Section I Audits and Investigations
Why Child Care Audits and Investigations are Conducted
The DHS Office of Inspector General (OIG) conducts child care audits. Audits are held to make sure providers have been correctly paid by DHS, that proper documentation of attendance is on file at a facility, Access Oklahoma EBT cards are used properly, and all terms of the contract are maintained.
Child care providers who have contracts with DHS are selected for an audit in one of three ways:
- by a “random sampling” selected by computer from contracted providers in a given area;
- by an approved complaint/referral received in the OIG office; or
- by an EBT system alert of suspicious or unusual transaction activity such as the majority of swipes being previous ins and outs or swipes occurring at times when the facility is closed.
OIG also conducts child care investigations to make sure the contract requirements for maintaining a drug-free workplace and usage of EBT cards are being met. Investigations will also occur if fraud is suspected.
You may or may not be notified ahead of time that you are going to be audited or investigated. You and your staff must cooperate with OIG staff if your facility is selected for an audit or investigation.
How Child Care Audits are Conducted
When OIG employees arrive at your facility to conduct an audit they will specify the months they are auditing. For example, they may request the records from January 1st of one year through June 30th of the next.
OIG auditors will expect you to have the following records available for them:
- Copy of your current provider contract.
- Daily written attendance records, as required by licensing for each child attending your facility. EBT records cannot be used as your attendance records.
- List of all children who attend Head Start, Pre-K program, or any other federal or state funded programs.
- List of all staff employed at your facility, including time records for each.
You must be able to present the records within one hour of being requested to do so. Keep this in mind when you choose your storage location. The person in charge at the facility during an audit must be aware of where these records are kept, have access to them and understand that he or she must release them to OIG or other DHS personnel upon request.
Note: In most instances, records that are not provided within an hour of request will not be accepted at a later time.
Auditors may remove the records from your facility or request a place in your facility to review the material in private. If a DHS representative asks to take some of these records with them, it is recommended you give them copies and keep the originals.
During the course of an audit or investigation, OIG staff will review a variety of records from many sources and conduct interviews with clients and their employers and/or school administrators. OIG will determine if there have been any major violations of your contract, handbook, or other DHS policies.
Major violations include:
- Possessing or swiping a client’s EBT card or the knowledge of a client’s PIN.
- Failing to ensure accurate time and attendance was swiped into the POS machine including:
- Asking clients to swipe for care for any day/hour the children did not attend.
- Asking clients to swipe extra days to offset a co-payment.
- Asking clients to swipe missed days to “hold their slot”.
- Asking clients to swipe different hours than those the child was actually in care; for example, asking a client to swipe from 8 to 5 when the child attended from 3 to 11.
- Failing to void incorrect swipes made by the clients.
- Asking a client to pay a fee for any day the child did not attend; for example, requesting payment for termination fees or vacation fees.
- Failing to post rates and fees.
- Failing to ask for permission from Adult and Family Services (AFS), Child Care Subsidy, before moving your POS equipment.
- Failing to allow OIG staff to have access to your facility to investigate any complaints.
- Having more children in care than you are licensed to care for (on record or actually in your facility).
- Having illegal drugs or indications of drug activity at your child care facility.
When OIG employees arrive at your facility to conduct an audit, they will notify you of the nature of the audit and the process that will be followed. You must fully cooperate with OIG staff if your facility is involved in an audit or risk having your contract canceled.
Audit Results and Recommendations
Audits can result in any of the following findings:
- You were paid the correct amount for the time period audited;
- You were UNDERPAID during the time period audited; or
- You were OVERPAID during the time period audited.
If it appears you were underpaid, the auditor will recommend that you file a Manual Claim for the additional amount that you should have been paid.
However, in cases where an overpayment was indicated, you will be required to pay back the amount you were overpaid.
Indications of fraud or other discrepancies discovered during audits will be investigated thoroughly. Confirmed cases of fraud will be referred for prosecution and/or administrative action.
Filing a fraudulent claim against the state, either electronically or on paper, is a FELONY punishable by a fine not exceeding $10,000 or imprisonment in the penitentiary for a term not exceeding two years or by both such fine and imprisonment per count (O.S. 21 Sections 358 – 359). Each claim for each recipient filed within a claim month can constitute one count.
Audit and investigation findings are shared with other DHS staff including AFS Child Care Subsidy, Child Care Services, and Finance. Depending on the nature and the extent of the findings, your contract may be considered for cancellation. In some instances, your facility may be placed on a corrective action plan. You will be notified of the terms of the corrective action in writing. These terms should be completed in the time frame requested. If the terms are not completed, your contract may be cancelled.