| (a) The OIG may recoup an overpayment if the overpayment
was identified in an audit that found claims or cost reports resulted
in money paid in excess of what the person is or was entitled to receive
under an HHS program, contract, or grant. This section does not include
overpayments identified by a Recovery Audit Contractor (RAC) pursuant
to 42 C.F.R. §455.506.
(b) Audit procedures.
(1) An audit conducted by the OIG or its contractor
must:
(A) be conducted and reported in accordance with Generally
Accepted Governmental Auditing Standards (GAGAS) or other appropriate
standards recognized by the United States Government Accountability
Office;
(B) limit the period covered by an audit to five years;
(C) notify the person, and the person's corporate headquarters
if the person is incorporated, of the impending audit not later than
the seventh day before the date the site visit, if any, begins, except
when an element of surprise is critical to the audit objective, such
as surprise audits, cash counts, or fraud-related procedures; and
(D) permit the person to produce, for consideration,
documentation to address any exception found during an audit not later
than the tenth calendar day after the date the exit conference, if
any, is completed, or by a later date as specified by the auditor.
(2) If an exit conference is conducted after the site
visit, the auditor must allow the person to:
(A) orally respond to questions by the auditor; and
(B) orally comment on the initial findings of the auditor.
(c) Notice.
(1) Point of contact. A person may designate a specific
address and individual point of contact to receive all correspondence
related to the audit by sending the designated individual's contact
information to the auditor and to the OIG Sanctions unit. The OIG
begins sending all notices and correspondence to the designated point
of contact within 30 calendar days after receiving the designation.
(2) Draft audit report. After the field work is completed,
the OIG or its auditor delivers written notice of a draft audit report
in accordance with §371.1609 of this subchapter (relating to
Notice and Service).
(3) Revised draft audit report and additional revisions.
The auditor may elect whether to issue a revised draft audit report
or to issue a final report. The auditor may revise the draft audit
report as needed to incorporate the management responses and reconsideration
of any initial findings. A revised draft audit report is delivered
to the person in accordance with §371.1609 of this subchapter.
(A) The auditor, in its discretion, may consider additional
management or HHS agency staff responses to the revised draft audit
report and make additional revisions.
(B) If additional revisions are made that modify the
basis or rationale for determining that an overpayment exists or that
increase the overpayment amount, the OIG or its auditor provides written
notice of the revised draft audit report.
(4) Notice of final audit report. The OIG or its auditor
delivers written notice of a final audit report in accordance with §371.1609
of this subchapter. The final audit report must include:
(A) a statement of the auditor's compliance with GAGAS;
(B) the management response, which may be summarized;
(C) the final determination of overpayment amount;
(D) reconsideration results and the revisions of any
initial findings; and
(E) a recitation of the person's rights and obligations
as set forth in subsections (d) and (e) of this section.
(5) Notice of appeal results. After the conclusion
of any appeal hearing, the OIG delivers written notice of the appeal
results in accordance with §371.1609 of this subchapter. The
written notice identifies the final overpayment amount.
(d) Due process.
(1) Draft audit report. A person who is the subject
of a draft audit report may request an informal appeal, may make a
written management response, or both. The OIG or its auditor, as designated
in the notice letter, must receive a written request for the informal
appeal or written management response no later than the 30th calendar
day after the date the person receives the draft audit report, or
by the date specified by the auditor, whichever is earlier. The informal
appeal, if requested, consists of a desk review by the auditing division
or entity at the OIG or its auditor.
(2) Revised draft audit report. If the person is the
subject of a revised draft audit report that modifies the basis or
rationale for determining that an overpayment exists or that increases
the overpayment amount, the person may request an informal appeal,
may make a written management response, or both. The OIG or its auditor,
as designated in the notice letter, must receive a written request
for the informal appeal or written management response no later than
the 30th calendar day after the date the person receives the revised
draft audit report, or by the date specified by the auditor, whichever
is earlier. The informal appeal, if requested, consists of a desk
review by the auditing division or entity at the OIG or its auditor.
(3) Response to final audit report. A person who receives
a final audit report must respond in one of the following ways:
(A) The person can refund the overpayment within 60
calendar days after receipt of the final audit report.
(B) The person can timely request and execute a final
payment plan agreement that has been approved by the OIG. A written
request for a final payment plan agreement must be received by the
OIG within 15 calendar days after the person received the final audit
report. The request must be signed by the person or its attorney and
contain a statement that the person agrees not to dispute the findings
of the final audit report for purposes of the overpayment recoupment
sanction at issue and waives its right to an appeal of any findings
for which a payment plan agreement is sought.
(i) The request for a final payment plan agreement
is not binding upon the OIG. A resolution is not final until the person
and the OIG execute a written final payment plan agreement.
(ii) A request for a final payment plan agreement does
not abate the imposition of a final debt in accordance with subsection
(e) of this section.
(iii) The OIG may agree to toll the repayment obligation
deadline pending negotiations of payment plan terms. The OIG sends
written notice to the person of any decision to toll the repayment
obligations or to discontinue further payment plan negotiations.
(iv) The OIG retains discretion to determine when payment
plan negotiations have been exhausted.
(C) The person can timely request an administrative
hearing appeal. To request an appeal of the final audit report, the
person must file a written request for an appeal, which must be received
by the OIG within 15 calendar days after receipt of the final audit
report. The request must:
(i) be signed by the person or its attorney;
(ii) contain a statement as to the specific issues,
findings, or legal authority in the final audit report being challenged,
and the basis for the person's contention that the specific issues
or findings and conclusion are incorrect; and
(iii) with respect to any audit findings that are not
being challenged, indicate whether the person intends to remit payment
within 60 calendar days or whether the person seeks a payment plan
in accordance with this section. Recoupment of overpayments at issue
on appeal is not initiated by the OIG until the appeal has been finally
determined.
(4) Request for a hearing to appeal. Upon timely receipt
of a proper written request for appeal, the OIG notifies the HHSC
Appeals Division of the provider's hearing request. The appeal then
proceeds pursuant to Chapter 357, Subchapter I of this title (relating
to Hearings Under the Administrative Procedure Act).
(e) Scope and effect.
(1) The effect of a final overpayment identified in
an audit is to create a final debt in favor of the State of Texas.
(2) A final audit report becomes final and unappealable
if a written request for an appeal is not received by the OIG within
15 calendar days after the person's receipt of the final audit report.
(3) If a duly requested final payment plan agreement
is not executed by all parties or full restitution is not received
within 60 calendar days after receipt by the person of an unappealed
final audit report or final disposition of an administrative appeal,
one or more vendor holds may be placed on the person's payment claims
and account; however, the OIG may agree to toll the imposition of
any vendor holds pending negotiations of payment plan terms. The OIG
sends written notice to the person of any decision to toll the imposition
of any vendor holds.
(4) If the person has duly requested an appeal, the
contested amount of the overpayment becomes final 30 days after the
person receives written notice of the appeal results. Recoupment of
any overpayments at issue on appeal is not initiated until the appeal
has been finally determined.
(f) Reporting.
(1) For purposes of refunding the federal share of
any questioned costs, the final audit report constitutes the State's
written notice of the identified overpayment amount. The date of the
written notice of overpayment accompanying a final audit report constitutes
the date of discovery.
(2) If a person appeals a final audit report, the State
issues a written notice of the identified overpayment amount at the
conclusion of the appeal, and the date of that notice of final audit
report constitutes the date of discovery.
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