Administrative Code

Virginia Administrative Code
10/26/2021

Article 11. Audits

12VAC30-90-120. Audit overview; scope of audit.

Article 11
Audits

A. Desk audits shall be performed to verify the completeness and accuracy of the cost report, and reasonableness of costs claimed for reimbursement. Field audits, as determined necessary by DMAS, shall be performed on the records of each participating provider to determine that costs included for reimbursement were accurately determined and reasonable, and do not exceed the ceilings or other reimbursement limitations established by DMAS.

B. The scope of the audit includes, but shall not be limited to: trial balance verification, analysis of fixed assets, schedule of assets, indebtedness, selected revenues, leases and the underlying cost of ownership, rentals and other contractual obligations, and costs to related organizations. The audit scope may also include various other analyses and studies relating to issues and questions unique to the NF and identified by DMAS. Census and related statistics, patient trust funds, and billing procedures are also subject to audit.

Statutory Authority

§ 32.1-325 of the Code of Virginia and Item 319 (II) of Chapter 1073 of the 2000 Acts of Assembly.

Historical Notes

Derived from VR460-03-4.1940:1 Article 9, eff. October 1, 1990; amended, Virginia Register Volume 12, Issue 16, eff. July 1, 1996; Volume 17, Issue 18, eff. July 1, 2001.

12VAC30-90-121. Field audit requirements.

Field audits shall be required as follows:

1. For the first cost report on all new NF's.

2. For the first cost report in which costs for bed additions or other expansions are included.

3. When a NF is sold, purchased, or leased.

4. As determined by DMAS desk audit.

Statutory Authority

§ 32.1-325 of the Code of Virginia.

Historical Notes

Derived from Virginia Register Volume 12, Issue 16, eff. July 1, 1996.

12VAC30-90-122. Provider notification.

The provider shall be notified in writing of all adjustments to be made to a cost report resulting from desk or field audit with stated reasons and references to the appropriate principles of reimbursement or other appropriate regulatory cites.

Statutory Authority

§ 32.1-325 of the Code of Virginia.

Historical Notes

Derived from Virginia Register Volume 12, Issue 16, eff. July 1, 1996.

12VAC30-90-123. Field audit exit conference.

A. The provider shall be offered an exit conference to be executed within 15 days following completion of the on-site audit activities, unless other time frames are mutually agreed to by DMAS and the provider. Where two or more providers are part of a chain organization or under common ownership, DMAS shall have up to 90 days after completion of all related on-site audit activities to offer an exit conference for all such NFs. The exit conference shall be conducted at the site of the audit or at a location mutually agreeable to DMAS and the provider.

B. The purpose of the exit conference shall be to enable the DMAS auditor to discuss such matters as the auditor deems necessary, to review the proposed field audit adjustments, and to present supportive references. The provider will be given an opportunity during the exit conference to present additional documentation and agreement or disagreement with the audit adjustments.

C. All remaining adjustments, including those for which additional documentation is insufficient or not accepted by DMAS, shall be applied to the applicable cost report or reports regardless of the provider's approval or disapproval.

D. The provider shall sign an exit conference form that acknowledges the review of proposed adjustments.

E. After the exit conference DMAS shall perform a review of all remaining field audit adjustments. Within a reasonable time and after all documents have been submitted by the provider, DMAS shall transmit in writing to the provider a final field audit adjustment report (FAAR), if revised, which will include all remaining adjustments not resolved during the exit conference. The provider shall have 15 days from the date of the letter which transmits the FAAR, to submit any additional documentation which may affect adjustments in the FAAR.

Statutory Authority

§ 32.1-325 of the Code of Virginia and Item 319 (II) of Chapter 1073 of the 2000 Acts of Assembly.

Historical Notes

Derived from Virginia Register Volume 12, Issue 16, eff. July 1, 1996; amended, Virginia Register Volume 17, Issue 18, eff. July 1, 2001.

12VAC30-90-124. Audit delay.

In the event the provider delays or refuses to permit an audit to occur or to continue or otherwise interferes with the audit process, payments to the provider shall be reduced as stated in 12VAC30-90-70 B.

Statutory Authority

§ 32.1-325 of the Code of Virginia.

Historical Notes

Derived from Virginia Register Volume 12, Issue 16, eff. July 1, 1996.

12VAC30-90-125. Field audit time frames.

A. If a field audit is necessary after receipt of a complete cost report, such audit shall be initiated within three years following the date of the last notification of program reimbursement and the on site activities, including exit conferences, shall be concluded within 180 days from the date the field audit begins. Where audits are performed on cost reports for multiple years or providers, the time frames shall be reasonably extended for the benefit of the DMAS and subject to the provisions of 12VAC30-90-123.

B. Documented delays on the part of the provider will automatically extend the above time frames to the extent of the time delayed.

C. Extensions of the time frames shall be granted to the department for good cause shown.

D. Disputes relating to the timeliness established in 12VAC30-90-123 and 12VAC30-90-124, or to the grant of extensions to the DMAS, shall be resolved by application to the Director of the DMAS or his designee.

Statutory Authority

§ 32.1-325 of the Code of Virginia.

Historical Notes

Derived from Virginia Register Volume 12, Issue 16, eff. July 1, 1996.

12VAC30-90-126. [Reserved]. (Reserved)

12VAC30-90-130. (Repealed.)

Historical Notes

Derived from VR460-03-4.1940:1 §§ 3.1 through 3.6, eff. August 1, 1993; amended, Virginia Register Volume 12, Issue 16, eff. July 1, 1996; repealed, Virginia Register Volume 17, Issue 18, eff. July 1, 2001.

12VAC30-90-136. Elements of capital payment methodology not subject to appeal.

Subpart III
Appeals

Elements of the capital payment methodology that shall not be subject to appeal shall be:

1. The definitions provided in Article 3 (12VAC30-90-35 et seq.) of Subpart II of this chapter, and the application of those definitions to the FRV rate calculation.

2. The transition policy described in 12VAC30-90-29.

3. The formula for determining the FRV per diem rate described in Article 3 of Subpart II of this chapter.

4. The calculation of the FRV rental amount described in Article 3 of Subpart II of this chapter.

5. The exclusion of certain beds from the transition policy as provided in Article 3 of Subpart II of this chapter.

Statutory Authority

§ 32.1-325 of the Code of Virginia and Item 319 (II) of Chapter 1073 of the 2000 Acts of Assembly.

Historical Notes

Derived from Virginia Register Volume 17, Issue 18, eff. July 1, 2001.

12VAC30-90-137. [Reserved]. (Reserved)

12VAC30-90-140. Individual expense limitation.

Subpart IV
Individual Expense Limitation

In addition to operating costs being subject to peer group ceilings, costs are further subject to maximum limitations as defined in 12VAC30-90-290, Cost Reimbursement Limitations.

Statutory Authority

§ 32.1-325 of the Code of Virginia.

Historical Notes

Derived from VR460-03-4.1940:1 Part IV, eff. August 1, 1993; amended, Virginia Register Volume 12, Issue 16, eff. July 1, 1996.

12VAC30-90-150. Cost report preparation instructions.

Subpart V
Cost Report Preparation Instructions

Instructions for preparing NF cost reports will be provided by the DMAS.

Statutory Authority

§ 32.1-325 of the Code of Virginia.

Historical Notes

Derived from VR460-03-4.1940:1 Part V, eff. August 1, 1993; amended, Virginia Register Volume 12, Issue 16, eff. July 1, 1996.

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