WAC 388-96-202   Scope of audit or department audit.  (1) The department will review the contractor's recordkeeping and accounting practices and, where appropriate, make written recommendations for improvements.

     (2) The department's audit will result in a schedule of summarizing adjustments to the contractor's cost report. The schedule will show whether such adjustments eliminate costs reported or include costs not reported. Each adjustment listed will include an explanation for the adjustment, the cost report account, and the dollar amount. In accordance with chapter 74.46 RCW, the department will comply with the purpose of department audits by verifying that:

     (a) Supporting records are in agreement with reported data;

     (b) Only those assets, liabilities, and revenue and expense items the department has specified as allowable have been included by the contractor in computing the costs of services provided under its contract;

     (c) Allowable costs have been accurately determined and are necessary, ordinary, and related to resident care;

     (d) Related organizations and beneficial ownerships or interests have been correctly disclosed;

     (e) Home office or central office costs have been reported and allocated in accordance with the provisions of this chapter and chapter 74.46 RCW;

     (f) Recipient and non-medicaid resident trust funds have been properly maintained and disbursed;

     (g) Facility receivables do not include benefits or payments to which the provider is not entitled; and

     (h) The contractor is otherwise in compliance with the provisions of this chapter and chapter 74.46 RCW.

     (3) In complying with the purpose of department audits in chapter 74.46 RCW, the department may select any or all schedules of a facility's cost report. The department will audit cost reports, resident trust fund accounts, and facility receivables of each nursing facility participating in the medicaid payment system as determined necessary by the department.

     (4) When determining the contractor's final settlement, the department will apply to reported costs adjustments written under subsection (2), whether used for the purpose of establishing component rate allocations as described in chapter 74.46 RCW or to ascertain contractor compliance with subsection (2).



[Statutory Authority: Chapter 74.46 RCW, 1999 c 376 § 3 amending c 309 § 207. 99-24-084, § 388-96-202, filed 11/30/99, effective 12/31/99. Statutory Authority: Chapter 74.46 RCW as amended by 1998 c 322 § 8 and RCW 74.46.800. 98-20-023, § 388-96-202, filed 9/25/98, effective 10/1/98.]