Regional Centers and audits

From ResCoalition:

In March of this year, the legislature passed SB74. This bill was intended to find additional savings in an effort to reduce the budget deficit. Within this bill there five (5) trailer bills in addition to specific savings. One trailer bill was titled Regional Center Audits. Within this trailer bill were provisions that mandate vendors to also get audits in some cases. Since this trailer bill has created a great deal of confusion and frustration amongst the vendor community this is being written to clarify what the new requirements are. First, you are only required to get a financial audit IF you receive more than $500,000.00 in payments from one or more regional centers a year. This means total gross income from one or more regional centers, not just more than 500,000.00 per vendorized program. It is important to remember that it is regional center payments NOT room and board payments. This means that if the regional center is payee, you don’t include the SSA/SSI payments in calculating your threshold. You also exclude any money paid by the RC for P&I.

If you have gross revenues from one or more regional centers you must get a financial audit from an independent CPA, and must be done in accordance with the American Institute of Certified Public Accountants. This means they’ll look at your accounting practices and methods, and your procedures for recoding, classifying, and summarizing transactions and accumulating information. If yours is a nonprofit you should already be doing annual independent financial audits. As a result, you wouldn’t be required to do another. You can turn in that one.

If you have gross revenues from one or more regional centers between 250,000 and 500,000 (remember excluding room and board payments and no P&I), you are not required to do a financial audit. Instead you are required to get a financial review. This is a less cumbersome (and cheaper) process.

Now there is an interesting issue surrounding this mandate. There is no legal requirement for when the audits must be completed. By this we mean there are no timelines for completion. This means that a Regional Center cannot cite you for failing to get an audit done on time – there is no time requirement. We appreciate this will be a contentious issue because RC’s will attempt to give us deadlines. However, these deadlines are not enforceable and they cannot penalize us for failing to comply.

If you have any thoughts or questions please don't hesitate to throw them back. If you have a question, I'd bet at least 30 other people are thinking the same thing so get back to us.

Since we're talking about XB/SB74 trailer bill language, there is a section that now requires negotiated rate programs (if you are funded under the ARM rate structure, you are not negotiated rate) to spend at least 85% of funding on direct service expenditures. If more information on this is of interest to you, please let us know.

Boyd Bradshaw

President ResCoalition

Total Care Exceptions and Hospice Care

Here's the policy:

Health and Safety Code Section 1569.73 requires facilities to obtain a Hospice Care
Waiver from the California Department of Social Services if they wish to retain clients
receiving hospice care services. Residents receiving hospice care services may
eventually require “total care,” which is a prohibited health condition as outlined in
California Code of Regulation (CCR), Title 22, Section 87615(a)(5).

Total care isdefined as a condition where residents depend on others to perform all of their activities of daily living, see (CCR) Title 22, Section 87459 Functional Capabilities.
A licensee must request a total care exception to allow a resident to be retained in the
Residential Care Facility for the Elderly (RCFE) if the resident’s condition requires total
care. The requirements for requesting this total care exception are found in California
Code of Regulation (CCR), Title 22, Section 87616.

To see the new and improved procedure, to to
http://ccld.ca.gov/res/pdf/10rcfe04.pdf