An Audit Report on the Health and Human Services Commission's Medicaid Managed Care Rate-Setting Process

Nepotism forms: 5 of 13 required nepotism forms were not obtained from contract team members prior to awarding the contract.

The Commission could enhance communication with oversight entities by explicitly addressing General Appropriations Act requirements in rate reports.

Contract team members did not consistently complete required certification and disclosure forms during vendor selection and procurement; missing nondisclosure and conflict-of-interest forms and nepotism forms.

AUP engagements and year-end reconciliations for MCO financial statements were not completed or audited timely; 2018-2021 AUPs were not completed before rate-setting and reconciliations sometimes occurred more than a year after year-end.

FSR data and related reconciliations were not consistently communicated to the Actuarial Analysis Department to inform rate-setting.

Rounding methodologies and the use of Data Analysis Unit analyses were not explicitly explained in rate communications to oversight entities.

Three of twelve required nondisclosure and conflict-of-interest certification forms were not obtained prior to receiving vendor proposals or participating in evaluation activities.

Develop and implement a process to consistently communicate the results of agreed-upon procedures engagements and year-end reconciliations of MCO financial statistical reports to the Actuarial Analysis Department.

Verify that all contract team members provide required certifications and disclosures (nondisclosure, conflict of interest, nepotism) before and during procurement activities.

Enhance communication with oversight entities by explicitly addressing rounding methodologies and whether analyses conducted by the Data Analysis Unit were pertinent to the rate-setting process.

Improve the timeliness and completeness of Financial Statistical Reports (FSRs) and related procedures, including ensuring AUPs are completed and audited on a timely basis.

Ensure that communications regarding rate-setting data and methodologies fully meet General Appropriations Act requirements.