Louisiana Legislative Auditor
Daryl G. Purpera, CPA, CFE

January 30, 2017

Department of Health Audit Shows Repeat Findings from Previous Years

An audit of the Louisiana Department of Health’s internal financial controls and compliance with federal regulations found several issues that remained unresolved from past years, the Legislative Auditor said in a report released today.

Auditors found that, for the second consecutive year, LDH failed to keep in place processes that allow the Department to identify and recover paid claims where a third party is liable to pay for medical services provided to a Medicaid-eligible recipient. In addition, for at least eight months of fiscal year 2016, LDH did not establish alternate procedures to pursue and recover previously identified instances of third-party liability, which the Department continued to report at more than $29 million.

For the second consecutive year as well, LDH failed to accurately complete the required quarterly reports of federal expenditures, including more than $250 million in errors that were not discovered before the reports were submitted to the federal oversight agency. The Department’s Office of Public Health (OPH) also did not implement cost containment requirements or adequately monitor the vendors for the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) program. Without the proper procedures in place, it is unknown how much of the $73 million in WIC food costs is at risk of noncompliance with program regulations.

In addition, for the second consecutive year, OPH did not adequately monitor WIC program subrecipients. Failure to properly monitor subrecipients could result in noncompliance with program requirements and increase the likelihood that the state may have to return funds to the federal grantor. The WIC program as a whole served an average of 128,000 participants each month with a total annual program cost of $104 million.

For the fifth consecutive year, auditors found that LDH paid New Opportunities Waiver and Community Choice Waiver claims under Medicaid totaling $13,989 ($8,703 in federal funds and $5,286 in state funds) for services that were not properly documented as required. Improper payments for waiver services have been reported in 14 of the last 17 audits, totaling $609,008.

LDH also did not have an adequate internal audit function in place to examine, evaluate, and report on its internal controls, including information systems, and to evaluate compliance with the policies and procedures that are necessary to maintain adequate controls.

For more information contact:
Daryl G. Purpera, CPA, CFE
Legislative Auditor


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