Report 2018-115 Recommendation 4 Responses
Report 2018-115: Department of Health Care Services: Although Its Oversight of Managed Care Health Plans Is Generally Sufficient, It Needs to Ensure That Their Administrative Expenses Are Reasonable and Necessary (Release Date: April 2019)
Recommendation #4 To: Health Care Services, Department of
By September 2019, and periodically thereafter, DHCS should conduct another risk assessment and ensure that it includes a comprehensive evaluation of which contract areas—including conflicts of interest—it should focus on in its annual medical audits.
Annual Follow-Up Agency Response From October 2021
DHCS has completed its formal risk assessment that incorporates managed care plans' conflict of interest controls review. This was fully implemented in January 2021.
- Completion Date: January 2021
California State Auditor's Assessment of Annual Follow-Up Status: Partially Implemented
DHCS conducted a risk assessment that includes a comprehensive evaluation of which contract areas—including conflicts of interest—it should focus on in its annual medical audits. However, it did not provide evidence demonstrating that it plans to periodically conduct such comprehensive risk assessments in the future. Until it does so, we will continue to report the status of this recommendation as not fully implemented.
- Auditee did not substantiate its claim of full implementation
- Auditee did not address all aspects of the recommendation
Annual Follow-Up Agency Response From November 2020
DHCS is well underway in completing a risk assessment and comprehensive evaluation of contract areas pertaining to the annual medical audits. Related activities began in April 2020 and we continue to work towards finalizing the comprehensive review by January 1, 2021.
- Estimated Completion Date: July 2021
California State Auditor's Assessment of Annual Follow-Up Status: Pending
1-Year Agency Response
DHCS added additional audit steps for the review of plan policies regarding conflict of interest. DHCS is currently in the process of revisiting contractual requirements and evaluating our plan monitoring procedures and audit tools to identify additional areas of high risk.
- Estimated Completion Date: April 2020
- Response Date: March 2020
California State Auditor's Assessment of 1-Year Status: Pending
Although DHCS added two additional audit steps to review plan policies related to conflicts of interest, it has not yet conducted a risk assessment that includes a comprehensive evaluation of which contract areas it should focus on in its annual medical audits.
6-Month Agency Response
The DHCS Medical Review Branch has held internal meetings to discuss modifications to its audit program. The addition of audit tools to review steps taken by the plan to avoid conflict of interest was part of these discussions.
- Estimated Completion Date: April 1, 2020
- Response Date: September 2019
California State Auditor's Assessment of 6-Month Status: Pending
60-Day Agency Response
The DHCS Medical Review Branch has held internal meetings to discuss modifications to its audit program. The addition of audit tools to review steps taken by the plan to avoid conflict of interest was part of these discussions.
- Estimated Completion Date: Setpember 1, 2019
- Response Date: May 2019
California State Auditor's Assessment of 60-Day Status: Pending
All Recommendations in 2018-115
Agency responses received are posted verbatim.