock, AR 72201
501-320-6270
Janet.mann@dhs.arkansas.gov
- 203 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-027
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1905AR5MAP; 05-2005AR5MAP
Federal Award Year(s):
2019 and 2020
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Provider Eligibility (Managed Care Organizations)
Type of Finding:
Material Noncompliance and Material Weakness
Auditee reported status as of June 30, 2021: Corrective action was taken. The agency updated its process for
performing provider eligibility reviews in May 2019 and completed regular compliance reviews during fiscal year 2021.
Repeat Finding:
A similar issue was reported in prior-year finding 2019-007.
Criteria:
According to section 140.000, Provider Participation, any provider of health services must be enrolled in the Arkansas
Medicaid Program prior to reimbursement for any services provided to Arkansas Medicaid beneficiaries. Managed
Care Network providers must also be enrolled in the Arkansas Medicaid Program. Enrollment is considered complete
when a provider has submitted the following forms:
•
Application.
•
W-9 tax form.
•
Medicaid provider contract.
•
PCP agreement, if applicable.
•
EPSDT agreement, if applicable.
•
Change in ownership control or conviction of crime form.
•
Disclosure of significant business transactions form.
•
Specific license or certification based on provider type and specialty, if applicable.
•
Participation in the Medicare program, if applicable.
42 CFR § 455.414 (effective March 25, 2011, with an extended deadline of September 25, 2016, for full compliance)
states that the State Medicaid Agency must revalidate the enrollment of all providers at least every five years.
Revalidation includes a new application; satisfactory completion of screening activities; and if applicable, fee payment.
Screening activities vary depending on the risk category of the provider as follows:
•
The limited-risk category includes database checks.
•
The moderate-risk category includes those required for limited, plus site visits.
•
The high-risk category includes those required for moderate, plus fingerprint background checks.
Condition and Context:
To determine if Managed Care Network providers met all necessary criteria to participate in the Medicaid program, ALA
staff selected 40 paid provider files for review. The providers selected participated in the Dental managed care program,
commonly referred to as Healthy Smiles, and the Provider-Led Arkansas Shared Savings Entity (PASSE), managed
care program. ALA review revealed deficiencies with 10 of the provider files as follows:
Moderate-risk category:
Sample item 20: The provider’s revalidation was due by September 25, 2016, but was not performed
until February 7, 2018. In addition, the Agency did not perform the additional screening requirement (site
visit) or provide documentation of the provider’s certification that covered the entire enrollment period.
Ineligible costs totaled $200.
- 204 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-027 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1905AR5MAP; 05-2005AR5MAP
Federal Award Year(s):
2019 and 2020
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Provider Eligibility (Managed Care Organizations)
Type of Finding:
Material Noncompliance and Material Weakness
Condition and Context (Continued):
Sample item 21: The provider’s revalidation was due by May 20, 2020, but was never performed. In
addition, the Agency did not perform the additional screening requirement (site visit) or provide
documentation of the provider’s certification that covered the entire enrollment period. Ineligible costs
totaled $6.
Sample item 22: The Agency did not provide documentation of the provider’s certification that covered
the entire enrollment period. Ineligible costs totaled $4,415.
Sample item 26: The Agency did not perform the additional screening requirement (site visit). Ineligible
costs totaled $70.
Sample item 30: The provider’s revalidation was due by May 30, 2020, but was never performed. In
addition, the Agency did not could not provide documentation supporting that the additional screening
requirement (site visit) was performed supporting the 2015 revalidation. Ineligible costs totaled $415,082.
Sample item 38: The provider’s revalidation was due by September 25, 2016, but was not performed
until September 13, 2019. Ineligible costs totaled $18,172.
Limited-risk category:
Sample item 6: The provider’s revalidation was due by September 25, 2016, but was never performed.
Due to the COVID-19 pandemic, no providers have been terminated. Ineligible costs totaled $252.
Sample item 7: The provider’s revalidation was due by September 25, 2016, but was not performed until
January 13, 2020. Ineligible costs totaled $6,123.
Sample item 14: The provider’s revalidation was due by September 25, 2016, but was not performed
until October 7, 2019. Ineligible costs totaled $3,798.*
Sample item 27: The Agency did not provide documentation of the provider’s professional license that
covered the entire enrollment period. Ineligible costs totaled $609.
Dental Managed Care* payments for the deficiencies noted above totaled $3,798. PASSE payments totaled $444,929.
NOTE: Because these providers are participating in the managed care portion of the Medicaid program, providers are
reimbursed by the managed care organizations, not the Agency. The managed care organizations receive a
predetermined monthly payment from the Agency in exchange for assuming the risk for the covered recipients.
These monthly payments are actuarially determined based, in part, upon historical costs data. Accordingly, the failure
to remove unallowable cost data from the amounts utilized by the actuary would lead to overinflated future rates, which
will be directly paid by the Agency.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
Unknown
- 205 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-027 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1905AR5MAP; 05-2005AR5MAP
Federal Award Year(s):
2019 and 2020
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Provider Eligibility (Managed Care Organizations)
Type of Finding:
Material Noncompliance and Material Weakness
Cause:
The Agency had asserted that, effective May 31, 2019, it established and implemented new procedures to improve the
following areas of provider enrollment: maintenance of provider enrollment application documents, provider
revalidation, site visits, and fingerprint background requirements. However, due to timing of the implementation of the
new procedures, deficiencies continued to exist during fiscal year 2020.
Effect:
Claims were processed and paid to the managed care entities for providers that did not meet all required criteria.
Recommendation:
ALA staff recommend the Agency strengthen controls to ensure required enrollment documentation is maintained to
support provider eligibility.
Views of Responsible Officials and Planned Corrective Action:
DHS concurs with this finding. Effective May 31, 2019, DMS established and implemented new procedures to improve
the following areas of provider enrollment: maintenance of provider enrollment application documents, provider
revalidation, site visits, and fingerprint background requirements. Five of the ten deficient provider files relate to non-
compliance with revalidation requirements pre-dating May 31, 2019. The deficiencies noted that occurred prior to May
31, 2019 will be corrected upon revalidation for the provider. The DHS Office of Payment Integrity and Internal Audit
also conducts regular provider eligibility compliance reviews.
Two of the ten deficient providers failed to complete revalidation requirements in SFY2020. The providers submitted
an incomplete application and did not respond to requests for additional information requested by DHS. DHS has not
terminated the providers due to the suspension of terminations during the COVID-19 federal public health emergency.
Three of the ten deficient providers did not have the required proof of certification or licensure. The agency sends an
automatic notification when a provider’s licensure or certification on file expires. If the licensure or certification is not
received within 60 days of the expiration date the provider is terminated. One provider submitted the requested
certification during SFY20. The other providers have not submitted the requested proof license or certification but were
not terminated due to the COVID-19 federal public health emergency.
Anticipated Completion Date:
Complete
Contact Person:
Janet Mann
Director, Division of Medical Services
Department of Human Services
700 Main Street
Little Rock, AR 72201
501-320-6270
Janet.mann@dhs.arkansas.gov
- 206 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-028
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1905AR5MAP; 05-2005AR5MAP
Federal Award Year(s):
2019 and 2020
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Utilization Control and Program Integrity and
Medicaid Fraud Control Unit
Type of Finding:
Noncompliance and Material Weakness
Auditee reported status as of June 30, 2021: Partially corrected. The agency received its first external quality
review report from vendors in April 2021. An internal monitoring review of the finding is pending.
Repeat Finding:
A similar issue was reported in prior-year finding 2019-021.
Criteria:
In accordance with 42 CFR § 438.350, each state that contracts with a Managed Care Organization (MCO) or Prepaid
Ambulatory Health Plan (PAHP) must ensure that an annual external qualified review (EQR) is performed for each
MCO or PAHP.
In addition, 42 CFR § 438.364 states that the EQR results be included in an annual technical report that must be
finalized by April 30 of each year.
Condition and Context:
The Healthy Smiles Waiver, Arkansas’s Dental managed care program, is a PAHP and became effective on January
1, 2018. Two entities participate in the dental managed care program: Delta Dental and Managed Care of North
America (MCNA). An EQR is required for both entities and was due by April 30, 2020.
The Provider-Led Arkansas Shared Savings Entity (PASSE) transitioned to a full-risk MCO effective March 1, 2019.
Three entities participate in the PASSE program: AR Total Care, Empower, and Summit. An EQR is required for all
three entities and was due by April 30, 2020.
ALA inquiry and request for the annual reports revealed that a contract to perform the EQRs was not put into place until
July 1, 2020. The first EQRs are expected to be provided by April 30, 2021.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
None
Cause:
The Agency has experienced staff turnover and did not implement steps to procure a contract for the EQRs timely.
Effect:
The contract to perform the EQRs was not implemented timely, and the EQRs were not performed as required.
Recommendation:
ALA staff recommend the Agency develop procedures to aid in ensuring compliance with the program, including those
related to external quality reviews.
Views of Responsible Officials and Planned Corrective Action:
DHS concurs with the finding. The contract start date for the vendor performing external quality reviews was July 1,
2020 and the vendor is required to submit reports to the agency by April 30, 2021.
- 207 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-028 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1905AR5MAP; 05-2005AR5MAP
Federal Award Year(s):
2019 and 2020
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Utilization Control and Program Integrity and
Medicaid Fraud Control Unit
Type of Finding:
Noncompliance and Material Weakness
Views of Responsible Officials and Planned Corrective Action (Continued):
Anticipated Completion Date:
Completed
Contact Person:
Janet Mann
Director, Division of Medical Services
Department of Human Services
700 Main Street
Little Rock, AR 72201
501-320-6270
Janet.mann@dhs.arkansas.gov
- 208 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2019 Prior Year Finding Number:
2019-006
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1805AR5021; 05-1905AR5021
(Children’s Health Insurance Program)
05-1805AR5MAP; 05-1905AR5MAP
(Medicaid Cluster)
Federal Award Year(s):
2018 and 2019
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Provider Eligibility (Fee-for-Service)
Type of Finding:
Material Noncompliance and Material Weakness
Auditee reported status as of June 30, 2021: Corrective action was taken. The agency updated its process for
performing provider eligibility reviews in May 2019 and completed regular compliance reviews during fiscal year 2021.
Audit Status as of June 30, 2020:
Corrective action has not been taken. See current-year finding 2020-019.
Auditee reported status as of June 30, 2020: Corrective action was taken. The agency updated its provider eligibility
internal controls in April 2020. Internal monitoring was completed in May 2020.
Repeat Finding:
A similar issue was reported in prior-year finding 2018-020.
Criteria:
According to section 140.000, Provider Participation, any provider of health services must be enrolled in the Arkansas
Medicaid Program prior to reimbursement for any services provided to Arkansas Medicaid beneficiaries. Enrollment is
considered complete when a provider has signed and submitted the following forms:
•
Application.
•
W-9 tax form.
•
Medicaid provider contract.
•
PCP agreement, if applicable.
•
EPSDT agreement, if applicable.
•
Change in ownership control or conviction of crime form.
•
Disclosure of significant business transactions form.
•
Specific license or certification based on provider type and specialty, if applicable.
•
Participation in the Medicare program, if applicable.
42 CFR § 455.414 (effective March 25, 2011, with an extended deadline of September 25, 2016, for full compliance)
states that the State Medicaid Agency must revalidate the enrollment of all providers at least every five years.
Revalidation includes a new application; satisfactory completion of screening activities; and, if applicable, fee payment.
Screening activities vary depending on the risk category of the provider as follows:
•
The limited-risk category includes database checks.
•
The moderate-risk category includes those required for limited, plus site visits.
•
The high-risk category includes those required for moderate, plus fingerprint background checks.
- 209 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2019 Prior Year Finding Number:
2019-006 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1805AR5021; 05-1905AR5021
(Children’s Health Insurance Program)
05-1805AR5MAP; 05-1905AR5MAP
(Medicaid Cluster)
Federal Award Year(s):
2018 and 2019
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Provider Eligibility (Fee-for-Service)
Type of Finding:
Material Noncompliance and Material Weakness
Condition and Context:
ALA staff reviewed 60 paid providers to ensure sufficient, appropriate evidence was provided to support the
determination of eligibility, including compliance with revalidation requirements. ALA review revealed deficiencies with
35 of the provider files as follows:
High-risk category:
•
One provider did not have a license on file covering the entire enrollment period.
•
One provider did not have a contract on file covering the entire enrollment period.
•
Two providers did not have an application on file covering the entire enrollment period.
•
One provider did not have disclosure forms on file covering the entire enrollment period.
•
Seven providers did not comply with the site visit and fingerprint background check screening
requirements.
•
One provider did not comply with the database checks screening requirement.
•
One provider did not revalidate timely, either by the September 26, 2016, extended deadline or within the
five years since the provider last enrolled.
Moderate-risk category:
•
Two providers did not have certifications on file covering the entire enrollment period.
•
One provider did not have an application on file covering the entire enrollment period.
•
Two providers did not have disclosure forms on file covering the entire enrollment period.
•
Nine providers did not comply with the site visit screening requirement.
•
One provider did not comply with the database checks screening requirement.
•
For two providers, a revalidation has not been performed.
Limited-risk category:
•
Two providers did not have a license on file covering the entire enrollment period.
•
Two providers did not have a contract on file covering the entire enrollment period.
•
Three providers did not have an application on file covering the entire enrollment period.
•
Five providers did not have a W-9 form on file covering the entire enrollment period.
•
Two providers did not have documentation on file covering the entire enrollment period that offered proof
of participation in the Medicare program.
•
Seven providers did not have disclosure forms on file covering the entire enrollment period.
•
For one provider, there was no documentation provided proving eligibility.
•
Seven providers did not comply with the database checks screening requirement.
- 210 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2019 Prior Year Finding Number:
2019-006 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1805AR5021; 05-1905AR5021
(Children’s Health Insurance Program)
05-1805AR5MAP; 05-1905AR5MAP
(Medicaid Cluster)
Federal Award Year(s):
2018 and 2019
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Provider Eligibility (Fee-for-Service)
Type of Finding:
Material Noncompliance and Material Weakness
Condition and Context (Continued):
•
Eleven providers did not revalidate timely, either by the September 26, 2016, extended deadline or within
the five years since they last enrolled.
•
For five providers, a revalidation had not been performed.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
$8,864,004 (Medicaid)
$1,046,663 (CHIP)
- 211 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2019 Prior Year Finding Number:
2019-007
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1805AR5021; 05-1905AR5021
(Children’s Health Insurance Program)
05-1805AR5MAP; 05-1905AR5MAP
(Medicaid Cluster)
Federal Award Year(s):
2018 and 2019
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Provider Eligibility (Managed Care Organizations)
Type of Finding:
Material Noncompliance and Material Weakness
Auditee reported status as of June 30, 2021: Corrective action was taken. The agency updated its process for
performing provider eligibility reviews in May 2019 and completed regular compliance reviews during fiscal year 2021.
Audit Status as of June 30, 2020:
Corrective action has not been taken. See current-year finding 2020-020.
Auditee reported status as of June 30, 2020: Corrective action was taken. The agency updated its provider eligibility
internal controls in April 2020. Internal monitoring was completed in May 2020.
Repeat Finding:
Not applicable
Criteria:
According to section 140.000, Provider Participation, any provider of health services must be enrolled in the Arkansas
Medicaid Program prior to reimbursement for any services provided to Arkansas Medicaid beneficiaries. Managed
Care Network providers must also be enrolled in the Arkansas Medicaid Program. Enrollment is considered complete
when a provider has signed and submitted the following forms:
•
Application.
•
W-9 tax form.
•
Medicaid provider contract.
•
PCP agreement, if applicable.
•
EPSDT agreement, if applicable.
•
Change in ownership control or conviction of crime form.
•
Disclosure of significant business transactions form.
•
Specific license or certification based on provider type and specialty, if applicable.
•
Participation in the Medicare program, if applicable.
42 CFR § 455.414 (effective March 25, 2011, with an extended deadline of September 25, 2016, for full compliance)
states that the State Medicaid Agency must revalidate the enrollment of all providers at least every five years.
Revalidation includes a new application; satisfactory completion of screening activities; and if applicable, fee payment.
Screening activities vary depending on the risk category of the provider as follows:
•
The limited-risk category includes database checks.
•
The moderate-risk category includes those required for limited, plus site visits.
•
The high-risk category includes those required for moderate, plus fingerprint background checks.
- 212 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2019 Prior Year Finding Number:
2019-007 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1805AR5021; 05-1905AR5021
(Children’s Health Insurance Program)
05-1805AR5MAP; 05-1905AR5MAP
(Medicaid Cluster)
Federal Award Year(s):
2018 and 2019
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Provider Eligibility (Managed Care Organizations)
Type of Finding:
Material Noncompliance and Material Weakness
Condition and Context:
To determine if Managed Care Network providers met all necessary criteria to participate in the Medicaid program, ALA
staff selected 60 paid provider files for review. The providers selected participated in the dental managed care program,
commonly referred to as Healthy Smiles, and the Provider-Led Arkansas Shares Savings Entity, or PASSE, managed
care program. ALA review revealed deficiencies with 40 of the provider files as follows:
High-risk category:
•
Three providers did not comply with the site visit and fingerprint background check screening
requirements.
•
Two providers did not have certifications on file covering the entire enrollment period.
•
For one provider, a revalidation had not been performed.
Moderate-risk category:
•
Four providers did not comply with the site visit screening requirement.
Limited-risk category:
•
Eight providers did not have a license on file covering the entire enrollment period.
•
Four providers did not have certifications on file covering the entire enrollment period.
•
Two providers did not have a contract on file covering the entire enrollment period.
•
Five providers did not have an application on file covering the entire enrollment period.
•
Five providers did not have a W-9 form on file covering the entire enrollment period.
•
Thirteen providers did not have disclosure forms on file covering the entire enrollment period.
•
Eleven providers did not comply with the database checks screening requirement.
•
Fifteen providers did not revalidate timely, either by the September 26, 2016, extended deadline or within
the five years since they last enrolled.
•
For fourteen providers, a revalidation had not been performed.
The following payments were made by the managed care entities to the providers identified above with deficiencies:
Dental managed care:
$1,366,460 (Medicaid)
$ 396,257 (CHIP)
PASSE
$494,713 (Medicaid)
$ 16,948 (CHIP)
- 213 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2019 Prior Year Finding Number:
2019-007 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.767 – Children’s Health Insurance Program
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1805AR5021; 05-1905AR5021
(Children’s Health Insurance Program)
05-1805AR5MAP; 05-1905AR5MAP
(Medicaid Cluster)
Federal Award Year(s):
2018 and 2019
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Provider Eligibility (Managed Care Organizations)
Type of Finding:
Material Noncompliance and Material Weakness
Condition and Context (Continued):
(NOTE: Because these providers are participating in the managed care portion of the Medicaid program, providers are
reimbursed by the managed care organizations, not the Agency. The managed care organizations receive a
predetermined monthly payment from the Agency in exchange for assuming the risk for the covered recipients.
These monthly payments are actuarially determined based, in part, upon historical costs data. Accordingly, the failure
to remove unallowable cost data from the amounts utilized by the actuary would lead to overinflated future rates, which
will be directly paid by the Agency.)
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
Unknown
- 214 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2019 Prior Year Finding Number:
2019-011
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1805AR5MAP; 05-1905AR5MAP
Federal Award Year(s):
2018 and 2019
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed –
Home and Community-Based Services
(ARChoices Waiver)
Type of Finding:
Noncompliance and Material Weakness
Auditee reported status as of June 30, 2021: Corrective action was taken. The agency developed a workflow
management strategy to ensure timely completion of PCSP’s for ARChoices beneficiaries in July 2020. Internal
monitoring for this finding is pending.
Audit Status as of June 30, 2020:
Although repayment was processed, similar deficiencies are reported in current-year finding 2020-021.
Auditee reported status as of June 30, 2020: Partially corrected. The agency completed its 704 mapping process in
March 2020 which served to improve the evaluation process. The agency is on track to implement Quickbase system
to manage the evaluation process by July 2020.
Repeat Finding:
A similar issue was reported in prior-year finding 2018-013.
Criteria:
Prior to January 1, 2019, the ARChoices waiver was governed by Section 212.300 of the ARChoices provider manual.
It stated that each beneficiary must have an individualized Person-Centered Service Plan (PCSP) and that attendant
care hours are based on the Resource Utilization Group (RUG) score produced from the ARPath assessment. Services
must be provided according to the beneficiary’s PCSP, with reimbursement limited to the amount and frequency
authorized in the PCSP.
On January 1, 2019, the Arkansas Independent Assessment (ARIA) tool was used to determine the ARChoices level
of care and aided in developing the beneficiary PCSP. Attendant care hours are determined utilizing the Task and
Hour Standards (THS), which is the written methodology used by Arkansas Department of Human Services (DHS)
Registered Nurses (RNs) as the basis for calculating the number of attendant care hours that are reasonably and
medically necessary. In addition, an Individual Service Budget (ISB) sets the maximum dollar amount for all waiver
services received by an individual. Services must be provided according to the beneficiary’s PCSP, with reimbursement
limited to the amount and frequency authorized on the PCSP.
Condition and Context:
ALA staff selected 60 beneficiaries for review to determine if attendant care services were provided in accordance with
the beneficiary’s PCSP and did not exceed the frequency or the maximum amount allowed. Our review revealed the
following:
•
44 beneficiaries had at least one claim for a date of service that was not covered by a valid agreement.
Questioned costs totaled $279,209.
•
Attendant care services for 4 beneficiaries exceeded the amount authorized in an agreement. Questioned
costs totaled $279.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
$279,488
- 215 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2019 Prior Year Finding Number:
2019-012
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1905AR5MAP
Federal Award Year(s):
2019
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed –
Managed Care
Type of Finding:
Noncompliance and Material Weakness
Auditee reported status as of June 30, 2021: Corrective action was taken. The agency updated its independent
assessment process in January 2020. The agency completed internal monitoring in June 2021.
Audit Status as of June 30, 2020:
Although repayment was processed, similar deficiencies are reported in current-year finding 2020-022.
Auditee reported status as of June 30, 2020: Partially corrected. The agency updated its independent assessment
process to ensure completion within a 12-month timeframe in January 2020. A system edit was developed in March
2020 to prevent future unallowable claims. The recoupment of improperly paid claims is pending.
Repeat Finding:
Not applicable
Criteria:
The Provider-Led Arkansas Shared Savings Entity (PASSE) program transitioned to a full-risk Managed Care
Organization (MCO) model on March 1, 2019. The program covers services for behavioral health (BH) recipients and
developmentally disabled (DD) recipients. To receive services through PASSE, an individual must have an
independent assessment performed that designates him or her at the appropriate level of need to participate in the
program.
The 1915(c) Home and Community-Based waiver, applicable to the DD population, requires that an independent
assessment be performed at least every three years. Section 1915(i) of the Social Security Act, which is applicable to
the BH population and provides states with the option to offer home and community-based services through the state’s
plan, requires that than an independent assessment be performed at least every 12 months. 42 CFR §441.720(b)
states that for reassessments, the independent assessment of need must be conducted at least every 12 months and
as needed when the individual’s support needs or circumstances change significantly, in order to revise the service
plan.
Condition and Context:
ALA selected 60 PASSE recipients (56 BH recipients and 4 DD recipients) to determine if the following attributes were
met:
•
There was an open eligibility segment for the recipient during the dates of service covered.
•
There was a valid independent assessment on file for the dates of service covered.
•
The appropriate amount was paid based upon the actuarially determined rates.
Our review revealed PASSE payments, totaling $58,894, for 23 BH recipients were made for dates of services outside
the date range covered by the recipients’ independent assessment.
In addition, an unallowable fee-for-service claim, totaling $145, was discovered. Fee-for-service claims should not be
paid for individuals who are covered under PASSE. (There are a few exceptions including, but not limited to, certain
school-based services that are provided by school employees.)
- 216 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2019 Prior Year Finding Number:
2019-012 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1905AR5MAP
Federal Award Year(s):
2019
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed –
Managed Care
Type of Finding:
Noncompliance and Material Weakness
Condition and Context (Continued):
The discovery of an unallowable fee-for-service claim prompted ALA to retrieve all fee-for-service claims for all
individuals with PASSE payments during state fiscal year 2019 to determine if additional unallowable fee-for-service
claims had been paid. After filtering and removing the claims that could be allowable (as previously mentioned), the
remaining fee-for-service claims totaled $2,575,426. These claims will require a review by the Agency to determine if
the fee-for-service claim or PASSE payment should be recouped.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
$58,894
- 217 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2019 Prior Year Finding Number:
2019-014
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
US Department of Health and Human Services
Federal Award Number(s):
05-1805AR5MAP; 05-1905AR5MAP
Federal Award Year(s):
2018 and 2019
Compliance Requirement(s) Affected:
Allowable Costs and Cost Principles
Type of Finding:
Noncompliance and Material Weakness
Auditee reported status as of June 30, 2021: Partially corrected. The agency updated its procedures for
processing overpayments in February 2021 and will attach funding codes to overpayments that can be identified as
Medicaid/CHIP in June 2021. An internal monitoring review of the finding is pending.
Audit Status as of June 30, 2020:
Corrective action has not been taken. See current-year finding 2020-014.
Auditee reported status as of June 30, 2020: Corrective action was taken. The agency developed documented
controls for processing OMIG and MFCU overpayments.
Repeat Finding:
Not applicable
Criteria:
In accordance with 45 CFR § 75.302(b)(7), a non-federal entity must establish written procedures to implement and
determine the allowability of costs in accordance with Uniform Administrative Requirements, Cost Principles, and Audit
Requirements, as well as the terms and conditions of the federal award.
In addition, 45 CFR § 75.303 states that a non-federal entity must:
•
Establish and maintain effective internal control over the federal award that provides reasonable
assurance that the non-federal entity is managing the federal award in compliance with federal statutes,
regulations, and the terms and conditions of the award. These controls should be in compliance with
Green Book or COSO guidance.
•
Evaluate and monitor its compliance with the award.
•
Take prompt action when instances of noncompliance are identified, including noncompliance identified
in audit findings.
42 CFR § 433, Subpart F, establishes requirements for identifying overpayments to Medicaid providers and for
refunding the federal portion of identified overpayments to the federal awarding agency. The provisions apply to
overpayments discovered by a state, by a provider and made known to the state, or through federal review.
Under Section 6506 of the Affordable Care Act (42 USC 1396b(d)(2)), states have up to one year from the date of
discovery of an overpayment for Medicaid services to recover, or attempt to recover, such overpayment before making
an adjustment to refund the federal share of the overpayment. Except in the case of overpayments resulting from fraud,
the adjustment to refund the federal share must be made no later than the deadline for filing the quarterly CMS-64
report for the quarter in which the one-year period ends, regardless of whether the state recovers the overpayment.
The date of discovery for fraudulent overpayments is the date of the final written notice of the state’s overpayment
determination. When the state is unable to recover an overpayment from a provider within one year from the date of
discovery because a final determination of the amount has not been made under an administrative or judicial process,
no adjustment shall be made to the quarterly expenditure report until 30 days after the date on which a final judgment
is made (including final determination on an appeal).
Condition and Context:
The Agency failed to establish and document internal control procedures over the escheated warrants and
overpayments compliance requirement. As a result, ALA met with DHS reporting staff and accounts receivable staff,
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State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2019 Prior Year Finding Number:
2019-014 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
US Department of Health and Human Services
Federal Award Number(s):
05-1805AR5MAP; 05-1905AR5MAP
Federal Award Year(s):
2018 and 2019
Compliance Requirement(s) Affected:
Allowable Costs and Cost Principles
Type of Finding:
Noncompliance and Material Weakness
Condition and Context (Continued):
as well as Navigant staff, to gain an understanding of controls that may be in place but not documented. ALA was
unable to identify any controls that were in place to ensure compliance with federal regulations.
Overpayments may be identified by DHS, the Office of Medicaid Inspector General (OMIG), or the Medicaid Fraud
Control Unit (MFCU) of the Office of the Attorney General. DHS is responsible for completion of the required quarterly
expenditure reports for the Medicaid program (CMS-64) and, therefore, for obtaining information needed to properly
report overpayments on these reports.
Overpayments identified by OMIG: OMIG notifies DHS of identified overpayments (a) when the provider repays the
identified amount or fails to respond to the finding letter or (b) after all possible appeals have been exhausted. For
cases under appeal, OMIG does not notify DHS of the initial “discovery date”; therefore, some uncollected
overpayments may not be reported by the required deadline.
Additionally, OMIG utilizes a “claim log” to monitor identified overpayments and collections related to the overpayments.
ALA reviewed the fiscal year 2018 claim log to determine whether uncollected balances were collected or reported in
fiscal year 2019 and reviewed the fiscal year 2019 claim log to determine whether payments collected by OMIG were
included on the proper CMS-64 report. ALA was unable to determine if outstanding balances on the 2018 claim log
were reported on the state fiscal year 2019 CMS-64 reports and was unable to trace six payments totaling $5,713
(federal portion $4,033) to internal reports used to calculate total overpayments for the quarterly CMS-64 reports for
state fiscal year 2019.
Overpayments identified by MFCU: Discussions with both MFCU and DHS staff revealed MFCU does not report
identified overpayments to DHS until a payment is received. As a result, uncollected overpayments resulting from fraud
are not included on the quarterly CMS-64 reports as required.
Additionally, payments forwarded to DHS directly from MFCU are generally not included on internal reports used to
calculate total overpayments for the quarterly CMS-64 reports. As a result, these payments may not be reported as
collected overpayments, as required.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
Unknown
- 219 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2019 Prior Year Finding Number:
2019-016
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1405AR5MAP; 05-1505AR5MAP; 05-1605AR5MAP;
05-1705AR5MAP; 05-1805AR5MAP; 05-1905AR5MAP
Federal Award Year(s):
2014, 2015, 2016, 2017, 2018, and 2019
Compliance Requirement(s) Affected:
Eligibility
Type of Finding:
Noncompliance and Material Weakness
Auditee reported status as of June 30, 2021: Partially corrected. The agency conducted staff training focusing on
the deficiencies noted in the findings in May 2021. An internal monitoring review of the finding is pending.
Audit Status as of June 30, 2020:
Although repayment was processed, similar deficiencies are reported in current-year finding 2020-023.
Auditee reported status as of June 30, 2020: Partially corrected; A new business process has been developed to
ensure timely completion of medical eligibility determination. The agency is in the process of updating this process to
account for long-term care facility transfers.
Repeat Finding:
A similar issue was reported in prior-year finding 2018-014.
Criteria:
It is the State’s responsibility to determine that Medicaid applicants meet the eligibility criteria as specified in the
approved State Plan. Eligibility requirements for the Medicaid Program are outlined in the Arkansas Medical Services
(MS) manual. The MS manual is specific to Medicaid eligibility policies and procedures and is, in addition to the
approved State Plan, required in accordance with 45 CFR § 75.206.
In addition, case documentation is governed by 42 CFR § 435.913, which states, “The Agency must include in each
application record facts to support the Agency’s decision....”
Guidance for timely eligibility determinations is outlined in 42 CFR § 435.912, which states that initial determinations
should be made within 45 days unless the applicant is applying upon the basis of disability; in that case, the initial
determination should be made within 90 days. Also, 42 CFR § 435.916 states that eligibility redeterminations are to be
performed at least once every 12 months.
Condition and Context:
ALA staff reviewed 23 traditional Medicaid recipient files in the ANSWER system and 37 Modified Adjusted Gross
Income (MAGI) Medicaid recipient files in the Curam system to ensure sufficient, appropriate evidence was provided
to support the Agency’s determination of eligibility. The review revealed deficiencies as summarized below:
•
One client file, with 588 claims totaling $39,892, did not contain a DCO-704 signed by a registered nurse
verifying medical necessity, affecting 58 claims. Questioned costs totaled $3,142.
The annual reevaluation was also not completed timely. The 2019 reevaluation, due in January 2019,
was not completed until February 26, 2019. (Disabled Tax Equity and Fiscal Responsibility Act [TEFRA]
Child) (Non-MAGI/ANSWER)
•
One client file, with 49 claims totaling $903, did not contain a DCO-704 signed by a registered nurse
verifying medical necessity, affecting 25 claims. Questioned costs totaled $456.
The annual reevaluation was also not completed timely. The 2019 reevaluation, due in December 2018,
was not completed until February 5, 2019. (Aid to the Aged) (Non-MAGI/ANSWER)
•
One client file, with 112 claims totaling $7,073, did not contain a DCO-704 signed by a registered nurse
verifying medical necessity, affecting 3 claims. Questioned costs totaled $727. (Disabled Tax Equity and
Fiscal Responsibility Act [TEFRA] Child) (Non-MAGI/ANSWER)
- 220 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2019 Prior Year Finding Number:
2019-016 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1405AR5MAP; 05-1505AR5MAP; 05-1605AR5MAP;
05-1705AR5MAP; 05-1805AR5MAP; 05-1905AR5MAP
Federal Award Year(s):
2014, 2015, 2016, 2017, 2018, and 2019
Compliance Requirement(s) Affected:
Eligibility
Type of Finding:
Noncompliance and Material Weakness
Condition and Context (Continued):
•
One client file, with 52 claims totaling $655, did not contain a DCO-704 signed by a registered nurse
verifying medical necessity, affecting 4 claims. Questioned costs totaled $28. (Disabled Tax Equity and
Fiscal Responsibility Act [TEFRA] Child) (Non-MAGI/ANSWER)
•
One client file, with 173 claims totaling $10,784, did not contain a DCO-704 signed by a registered nurse
verifying medical necessity and did not contain documentation supporting the income and resources
criteria, affecting 73 claims. Questioned costs totaled $3,347.
The annual reevaluation was also not completed timely. The 2019 reevaluation, due in December 2018,
was not completed until February 1, 2019. (AR Choices) (Non-MAGI/ANSWER)
•
One client file, with 22 claims totaling $2,818, did not contain a DCO-704 signed by a registered nurse
verifying medical necessity and did not contain documentation supporting the income and resources
criteria, affecting 22 claims. Questioned costs totaled $1,997.
In addition,103 claims paid in 2018 were also affected. Questioned costs totaled $3,323.
The annual reevaluation was also not completed timely. The 2018 reevaluation, due in August 2017, was
not completed. (Aid to the Aged) (Non-MAGI/ANSWER)
•
One client file, with 113 claims totaling $7,827, did not contain a DCO-704 signed by a registered nurse
verifying medical necessity, affecting 26 claims. Questioned costs totaled $1,305. (AR Choices) (Non-
MAGI/ANSWER)
•
One client file, with 15 claims totaling $24,715, did not contain a DCO-704 signed by a registered nurse
verifying medical necessity, affecting 10 claims. Questioned costs totaled $10,347.
The annual reevaluation was also not completed timely. The 2019 reevaluation, due in January 2019,
was not completed until March 29, 2019. (Assisted Living/ Living Choices) (Non-MAGI/ANSWER)
•
One client file, with 143 claims totaling $50,790, did not contain documentation proving resource eligibility,
affecting 18 claims. Questioned costs totaled $8,053.
The annual reevaluation was also not completed timely. The 2019 reevaluation, due in April 2019, was
not completed until November 1, 2019, after the recipient’s file was selected for review. (Aid to the Aged)
(Non-MAGI/ANSWER)
•
One client file, with 29 claims totaling $5,633, did not contain a DCO-704 signed by a registered nurse
verifying medical necessity, documentation supporting the resources or income criteria, disability
verification, institutional status, or proof of assignment of medical rights by the recipient to DHS, affecting
all 29 claims. Questioned costs totaled $3,972.
In addition, 137 claims paid in 2018, 2017, 2016, 2015, and 2014 were also affected. Questioned costs
totaled $325, $76, $193, $362, and $71, respectively.
The annual reevaluations were also not completed timely. The 2014 reevaluation, due in April 2014, had
not been completed at the conclusion of audit fieldwork, and there were no reevaluations for 2015, 2016,
2017, 2018, or 2019. (Aid to the Disabled) (Non-MAGI/ANSWER)
•
One client file, with 13 claims totaling $3,539, did not contain documentation proving income eligibility,
affecting all 13 claims. Questioned costs totaled $2,496. (Adult Expansion) (MAGI/CURAM)
•
One client file, with 10 claims totaling $116, did not contain documentation proving the recipient had
assigned medical rights to DHS, affecting all 10 claims. Questioned costs totaled $82. (ARKids A)
(MAGI/CURAM)
- 221 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2019 Prior Year Finding Number:
2019-016 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1405AR5MAP; 05-1505AR5MAP; 05-1605AR5MAP;
05-1705AR5MAP; 05-1805AR5MAP; 05-1905AR5MAP
Federal Award Year(s):
2014, 2015, 2016, 2017, 2018, and 2019
Compliance Requirement(s) Affected:
Eligibility
Type of Finding:
Noncompliance and Material Weakness
Condition and Context (Continued):
Additional deficiencies related to eligible recipients with late re-determinations. Although no questioned costs are
associated with these recipients, the total amount of claims paid (state and federal) as of fieldwork date of December
2, 2019, for dates of services between the time the reevaluation was due and the day before it was performed is noted
below in order to show what could have been paid in error if the recipient had ultimately been deemed ineligible:
•
One client file did not have a timely reevaluation, as it was due in December 2018 but was not completed
until February 20, 2019. The claims paid for dates of services between when the reevaluation was due
and the day before it was performed totaled $13,178 in state fiscal year 2019. (Aid to the Aged) (Non-
MAGI/ANSWER)
•
One client file did not have a timely reevaluation, as it was due in February 2019 but was not completed
until March 6, 2019. The claims paid for dates of services between when the reevaluation was due and
the day before it was performed totaled $5,262 in state fiscal year 2019. (Aid to the Disabled) (Non-
MAGI/ANSWER)
•
One client file did not have a timely reevaluation, as it was due in July 2018 but was not completed until
August 12, 2018. The claims paid for dates of services between when the reevaluation was due and the
day before it was performed totaled $434 in state fiscal year 2019. (Adult Expansion) (MAGI/CURAM)
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
State Fiscal Year 2019 - $35,952
State Fiscal Year 2018 - $3,648
State Fiscal Year 2017 - $76
State Fiscal Year 2016 - $193
State Fiscal Year 2015 - $362
State Fiscal Year 2014 - $71
- 222 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2019 Prior Year Finding Number:
2019-017
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1805AR5MAP; 05-1905AR5MAP
Federal Award Year(s):
2018 and 2019
Compliance Requirement(s) Affected:
Matching, Level of Effort, Earmarking
Type of Finding:
Material Noncompliance and Material Weakness
Auditee reported status as of June 30, 2021: Partially corrected. The agency has improved its ability to provide
greater specificity in tracking “other non-federal funds” through the purchase of a new general ledger system that is to
be implemented by 9/1/21. Internal monitoring for this finding is pending.
Audit Status as of June 30, 2020:
Corrective action has not been taken. See current-year finding 2020-017.
Auditee reported status as of June 30, 2020: Partially corrected; The agency developed a process for identifying
other non-federal funds with greater specificity and is developing a long-term plan for improvement of reconciliation
process.
Repeat Finding:
A similar issue was reported in prior-year finding 2018-015.
Criteria:
In accordance with 45 CFR § 95.507(4), the Agency’s established Cost Allocation Plan is required to contain sufficient
information in such detail to permit the Director - Division of Cost Allocation, after consulting with the Operating
Divisions, to make an informed judgment on the correctness and fairness of the State's procedures for identifying,
measuring, and allocating all costs to each of the programs operated by the State agency.
42 CFR § 433.10 and § 433.15 established rates to be used to calculate non-administrative and administrative state
match and require that the state pay part of the costs for providing and administering the Medical Assistance Program
(MAP).
In addition, 45 CFR § 75.303 states that a non-federal entity must “take prompt action when instances of
noncompliance are identified including noncompliance identified in audit findings.”
Condition and Context:
To verify that state general revenues and other non-federal funding sources used to “match” the federal grant award
monies were from an appropriate source of funding, ALA selected 25 daily draw dates and traced the daily draw amount
recorded in AASIS to the Agency's supporting draw packet. The following issues were noted:
•
The Agency did not maintain documentation identifying the original source of revenues identified as other
non-federal.
•
The Agency utilizes an outside accounting system, Lotus 1-2-3, to maintain and track State General
Revenue and other non-federal fund balances available. Agency staff manually key information into this
system daily. However, there are no reviews or other controls in place to ensure the accuracy of the
funding category balances.
•
Accounting records maintained in the Lotus 1-2-3 system include one-sided adjustments to State General
Revenue and other non-federal funds, causing the ending balances of both funding categories to be
inaccurate.
Additionally, to confirm the Agency was properly monitoring its state match, we requested the reconciliations the Agency
indicated it used to track, compare, and verify state match requirements.
- 223 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2019 Prior Year Finding Number:
2019-017 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1805AR5MAP; 05-1905AR5MAP
Federal Award Year(s):
2018 and 2019
Compliance Requirement(s) Affected:
Matching, Level of Effort, Earmarking
Type of Finding:
Material Noncompliance and Material Weakness
Condition and Context (Continued):
Although reconciliations were provided for the first three quarters of 2019, they contained numerous errors, and the
Agency failed to provide the reconciliation for the fourth quarter ending June 30, 2019. ALA attempted to perform
alternative procedures; however, because of the issues noted above, we were unable to verify that the Agency met the
match requirements.
(NOTE: The Agency’s reported state match for all active Medicaid grants was $1,677,981,874.)
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
Unknown
- 224 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2019 Prior Year Finding Number:
2019-018
State/Educational Agency(s):
Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
US Department of Health and Human Services
Federal Award Number(s):
05-1805AR5MAP; 05-1905AR5MAP;
05-1805AR5ADM, 05-1905AR5ADM
Federal Award Year(s):
2018 and 2019
Compliance Requirement(s) Affected:
Reporting
Type of Finding:
Noncompliance and Material Weakness
Auditee reported status as of June 30, 2021: Partially corrected. The agency corrected errors to formulas used
to allocated and expenditures on the CMS-64. An internal monitoring review of the finding is pending.
Audit Status as of June 30, 2020:
Corrective action has not been taken. See current-year finding 2020-024.
Auditee reported status as of June 30, 2020: Partially corrected; The agency has developed a process to reconcile
the CMS-64 to payouts and cost allocation. The agency is in the process of developing a process to reconcile the CMS-
64 to AASIS.
Repeat Finding:
A similar finding was reported in the year finding 2018-009.
Criteria:
42 CFR 430.30(c) requires submission of a quarterly statement of expenditures report (CMS-64) for the Medical
Assistance Program (MAP) no later than 30 days after the end of each quarter. To ensure compliance, the Agency
maintains policies and procedures for the preparation of the CMS-64 report. One procedure specifically states that the
Agency will prepare quarterly reconciliations, as well as review, investigate, and provide explanations for identified
variances. Reconciliations, along with the variance explanations, should be included as supporting documentation for
the CMS-64.
Condition and Context:
ALA requested the quarterly reconciliations between expenditures recorded in its financial management system and
expenditures reported to the federal awarding agency. The Agency provided reconciliations for portions of the CMS-
64 reports to “payout” reports but did not complete reconciliations for the report as a whole. Payout reports are created
by DMS staff and represent the 13 weekly funding requests for each quarter. The Agency utilizes an Excel workbook
to combine the claims data included in each week’s funding request to create the payout reports. However, the
reconciliations provided did not include reconciliations to the Agency’s financial management systems (AASIS and
Allocap).
ALA staff also performed testing of expenditures reported on the CMS-64 for the quarters ended December 31, 2018,
and March 31, 2019, to confirm accuracy and completeness with the expenditures recorded in the Agency’s financial
management system. ALA review revealed the following errors:
From the December 31, 2018, report:
•
Twenty-three line items totaling $1,322,346,159 and representing 86% of MAP expenditures were
selected. An error was identified in one line item, resulting in an overstatement of the federal portion of
expenditures totaling $477,042.
•
Nine line items totaling $91,932,560 and representing 94% of administrative expenditures were selected.
Errors were identified in four line items, resulting in an overstatement of the federal portion of
expenditures totaling $29,870.
•
- 225 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2019 Prior Year Finding Number:
2019-018 (Continued)
State/Educational Agency(s):
Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
US Department of Health and Human Services
Federal Award Number(s):
05-1805AR5MAP; 05-1905AR5MAP;
05-1805AR5ADM, 05-1905AR5ADM
Federal Award Year(s):
2018 and 2019
Compliance Requirement(s) Affected:
Reporting
Type of Finding:
Noncompliance and Material Weakness
Condition and Context (Continued):
From the March 31, 2019, report:
•
Twenty-one line items totaling $1,499,993,497 and representing 85% of MAP expenditures were selected.
Two errors were identified, resulting in an understatement of the federal portion of expenditures totaling
$939.
Eight line items totaling $72,862,882 and representing 92% of administrative expenditures were selected. Errors
were identified in four line items, resulting in an overstatement of the federal portion of expenditures totaling
$119,695.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
Unknown
- 226 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2019 Prior Year Finding Number:
2019-019
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1505AR5MAP; 05-1605AR5MAP;
05-1705AR5MAP; 05-1805AR5MAP;
05-1905AR5MAP
Federal Award Year(s):
2015, 2016, 2017, 2018, and 2019
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Claims Paid Subsequent to Recipient Death
Type of Finding:
Noncompliance and Significant Deficiency
Auditee reported status as of June 30, 2021: Partially corrected. The agency completion of Medicaid rollout for
ARIES was completed in April 2021. The process for activating review and reconciliation for PCCM payments will be
completed in July 2021. An internal monitoring review of the finding is pending.
Audit Status as of June 30, 2020:
Although repayment was processed, similar deficiencies are reported in current-year finding 2020-025.
Auditee reported status as of June 30, 2020: Partially corrected; The agency has corrected deficiencies in its
eligibility systems and MMIS to prevent payment of claims after DOD. An internal monitoring review is pending.
Repeat Finding:
A similar issue was reported in prior-year finding 2018-021.
Criteria:
It is the State’s responsibility to ensure that claims are only paid for eligible Medicaid recipients and that any changes
to a recipient’s eligibility be updated timely. According to Section I-600 of the Medical Service Policy Manual, DHS is
required to act on any change that may alter eligibility within 10 days of receiving the change. One of the changes
listed that could affect eligibility is death of the recipient. Additionally, Section I-610 of the manual indicates that a
recipient loses eligibility upon death.
Condition and Context:
The Arkansas Department of Health provided ALA with a list of deceased individuals, which ALA used to identify
individuals who had claims or capitation payments paid or adjusted in state fiscal year 2019 with dates of service after
their date of death. The resulting population was split into those related to claims payments and those related to
capitation payments.
ALA staff review of 60 recipients with claims paid for dates of service subsequent to the date of death revealed the
following:
•
Nine recipients had claims paid for dates of service after their date of death. One recipient’s claims,
totaling $576, were for dates of service seven months after the date of death. These claims had not been
recouped as of fieldwork date October 14, 2019. Questioned costs totaled $689 and $8 for state fiscal
years 2019 and 2018, respectively.
•
For nine recipients, the Medicaid Management Information System (MMIS) did not have a date of death
recorded or the date of death was not correct as of fieldwork date November 22, 2019.
ALA staff review of 60 recipients with capitation payments for dates of service subsequent to the date of death revealed
the following:
•
Fifty-seven recipients had capitation payments paid for dates of service after their date of death. These
claims had not been recouped as of fieldwork date October 14, 2019. Questioned costs totaled $722,
$435, $183, $141, and $37 for state fiscal years 2019, 2018, 2017, 2016 and 2015, respectively.
•
For nine recipients, MMIS did not have a date of death recorded, or the date of death was not correct as
of fieldwork date November 22, 2019.
- 227 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2019 Prior Year Finding Number:
2019-019 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1505AR5MAP; 05-1605AR5MAP;
05-1705AR5MAP; 05-1805AR5MAP;
05-1905AR5MAP
Federal Award Year(s):
2015, 2016, 2017, 2018, and 2019
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Claims Paid Subsequent to Recipient Death
Type of Finding:
Noncompliance and Significant Deficiency
Condition and Context (Continued):
•
For 10 recipients, capitation payments were paid more than six months past the date of death and ranged
from 7 to 54 months.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
State Fiscal Year 2015 - $37
State Fiscal Year 2016 - $141
State Fiscal Year 2017 - $183
State Fiscal Year 2018 - $443
State Fiscal Year 2019 - $1,411
- 228 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2019 Prior Year Finding Number:
2019-021
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1805AR5MAP; 05-1905AR5MAP
Federal Award Year(s):
2018 and 2019
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Utilization Control and Program Integrity and
Medicaid Fraud Control Unit
Type of Finding:
Noncompliance and Material Weakness
Auditee reported status as of June 30, 2021: Partially corrected. The agency’s receipt of the first EQR report from
vendors was completed in April 2021. An internal monitoring review of the finding is pending.
Audit Status as of June 30, 2020:
Corrective action has not been taken. See current-year finding 2020-028.
Auditee reported status as of June 30, 2020: Partially corrected; The agency began the process to secure a vendor
to perform reviews and anticipates a contract start date of July 1, 2020. Note: The EQRO contract started in July 2020.
Repeat Finding:
Not applicable
Criteria:
In accordance with 42 CFR § 438.350, each state that contracts with a Managed Care Organization (MCO) or Prepaid
Ambulatory Health Plan (PAHP) must ensure that an annual external quality review (EQR) is performed for each MCO
or PAHP.
In addition, 42 CFR § 438.364 states that the EQR results must be included in an annual technical report that must be
finalized by April 30 of each year.
Condition and Context:
The Healthy Smiles Waiver, Arkansas’s dental managed care program, is a PAHP and became effective on January
1, 2018. Two entities participate in the dental managed care program: Delta Dental and MCNA Dental. An EQR is
required for both entities and was due by April 30, 2019.
ALA inquiry and request for the annual report revealed that as of October 28, 2019, the Agency had yet to retain a
vendor to perform the EQR and was still working on the RFP (request for proposal) to select the vendor.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
None
- 229 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2018 Prior Year Finding Number:
2018-021
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1505AR5MAP; 05-1605AR5MAP;
05-1705AR5MAP; 05-1805AR5MAP
Federal Award Year(s):
2015, 2016, 2017, and 2018
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Claims Paid Subsequent to Recipient Death
Type of Finding:
Noncompliance and Significant Deficiency
Auditee reported status as of June 30, 2021: Partially corrected. The agency completion of Medicaid rollout for
ARIES was competed in April 2021. The process for activating review and reconciliation for PCCM payments will be
completed in July 2021. The internal monitoring review is pending.
Audit Status as of June 30, 2020:
Partial repayment made. Similar deficiencies are reported in current-year finding 2020-025.
Auditee reported status as of June 30, 2020: Partially corrected: DHS has completed its review of date of death
discrepancies between eligibility systems and MMIS and has updated each system to reflect the reported date of
death. Additionally, all reconciliation processes that include automatic recoupment of claims are now active. All claims
paid subsequent to date of death have been recouped and will be reported on the CMS-64 to be submitted on
10/31/2020.
Audit Status as of June 30, 2019:
Corrective action has not been taken. See current-year finding 2019-019.
Auditee reported status as of June 30, 2019: Partially corrected; DHS has updated its internal reconciliation process
to automatically recoup pharmacy and legacy system processed claims that were paid subsequent to recipient date of
death. Also, the agency has updated. its MMIS to populate the date of death received from its eligibility system in a
date of death data field as opposed to an eligibility data field. Further, the agency is in the process of reviewing date of
death data in its eligibility systems and MMIS for the purpose of identifying any additional updates that need to be made
in both systems to prevent the payment of claims after a recipient’s date of death.
Repeat Finding:
A similar issue was reported in prior-year finding 2017-022.
Criteria:
It is the State’s responsibility to ensure that claims are only paid for eligible Medicaid recipients and that any changes
to a recipient’s eligibility be updated timely. According to Section I-600 of the Medical Service Policy Manual, the
Arkansas Department of Human Services (DHS) is required to act on any change that may alter eligibility within 10
days of receiving the change. One of the changes listed that could affect eligibility is death of the recipient. Additionally,
Section I-610 of the manual indicates that a recipient loses eligibility upon death.
Condition and Context:
The Arkansas Department of Health provided ALA with a list of deceased individuals, which ALA used to identify
individuals who had claims or capitation payments paid or adjusted in state fiscal year 2018 with dates of service after
their date of death. The resulting population was split into those related to claims payments and those related to
capitation payments.
ALA staff review of 60 recipients with claims paid for dates of service subsequent to the date of death revealed the
following:
•
Twenty-one recipients had claims paid for dates of service after their date of death. These claims had
not been recouped as of fieldwork date October 26, 2018. Questioned costs totaled $1,408.
- 230 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2018 Prior Year Finding Number:
2018-021 (Continued)
State/Educational Agency(s):
Arkansas Department of Human Services
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
93.778 – Medical Assistance Program
(Medicaid Cluster)
Federal Awarding Agency:
U.S. Department of Health and Human Services
Federal Award Number(s):
05-1505AR5MAP; 05-1605AR5MAP;
05-1705AR5MAP; 05-1805AR5MAP
Federal Award Year(s):
2015, 2016, 2017, and 2018
Compliance Requirement(s) Affected:
Special Tests and Provisions –
Claims Paid Subsequent to Recipient Death
Type of Finding:
Noncompliance and Significant Deficiency
Condition and Context (Continued):
•
For twenty-two recipients, the Medicaid Management Information System (MMIS) did not have a date of
death recorded, or the date of death was not correct as of fieldwork date December 6, 2018.
•
Forty-three recipients had capitation payments paid for dates of service after their date of death. These
claims had not been recouped as of fieldwork date November 15, 2018. Questioned costs totaled $1,328,
$2, $106, and $38 for state fiscal years 2018, 2017, 2016, and 2015, respectively.
ALA staff review of 60 recipients with capitation payments for dates of service subsequent to the date of death
revealed the following:
•
Forty-three recipients had capitation payments paid for dates of service after their date of death. These
claims had not been recouped as of fieldwork date November 15, 2018. Questioned costs totaled $1,328,
$2, $106, and $38 for state fiscal years 2018, 2017, 2016, and 2015, respectively.
•
For 16 recipients, MMIS did not have a date of death recorded, or the date of death was not correct as of
fieldwork date December 6, 2018.
•
For seven recipients, capitation payments were paid more than six months past the date of death and
ranged from 7 to 27 months.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
State Fiscal Year 2015 – $ 38
State Fiscal Year 2016 – $ 106
State Fiscal Year 2017 – $ 2
State Fiscal Year 2018 – $2,736
(Known questioned costs greater than $25,000 are required to be reported. The auditor must also report known
questioned costs when likely questioned costs are greater than $2
- 231 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-005
State/Educational Agency(s):
Henderson State University
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
84.268 – Federal Direct Student Loans
(Student Financial Assistance Cluster)
Federal Awarding Agency:
U.S. Department of Education
Federal Award Number(s):
P268K201081
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed
Type of Finding:
Noncompliance and Significant Deficiency
Auditee reported status as of June 30, 2021: Partially corrected. Henderson State University's Student Accounts
director took corrective actions in FY2021 and trained the staff in the allowable amount ($200) of financial aid funds
that can be applied to prior-year charges for tuition and fees, room, or board or other charges incurred at the institution
authorized by the account holder. The legacy computer system (POISE) experienced a glitch causing this particular
error. Henderson State University's merger with Arkansas State University System in FY2021 created an opportunity
to convert from POISE to Banner for all fiscal functions. The conversion of the student accounts module has begun
and will be finalized in the Spring of 2022.
Repeat Finding:
Not applicable
Criteria:
According to 34 CFR § 668.164(c)(3)(i), an institution can disburse funds for prior-year charges for a total of not more
than $200 for tuition and fees, room, or board and, if the institution obtains the student’s or parent’s authorization under
34 CFR § 668.165(b), other educationally related charges incurred by the student at the institution.
Condition and Context:
From a sample of 7 students selected for testing, ALA staff noted 1 instance in which excess loan funds were utilized
to pay for prior-year charges of $3,915, in excess of the $200 amount allowed.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
Unknown
Cause:
The University did not have proper training procedures in place that allowed staff to be aware the aid was not being
applied in accordance with federal regulations.
Effect:
The University’s procedures for disbursement of credit balances related to FSA funds were not in compliance with
Department of Education guidelines.
Recommendation:
ALA staff recommend the University establish and implement procedures to ensure excess loan funds are paid in
accordance with federal regulations and to ensure applicable training of personnel and oversight regarding the
disbursement of Title IV, HEA program funds.
Views of Responsible Officials and Planned Corrective Action:
The University concurs with the finding. Student Accounts staff will be trained in the allowable amount of financial aid
funds that can be applied to prior-year charges for tuition and fees, room, or board or other charges incurred at the
institution authorized by the account holder.
Anticipated Completion Date:
March 31, 2021
- 232 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-005
State/Educational Agency(s):
Henderson State University
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
84.268 – Federal Direct Student Loans
(Student Financial Assistance Cluster)
Federal Awarding Agency:
U.S. Department of Education
Federal Award Number(s):
P268K201081
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed
Type of Finding:
Noncompliance and Significant Deficiency
Contact Person:
Rita Fleming
Vice Chancellor of Finance and Administration
Henderson State University
1100 Henderson Street
Arkadelphia, AR 71999
870-230-5061
fleminr@hsu.edu
- 233 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-006
State/Educational Agency(s):
Southern Arkansas University
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
84.063 – Federal Pell Grant Program
84.268 – Federal Direct Loan Program
(Student Financial Assistance Cluster)
Federal Awarding Agency:
U.S. Department of Education
Federal Award Number(s):
P063P191087
(Federal Pell Grant Program)
P268K201087
(Federal Direct Loan Program)
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed
Type of Finding:
Noncompliance and Significant Deficiency
Auditee reported status as of June 30, 2021: Corrective action was taken.
Repeat Finding:
Not applicable
Criteria:
According to 34 CFR § 668.165(b)(1) and b(1)(ii), if an institution obtains written authorization from a student or parent,
as applicable, the institution may hold on behalf of the student or parent any Title IV, HEA program funds that would
otherwise be paid directly to the student or parent as a credit balance under 34 CFR § 668.164(h). Furthermore, 34
CFR § 668.165 (b)(5) and (b)(5)iii) state that if an institution holds excess funds under paragraph (b)(1)(ii), the institution
must, notwithstanding any authorization by the institution under this paragraph, pay any remaining balance on loan
funds by the end of the loan period.
According to 34 CFR § 668.164(c)(3)(i), an institution can disburse funds for prior-year charges for a total of not more
than $200 for tuition and fees, room, or board and, if the institution obtains the student’s or parent’s authorization under
34 CFR § 668.165(b), other educationally related charges incurred by the student at the institution.
Condition and Context:
From a sample of 7 students selected for testing, ALA staff noted 1 instance in which a student’s FSA credit balance
of $3,574, comprised of Pell ($853) and Loan Funds ($2,721), was held without documentation of authorization from
the student. Additionally, the remaining balance of $2,721 derived from FSA loan funds was not paid at the end of the
loan period and was instead used to pay charges incurred after the end of the loan period.
From a sample of 7 students selected for testing, ALA noted 1 instance in which excess loan funds were utilized to pay
for prior-year charges of $1,124, in excess of the $200 amount allowed.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
Unknown
Cause:
The University did not have proper training procedures in place that allowed staff to be aware the aid was not being
applied in accordance with federal regulations.
Effect:
The University’s procedures for disbursement of credit balances related to FSA funds were not in compliance with
Department of Education guidelines.
- 234 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-006 (Continued)
State/Educational Agency(s):
Southern Arkansas University
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
84.063 – Federal Pell Grant Program
84.268 – Federal Direct Loan Program
(Student Financial Assistance Cluster)
Federal Awarding Agency:
U.S. Department of Education
Federal Award Number(s):
P063P191087
(Federal Pell Grant Program)
P268K201087
(Federal Direct Loan Program)
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Activities Allowed or Unallowed
Type of Finding:
Noncompliance and Significant Deficiency
Recommendation:
ALA staff recommend the University establish and implement procedures to ensure excess loan funds are paid in
accordance with federal regulations and to ensure applicable training of personnel and oversight regarding the
disbursement of Title IV, HEA program funds.
Views of Responsible Officials and Planned Corrective Action:
The University plans to implement procedures to help identify federal financial awards made subsequent to adding
additional student charges. Due to this timing issue, the administrative software is not able to detect and create the
required refund. Software and/or procedural changes will be addressed to resolve the matter. In addition, a reminder
will be extended to the appropriate Business Office staff to adhere to the $200 allowable amount.
Anticipated Completion Date:
June 30, 2021
Contact Person:
Shawana Reed
VP for Finance
Southern Arkansas University
100 E University MSC 9403
Magnolia, AR 71753
870-235-5008
srreed@saumag.edu
- 235 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-007
State/Educational Agency(s):
Southern Arkansas University
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
84.007 – Federal Supplemental Educational Opportunity Grants
84.063 – Federal Pell Grant Program
84.268 – Federal Direct Student Loans
(Student Financial Assistance Cluster)
Federal Awarding Agency:
U.S. Department of Education
Federal Award Number(s):
P007A190194
(Federal Supplemental Educational Opportunity Grants)
P063P191087
(Federal Pell Grant Program)
P268K201087
(Federal Direct Student Loans)
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Eligibility
Type of Finding:
Noncompliance and Significant Deficiency
Auditee reported status as of June 30, 2021: Corrective action was taken.
Repeat Finding:
Not applicable
Criteria:
34 CFR § 668.32(f) states that a student is eligible to receive Title IV, HEA program assistance if the student maintains
satisfactory academic progress (SAP) in his or her course of study according to the institution’s published standards
for SAP that meet the requirements of 34 CFR § 668.34. Specifically, 34 CFR § 668.34(d)(3) states that a student on
financial probation for a payment period may not receive Title IV, HEA program funds for the subsequent payment
period unless the student makes SAP or the institution determines that the student met the requirements specified by
the institution in the academic plan for the student. Furthermore, 34 CFR § 668.34(a) states, “An institution must
establish a reasonable satisfactory academic progress policy for determining whether an otherwise eligible student is
making satisfactory academic progress in his or her educational program and may receive assistance under the title
IV, HEA programs.”
Condition and Context:
While the University has a process to receive and consider SAP appeals, its internal controls were not sufficient to
ensure compliance with SAP requirements. The University’s SAP policy states that an appeals committee reviews
appeals of SAP determinations. However, the SAP policy does not provide specific information on the methodology the
University uses to evaluate appeals. In a sample of 9 students, ALA noted 2 students for which the University
maintained evidence the students had filed appeals but did not document its rationale for approving those students’
SAP appeals. Furthermore, the 2 students were placed on probation status and did not make SAP at the end of the
probation term but continued to receive Title IV, HEA program funds in the subsequent payment periods. Specifically:
•
One of the students did not meet the 2.0 cumulative GPA requirement at the end of the probation term
but continued to receive aid in the Spring 2020 semester. The appeal did not document a multi-term
academic plan.
•
One of the students did not meet the quantitative pace of completion, the maximum timeframe element,
or the 2.0 cumulative GPA requirement at the end of the probation term but continued to receive aid in
the Fall 2019, Spring 2020, and Summer I 2020 semesters. The appeal did not document a multi-term
academic plan.
Statistically Valid Sample:
Not a statistically valid sample
- 236 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-007 (Continued)
State/Educational Agency(s):
Southern Arkansas University
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
84.007 – Federal Supplemental Educational Opportunity Grants
84.063 – Federal Pell Grant Program
84.268 – Federal Direct Student Loans
(Student Financial Assistance Cluster)
Federal Awarding Agency:
U.S. Department of Education
Federal Award Number(s):
P007A190194
(Federal Supplemental Educational Opportunity Grants)
P063P191087
(Federal Pell Grant Program)
P268K201087
(Federal Direct Student Loans)
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Eligibility
Type of Finding:
Noncompliance and Significant Deficiency
Questioned Costs:
Known - $7,357 in Pell, $6,500 in FSEOG, $16,052 in Direct Loans
Projected - $7,335,235
Cause:
The University’s method for evaluating SAP did not always follow its policies and procedures, and the University’s SAP
appeals policies and procedures were inadequate.
Effect:
In the absence of established controls to ensure compliance with established SAP policies and procedures and federal
regulations, two ineligible students received Title IV, HEA program funds.
Recommendation:
ALA staff recommend the University establish and implement a process to consider and approve or deny appeals that
students make after the University determines they are not eligible for federal financial assistance because they do not
comply with its SAP policy. This process should include documenting and retaining the rationale for approving appeals.
Additionally, ALA staff recommend the University enhance controls to ensure adherence to its SAP policies and
procedures and compliance with federal regulations. The University should consult the U.S. Department of Education
for resolution regarding this matter.
Views of Responsible Officials and Planned Corrective Action:
The University will update the satisfactory academic progress (SAP) policy, provide additional written explanation of
the process and increase the academic plan documentation during the SAP appeal process.
Anticipated Completion Date:
August 10, 2021
Contact Person:
Marcela Brunson
Financial Aid Director
Southern Arkansas University
100 E University MSC 9403
Magnolia, AR 71753
870-235-4023
mdbrunson@saumag.edu
- 237 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-008
State/Educational Agency(s):
Southern Arkansas University
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
84.063 – Federal Pell Grant Program
84.268 – Federal Direct Student Loans
(Student Financial Assistance Cluster)
Federal Awarding Agency:
U.S. Department of Education
Federal Award Number(s):
P063P191087
(Federal Pell Grant Program)
P268K201087
(Federal Direct Student Loans)
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Reporting
Type of Finding:
Noncompliance and Significant Deficiency
Auditee reported status as of June 30, 2021: Partially Corrected – In Progress. Additional staff has been added
to ensure accuracy and reporting of disbursements.
Repeat Finding:
Not applicable
Criteria:
In accordance with 34 CFR § 668.164(a), Title IV funds are disbursed on the date that the institution (a) credits those
funds to the student’s account in the institution’s general ledger or any sub-ledger of the general ledger or (b) pays
those funds to the student directly. Title IV funds are disbursed even if the institution uses its own funds in advance of
receiving program funds from the Secretary of Education. Additionally, in accordance with CFR § 690.83, universities
are required to submit student disbursement data via the Common Origination and Disbursement System (COD) within
the required timeframe established by the Secretary, which is 15 days from the date of disbursement.
Condition and Context:
For 4 of 9 students tested, PELL disbursement dates recorded in the student ledgers differed from the disbursement
dates reported to the COD system. Variances between the disbursed dates in the students’ accounts and the dates
reported in COD ranged from 5 to 86 days. For 6 of 7 students tested, Federal Direct Student Loan disbursement dates
recorded in the student ledgers differed from the disbursement dates reported to the COD system. Variances between
the disbursed dates in the students’ accounts and the dates reported in COD ranged from 1 to 70 days.
Additionally, for 9 of 9 students tested, Pell disbursements were not reported to COD within 15 days after the
disbursement; 4 disbursements were reported from 26 to 176 days late; and 5 disbursements had not been reported
as of report date. Upon further review and inquiry of management, ALA staff determined the University had not reported
$787,280 in Pell disbursements to COD as of December 9, 2020; therefore, funds were not available to be drawn down.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
None
Cause:
The University did not implement policies and procedures to ensure data related to disbursements of Title IV, HEA
program funds were reported in a timely and accurate manner. Additionally, internal controls were not sufficiently
designed to identify inaccuracies or disbursements not reported.
- 238 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-008 (Continued)
State/Educational Agency(s):
Southern Arkansas University
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
84.063 – Federal Pell Grant Program
84.268 – Federal Direct Student Loans
(Student Financial Assistance Cluster)
Federal Awarding Agency:
U.S. Department of Education
Federal Award Number(s):
P063P191087
(Federal Pell Grant Program)
P268K201087
(Federal Direct Student Loans)
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Reporting
Type of Finding:
Noncompliance and Significant Deficiency
Effect:
Failure to properly report information to COD increases the risk of material non-compliance with federal Student
Financial Aid program requirements and may result in rejection of all or part of the reported disbursement. Additionally,
late reporting of payment data delays federal reimbursements as federal funds cannot be drawn down until the
University has completed the reporting of payment data to the Department of Education.
Recommendation:
The University should perform procedures to correct and reconcile the COD system and students’ actual
disbursements. Additionally, the University should implement a control process in which the information provided to
COD and to the National Student Loan Data System (NSLDS) is complete and accurate and should also ensure that
monthly reconciliations are performed between the COD system and the University’s internal records.
Views of Responsible Officials and Planned Corrective Action:
The University will perform reconciliations between COD and internal records (i.e. student account ledgers and student
financial aid records) to ensure accuracy and timely reporting, within 15 days of disbursement. The University plans to
implement procedures to identify and correct variances in disbursement dates between student ledger information and
COD reporting regarding disbursement of funds. Additional staff has been added to complete reporting and create
internal controls in order to monitor and respond to discrepancies.
Anticipated Completion Date:
August 10, 2021
Contact Person:
Marcela Brunson
Financial Aid Director
Southern Arkansas University
100 E University MSC 9403
Magnolia, AR 71753
870-235-4023
mdbrunson@saumag.edu
- 239 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-009
State/Educational Agency(s):
Southern Arkansas University
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
84.425F – Higher Education Emergency Relief Fund (HEERF)
Institutional Portion
Federal Awarding Agency:
U.S. Department of Education
Federal Award Number(s):
P425F202725
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Allowable Costs/Cost Principles;
Period of Performance
Type of Finding:
Noncompliance and Significant Deficiency
Auditee reported status as of June 30, 2021: Corrective action was taken.
Repeat Finding:
Not applicable
Criteria:
In accordance with 2 CFR § 200.309, a non-federal entity may charge to the federal award only allowable costs incurred
during the period of performance and any costs incurred before the federal awarding agency or pass-through entity
made the federal award that were authorized by the federal awarding agency or pass-through entity. Institutions were
allowed to incur pre-award costs consistent with 2 CFR § 200.458 and 34 CFR § 75.263 from March 13, 2020, the
declaration of the national emergency due to the coronavirus, to the date of their HEERF grant award for their (a)(1)
Institutional Portion, as long as those expenditures would have been allowable if incurred after the date of the HEERF
grant award.
Condition and Context:
ALA staff selected 25 student and institutional costs for the HEERF program to ensure the costs charged were allowable
and incurred during the period of performance. Of the 25 selected, ALA noted 6 instances in which the costs were
incurred prior to March 13, 2020. In 5 of these instances, the payroll expense was dated March 20, 2020, but was for
work performed prior to March 13, 2020, and in 1 instance, the wireless upgrade purchase was incurred prior to March
13, 2020. After further review and discussion with management, ALA determined all costs related to the March 20,
2020, payroll and all wireless upgrade expenditures were incurred before March 13, 2020. As a result, ALA determined
a total of $250,935 in Institutional Portion costs were incurred outside the period of performance.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
$250,935
Cause:
The University’s internal controls were not sufficient to ensure that pre-award costs charged to the HEERF program
were incurred within the allowable period.
Effect:
Expenditures charged to a federal award that were not incurred during the authorized period of performance could be
subject to disallowance by the federal awarding agency.
Recommendation:
ALA staff recommend the University design and implement controls to ensure that costs are incurred within the
allowable period of the federal award.
- 240 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-009 (Continued)
State/Educational Agency(s):
Southern Arkansas University
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
84.425F – Higher Education Emergency Relief Fund (HEERF)
Institutional Portion
Federal Awarding Agency:
U.S. Department of Education
Federal Award Number(s):
P425F202725
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Allowable Costs/Cost Principles;
Period of Performance
Type of Finding:
Noncompliance and Significant Deficiency
Views of Responsible Officials and Planned Corrective Action:
HEERF funds were limited to the beginning of the declaration of the national emergency on March 13, 2020. Items
previously reported as allowable expenditures prior to this date were removed and all quarter and annual reports were
updated.
Anticipated Completion Date:
February 5, 2021
Contact Person:
Shawana Reed
VP for Finance
Southern Arkansas University
100 E University MSC 9403
Magnolia, AR 71753
870-235-5008
srreed@saumag.edu
- 241 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-010
State/Educational Agency(s):
Arkansas Tech University
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
84.007 – Federal Supplemental Educational Opportunity Grants
84.033 – Federal Work Study Program
84.063 – Federal Pell Grant Program
84.268 – Federal Direct Student Loans
(Student Financial Assistance Cluster)
Federal Awarding Agency:
U.S. Department of Education
Federal Award Number(s):
Various
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Special Tests and Provisions
Type of Finding:
Noncompliance and Significant Deficiency
Auditee reported status as of June 30, 2021:
Views of Responsible Officials and Planned Corrective Action: (Finding 1): Partially corrected. In response to
the Arkansas Legislative Audit GLBA Findings, Arkansas Tech University is reporting this finding as "Partially
Corrected" A Risk Assessment, as indicated by the recommendation, was completed by Fin-Aid (Mrs. Niki Schwartz),
and the Information Security Officer (Mr. Chris Moss) between June 9 and June 28 and the Director of the Office of
Information Systems and Chief Information Officer (Mr. Ken Wester) also reviewed that combined document and made
additional comments and suggestions. The assessment was conducted using the Educause HEISC template (which
is a compilation of NIST-800-53 and CIS Top 20 Controls). An internal evaluation score of 2.97 was asserted out of a
possible score of 5. We are in the process of identifying the risks levels (no criticals) and addressing those within Fin-
Aid, IT, and the University.
This is marked partially completed due to the additional indicators in the finding recommendation "The GLBA risk
assessment must include a clear identification of any foreseeable threats (done), a full assessment of the likelihood of
such threats and the damage they can do, and the Universities mitigation efforts of potential foreseeable risks."
The risk assessment template should be performed in two stages: the functional area's initial self-assessment and the
information security office. Input is provided on how they see the maturity of the items within the template for that unit,
and from that review, a more comprehensive investigation may be required of the items identified as low maturity (or
needing work).
After that review is complete, the review team would then enter stage 2, which is reviewing the low maturity items and
their specific risks to the area under review. Afterward, they would identify any mitigation steps, processes, or controls
that would raise the maturity level and lower the inherent risk of that item. Estimated completion August 31, 2021.
Repeat Finding:
Not applicable
Criteria:
The Gramm-Leach-Bliley Act (GLBA) and 16 C.F.R § 314.4 require financial institutions to develop, implement, and
maintain an information security program that includes a risk assessment over employee training and management to
facilitate the design and implementation of appropriate safeguards to students' financial aid information.
Condition and Context:
During the audit period, the University disbursed $53,952,672 in federal financial assistance subject to this requirement
and did not conduct a risk assessment as required.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
Not applicable
- 242 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-010 (Continued)
State/Educational Agency(s):
Arkansas Tech University
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
84.007 – Federal Supplemental Educational Opportunity Grants
84.033 – Federal Work Study Program
84.063 – Federal Pell Grant Program
84.268 – Federal Direct Student Loans
(Student Financial Assistance Cluster)
Federal Awarding Agency:
U.S. Department of Education
Federal Award Number(s):
Various
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Special Tests and Provisions
Type of Finding:
Noncompliance and Significant Deficiency
Cause:
The University did not develop internal controls to monitor grant requirements. As a result, the required risk assessment
was not performed to protect students' financial aid information.
Effect:
Student information was more susceptible to unauthorized disclosure, misuse, alteration, destruction, or other
compromise because risks could exist for which safeguards have not been designed and implemented.
Recommendation:
ALA staff recommend the University conduct a risk assessment utilizing a standard risk assessment framework. The
GLBA risk assessment must include a clear identification of any foreseeable threats, a full assessment of the likelihood
of such threats and the damage they can do, and the University's efforts to mitigate potential foreseeable risks.
Views of Responsible Officials and Planned Corrective Action:
In response to the Arkansas Legislative Audit GLBA findings, Arkansas Tech University is preparing to conduct a risk
assessment of Financial Aid's office. This assessment will be completed on or before June 30, 2021. The office of
information security will be using NIST 800-171 as a guide to complete this assessment.
We are also investigating tools that we can use to perform network scans on specific VLANs on the network. We have
partnered with Palo Alto and Critical Start SOC monitoring service. We are using their Cortex XDR platform to monitor
campus networks, desktops continually, and servers. This service continuously profiles endpoints, network, and user
behavior to uncover stealth attacks.
Views of Responsible Officials and Planned Corrective Action (Continued):
Formal GLBA and FERPA training will be developed and conducted with the Financial Aid and Student Accounts office.
This training will be designed using information from the SANS Institute paper about the GLBA risk assessment and
legal counsel input. This training will be conducted yearly, with all new employees receiving training upon on-boarding.
The initial training will be developed and completed before July 1, 2021.
On January 7, Academic Affairs held a Professional Development seminar for faculty and staff. The office of information
security held an information security session covering HIPAA, FERPA, PII, GDPR, and work from home best practices.
The session was attended by 125 employees from across the campus.
Anticipated Completion Date:
July 1, 2021
Contact Person:
Laury Fiorello
Budget Director
Arkansas Tech University
215 West O St RCB406
Russellville, AR 72801
479-964-0821
lfiorello@atu.edu
- 243 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-004
State/Educational Agency(s):
University of Arkansas, Fayetteville
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
84.007 – Federal Supplemental Educational Opportunity Grants
84.033 – Federal Work Study Program
84.063 – Federal Pell Grant Program
84.268 – Federal Direct Student Loans
93.264 – Nurse Faculty Loan Program
(Student Financial Assistance Cluster)
Federal Awarding Agency:
U.S. Department of Education;
U.S. Department of Health and Human Services
Federal Award Number(s):
Various
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Special Tests and Provisions
Type of Finding:
Noncompliance and Significant Deficiency
Auditee reported status as of June 30, 2021: Partially corrected. In November 2020 UITS established a GLBA
risk assessment policy as well as adopted a standard SANS Institutes risk assessment framework modified for the
University environment including the addition of physical and insider threat risk evaluation criteria. While an actual risk
assessment was not completed prior to calendar year end, a risk assessment of the Financial Aid Group was completed
June 30, 2021, and available to the legislative audit team for review and feedback. The official 2021 GLBA Risk
assessment will be completed in November 2021.
Repeat Finding:
Not applicable
Criteria:
The Gramm-Leach-Bliley Act (GLBA) and 16 C.F.R § 314.4 require financial institutions to develop, implement, and
maintain an information security program that includes a risk assessment over employee training and management to
facilitate the design and implementation of appropriate safeguards to students’ financial aid information.
Condition and Context:
During the audit period, the University disbursed $127,201,923 in federal financial assistance subject to this
requirement and did not conduct a risk assessment as required.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
None
Cause:
The University did not conduct a risk assessment, as required by 16 C.F.R § 314.4b, to identify reasonably foreseeable
internal and external risks to the security, confidentiality, and integrity of customer information.
Effect:
Student financial information was more susceptible to unauthorized disclosure, misuse, alteration, destruction, or other
compromise because risks could exist for which safeguards have not been designed and implemented.
Recommendation:
ALA staff recommend the University conduct a risk assessment utilizing a standard risk assessment framework. The
GLBA risk assessment must include a clear identification of any foreseeable threats, a full assessment of the likelihood
of such threats and potential damage, and the University’s efforts to mitigate potential foreseeable risks.
Views of Responsible Officials and Planned Corrective Action:
We agree. In November 2020 UITS established a GLBA risk assessment policy as well as adopted a standard SANS
Institutes risk assessment framework modified for the University environment including the addition of physical and
- 244 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-004 (Continued)
State/Educational Agency(s):
University of Arkansas, Fayetteville
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
84.007 – Federal Supplemental Educational Opportunity Grants
84.033 – Federal Work Study Program
84.063 – Federal Pell Grant Program
84.268 – Federal Direct Student Loans
93.264 – Nurse Faculty Loan Program
(Student Financial Assistance Cluster)
Federal Awarding Agency:
U.S. Department of Education;
U.S. Department of Health and Human Services
Federal Award Number(s):
Various
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Special Tests and Provisions
Type of Finding:
Noncompliance and Significant Deficiency
Views of Responsible Officials and Planned Corrective Action (continued):
insider threat risk evaluation criteria. While an actual risk assessment was not completed prior to calendar year end, a
risk assessment of the Financial Aid Group will be completed by June 30, 2021. Once completed, it will be provided to
Legislative Audit for review and feedback. The official 2021 GLBA Risk assessment will be completed in November
2021.
Views of Responsible Officials and Planned Corrective Action (Continued):
Anticipated Completion Date:
A risk assessment of the Financial Aid Group will be completed by June 30, 2021.
Once completed, it will be provided to Legislative Audit for review and feedback.
The official 2021 GLBA Risk assessment will be completed in November 2021.
Contact Person:
Steve Krogull
Chief Information Officer, Associate Vice Chancellor
UAF Information Technology Services
1 University of Arkansas
Fayetteville, AR 72701
479-718-3314
skrogull@uark.edu
- 245 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-011
State/Educational Agency(s):
Arkansas Northeastern College
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
84.063 – Federal Pell Grant Program
(Student Financial Assistance Cluster)
Federal Awarding Agency:
U.S. Department of Education
Federal Award Number(s):
Unknown
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Special Tests and Provisions
Type of Finding:
Noncompliance and Significant Deficiency
Auditee reported status as of June 30, 2021: Partially corrected. The College has performed a risk assessment
couple with a Capability Maturity Model to meet the requirements identified in the recommendation. Additionally, the
College has developed a standard set of policies and procedures to address the gaps and is in the process of
implementing those across our IT environment. Finally, the Risk Assessment/Capability Maturity Model findings have
been turned into a Statement of Work. The College has engaged with Cyberopz to close the identified gaps and
challenges identified in the Risk Assessment. The contract with Cyberopz was formalized on July 2, 2021.
Repeat Finding:
Not applicable
Criteria:
The Gramm-Leach-Bliley Act (GLBA) and 16 C.F.R § 314.4 require financial institutions to develop, implement, and
maintain an information security program that includes a risk assessment over employee training and management to
facilitate the design and implementation of appropriate safeguards to students’ financial aid information.
Condition and Context:
During the audit period, the College disbursed $2,321,923 in federal financial assistance subject to this requirement
and did not conduct a risk assessment as required.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
Not applicable
Cause:
The College did not develop internal controls to monitor grant requirements. As a result, the required risk assessment
was not performed to protect students’ financial aid information.
Effect:
Student information was more susceptible to unauthorized disclosure, misuse, alteration, destruction, or other
compromise because risks could exist for which safeguards have not been designed and implemented.
Recommendation:
ALA staff recommend the College conduct a risk assessment utilizing a standard risk assessment framework. The
GLBA risk assessment must include a clear identification of any foreseeable threats, a full assessment of the likelihood
of such threats and the damage they can do, and the College’s efforts to mitigate potential foreseeable risks.
- 246 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-011
State/Educational Agency(s):
Arkansas Northeastern College
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
84.063 – Federal Pell Grant Program
(Student Financial Assistance Cluster)
Federal Awarding Agency:
U.S. Department of Education
Federal Award Number(s):
Unknown
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Special Tests and Provisions
Type of Finding:
Noncompliance and Significant Deficiency
Views of Responsible Officials and Planned Corrective Action:
The College has performed a risk assessment coupled with a Capability Maturity Model to meet the requirements
identified in the recommendation. Additionally, the college has developed a standard set of policies and procedures to
address the gaps and is in the process of implementing those across our IT environment.
Finally, the risk assessment/capability maturity model findings have been turned into a Statement of Work for the
College to make the necessary purchases to close the identified gaps and challenges identified in the risk assessment.
It is currently in the process of preparing the bid for release in the next 60 days.
Anticipated Completion Date:
The Risk Assessment was completed on 2/11/2021.
Views of Responsible Officials and Planned Corrective Action (Continued):
Contact Person:
James W. McClain
Vice President Information Technology/Student Affairs
Arkansas Northeastern College
2501 S Division
Blytheville, AR 72315
870-762-3133
jmcclain@smail.anc.edu
- 247 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-012
State/Educational Agency(s):
Arkansas State University Three Rivers
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
84.007 – Federal Supplemental Educational Opportunity Grants
84.033 – Federal Work Study Program
84.063 – Federal Pell Grant Program
84.268 – Federal Direct Student Loans
(Student Financial Assistance Cluster)
Federal Awarding Agency:
U.S. Department of Education
Federal Award Number(s):
Various
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Special Tests and Provisions
Type of Finding:
Noncompliance and Significant Deficiency
Auditee reported status as of June 30, 2021: Partially Corrected. The Associate Vice Chancellor for Information
Technology has compiled a draft risk assessment that outlines risks associated with the GLBA, controls, and mitigation
strategies in use at the College. The College anticipates final completion of the risk assessment document by 11/30/21.
An Information Security Awareness Training Session has been developed which contains best practices for securing
sensitive information, as well as providing examples of common phishing and data harvesting tactics. This training is
scheduled to take place on 8/10/21 during the College’s Fall In-Service Meeting; which all employees are required to
attend.
Repeat Finding:
Not applicable
Criteria:
The Gramm-Leach-Bliley Act (GLBA) and 16 C.F.R § 314.4 require financial institutions to develop, implement, and
maintain an information security program that includes a risk assessment over employee training and management to
facilitate the design and implementation of appropriate safeguards to students’ financial aid information.
Condition and Context:
During the audit period, the University disbursed $3,738,828 in federal financial assistance subject to this requirement
and did not conduct a risk assessment as required.
Statistically Valid Sample:
Not a statistically valid sample
Questioned Costs:
Not applicable
Cause:
The University did not develop internal controls to monitor grant requirements. As a result, the required risk assessment
was not performed to protect students’ financial aid information.
Effect:
Student information was more susceptible to unauthorized disclosure, misuse, alteration, destruction, or other
compromise because risks could exist for which safeguards have not been designed and implemented.
Recommendation:
ALA staff recommend the University conduct a risk assessment utilizing a standard risk assessment framework. The
GLBA risk assessment must include a clear identification of any foreseeable threats, a full assessment of the likelihood
of such threats and the damage they can do, and the University’s efforts to mitigate potential foreseeable risks.
- 248 -
State of Arkansas
Summary Schedule of Prior Audit Findings
For the Year Ended June 30, 2021
2020 Prior Year Finding Number:
2020-012 (Continued)
State/Educational Agency(s):
Arkansas State University Three Rivers
Pass-Through Entity:
Not Applicable
CFDA Number(s) and Program Title(s):
84.007 – Federal Supplemental Educational Opportunity Grants
84.033 – Federal Work Study Program
84.063 – Federal Pell Grant Program
84.268 – Federal Direct Student Loans
(Student Financial Assistance Cluster)
Federal Awarding Agency:
U.S. Department of Education
Federal Award Number(s):
Various
Federal Award Year(s):
2020
Compliance Requirement(s) Affected:
Special Tests and Provisions
Type of Finding:
Noncompliance and Significant Deficiency
Views of Responsible Officials and Planned Corrective Action:
The College concurs with the finding, and will conduct an information security risk assessment based on GLBA
guidelines. The risk assessment will be performed by the Associate Vice Chancellor for Information Technology and
will help determine procedures needed to improve internal controls. Additionally, an information security training course
will be implemented by the AVC for IT. Appropriate staff will attend this required training in order to become familiar
with the regulations under GLBA.
Anticipated Completion Date:
An Information Security course for employee training will be established and
required for all College employees in 2021.
Contact Person:
James R. White
Vice Chancellor for Finance and Administration
Arkansas State University Three Rivers
One College Circle
Malvern, AR 72104
501-332-0252
jwhite@asutr.edu
- 249 -
St at e of Arkansas Single Audit
____________________________________________________________________________________________________
Audit St at us for Unresolved Prior Audit Findings
For t he Year Ended June 30, 2021
___________________________________________
State of Arkansas
Audit Status for Unresolved Prior Audit Findings
For the Year Ended June 30, 2021
- 250 -
In accordance with 2 CFR § 200.514(e), the auditor must follow-up on prior audit findings, perform procedures to
assess the reasonableness of the Summary Schedule of Prior Audit Findings prepared by the auditee. If the auditor
concludes that the Summary Schedule of Prior Audit Findings materially misrepresents the actual status of any prior
audit finding, the auditor must report a current-year finding. The audit status document begins on page 251.
Financial Statement Findings
Page Number(s)
Division of Workforce Services
251
Federal Program Name
Page Number(s)
Unemployment Insurance
251
Student Financial Assistance Cluster
251 - 253
COVID-19: Education Stabilization Fund – CARES Act
(Higher Education Emergency Relief Fund (HEERF)
Institutional Portion)
253
Adoption Assistance
254
Medicaid Cluster
254 - 262
Children’s Health Insurance Program
254 - 256; 259
State of Arkansas
Audit Status for Unresolved Prior Audit Findings
For the Year Ended June 30, 2021
- 251 -
State/Educational Agency:
Arkansas Department Commerce – Division of Workforce Services
Federal Program Name:
N/A – Financial Statement Finding
Prior Audit Finding Number:
2020-001
Page Number (from schedule):
154 - 155
Federal Awarding Agency:
N/A
Compliance Area Affected:
N/A
Questioned Costs:
None
Status of Questioned Costs:
Not applicable
Status of Finding:
Corrective action has not been taken.
A similar issue is reported in current-year finding 2021-001.
State/Educational Agency:
Arkansas Department Commerce – Division of Workforce Services
Federal Program Name:
Unemployment Insurance
Prior Audit Finding Number:
2020-002
Page Number (from schedule):
156 - 158
Federal Awarding Agency:
U.S. Department of Labor
Compliance Area Affected:
Allowable Costs/Cost Principles;
Eligibility
Questioned Costs:
$42,499
Status of Questioned Costs:
Recoupment not required.
Status of Finding:
Partial corrective action taken.
Similar deficiencies are reported in current-year finding 2021-004.
State/Educational Agency:
Arkansas Department Commerce – Division of Workforce Services
Federal Program Name:
Unemployment Insurance
Prior Audit Finding Number:
2020-003
Page Number (from schedule):
159 - 160
Federal Awarding Agency:
U.S. Department of Labor
Compliance Area Affected:
Allowable Costs/Cost Principles;
Eligibility
Questioned Costs:
$103,438
Status of Questioned Costs:
Recoupment not required.
Status of Finding:
Corrective action has not been taken.
Similar deficiencies are reported in current-year finding 2021-006.
State/Educational Agency:
University of Arkansas, Fayetteville
Federal Program Name:
Student Financial Assistance Cluster
Prior Audit Finding Number:
2020-004
Page Number (from schedule):
244 - 245
Federal Awarding Agency:
U.S. Department of Education;
U.S. Department of Health and Human Services
Compliance Area Affected:
Special Tests and Provisions
Questioned Costs:
None
Status of Questioned Costs:
Not applicable
Status of Finding:
Corrected
State of Arkansas
Audit Status for Unresolved Prior Audit Findings
For the Year Ended June 30, 2021
- 252 -
State/Educational Agency:
Henderson State University
Federal Program Name:
Student Financial Assistance Cluster
Prior Audit Finding Number:
2020-005
Page Number (from schedule):
232 - 233
Federal Awarding Agency:
U.S. Department of Education
Compliance Area Affected:
Activities Allowed or Unallowed
Questioned Costs:
Unknown
Status of Questioned Costs:
Not applicable
Status of Finding:
Corrected
State/Educational Agency:
Southern Arkansas University
Federal Program Name:
Student Financial Assistance Cluster
Prior Audit Finding Number:
2020-006
Page Number (from schedule):
234 - 235
Federal Awarding Agency:
U.S. Department of Education
Compliance Area Affected:
Activities Allowed or Unallowed
Questioned Costs:
Unknown
Status of Questioned Costs:
Not applicable
Status of Finding:
Corrected
State/Educational Agency:
Southern Arkansas University
Federal Program Name:
Student Financial Assistance Cluster
Prior Audit Finding Number:
2020-007
Page Number (from schedule):
236 - 237
Federal Awarding Agency:
U.S. Department of Education
Compliance Area Affected:
Eligibility
Questioned Costs:
$29,909
Status of Questioned Costs:
Unknown
Status of Finding:
Partial corrective action taken.
The University did not provide information indicating its SAP appeals process
was revised.
State/Educational Agency:
Southern Arkansas University
Federal Program Name:
Student Financial Assistance Cluster
Prior Audit Finding Number:
2020-008
Page Number (from schedule):
238 - 239
Federal Awarding Agency:
U.S. Department of Education
Compliance Area Affected:
Reporting
Questioned Costs:
None
Status of Questioned Costs:
Not applicable
Status of Finding:
Partial corrective action taken.
The University did not provide information indicating that procedures had been
implemented to ensure accurate and timely reporting or that monthly
reconciliations are being performed.
State of Arkansas
Audit Status for Unresolved Prior Audit Findings
For the Year Ended June 30, 2021
- 253 -
State/Educational Agency:
Southern Arkansas University
Federal Program Name:
Higher Education Emergency Relief Fund (HEERF)
Institutional Portion
Prior Audit Finding Number:
2020-009
Page Number (from schedule):
240 - 241
Federal Awarding Agency:
U.S. Department of Education;
Compliance Area Affected:
Allowable Costs/Cost Principles;
Period of Performance
Questioned Costs:
$250,935
Status of Questioned Costs:
Recoupment not required.
Status of Finding:
Corrected
State/Educational Agency:
Arkansas Tech University
Federal Program Name:
Student Financial Assistance Cluster
Prior Audit Finding Number:
2020-010
Page Number (from schedule):
242 - 243
Federal Awarding Agency:
U.S. Department of Education
Compliance Area Affected:
Special Tests and Provisions
Questioned Costs:
Not applicable
Status of Questioned Costs:
Not applicable
Status of Finding:
Corrected
State/Educational Agency:
Arkansas Northeastern College
Federal Program Name:
Student Financial Assistance Cluster
Prior Audit Finding Number:
2020-011
Page Number (from schedule):
246 - 247
Federal Awarding Agency:
U.S. Department of Education
Compliance Area Affected:
Special Tests and Provisions
Questioned Costs:
Not applicable
Status of Questioned Costs:
Not applicable
Status of Finding:
Corrected
State/Educational Agency:
Arkansas State University Three Rivers
Federal Program Name:
Student Financial Assistance Cluster
Prior Audit Finding Number:
2020-012
Page Number (from schedule):
248 - 249
Federal Awarding Agency:
U.S. Department of Education
Compliance Area Affected:
Special Tests and Provisions
Questioned Costs:
Not applicable
Status of Questioned Costs:
Not applicable
Status of Finding:
Corrected
State of Arkansas
Audit Status for Unresolved Prior Audit Findings
For the Year Ended June 30, 2021
- 254 -
State/Educational Agency:
Arkansas Department of Human Services
Federal Program Name:
Adoption Assistance
Prior Audit Finding Number:
2020-013
Page Number (from schedule):
161 - 162
Federal Awarding Agency:
U.S. Department of Health and Human Services
Compliance Area Affected:
Eligibility
Questioned Costs:
$14,077
Status of Questioned Costs:
Outstanding
Resolution has not been provided by the federal awarding agency regarding
recoupment status.
Status of Finding:
Corrected
State/Educational Agency:
Arkansas Department of Human Services
Federal Program Name:
Children’s Health Insurance Program;
Medicaid Cluster
Prior Audit Finding Number:
2020-014
Page Number (from schedule):
163 - 164
Federal Awarding Agency:
U.S. Department of Health and Human Services
Compliance Area Affected:
Allowable Costs/Cost Principles
Questioned Costs:
$72,686 (Medicaid Cluster)
Unknown (CHIP)
Status of Questioned Costs:
Recoupment of $72,686 was processed.
CMS considers this finding closed as of September 2021.
Status of Finding:
Noncompliance continued for the year ended June 30, 2021.
See current-year finding 2021-034.
Similar deficiencies were also reported in our June 30, 2019, report (2019-014).
State/Educational Agency:
Arkansas Department of Human Services
Federal Program Name:
Children’s Health Insurance Program;
Medicaid Cluster
Prior Audit Finding Number:
2020-015
Page Number (from schedule):
165 - 167
Federal Awarding Agency:
U.S. Department of Health and Human Services
Compliance Area Affected:
Allowable Costs/Cost Principles -
Managed Care Medical Loss Ratio (PASSE and Dental)
Questioned Costs:
None
Status of Questioned Costs:
Not applicable
Status of Finding:
Corrected
State of Arkansas
Audit Status for Unresolved Prior Audit Findings
For the Year Ended June 30, 2021
- 255 -
State/Educational Agency:
Arkansas Department of Human Services
Federal Program Name:
Children’s Health Insurance Program;
Medicaid Cluster
Prior Audit Finding Number:
2020-016
Page Number (from schedule):
168 - 170
Federal Awarding Agency:
U.S. Department of Health and Human Services
Compliance Area Affected:
Allowable Costs/Cost Principles -
Managed Care Medical Loss Ratio (PASSE and Dental)
Questioned Costs:
Unknown
Status of Questioned Costs:
Not applicable
Status of Finding:
CMS considers this finding closed as of September 2021.
However, noncompliance continued for the year ended June 30, 2021.
See current-year finding 2021-023.
State/Educational Agency:
Arkansas Department of Human Services
Federal Program Name:
Children’s Health Insurance Program;
Medicaid Cluster
Prior Audit Finding Number:
2020-017
Page Number (from schedule):
171 - 172
Federal Awarding Agency:
U.S. Department of Health and Human Services
Compliance Area Affected:
Matching, Level of Effort, Earmarking
Questioned Costs:
Unknown
Status of Questioned Costs:
Not applicable
Status of Finding:
Noncompliance continued for the year ended June 30, 2021.
See current-year finding 2021-024.
CMS is awaiting a response from the Agency as of September 2021 and will
continue to monitor this finding. An update was expected by December 31, 2021.
Similar deficiencies were also reported in our June 30, 2019, report (2019-017).
State/Educational Agency:
Arkansas Department of Human Services
Federal Program Name:
Children’s Health Insurance Program
Prior Audit Finding Number:
2020-018
Page Number (from schedule):
173 - 176
Federal Awarding Agency:
U.S. Department of Health and Human Services
Compliance Area Affected:
Activities Allowed or Unallowed -
Managed Care (PASSE)
Questioned Costs:
$94,715
Status of Questioned Costs:
Repayment of $158,410 was processed.
Status of Finding:
Corrected
State of Arkansas
Audit Status for Unresolved Prior Audit Findings
For the Year Ended June 30, 2021
- 256 -
State/Educational Agency:
Arkansas Department of Human Services
Federal Program Name:
Children’s Health Insurance Program
Prior Audit Finding Number:
2020-019
Page Number (from schedule):
177 - 179
Federal Awarding Agency:
U.S. Department of Health and Human Services
Compliance Area Affected:
Special Tests and Provisions -
Provider Eligibility (Fee-for-Service)
Questioned Costs:
$20,710
Status of Questioned Costs:
Outstanding
CMS considers this finding closed as of November 2, 2021. However, CMS did
not provide clarification regarding recoupment of questioned costs.
Status of Finding:
Noncompliance continued for the year ended June 30, 2021.
See current-year finding 2021-029.
Similar deficiencies were also reported in our June 30, 2019, report (2019-006).
State/Educational Agency:
Arkansas Department of Human Services
Federal Program Name:
Children’s Health Insurance Program
Prior Audit Finding Number:
2020-020
Page Number (from schedule):
180 - 183
Federal Awarding Agency:
U.S. Department of Health and Human Services
Compliance Area Affected:
Special Tests and Provisions -
Provider Eligibility (Managed Care Organization)
Questioned Costs:
Unknown
Status of Questioned Costs:
Not applicable
Status of Finding:
CMS considers this finding closed as of November 2, 2021.
However, noncompliance continued for the year ended June 30, 2021.
See current-year finding 2021-030.
Similar deficiencies were also reported in our June 30, 2019, report (2019-007).
State/Educational Agency:
Arkansas Department of Human Services
Federal Program Name:
Medicaid Cluster
Prior Audit Finding Number:
2020-021
Page Number (from schedule):
184 - 187
Federal Awarding Agency:
U.S. Department of Health and Human Services
Compliance Area Affected:
Activities Allowed or Unallowed –
Home and Community-Based Services
(AR Choices)
Questioned Costs:
$197,344
Status of Questioned Costs:
Repayment totaling $197,343, was processed.
Status of Finding:
CMS considers this finding closed as of September 2021.
However, noncompliance continued for the year ended June 30, 2021.
See current-year finding 2020-031.
Similar deficiencies were also reported in our June 30, 2019, report (2019-011).
State of Arkansas
Audit Status for Unresolved Prior Audit Findings
For the Year Ended June 30, 2021
- 257 -
State/Educational Agency:
Arkansas Department of Human Services
Federal Program Name:
Medicaid Cluster
Prior Audit Finding Number:
2020-022
Page Number (from schedule):
188 - 191
Federal Awarding Agency:
U.S. Department of Health and Human Services
Compliance Area Affected:
Activities Allowed or Unallowed –
Managed Care (PASSE)
Questioned Costs:
$108,960
Status of Questioned Costs:
Repayment totaling $108,960 was processed.
Status of Finding:
Corrected
State/Educational Agency:
Arkansas Department of Human Services
Federal Program Name:
Medicaid Cluster
Prior Audit Finding Number:
2020-023
Page Number (from schedule):
192 - 194
Federal Awarding Agency:
U.S. Department of Health and Human Services
Compliance Area Affected:
Eligibility
Questioned Costs:
$48,220
Status of Questioned Costs:
Repayment totaling $48,219 was processed.
Status of Finding:
Corrected
State/Educational Agency:
Arkansas Department of Human Services
Federal Program Name:
Medicaid Cluster
Prior Audit Finding Number:
2020-024
Page Number (from schedule):
195 - 196
Federal Awarding Agency:
U.S. Department of Health and Human Services
Compliance Area Affected:
Reporting
Questioned Costs:
$495,421
Status of Questioned Costs:
Outstanding
CMS will continue to monitor this finding and was expecting an update from the
Agency by December 30, 2021.
Status of Finding:
Corrected
State/Educational Agency:
Arkansas Department of Human Services
Federal Program Name:
Medicaid Cluster
Prior Audit Finding Number:
2020-025
Page Number (from schedule):
197 - 199
Federal Awarding Agency:
U.S. Department of Health and Human Services
Compliance Area Affected:
Special Tests and Provisions –
Capitation Payments Paid Subsequent to Recipient Death
Questioned Costs:
$7,239
Status of Questioned Costs:
Repayment totaling $7,239 was processed.
Status of Finding:
Corrective action had not been fully implemented as of the end of fieldwork,
November 16, 2021.
State of Arkansas
Audit Status for Unresolved Prior Audit Findings
For the Year Ended June 30, 2021
- 258 -
State/Educational Agency:
Arkansas Department of Human Services
Federal Program Name:
Medicaid Cluster
Prior Audit Finding Number:
2020-026
Page Number (from schedule):
200 - 203
Federal Awarding Agency:
U.S. Department of Health and Human Services
Compliance Area Affected:
Special Tests and Provisions –
Provider Eligibility (Fee-for-Service)
Questioned Costs:
$2,477,398
Status of Questioned Costs:
Outstanding
CMS considers this finding closed as of November 2, 2021. However, CMS did
not provide clarification regarding recoupment of questioned costs.
Status of Finding:
Noncompliance continued for the year ended June 30, 2021.
See current-year finding 2021.032.
Similar deficiencies were also reported in our June 30, 2019, report (2019-006).
State/Educational Agency:
Arkansas Department of Human Services
Federal Program Name:
Medicaid Cluster
Prior Audit Finding Number:
2020-027
Page Number (from schedule):
204 - 206
Federal Awarding Agency:
U.S. Department of Health and Human Services
Compliance Area Affected:
Special Tests and Provisions –
Provider Eligibility (Managed Care Organizations)
Questioned Costs:
Unknown
Status of Questioned Costs:
Not applicable
Status of Finding:
CMS considers this finding closed as of November 2, 2021.
However, noncompliance continued for the year ended June 30, 2021.
See current-year finding 2021-033.
Similar deficiencies were also reported in our June 30, 2019, report (2019-007).
State/Educational Agency:
Arkansas Department of Human Services
Federal Program Name:
Medicaid Cluster
Prior Audit Finding Number:
2020-028
Page Number (from schedule):
207 - 208
Federal Awarding Agency:
U.S. Department of Health and Human Services
Compliance Area Affected:
Special Tests and Provisions –
Utilization Control and Program Integrity and
Medicaid Fraud Control Unit
Questioned Costs:
None
Status of Questioned Costs:
Not applicable
Status of Finding:
Corrected
State of Arkansas
Audit Status for Unresolved Prior Audit Findings
For the Year Ended June 30, 2021
- 259 -
State/Educational Agency:
Arkansas Department of Human Services
Federal Program Name:
Children’s Health Insurance Program;
Medicaid Cluster
Prior Audit Finding Number:
2019-006
Page Number (from schedule):
209 - 211
Federal Awarding Agency:
U.S. Department of Health and Human Services
Compliance Area Affected:
Special Tests and Provisions – Provider Eligibility (Fee-for-Service)
Questioned Costs:
CHIP - $1,046,663
Medicaid - $8,864,004
Status of Questioned Costs:
Recoupment not required
Status of Finding:
CMS considers this finding closed as of December 2020.
However, noncompliance continued for the year ended June 30, 2021.
See current-year findings 2021-029 (CHIP) and 2021-032 (Medicaid).
Similar deficiencies were also reported in our June 30, 2020, report (2020-019
(CHIP) and 2020-026 (Medicaid)).
State/Educational Agency:
Arkansas Department of Human Services
Federal Program Name:
Children’s Health Insurance Program;
Medicaid Cluster
Prior Audit Finding Number:
2019-007
Page Number (from schedule):
212 - 214
Federal Awarding Agency:
U.S. Department of Health and Human Services
Compliance Area Affected:
Special Tests and Provisions – Provider Eligibility (Managed Care Organizations)
Questioned Costs:
Unknown
Status of Questioned Costs:
Not applicable
Status of Finding:
CMS considers this finding closed as of December 2020.
However, noncompliance continued for the year ended June 30, 2021.
See current-year findings 2021-030 (CHIP) and 2021-033 (Medicaid).
Similar deficiencies were also reported in our June 30, 2020, report (2020-020
(CHIP) and 2020-027 (Medicaid)).
State/Educational Agency:
Arkansas Department of Human Services
Federal Program Name:
Medicaid Cluster
Prior Audit Finding Number:
2019-011
Page Number (from schedule):
215
Federal Awarding Agency:
U.S. Department of Health and Human Services
Compliance Area Affected:
Activities Allowed or Unallowed –
Home and Community-Based Services
(ARChoices Waiver)
Questioned Costs:
$279,488
Status of Questioned Costs:
Recouped
Status of Finding:
CMS considers this finding closed as of September 2021.
However, noncompliance continued for the year ended June 30, 2021.
See current-year finding 2021-031.
Similar deficiencies were also reported in our June 30, 2020, report (2020-021).
State of Arkansas
Audit Status for Unresolved Prior Audit Findings
For the Year Ended June 30, 2021
- 260 -
State/Educational Agency:
Arkansas Department of Human Services
Federal Program Name:
Medicaid Cluster
Prior Audit Finding Number:
2019-012
Page Number (from schedule):
216 - 217
Federal Awarding Agency:
U.S. Department of Health and Human Services
Compliance Area Affected:
Activities Allowed or Unallowed – Managed Care
Questioned Costs:
$58,894
Status of Questioned Costs:
Recouped
Status of Finding:
Corrected
State/Educational Agency:
Arkansas Department of Human Services
Federal Program Name:
Medicaid Cluster
Prior Audit Finding Number:
2019-014
Page Number (from schedule):
218 - 219
Federal Awarding Agency:
U.S. Department of Health and Human Services
Compliance Area Affected:
Allowable Costs and Cost Principles
Questioned Costs:
Unknown
Status of Questioned Costs:
Not applicable
Status of Finding:
CMS considers this finding closed as of December 2020.
However, noncompliance continued for the year ended June 30, 2021.
See current-year finding 2021-034.
Similar deficiencies were also reported in our June 30, 2020, report (2020-014).
State/Educational Agency:
Arkansas Department of Human Services
Federal Program Name:
Medicaid Cluster
Prior Audit Finding Number:
2019-016
Page Number (from schedule):
220 - 222
Federal Awarding Agency:
U.S. Department of Health and Human Services
Compliance Area Affected:
Eligibility
Questioned Costs:
State Fiscal Year 2019 – $35,952
State Fiscal Year 2018 – $3,648
State Fiscal Year 2017 – $76
State Fiscal Year 2016 – $193
State Fiscal Year 2015 – $362
State Fiscal Year 2014 – $71
Status of Questioned Costs:
Recoupment of $36,750 was processed.
Status of Finding:
Corrected
State of Arkansas
Audit Status for Unresolved Prior Audit Findings
For the Year Ended June 30, 2021
- 261 -
State/Educational Agency:
Arkansas Department of Human Services
Federal Program Name:
Medicaid Cluster
Prior Audit Finding Number:
2019-017
Page Number (from schedule):
223 - 224
Federal Awarding Agency:
U.S. Department of Health and Human Services
Compliance Area Affected:
Matching, Level of Effort, Earmarking
Questioned Costs:
Unknown
Status of Questioned Costs:
Not applicable
Status of Finding:
Noncompliance continued for the year ended June 30, 2021.
See current-year finding 2021-024.
A similar deficiency was also reported in our June 30, 2020, report (2020-017).
In addition, as of September 2021, CMS is awaiting support of the Agency’s fully
implemented new system.
State/Educational Agency:
Arkansas Department of Human Services
Federal Program Name:
Medicaid Cluster
Prior Audit Finding Number:
2019-018
Page Number (from schedule):
225 - 226
Federal Awarding Agency:
U.S. Department of Health and Human Services
Compliance Area Affected:
Reporting
Questioned Costs:
Unknown
Status of Questioned Costs:
Not applicable
Status of Finding:
Corrected
State/Educational Agency:
Arkansas Department of Human Services
Federal Program Name:
Medicaid Cluster
Prior Audit Finding Number:
2019-019
Page Number (from schedule):
227 - 228
Federal Awarding Agency:
U.S. Department of Health and Human Services
Compliance Area Affected:
Special Tests and Provisions –
Claims Paid Subsequent to Recipient Death
Questioned Costs:
State Fiscal Year 2019 – $1,411
State Fiscal Year 2018 – $443
State Fiscal Year 2017 – $183
State Fiscal Year 2016 – $141
State Fiscal Year 2015 – $37
Status of Questioned Costs:
Recoupment of $1,411 was processed.
Status of Finding:
Corrective action had not been fully implemented as of the end of fieldwork,
November 16, 2021.
CMS is also awaiting additional support.
State of Arkansas
Audit Status for Unresolved Prior Audit Findings
For the Year Ended June 30, 2021
- 262 -
State/Educational Agency:
Arkansas Department of Human Services
Federal Program Name:
Medicaid Cluster
Prior Audit Finding Number:
2019-021
Page Number (from schedule):
229
Federal Awarding Agency:
U.S. Department of Health and Human Services
Compliance Area Affected:
Special Tests and Provisions –
Utilization Control and Program Integrity and
Medicaid Fraud Control Unit
Questioned Costs:
None
Status of Questioned Costs:
Not applicable
Status of Finding:
Corrected
State/Educational Agency:
Arkansas Department of Human Services
Federal Program Name:
Medicaid Cluster
Prior Audit Finding Number:
2018-014
Page Number (from schedule):
N/A
Federal Awarding Agency:
U.S. Department of Health and Human Services
Compliance Area Affected:
Eligibility
Questioned Costs:
State Fiscal Year 2018 – $ 150,272
State Fiscal Year 2017 – $ 157,104
State Fiscal Year 2016 – $ 57,523
State Fiscal Year 2015 – $ 7,293
State Fiscal Year 2014 – $ 4,080
State Fiscal Year 2013 – $ 323
Status of Questioned Costs:
Repayment totaling $244,180 was processed.
Status of Finding:
Corrected
State/Educational Agency:
Arkansas Department of Human Services
Federal Program Name:
Medicaid Cluster
Prior Audit Finding Number:
2018-021
Page Number (from schedule):
230 - 231
Federal Awarding Agency:
U.S. Department of Health and Human Services
Compliance Area Affected:
Special Tests and Provisions –
Claims Paid Subsequent to Recipient Death
Questioned Costs:
State Fiscal Year 2015 – $ 38
State Fiscal Year 2016 – $ 106
State Fiscal Year 2017 – $ 2
State Fiscal Year 2018 – $2,736
Status of Questioned Costs:
Repayment totaling $1,869 was processed.
Status of Finding:
Corrected