Ryan White CARE Act: Health Resources and Services Administration's Implementation of Certain Provisions Hampered by Lack of Timely and Accurate Information
Published: 2009-09-29T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: Under the CARE Act, funds are made available to assist over 530,000 individuals affected by HIV/AIDS. Grantees directly provide services to individuals (clients) or arrange with service providers to do so. The Department of Health and Human Services's (HHS), Health Resources and Services Administration (HRSA), which administers CARE Act programs, is required to cancel balances of grants that are unobligated after one year and redistribute amounts to grantees in need. HRSA began to collect client-level data in 2009. Under the CARE Act, states and territories receive grants for AIDS Drug Assistance Programs (ADAP), which provide HIV/AIDS drugs. GAO was asked to examine elements of the CARE Act. In this report, we review: (1) HRSA's implementation of the unobligated balance provisions, (2) HRSA's actions to collect client-level data, and (3) the status of ADAP waiting lists. GAO reviewed reports and agency documents and interviewed federal officials, officials from 13 state and 5 local health departments chosen based on location and number of cases, and other individuals knowledgeable about HIV/AIDS.
section_title: What GAO Found
paragraphs: The lack of timely and accurate information reporting by grantees has delayed HRSA's distribution of certain grants and has placed at risk HRSA's ability to obligate these funds. The late submission of actual unobligated balances for the 2007 grant year delayed HRSA's ability to determine grantees' unobligated balances and redistribute these funds to other grantees. A number of grantees were late in their submissions. For example, 21 of the 56 metropolitan areas submitted their information beyond the date initially set by HRSA. Additionally, some grantees reported inaccurate unobligated balances, which required HRSA staff to correspond with grantees and request revised information, creating additional delays. HRSA is authorized to obligate fiscal year 2007 funds for a 3-year period and is at risk of losing the authority to make grants from these funds. HRSA officials said they have made changes to how they implement the unobligated provisions in an effort to avoid these issues in the future. HRSA has taken actions to collect client-level data by implementing a new data collection and reporting system. However, some grantees and service providers did not submit the initial reports by HRSA's deadline. HRSA set a July 31, 2009, submission deadline for grantees' initial reports, but 100 of 638 grantees did not meet this deadline. Client-level data includes information such as the dates clients were served, the types of services provided, and the clients' health status. HRSA has implemented a system to collect data on the number of unique clients from grantees and service providers that will allow HRSA to determine the services each client received and the outcomes of these services. In order for HRSA to collect this information, grantees and service providers must first collect the data using their own systems, and HRSA has provided technical and financial assistance so that they can develop these systems. For example, under a project initiated in 2009, HRSA awarded approximately $4 million to CARE Act grantees for the development of their own client-level data collection systems. The number of ADAPs with waiting lists and the number of individuals on those lists is increasing. In the first quarter of grant year 2008 (April 1, 2008, through June 30, 2008), 2 ADAPs had waiting lists with a total of 55 people on those lists; this grew to 3 ADAPs and a total of 112 people in the fourth quarter of the year, and increased to 4 ADAPs and 136 individuals in August 2009. Kentucky, Montana, Nebraska, and Wyoming were each maintaining a waiting list for ADAP services in August 2009; Nebraska had the largest number of individuals (71), and Wyoming had the smallest number (5). ADAP officials expressed concern that they will have to establish or expand waiting lists or implement other cost-control measures, such as limiting the number of drugs they make available.

section_title: Letter
paragraphs: It has been more than 28 years since the first cases of acquired  immunodeficiency syndrome (AIDS) in the United States were reported in  June 1981. Since that time, approximately 1.7 million Americans have been  infected with human immunodeficiency virus (HIV), including more than  580,000 who have died. The Centers for Disease Control and Prevention  (CDC) estimates that approximately 1.1 million people were living with  HIV infection in the United States at the end of 2006, and that there were  56,300 new HIV infections in that year.
The Ryan White Comprehensive AIDS Resources Emergency Act of 1990  (CARE Act), administered by the Department of Health and Human  Services’s (HHS) Health Resources and Services Administration (HRSA),  was enacted to address the needs of jurisdictions, health care providers,  and people with HIV/AIDS and their family members. Each year CARE  Act programs provide assistance to over 530,000 mostly low-income,  underinsured, or uninsured individuals living with HIV/AIDS. Under the  CARE Act, approximately $2.2 billion in grants were made to states,  localities, and others in fiscal year 2009. CARE Act programs have been  reauthorized three times (1996, 2000, and 2006) and are scheduled to be  reauthorized again in 2009. The Ryan White HIV/AIDS Treatment  Modernization Act of 2006 (RWTMA) reauthorized CARE Act programs for  fiscal year 2007 through fiscal year 2009.
Part A of the CARE Act provides for grants to selected metropolitan  areas—known as eligible metropolitan areas (EMA) and transitional grant  areas (TGA)—that have been disproportionately affected by the HIV/AIDS  epidemic. Part B provides for grants to states, the District of Columbia,  and territories and associated jurisdictions to improve quality, availability,  and organization of HIV/AIDS services, including grants specifically for  AIDS Drug Assistance Programs (ADAP). ADAPs provide medications for  the treatment of HIV/AIDS. Program funds may also be used to purchase  health insurance for eligible clients and for services that enhance access  to, adherence to, and monitoring of drug treatments. ADAP grants  accounted for about 37 percent of the total $2.2 billion in CARE Act grants  awarded in fiscal year 2009. ADAPs and other programs funded through  CARE Act grants serve as the payers of last resort for eligible individuals  who have no other private or public sources available for the services they  need. Some ADAPs have struggled to meet the demand for their services  and have established waiting lists for eligible individuals who will be  served when space in the program becomes available and have taken other  measures that restrict access and control costs. For example, in the past  ADAPs have required that individuals make a copayment in order to  receive a drug and have placed caps on expenditures per enrollee.
Most CARE Act funding is distributed to grantees either as base or  supplemental grants. Base grants are distributed by formula, and HRSA  uses a grantee’s share of living HIV/AIDS cases to determine the amount of  base grants. Supplemental grants are generally awarded through a  competitive process based on the demonstration of severe need and other  criteria. Grantees may deliver services directly to individuals (clients) or  arrange with service providers to provide client services.
RWTMA added provisions regarding the obligation of funds by Part A and  Part B grantees. In the past, some CARE Act grantees did not obligate all  of their funds in some years, while others obligated all of their funds.  RWTMA provided that base and supplemental grants were available for  obligation by the grantee for a 1-year period beginning on the date  awarded funds first became available to the grantee (i.e., the grant year). It  also required HRSA to cancel any unobligated balances at the end of the  grant year, recover funds that had been disbursed to grantees, and  redistribute these funds to grantees in need as supplemental grants.  Under appropriations acts enacted since RWTMA, funds for these grants  are available for obligation by HRSA for a 3-year period. For example,  fiscal year 2007 appropriations are available until September 30, 2009.
In 2009, HRSA began requiring the collection of client-level data from  grantees and service providers. Client-level data refers to information on  each client receiving CARE Act-funded services, such as the dates services  were received, the types of services provided, and current health status.  Previously, grantees and service providers submitted only aggregate data  to HRSA on those being served. To help ensure the accountability of CARE  Act funds, HRSA has begun to collect client-level data. Implementing a  client-level data collection and reporting system can allow HRSA to obtain  accurate information on the medical and support services received by  each unique client served with CARE Act funds. HRSA requires grantees  and service providers to complete specified reports and transfer these  reports electronically to HRSA.
As Congress prepares to reauthorize CARE Act programs, you asked us to  examine various elements of CARE Act programs. In this report, we  review (1) HRSA’s first year implementation of the unobligated balance  provisions; (2) the actions taken by HRSA to collect client-level data, and  (3) the number and size of ADAP waiting lists.
To examine the first year implementation of the unobligated balance  provisions, we reviewed all grant year 2007 Part A and Part B carryover  requests that were provided to us by HRSA, including those based on  grantees’ estimated unobligated balances and those based on grantees’  actual unobligated balances. We also reviewed all grant year 2007 Part A  and B financial status reports provided to us by HRSA. We reviewed HRSA  documentation on grantees’ carryover requests and financial status reports  as well as HRSA documentation on grantees’ unobligated balances at the  end of grant year 2007. We interviewed HRSA officials and asked follow-up  questions related to the calculation of unobligated balances, discrepancies  in the carryover requests and financial status reports, grantee estimates of  their unobligated balances that differed from their actual unobligated  balances, and information provided by grantees that we found to be  incorrect. We determined that the information provided to us by HRSA  was sufficiently reliable for our purposes.
To examine the actions taken by HRSA to collect client-level data, we  reviewed statements, manuals, and other materials on the implementation  of client-level data collection by HRSA, grantees, and service providers.  We focused on 2009, the first year grantees and service providers were  required by HRSA to submit client-level data, including deadlines for data  submission. In addition, we interviewed officials at HRSA as well as  officials from 12 state and 5 local health departments who are  knowledgeable about the CARE Act and the client-level data that grantees  and service providers must collect. We also interviewed officials from the  Henry J. Kaiser Family Foundation, the National Alliance of State and  Territorial AIDS Directors (NASTAD), and other organizations  knowledgeable about client-level data.
To examine the number and size of ADAP waiting lists, we obtained and  reviewed the ADAP Quarterly Data Reports submitted to HRSA by   ADAP grantees covering the first quarter of grant year 2008 (April 1, 2008,  through June 30, 2008) and the fourth quarter of grant year 2008   (January 1, 2009, through March 31, 2009). These reports contain  information on waiting lists. We reviewed the ADAP Quarterly Data  Reports and asked HRSA officials follow-up questions about the accuracy  of the data, and determined that the data were sufficiently reliable for our  purposes. We also obtained updated data from HRSA on ADAP waiting  lists as of August 10, 2009, and determined that the data were sufficiently  reliable for our purposes after discussing the data with HRSA officials. We  reviewed published information on ADAPs. We interviewed HRSA officials  knowledgeable about ADAPs and interviewed officials from 13 states,  which we chose based on their geographic location, size, and number of  HIV/AIDS cases, about their ADAPs. In addition, we interviewed officials  from the Henry J. Kaiser Family Foundation, NASTAD, and other  organizations knowledgeable about ADAPs.
We conducted this performance audit from April 2009 through September  2009 in accordance with generally accepted government auditing  standards. Those standards require that we plan and perform the audit to  obtain sufficient, appropriate evidence to provide a reasonable basis for  our findings and conclusions based on our audit objectives. We believe  that the evidence obtained provides a reasonable basis for our findings  and conclusions based on our audit objectives.
subsections: section_title: Background
paragraphs: RWTMA includes provisions related to unobligated balances, client-level  data, and ADAPs.
subsections: section_title: Unobligated Balance Provisions and Impact on Funding
paragraphs: RWTMA includes provisions to encourage grantees to obligate their   grant funds in the year in which they were awarded. RWTMA provides that  Part A and Part B grant funds are available for obligation for a one-year  period beginning on the date funds first become available (referred to as  the grant year for the award). RWTMA requires HRSA to cancel the  unobligated balance of grant awards at the end of a grant year and to  require grantees to return any amounts from such balances that have been  disbursed to them. However, in the case of base grants, a grantee may  submit a request to carry over the unobligated balance prior to the end of  the grant year. If HRSA approves the request, the unobligated balance that  is approved for carryover (carryover funds) is available to the grantee for  expenditure for a one-year period beginning upon the expiration of the  grant year (referred to as a carryover year). Under the RWTMA  unobligated balance provisions, HRSA is required to cancel any  unexpended balance of carryover funds at the end of the carryover year.  HRSA must make the canceled balances from the grant awards (that is,  funds that were not eligible or approved for carryover and carryover funds  that remain after the carryover year) available as supplemental grants for  the first fiscal year beginning after the fiscal year in which HRSA obtains  the information necessary for determining the balance available. Part A  grantees with greater than 2 percent of their base grant awards  unobligated at the end of the grant year and Part B grantees with greater  than 2 percent of their Part B and ADAP base awards unobligated at the  end of the grant year incur a penalty. RWTMA requires HRSA to reduce the  amount of those grants by the same amount as the unobligated balance for  the first fiscal year beginning after the fiscal year in which HRSA obtains  the information necessary for determining the unobligated balance. The  grant funds that become available as a result of these reductions are also  to be made available as supplemental grants.
RWTMA’s authorization of appropriations for base and supplemental  grants under Parts A and B provided that amounts appropriated for a fiscal  year would be available for obligation until the end of the second  succeeding fiscal year. Further, under appropriations acts enacted since  RWTMA, funds for grants under Parts A and B, to which the unobligated  balance provisions apply, are available for obligation for a 3-year period.  In fiscal year 2007, for example, funds were made available for obligation  until September 30, 2009—the end of the 2009 federal fiscal year. Thus, as  HRSA recognized in its guidance regarding the unobligated balance  provisions, the initial obligation of funds, cancellation of unobligated  balances, return of amounts disbursed to grantees, and the recompetition  and redistribution of supplemental grants would need to occur within the  3-year window.
In order to implement the RWTMA unobligated balance provisions, HRSA  created a multistep process for grantees and issued a policy notice to  grantees explaining this process. HRSA’s process for implementing the  unobligated balance provisions in grant year 2007 included five steps.  First, a grantee wishing to carry over funds was required to submit a  carryover request to HRSA with an estimated unobligated balance of base  grant funds 60 days prior to the end of the grant year. In addition to the  estimated unobligated balance, the initial carryover request also had to  contain a viable plan and detailed budget for the use of the funds, and a  description of the grantee’s capacity to utilize the funds within one-grant  year. Part A grantees had to submit their initial carryover request to HRSA  by January 1, 2008. Part B grantees had to submit their initial carryover  request to HRSA by February 1, 2008.
The second step of the 2007 grant year process was the evaluation of the  initial carryover requests. HRSA authorized grantees that obtained  approval before the end of the 2007 grant year to carryover 50 percent of  the amount they requested in this initial carryover request. To authorize  the use of the carryover funds, HRSA issued these grantees a notice of  grant award that explained to the grantees that HRSA had effectively  transferred the carryover funds from their grant year 2007 account into  their grant year 2008 account, though balances remained, in effect,  available to the grantees for obligation until the end of grant year 2007.  HRSA officials explained that they did not authorize the full amount of the  initial carryover request because they believed it was possible that the  grantees that requested waivers would incur obligations greater than  anticipated in the 60-day estimate. HRSA officials stated that they wanted  to authorize the carryover of a portion of the unobligated balance so that  grantees with approved carryover requests would have a longer period of  time to obligate the carried over funds.
For step three of HRSA’s 2007 grant year unobligated balance process,  grantees were required by HRSA to submit a Financial Status Report  (FSR) 90 days after the end of the grant year. The FSR contains, among  other things, a grantee’s actual unobligated balance. For Part A grantees,  FSRs were due on June 1, 2008. For Part B grantees, FSRs were due on  June 30, 2008. HRSA can extend the deadlines for grantees for submission  of their FSRs and granted extensions for 30 to 180 days.
For step four of the process, although not required by HRSA for grant year  2007, grantees could submit a final carryover request based on their actual  unobligated balances. Those grantees that had their initial carryover  requests approved and had been authorized by HRSA to carry over   50 percent of their unobligated balances at that time, could apply for the  remaining funds (the difference between the 50 percent they had already  been authorized to carry over by HRSA and their actual unobligated  balance). HRSA then authorized the use of the additional amount of  carryover funds by issuing a notice of grant award.
For step five of this process, grantees with unobligated balances of greater  than 2 percent of their grant year 2007 Part A, Part B, and ADAP base  grants were assessed a penalty. This penalty was a corresponding  reduction in grant year 2009 funds. In addition, Part A and B grantees  with unobligated balances of greater than 2 percent for grant year 2007  were ineligible to receive supplemental grants in grant year 2009. For   Part A grantees this meant that they were not eligible to receive grant year  2009 Part A supplemental grants. For Part B base grantees this resulted in  ineligibility to receive grant year 2009 Part B supplemental grants. For   Part B ADAP grantees, an unobligated balance of greater than 2 percent  does not result in ineligibility for ADAP supplemental grants. Instead,  ineligibility for the ADAP supplemental grant occurs when a grantee has  not obligated at least 75 percent of its ADAP grant award within 120 days  of the award.
Figure 1 shows a timeline for Part A and B grant distribution and the  distribution and the  unobligated balance provisions.  unobligated balance provisions.
HRSA cancelled and recovered $13,764,295 in combined grant year 2007  Part B base and supplemental unobligated balances from 16 Part B  grantees with unobligated balances of greater than 2 percent. In addition,  these 16 grantees’ grant year 2009 awards were reduced by a total of  $19,677,483 as a penalty for incurring an unobligated balance of greater  than 2 percent in grant year 2007. Of this, $4,441,865 was from Part B base  grants and $15,235,618 was from ADAP base grants.
section_title: Client-Level Data
paragraphs: Prior to RWTMA, HRSA used the Ryan White HIV/AIDS Program Data  Report (RDR) to collect information on CARE Act services from grantees  and their service providers. However, RDR was unable to collect client- level data with unique identifying information. Consequently, there was no  way of knowing if the clients counted as being served by one provider  were also included in the counts of those being served by other providers.  Therefore, totaling the number of clients receiving services across  providers could result in clients being counted more than once.  Additionally, the lack of client-level data meant that HRSA was unable to  assess the quality of care given to clients or sufficiently account for the  use of CARE Act funds.
HRSA now collects client-level data to help ensure accountability of CARE  Act funds. A client-level data collection and reporting system contains  information unique to each client receiving CARE Act-funded services,  such as their socio-demographic characteristics, the services provided,  and each client’s current health status. Because the system collects client- specific information rather than only aggregate-level data, HRSA can  obtain a more accurate measure of the number of clients being served than  was available using RDR.
section_title: ADAP Funding and Activities
paragraphs: Each ADAP is given broad authority under the CARE Act to design its own  program. The scope of an ADAP’s coverage—who and what is covered—is  determined by each ADAP’s program design, which includes criteria such  as the number and types of drugs it will provide to its clients, and the  income levels to qualify for services. However, RWTMA required that each  grantee establish an ADAP formulary that covers all core classes of  antiretroviral medications.
ADAP grants totaled approximately $821 million in fiscal year 2009. Of this  amount, $780 million was provided to grantees as ADAP base grants,  which are awarded by formula and are based on a grantee’s share of living  HIV/AIDS cases. The remaining $41 million was distributed to grantees as  ADAP supplemental grants. These grants are distributed to ADAPs that  demonstrate a severe need to increase the availability of HIV/AIDS drugs.
ADAPs must balance client need with available resources. In previous  years, many ADAPs have had to institute waiting lists and other cost  containment measures because of insufficient funds to provide services to  all individuals who qualify. In our 2006 report, we found that in fiscal year  2004, 14 ADAPs had waiting lists of individuals they determined were  eligible for assistance but they were unable to serve. According to  NASTAD and the Henry J. Kaiser Family Foundation, since 2002 a total of  20 different ADAPs have had waiting lists at some point. The largest  number of individuals on waiting lists across all grantees at any time was  1,629 in May 2004. However, they reported that there were no individuals  on waiting lists as of September 2007. NASTAD, the Henry J. Kaiser  Family Foundation, and others have cited several factors that contributed  to the elimination of waiting lists as of September 2007. These reasons  included HRSA’s awarding $39.5 million in ADAP supplemental grants in  September 2007, states’ increasing their contributions to ADAPs, and the  continued implementation of Medicare Part D prescription drug  coverage.
section_title: Lack of Timely, Accurate Information Places at Risk Certain Funds, and HRSA Has Unsuccessfully Attempted to Obtain Needed Information
paragraphs: The lack of timely and accurate information has delayed HRSA’s  distribution of unobligated balances as supplemental grants and places at  risk HRSA’s ability to obligate these funds. HRSA has attempted to develop  timely information on grantee obligations but was unsuccessful doing so  for grant year 2007.
subsections: section_title: The Lack of Timely, Accurate Information Has Delayed HRSA’s Redistribution of Funds and Places at Risk HRSA’s Ability to Obligate Funds in the Required Time Frame
paragraphs: The lack of timely and accurate information in grantees’ FSRs regarding  grant year 2007 unobligated balances has delayed HRSA’s distribution of  Part B supplemental grants, and places at risk HRSA’s ability to  redistribute these funds by September 30, 2009, after which it will no  longer have the authority to redistribute the funds. Because of late FSR  submissions, as of September 14, 2009, HRSA had not yet redistributed  funds that it canceled and recovered from grantees’ 2007 unobligated  balances. However, as HRSA recognized in its guidance regarding the  unobligated balance provisions, the entire process for canceling and  recovering grant funds and making the corresponding awards of  supplemental grants must occur within the 3-year period of availability of  those Part B funds.
For HRSA’s grant year 2007 process, Part A grantees were required to  submit their FSRs by June 1, 2008, and Part B FSRs were to be submitted  to HRSA by June 30, 2008. The FSR contains, among other information, a  grantee’s actual unobligated balance. HRSA uses the grantees’ actual  unobligated balances, as reported on their FSRs, to determine the total  amount of unobligated balance funds that will be available for  redistribution through supplemental grants. Without complete, accurate,  and timely information from grantees about their unobligated balances,  HRSA is unable to redistribute unobligated balance funding through the  Part A and Part B supplemental grants.
Many Part A and B grantees submitted their FSRs late, and some  submitted their FSRs more than 120 days after the deadline. Of the 56   Part A grantees, 21 submitted FSRs after the June 1, 2008, deadline. Of the  59 Part B grantees, 24 submitted FSRs after the June 30, 2008, deadline.  Table 1 shows the number of days after the deadline that Part A and Part B  grantees submitted their FSRs.
HRSA officials stated that grantees were often delayed in submitting their  FSRs because of their end-of-the-year workload, which includes the need  to submit grant applications and multiple reports for their formula and  supplemental funding. HRSA officials stated that grantees normally  request extensions for submitting their FSRs, and 60-day extensions are  typically granted. HRSA officials stated that in grant year 2007, due to the  new process HRSA implemented to address the unobligated balance  provisions, grantees had to implement separate tracking of the  expenditure of current grant year base grant and supplemental funds, and  the expenditure of carryover funding from previous years. HRSA officials  also stated that grantees had difficulty implementing the separate tracking  of these funds. HRSA officials stated that due to grantees’ difficulty  tracking funds separately, some grantees’ FSRs reported inaccurate  unobligated balances, which required HRSA staff to correspond with  grantees and request revised information, creating additional delays.
According to HRSA officials, in addition to experiencing difficulty tracking  funds, grantees were dealing with other factors including late receipt of  final invoices from contractors, delays in receipt of ADAP rebates, and  staff vacancies.
While HRSA has typically approved grantees’ requests for extensions in  submitting their FSRs, the tardiness of grantees’ FSR submissions and  HRSA’s need to correspond with grantees to address their inaccuracies  has delayed HRSA’s ability to determine the amount of unobligated  balances available for redistribution to grantees through Part B  supplemental grants. In April 2009, HRSA officials stated that they planned  to distribute Part B supplemental grants in May 2009. However, as of  September 14, 2009, HRSA had not distributed the 2009 Part B  supplemental grants. As a consequence, HRSA had not yet fully  implemented the unobligated balance provisions for the first time. HRSA  officials stated that they plan to implement changes to improve the  timeliness of their process. For example, HRSA officials also stated that  beginning in grant year 2009 they will no longer approve grantees’ requests  for extensions for their FSR submissions. Additionally, beginning in grant  year 2009, FSRs will be due 30 days after the end of the grant year instead  of the grant year 2007 deadline of 90 days after the end of the grant year.
section_title: In Its 2007 Process, HRSA Attempted to Develop Timely Information on Grantees’ Unobligated Balances but Was Unsuccessful
paragraphs: In its 2007 process, HRSA tried to develop timely information on grantees’  unobligated balances, but these efforts were unsuccessful. For grant year  2007, in order to gain information on grantees’ unobligated balances so  that it could begin to determine how much funding would be available for  distribution as supplemental grants and so that it could provide grantees  with a full year to obligate carryover funds, HRSA requested that grantees  submit estimates of their unobligated balances 60 days before the end of  the 2007 grant year. Because unobligated balance funds that grantees  decide not to carry over and unobligated balance funds from carryover  requests that are not approved by HRSA are available for redistribution  through supplemental grants, HRSA officials needed to complete  processing of the carryover requests before they could determine the  amount of funding that and could be made available as supplemental  grants.
Many grantees’ estimates of their unobligated balances in advance of the  end of the grant year differed from their actual unobligated balances at the  end of the grant year. In accordance with HRSA’s requirements, many   Part A and Part B grantees submitted estimates of their unobligated  balances with requests to carryover these funds 60 days before the end of  the grant year, but their estimates proved to be substantially different from  the actual unobligated balances reported on their FSRs. Of the 29 Part A  grantees that submitted initial carryover requests, compared to the actual  unobligated balances they submitted on their FSRs, 25 overestimated their  unobligated balances, two grantees underestimated their unobligated  balances, and two grantees correctly estimated their unobligated balances.  Among the grantees that overestimated their balances were nine grantees  that were ultimately able to obligate all of their funding by the end of the  grant year and therefore did not need to carry over any funds. Of the 24  Part B grantees that completed initial carryover requests, compared to the  actual unobligated balances they submitted on their FSRs, 18  overestimated their unobligated balances. Two of these grantees, New  York and New Jersey, overestimated their unobligated balances by more  than the amount they received from HRSA based on their initial carryover  requests and had to request that HRSA return the grant year 2007  carryover funds that the grantees had previously requested be transferred  into their grant year 2008 accounts. Six grantees underestimated their  unobligated balances. Nine grantees that overestimated their balances  were ultimately able to obligate all of their funds by the end of the grant  year and did not need to carryover any unobligated balances.
The process of approving grantees’ initial carryover requests sometimes  extended into the 2008 grant year. As a result, grantees were not  authorized to use carryover funds at the expiration of the 2007 grant year  as provided for by RWTMA. HRSA officials stated that the implementation  of procedures to process, approve, and authorize carryover funding  required significant staff time from the HRSA project officer, grants  management staff, and program managers. The HRSA process called for  staff to review these initial carryover requests, approve them, and  authorize carryover funding to be transferred from the grantees’ 2007  accounts into their 2008 accounts. HRSA officials stated that the multiple  grantee submissions, which often included revised proposals, resulted in  processing delays and confusion for HRSA staff. On average, it took HRSA  staff 3 months to complete processing of Part A grantees’ initial  unobligated balance carryover requests and 4 months for Part B grantees.  Because grantees were only given until the end of grant year 2008 to  expend carry over funds, grantees who received authorization to carryover  funds after the start of the grant year did not have the entire grant year to  expend these funds.
In light of HRSA’s difficulty implementing procedures related to the  submission of initial carryover requests and the differences between  grantees’ estimated and actual unobligated balances, HRSA has decided to  discontinue its process of approving initial carryover waiver requests  based on estimated unobligated balances.
section_title: HRSA Has Taken Actions to Collect Client-Level Data, but Some Grantees Did Not Submit Initial Reports by the Deadline
paragraphs: HRSA has taken actions to collect client-level data by implementing a new  data collection and reporting system. It has also provided financial and  technical assistance to grantees and service providers implementing their  own client-level data and reporting systems. In addition, HRSA developed  a timeline for the submission of reports covering the initial reporting  period using client-level data, but some grantees did not submit the initial  reports by the deadline.
subsections: section_title: HRSA Has Taken Actions to Collect Client-Level Data by Implementing a New Data Collection and Reporting System
paragraphs: HRSA has taken actions to collect client-level data from CARE Act  grantees and service providers. Beginning in December 2007, after the  initial design and development of a client-level data collection and  reporting demonstration project, HRSA held meetings with CARE Act  grantees, national organizations, and federal agencies to discuss collecting  and reporting client-level data. Topics discussed included data collection  and reporting barriers, data elements to be collected, how the data would  be used, and the technical assistance that would be available from HRSA.  Using information from these sessions, HRSA finalized the Ryan White  HIV/AIDS Program Services Report (RSR), its client-level data collection  and reporting system. RSR consists of three reports: the Grantee Report,  the Service Provider Report, and the Client Report. RSR was submitted to  the Office of Management and Budget for approval in November 2008,  which granted approval for HRSA to collect data from grantees and  service providers using RSR in March 2009.
HRSA stated that RSR will improve information on the clients served, the  services provided to clients, and the outcomes of the services provided.  RSR is designed to provide HRSA with a more accurate measure of the  number of unique clients receiving CARE Act-funded services by assigning  each individual an encrypted Unique Client Identifier thereby allowing the  tracking of individuals who receive services from multiple providers.  Because RSR will contain client-specific data, HRSA will be able to  determine the services each client received and the outcomes of these  services.
RSR is part of a process through which HRSA plans to collect information,  including client-level data, from grantees and service providers funded  under CARE Act Parts A, B, C, D, and F. First, the grantees and service  providers collect data using their own data collection systems. Second, the  grantees and service providers report the data to HRSA in specified  reports using RSR. HRSA has stated that it intends to use the data  collected through RSR to generate reports on the use of CARE Act funds  and the providers that receive them. HRSA reports are expected to provide  client-level information on the characteristics of the clients served, the  types of services they received from the provider, and their current health  status. Additionally, HRSA has stated that it intends to conduct detailed  analyses of national and regional information about clients and services.
section_title: HRSA Has Provided Financial and Technical Assistance to Grantees to Develop Their Own Client- Level Data Collection and Reporting Systems
paragraphs: HRSA provided financial assistance to CARE Act grantees to develop or  adapt their client-level data collection and reporting systems so that they  could submit the required information to RSR. There are grantees who  must develop new systems while other grantees’ systems require  modification to enable them to generate data compatible with the  requirements of RSR. HRSA administered a Special Projects of National  Significance (SPNS) initiative in fiscal year 2008 and another in fiscal year  2009 to provide funds to support CARE Act grantees in developing client- level data systems that could be used to report information to RSR.  Under the fiscal year 2008 SPNS initiative, HRSA awarded 17 grants  ranging from $87,000 to $200,000 to all 17 CARE Act Parts A and B  grantees that applied for funding. Under the fiscal year 2009 SPNS  initiative, HRSA awarded a total of approximately $4 million to all 57   Parts C and D grantees that applied for funding. Officials from 4 of the 17  health departments we interviewed stated that they received financial  assistance from HRSA to develop and implement a client-level data  collection and reporting system. Two of these health departments received  $200,000 each. One of these health departments used the funding to help  build its own new system while the other department used the funding to  adapt its current system to be compatible with CAREWare, a free, data  collection system available through HRSA’s Web site. In addition to the  SPNS funds, HRSA has made other funding available for infrastructure  development. In 2008, HRSA provided a total of more than $1 million to 15  CARE Act Part C grantees that included funds for them to develop their  client-level data systems. As of April 2009, HRSA was reviewing 72  applications for infrastructure development grants.
HRSA also provided technical assistance to CARE Act grantees and  service providers to develop client-level data collection and reporting  systems. HRSA established the Technical Assistance Resources, Guidance,  Education & Training Web site to provide information and resources, such  as help desk support. HRSA conducted training sessions and webcasts to  provide information on issues relating to implementing a client-level data  system. Additionally, HRSA established the RSR Triage Committee to  monitor and address the technical assistance needs of grantees. The  committee meets weekly to discuss technical assistance concerns of  grantees and monitors contractors charged with addressing technical  concerns on behalf of HRSA. Officials from 7 of the 17 health departments  we interviewed told us that they received technical assistance from HRSA  to develop and implement a client-level data collection and reporting  system. For example, one state grantee told us that HRSA provided a 2-day  training session on CAREWare in November 2008. The HRSA official  returned in March 2009 to provide assistance in implementing the  CAREWare system.
The state and local health departments that we interviewed have taken  steps to implement a client-level data collection and reporting system that  can report client-level data to RSR. Officials from all 17 health  departments we spoke with stated that they either already had a client- level data system or were implementing such a system. Officials from six  health departments indicated that they either currently use or plan to use  CAREWare. The other eleven said they will use or plan to use a  customized or vendor-distributed client-level information data system.  Officials from 8 of the 17 departments stated that they had a system to  collect client-level data before HRSA’s requirement to implement such a  system.
Officials from 10 of the 17 health departments we interviewed had  concerns or challenges with implementing a client-level data collection  and reporting system and reporting client-level data to HRSA. For  example, officials from three health departments stated they were  concerned about how to train service providers and other partners to  collect client-level data. An official from 1 of these 3 health departments  mentioned that it had been a challenge for his state to train the 100 case  managers in the state to report client-level data in a consistent manner.  Additionally, officials from three departments stated that they were  concerned with potential breaches in the confidentiality of client  information when data are entered into the RSR system.
section_title: HRSA Developed a Timeline for Submitting the Initial Reports to RSR, but Some Grantees Did Not Submit Initial Reports by the Deadline
paragraphs: HRSA developed a timeline for grantees to submit their initial reports to  RSR, but some grantees did not submit initial reports. The initial RSR  reporting period covered January 1, 2009, through June 30, 2009; however,  the deadlines varied for the different reports. Table 2 provides a  description of the reports to be submitted to RSR by grantees and service  providers and the deadline for the initial reporting period for each report.
While most grantees submitted a Grantee Report to HRSA by the July 31,  2009 deadline, some did not do so. For the initial RSR reporting period,  538 of 638 (about 84 percent) CARE Act grantees submitted Grantee  Reports to HRSA by the deadline. According to HRSA officials, as of  August 13, 2009, of the 100 grantees and service providers that had not  submitted their required reports, 50 had started the submission process  and 50 had not begun. HRSA officials told us that they are contacting the  grantees to determine the cause of the reporting delays. HRSA officials  also stated that they are aware that some grantees have had problems  generating data in the RSR-required format.
section_title: The Number and Size of ADAP Waiting Lists Is Increasing
paragraphs: The number of individuals on ADAP waiting lists increased during grant  year 2008 and has continued to increase in 2009. In the first quarter of  grant year 2008 (April 1, 2008, through June 30, 2008), 2 ADAPs had  waiting lists with a total of 55 people on those lists. In the fourth quarter of  grant year 2008 (January 1, 2009, through March 31, 2009), there were 3  ADAPs with waiting lists, but the number of individuals on the lists had  increased to 112. By August 10, 2009, the most recent date for which data  were available at the time of our analysis, these numbers had grown to 136  individuals on 4 ADAP waiting lists. Overall, this represents an increase of  147 percent (from 55 to 136) in the number of individuals on waiting lists  from the first quarter of grant year 2008 to August 2009. Kentucky,  Montana, Nebraska, and Wyoming all had waiting lists in August 2009.  Nebraska had the largest ADAP waiting list with 71 individuals while  Wyoming had the smallest list with 5 individuals. Five ADAPs had waiting  lists at some point during the time period we examined. Montana had a  waiting list at all three points while Kentucky and Wyoming had a waiting  list at one of those times. Indiana and Nebraska had a waiting list at two  points. Table 3 lists the grantees with ADAP waiting lists and the number  of individuals on those lists.
We also found that the total number of individuals enrolled in ADAPs  increased during grant year 2008. In the first quarter of grant year 2008,  164,849 individuals were enrolled in ADAPs. The number enrolled by the  fourth quarter of grant year 2008 was 177,746, an increase of 7.8 percent.  Similarly, the number of individuals receiving at least one medication from  an ADAP increased. In the first quarter of grant year 2008, 121,075 received  at least one medication while 134,019 individuals received at least one  medication in the fourth quarter of grant year 2008, an increase of   10.7 percent.
The increase in the number and size of ADAP waiting lists, as well as the  increase in the number of individuals enrolled in and receiving  medications through ADAPs, indicates increased financial pressure on  ADAPs as ADAPs balance client needs with available resources. HRSA  officials told us that because of financial pressures they are closely  monitoring five ADAPs—Arizona, Arkansas, California, Kentucky, and  Iowa—for the initiation or expansion of waiting lists or other cost-control  measures. For example, Arkansas is considering establishing an ADAP  waiting list while Kentucky projects that additional individuals will be  added to its waiting list. Arizona’s ADAP reduced the number of drugs on  its formulary effective July 1, 2009, because of a budgetary shortfall.  Additionally, Arizona’s ADAP still anticipates a budgetary shortfall this  grant year even with the reduced number of drugs on its formulary and is  considering additional cost-control measures.
ADAP officials we interviewed also indicated that ADAPs were under  increasing financial pressure. For example, Hawaii officials expressed  concern that they will have to establish a waiting list. They stated that they  are facing higher drug prices and an increasing number of people enrolled  in their ADAP. Washington state officials noted that they are facing ADAP  budget constraints. An advisory committee has developed a number of  possible cost-control measures to stay within budget, including reducing  the number of drugs on the ADAP formulary and reducing payments to  pharmacies and medical laboratories.
section_title: Conclusions
paragraphs: HRSA has been working to implement the unobligated balance provisions  of RWTMA since its enactment in December 2006. As a result of the  requirement to cancel unobligated balances and, in some cases, penalize  grantees, HRSA implemented complex processes that have been difficult  for grantees to comply with, thus delaying HRSA’s first implementation of  the requirement. To implement the unobligated balance provisions, HRSA  has required information on the amount of unobligated balances at the end  of the grant year that some grantees either did not provide in a timely  manner or that was inaccurate, or both. Three years after enactment of  RWTMA, HRSA was continuing to develop its process for implementing  the provisions and making adjustments based on some grantees’ continued  inability to comply with the process that HRSA established. In addition, at  least one key provision, the use of Part B supplemental grants to  redistribute unobligated funds, has yet to occur for the first time. Because  funds for these grants are only available until September 30, 2009, HRSA is  at risk of losing the authority to make these grants.
HRSA officials told us that, for grant years 2008 and 2009, they have  changed their process for implementing the unobligated balance  provisions in order to alleviate the burden on staff and to ensure that  HRSA has the information it needs to implement the unobligated balance  provisions in a timely manner. However, even with a changed process,  HRSA will continue to depend upon grantees to provide useful information  on their unobligated balances in a timely manner. This will not be achieved  if grantees continue to provide information after the deadline by which it  is required. HRSA must have complete, accurate, and timely information  from grantees to complete the entire process to redistribute unobligated  balances as supplemental grants within the period given for obligation of  funds for Part A and Part B of the CARE Act.
section_title: Recommendations for Executive Action
paragraphs: To help ensure that HRSA is able to implement the unobligated balance  provisions in a timely manner, we recommend that the Secretary of HHS  instruct the administrator of HRSA to take the following two actions to  obtain timely and accurate information on grantees’ unobligated balances:  Identify the causes of grantees’ difficulties in providing a timely and  accurate accounting of their unobligated balances.
Ensure that grantees adhere to deadlines for submission of their  unobligated balances by developing steps to assist them in overcoming the  causes of difficulties identified in accounting for unobligated balances.
section_title: Agency Comments
paragraphs: HHS reviewed a draft of the report, but did not comment on our  conclusions and recommendations. HHS’ comments are reprinted in  appendix I. We incorporated HHS comments and technical comments as  appropriate.
We are sending copies of this report to the Secretary of Health and Human  Services. The report is also available at no charge on GAO’s Web site at  http://www.gao.gov.
If you or your staffs have any questions, please contact me at (202) 512- 7114 or crossem@gao.gov. Contact points for our Offices of Congressional  Relations and Public Affairs may found on the last page of this report.  Other staff who made major contributions to this report are listed in  appendix II.
section_title: Appendix I: Comments from the Department of Health and Human Services
section_title: Appendix II: GAO Contact and Staff Acknowledgments
subsections: section_title: Acknowledgments
paragraphs: In addition to the contact above, Thomas Conahan, Assistant Director;  Robert Copeland, Assistant Director; Leonard Brown; Romonda McKinney  Bumpus; Cathleen Hamann; Sarah Resavy; Rachel Svoboda; and Jennifer  Whitworth made key contributions to this report.