An Audit Report on Community Mental Health Mental Retardation Centers' Expenditures
August 2006
Report Number 06-061
Overall Conclusion
While auditors identified questionable expenditures at the two community mental health mental retardation centers we visited, those expenditures were not significant. However, there are opportunities for the Department of Aging and Disability Services (DADS), the Department of State Health Services (DSHS), and the Health and Human Services Commission (HHSC) to improve their financial oversight of community mental health mental retardation centers. Specifically:
- DADS, DSHS, and HHSC have not defined in a written agreement each agency's responsibilities for financial monitoring of community mental health mental retardation centers. These three agencies perform one or more financial oversight functions related to community mental health mental retardation centers. Without a written agreement, some aspects of financial monitoring could be overlooked.
- DADS has not established a financial monitoring function to ensure that community mental health mental retardation centers are spending state funds as intended for mental retardation services.
- DSHS has established a financial monitoring function to ensure that community mental health mental retardation centers are spending state funds as intended for mental health services. However, it should improve certain aspects of that function. For example, DSHS did not enforce compliance with a contract provision that required centers to separately account for each source of funds.
At the two community mental health mental retardation centers auditors visited, state funds could not be isolated in centers' accounting records. Therefore, these two centers did not comply with their fiscal year 2005 and 2006 contracts with DADS and DSHS, which required them to separately account for each source of funds.
HHSC has established adequate access and security controls for the Encounter Data Warehouse and the Client Assessment and Registration (CARE) System, which are the two automated systems that DADS and DSHS use to monitor community mental health mental retardation centers. However, HHSC should make certain improvements to further ensure data accuracy and protect the confidential and financial information in these systems from unauthorized and inappropriate use. Information in the Encounter Data Warehouse and CARE System is self-reported by the centers and not always accurate. In addition, DADS and DSHS do not always use this information to its full potential to monitor the centers. Without monitoring of this data, potential errors, fraud and abuse may not be identified.
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