COUNTY OF SUMMITLocal Government

U.S. Department of Health and Human Services Passed-through Colorado Department of Health Care Policy and Financing FFAL # 93.778 Medical Assistance Program Eligibility Significant Deficiency in Internal Control over Compliance and Noncompliance Criteria: The Federal requirement related to processing of an application requires the State to provide notice of its decision concerning eligibility and provide timely and adequate notice of the basis for denial or termination of assistance (42 USC 1320c-7(d)). According to the Colorado Department of Health Care Policy and Financing (HCPF), processing standards 8.100.3.D, the County is required to process an initial application for any program not requiring a disability determination no later than 45 days following receipt of application. Condition: We tested eligibility determination and controls over this process for sixty case files. We noted the following in our testing: • Two instances of non-compliance in which the County did not complete the eligibility determination and approve/deny the case within 45 days and no notice of action was sent to the client within the required timeframe. • Two instances of non-compliance in which the County it could not be verified whether the notice of action was sent to the client via mail or email Cause: Due to the County’s ineffective monitoring, eligibility determinations were not completed in a timely manner and within the 45-day deadline and cases were not notified if their benefits were approved/denied. Effect: Failure to process applications timely could result in participants that are delayed approval of Medicaid services. Failure to determine the appropriate eligibility will result in participants receiving benefits from the state in error. Questioned Costs: None reported Context/Sampling: A nonstatistical sample of 60 participants were selected for eligibility testing. Repeat Finding from Prior Year(s): Yes Recommendation: We recommend the County utilize available reports to determine which cases are nearing the exceeding processing guidelines. Further, we recommend the County strengthen its controls over how determination letters are sent.

Criteria: The Federal requirement related to processing of an application requires the State to provide notice of its decision concerning eligibility and provide timely and adequate notice of the basis for denial or termination of assistance (42 USC 1320c-7(d)). According to the Colorado Department of Health Care Policy and Financing (HCPF), processing standards 8.100.3.D, the County is required to process an initial application for any program not requiring a disability determination no later than 45 days following receipt of application. In addition, per the Code of Colorado Regulations, in order to be an eligible participant in the Medicaid program one must be a citizen of the United States and meet certain income guidelines. Condition: We tested eligibility determination and controls over this process for sixty case files. We noted the following in our testing: • One instance of non-compliance in which the County did not complete the eligibility determination and approve/deny the case within 45 days and no notice of action was sent to the client within the required timeframe. • Two instances of non-compliance in which the County did not ensure removal from the Medicaid program due to cases being ineligible, where eligibility is determined by a third party, because of over income or being undocumented. Cause: Due to the County’s ineffective monitoring, eligibility determinations were not completed in a timely manner and within the 45-day deadline and cases not removed from the program for being ineligible. Effect: Failure to process applications timely could result in participants that are delayed approval of Medicaid services. Failure to determine the appropriate eligibility will result in participants receiving benefits from the state in error. Questioned Costs: None reported Context/Sampling: A nonstatistical sample of 60 participants were selected for eligibility testing. Repeat Finding from Prior Year(s): No Recommendation: We recommend the County utilize available reports to determine which cases are nearing the exceeding processing guidelines. Further, we recommend the County strengthen its controls over approving cases as eligible.

U.S. Department of Treasury Passed-through the Colorado Department of Local Affairs FFAL #21.027 COVID 19 – Coronavirus State and Local Fiscal Recovery Funds Procurement Material Noncompliance Material Weakness in Internal Control Criteria: As a condition of receiving Federal awards, non-Federal entities agree to comply with laws, regulations, and the provisions of grant agreements and contracts, and to maintain internal control to provide reasonable assurance of compliance with these requirements. Prior to entering a covered transaction, a non-federal entity must ensure the vendor was not suspended, debarred, or otherwise excluded. A contract award must not be made to parties listed on the governmentwide exclusions in the System for Award Management (SAM), in accordance with the OMB guidelines at 2 CFR 180. Further, 2 CFR section Appendix II to Part 200, Contract Provisions for Non-Federal Entity Contracts Under Federal Awards states that in addition to other provisions required by the Federal agency or non-Federal entity, all contracts made by the non-Federal entity under the Federal award must contain certain provisions, as applicable. Finally, the procurement method used must be appropriate based on the dollar amount and conditions specified in 2 CFR section 200.320. The procurement file must contain evidence that supports the rationale for the method of procurement, selection of the contract type, basis for contractor selection, and basis of contract price. Condition: The County was not able to provide evidence that they verified the vendors used in the program were not suspended, debarred, or otherwise excluded prior to entering the contract for 2 of 2 vendors tested. The County also failed to provide certain provisions required by the Uniform Guidance in the contracts with both vendors specifically for the Davis Bacon Act and the Equal Employment Opportunity provisions. The County was not able to provide evidence to support the rationale for the method of procurement, for 1 of 2 vendors testing. This included whether the procurement method was appropriate, whether it provided for full and open competition, or if a cost/price analysis was performed. Cause: Due to the County’s failure to understand the procurement requirements the procurement files did not contain the required information to support compliance with the standards. Effect: Insufficient procedures and internal controls related to procurement resulted in a finding. 13 14 Summit County, Colorado Schedule of Findings and Questioned Costs Year Ended December 31, 2023 Questioned Costs: None to report Context/Sampling: The population consisted of 3 vendors, 2 of which were selected for procurement, suspension and debarment testing. Repeat Finding from Prior Year(s): No Recommendation: We recommend the County modify and strengthen its current policies and procedures to ensure documentation is retained regarding verification of vendor suspension/debarment, selection of procurement method in accordance with 2 CFR section 200.320 and that all applicable required provisions are communicated to contractors in accordance with 2 CFR Appendix II to Part 200. Views of Responsible Officials: Agree

U.S. Department of Treasury Passed-through the Colorado Department of Local Affairs FFAL #21.027 COVID-19 Coronavirus State and Local Fiscal Recovery Funds Subrecipient Monitoring Material Noncompliance Material Weakness in Internal Controls Criteria: Section 2 CFR 200.331 establishes the determination of whether there is a subrecipient or contractor of the federal award. The non-Federal entity may concurrently receive Federal awards as a recipient, a subrecipient, and a contractor, depending on the substance of its agreements with Federal awarding agencies and pass-through entities. Therefore, a passthrough entity must make case-by-case determinations whether each agreement it makes for the disbursement of Federal program funds casts the party receiving the funds in the role of a subrecipient or a contractor. The Federal awarding agency may supply and require recipients to comply with additional guidance to support these determinations provided such guidance does not conflict with this section. Once it is determined the recipient is a sub-recipient there are certain requirements for pass-through entities established in 2 CFR 200.332. Per 2 CFR 200.332, pass-through entities are responsible for informing subrecipients of the Federal award identifiers including but not limited to award date, period of performance and Federal awarding agency and Assistance Listing Number and title. Pass-through entities are required to assess the subrecipient’s risk of noncompliance with Federal statutes, regulations and the terms and conditions of the subaward. Further, the pass-through entity is required to perform certain monitoring activities to ensure the subaward is used for authorized purposes, in compliance with Federal statutes, regulations, and the terms and conditions of the subaward; and that subaward performance goals are achieved. Finally, the pass-through entity should also verify the subrecipient is audited as required by Subpart F - Audit Requirement under the Uniform Guidance. The monitoring policy should include an initial valuation of risk of noncompliance to determine the appropriate level of monitoring required related to the subaward as well as appropriate awarding documentation. Condition: The County did not appropriately identify two subrecipients of the grant and initially determined them to be contractors. The County failed to perform any subrecipient monitoring as required by the Uniform Guidance. Cause: Due to the County’s failure to understand the sub-recipient monitoring requirements, two of subawards were incorrectly identified as contractors and none of the required award and monitoring procedures were performed for the four subrecipients of the grant. Effect: Insufficient procedures and internal controls related to subrecipients resulted in noncompliance. Questioned Costs: No questioned costs were identified as a result of our procedures. 16 Summit County, Colorado Schedule of Findings and Questioned Costs Year Ended December 31, 2023 Context/Sampling: All four subrecipients were selected for subrecipient monitoring testing. Repeat Finding from Prior Years: No. Recommendation: We recommend that the County establish and adhere to policies and procedures, including internal controls, to ensure compliance with subrecipient monitoring requirements as established by 2 CFR 200.331 and 2 CFR 200.332. Views of Responsible Officials: Management agrees with the finding.

2022-002 U.S. Department of Treasury FFAL #21.032 COVID 19 - Local Assistance and Tribal Consistency Fund Reporting Significant Deficiency in Internal Control over Compliance Criteria: The Uniform Guidance, Section 200.303 Internal Controls, requires that the non-Federal entity must establish and maintain documentation of effective internal controls over Federal awards that provide reasonable assurance that awards are being managed in compliance with Federal statutes, regulations and the terms and conditions of the Federal award. Condition: We tested the annual report required to be submitted to the Treasury verifying compliance requirements and controls were in place. We noted the County did not submit the report by the required submission deadline. Cause: The County failed to ensure the internal controls surrounding compliance over the program?s reporting criteria was met. Effect: Untimely submission of reports to the Treasury. Questioned Costs: None to report Context/Sampling: There was one annual report due in the current reporting period, as such, no sampling required and 100% was tested. Repeat Finding from Prior Year(s): No Recommendation: We recommend the County ensure review and approval controls are in place to ensure all required reports are submitted timely. Views of Responsible Officials: Agree

2021-002 U.S. Department of Treasury FFAL #21.027 Coronavirus State and Local Fiscal Recovery Funds Reporting Significant Deficiency in Internal Control over Compliance Criteria: The Uniform Guidance, Section 200.303 Internal Controls, requires that the non-Federal entity must establish and maintain documentation of effective internal controls over Federal awards that provide reasonable assurance that awards are being managed in compliance with Federal statutes, regulations and the terms and conditions of the Federal award. Condition: We tested the interim report required to be submitted in the first year of the grant verifying compliance requirements and controls were in place. We noted the County used an incorrect date to begin the reporting period resulting in an incorrect amount reported for the interim report. Cause: Due to ineffective controls over reporting, the controls are not operating as designed to prevent, detect, and correct errors timely. Effect: Failure to review the correct reporting period could result in required reporting to be materially misstated. Questioned Costs: None reported Context/Sampling: There was one interim report due in the current reporting period, as such, no sampling required and 100% was tested. Report Finding from Prior Year(s): No Recommendation: We recommend the County ensure review and approval controls are in place to verify the correct reporting period. Views of Responsible Officials: Agree.

2021-003 U.S. Department of Treasury FFAL #21.027 Coronavirus State and Local Fiscal Recovery Funds Period of Performance Material Weakness in Internal Control over Compliance Criteria: The Uniform Guidance, Section 200.303 Internal Controls, requires that the non-Federal entity must establish and maintain documentation of effective internal controls over Federal awards that provide reasonable assurance that awards are being managed in compliance with Federal statutes, regulations and the terms and conditions of the Federal award. Condition: This is the first year of the grant with a beginning period of performance of March 3, 2021. Through an audit of the expenditure detail charged against the advance of federal funding, we noted the County included expenditures from January 1, 2021 instead of March 3, 2021. As a result, various transactions were included in the population prior to March 3, 2021. Cause: Due to ineffective monitoring over the period of performance, the controls are not operating as designed to prevent, detect, and correct errors timely. Effect: Failure to review the correct period of performance could result in allowable costs to be materially misstated and potentially require allowable costs to be returned to a granting agency. Questioned Costs: $323,017 Context/Sampling: After review of the grant agreement and population for allowable costs, the population prior to March 3, 2021 were excluded from the sampling population. Report Finding from Prior Year(s): No Recommendation: We recommend the County ensure review and approval controls are in place to verify the correct period of performance. Views of Responsible Officials: Agree.

Condition: We tested twelve participants for eligibility and allowable costs and activities. We noted the following in our testing: ? One instance in which the parent fee was incorrectly determined based on information maintained in case file. ? No quality control reviews were performed Cause: Due to the County?s ineffective monitoring, the error was a result of lack of review as the caseworker did not attach the parent fee to the participant?s case. Failure to properly review completed files resulted in the County maintaining incomplete applicationsEffect: In conjunction, the error ultimately lead to an incorrect parent fee. The incorrect parent fee assessed results in an incorrect allocation of federal dollars. Questioned Costs: $112 Context/Sampling: A nonstatistical sample of 12 participants out of approximately 75 were selected for eligibility and allowable cost testing. We tested the monthly parent fee for each participant to verify accuracy of the parent fee which reduces the federal portion of the monthly care costs. We tested a total of approximately $888 monthly parent fees charged to the 12 participants we selected. Repeat Finding from Prior Year(s): No Recommendation: We recommend the County implement trainings and require caseworkers to utilize the income calculation template to calculate income every time there is an adjustment to income. We also suggest they implement a checklist that a caseworker must complete prior to finalizing a case. Views of Responsible Officials: Agree.

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