Commonwealth of Virginia Department of Health Section 1864 - 1902 Survey and Certification Costs for Health Care Providers and Suppliers October 1, 1997 - September 30, 1999

EXECUTIVE SUMMARY:

This review points out that the Virginia Department of Health (VDH), Center for Quality Healthcare Services and Consumer Protection (the Center) utilized a reasonable methodology to allocate S&C costs to the Medicare and Medicaid certification, and State licensing programs and correctly applied the Federally approved indirect costs rates for FYs 1997-1999.  However, based on our examination and analysis of financial information, supporting documentation and other available evidence, we found that the Center: (1) claimed unallowable costs totaling $29,298 for the Medicare program in the first quarter of FY 1997 for the nurse aide program; (2) did not maintain adequate documentation to determine whether certain costs billed to VDH by the Virginia Department of Health Professions (DHP) for the nurse aide program were supportable, allowable, and accurate; and (3) did not obtain approval from CMS or the HHS Division of Cost Allocation (DCA) to implement a new cost allocation methodology for joint licensing and certification surveys conducted at long term care (LTC) facilities beginning in FY 2000.  We recommended that the Center: (1) refund $29,298 to the Medicare program for unallowable costs charged in FY 1997; (2) establish a process for assuring that the quarterly charges to the Federal programs for the nurse aide program are supportable, allowable, and accurate; and (3) obtain final CMS/DCA approval for the new cost sharing methodology for joint licensing and certification surveys conducted at LTC facilities implemented in FY 2000.