Ryan White Care Act: Improvements Needed in Oversight of Grantees
Released: 2012-07-11T00:00:00


Highlights: section_title: Why GAO Did This Study
paragraphs: Each year, half a million people affected by human immunodeficiency virus (HIV) and acquired immunodeficiency syndrome (AIDS) receive services funded by CARE Act grants. HRSA, an agency within HHS, awards CARE Act Part A grants to localities and Part B grants to states and territories. These grantees may provide services themselves or may contract with service providers. HRSA POs monitor grantees, but grantees are to monitor their service providers. PO oversight includes routine monitoring, site visits, and monitoring of special award conditions, such as restrictive drawdown. GAO was asked to 1) evaluate HRSA’s oversight of CARE Act grantees and 2) examine steps HRSA has taken to assist CARE Act grantees in monitoring their service providers. GAO conducted a review of grantee files from 2010 and 2011 for 25 selected Part A and B grantees, reviewed HHS and HRSA policies, interviewed HRSA officials, analyzed HRSA data on site visits and interviewed grant officials from GAO’s 25 selected grantees and 6 selected service providers.

section_title: What GAO Found
paragraphs: The Department of Health and Human Services’ (HHS) Health Resources and Services Administration (HRSA) does not consistently follow HHS regulations and guidance in its oversight of Ryan White Comprehensive AIDS Resources Emergency Act of 1990 (CARE Act) grantees when conducting key elements of grantee oversight, including routine monitoring and implementing restrictive drawdowns. Additionally, HRSA did not demonstrate a risk-based strategy for selecting grantees for site visits. Project officers (POs) do not consistently document routine monitoring or follow up on that monitoring to help grantees address problems, as required by HHS and HRSA guidance. The purpose of routine monitoring is to enable POs to answer grantee questions about program requirements, provide technical assistance (TA), and follow up on grantee corrective actions in response to previously provided TA. However, GAO found that most POs did not document routine monitoring calls with grantees—only 4 of the 25 PO files GAO reviewed from 2010 and 8 of the 25 files GAO reviewed from 2011 contained documentation of monitoring calls at least quarterly. HRSA often did not follow HHS regulations and guidance in implementing restrictive drawdowns, a special award condition HRSA can place on grantees with serious problems. Restrictive drawdown requires that prior to spending any grant funds, grantees must submit a request, along with documentation of the need, for funds for HRSA review. Six of the 52 Part A grantees and 13 of the 59 Part B grantees were placed on restrictive drawdown from 2008 through 2011. GAO found that HRSA did not consistently provide grantees in GAO’s sample that were on restrictive drawdown with the reasons the restrictive drawdown was implemented, instructions for meeting the conditions of the restrictive drawdown, or guidance on the types of corrective actions needed. This has limited the effectiveness of restrictive drawdown as a tool for improving grantee performance. Regarding the oversight of grantees through site visits, HRSA did not demonstrate a clear strategy for selecting the grantees it visited from 2008 through 2011. For example, HRSA did not appear to prioritize site visits to grantees based on the amount of time that had passed since a grantee’s last site visit. Although many HRSA POs GAO spoke with said that site visits were a valuable and effective form of oversight, GAO found that 44 percent of all grantees did not receive a site visit from 2008 through 2011 while others received multiple visits.

Grantees are required to oversee the service providers with whom they contract and in April 2011, HRSA issued the National Monitoring Standards for grantee monitoring of service providers. The standards describe program and financial requirements and include 133 requirements for Part A grantees and 154 requirements for Part B grantees. Though the standards were intended to improve grantee monitoring of service providers, some grantees said that a lack of training and TA has hindered its implementation. Additionally, some grantees have found the requirement for annual site visits of service providers to be challenging. HRSA officials said that they believe they provided adequate training to grantees in implementing the standards, which did not represent new requirements.

section_title: What GAO Recommends
paragraphs: GAO is making several recommendations, including that HRSA implement key elements of grantee oversight consistent with guidance, including restrictive drawdowns; develop a strategic approach for selecting grantees for site visits; and work to identify grantees’ training needs in order to comply with the National Monitoring Standards. HHS concurred with the recommendations.

section_title: Letter
paragraphs: An estimated 1.2 million people in the United States are living with human  immunodeficiency virus (HIV) infection in 2012, and approximately 50,000  new infections occur annually. Since the first cases of acquired  immunodeficiency syndrome (AIDS) were reported in June 1981, more  than 600,000 people with AIDS have died. Each year, half a million  uninsured or underinsured individuals and families affected by HIV/AIDS  receive assistance funded by grants provided for in the Ryan White  Comprehensive AIDS Resources Emergency Act of 1990 (CARE Act).  CARE Act funds are distributed to grantees such as states, localities, and  other public or nonprofit entities; these grantees may provide CARE Act  program services themselves or may contract with service providers to  offer the medical care or support services needed to achieve positive  medical outcomes. The CARE Act is administered by the Department of  Health and Human Services’ (HHS) Health Resources and Services  Administration (HRSA). In fiscal year 2012, HRSA allocated over   $2.3 billion of its annual appropriation to CARE Act programs.

Members of Congress have asked questions about HRSA’s ability to  adequately oversee Ryan White grantees and service providers to ensure  that CARE Act funds are used properly and effectively. CARE Act  grantees are monitored by HRSA project officers (PO) and other grants  management officials, and federal regulations require grantees to monitor  their service providers’ compliance with program requirements. Grantees  or service providers found to be in violation of program or federal grants  management requirements are to receive technical assistance (TA) or  other corrective actions designed to bring them into compliance. report, we (1) evaluate how HRSA oversees CARE Act grantees and   (2) examine steps HRSA has taken to assist CARE Act grantees in  monitoring their service providers.

HRSA defines technical assistance as the delivery of practical program and technical  support which may include necessary technical and nonfinancial assistance, fiscal and  program management assistance, operational and administrative support, and the  provision of information to grantees regarding the variety of resources available to them,  and how those resources can best be used to meet the health needs of their clients.

U.S. territories and associated jurisdictions and comprise about   55 percent of CARE Act grants. Part B also provides for grants under the  AIDS Drug Assistance Program (ADAP) through which drugs are  provided to eligible individuals with HIV/AIDS. Our review was limited to  Part A and Part B grantees and their service providers.

To evaluate how HRSA oversees CARE Act grantees, we reviewed HHS  and HRSA policies and procedures, conducted a review of selected  grantee files, interviewed selected Part A and Part B grantees, HRSA  POs, and selected national organizations with HIV/AIDS expertise, and  reviewed HRSA data on site visits and staffing. First, we reviewed HHS  and HRSA policies and procedures for overseeing grantees and service  providers. We interviewed HRSA staff about policies and procedures for  overseeing grantees and service providers, as well as about coordination  among HRSA oversight personnel. Second, we selected a  nongeneralizable sample of 25 of the 111 Part A and Part B grantees—12   To select our  of the 52 Part A grantees and 13 of the 59 Part B grantees. sample we divided all of the Part A and Part B grantees into two  categories based on whether or not they had been found to be in violation  of program or financial requirements from 2008 through 2011. We then  chose grantees from each of these two categories to reflect a range of  funding levels, geographic factors, and grant longevity. We reviewed the  files HRSA maintained for this nongeneralizable sample of 25 Part A and Part B grantees. We reviewed these files for grant years 2010 and 2011.

Our file review included a review of the grantees’ reports for grant years  2010 and 2011 in response to requirements, located in HRSA’s Electronic  Handbook (EHB); review of external audit files for these grant years; and  review of the grantee’s PO files, which include important documentation  of site visits and routine monitoring, among other things, for these grant  years. To conduct this file review, we developed and used a data  collection instrument to determine if the files included evidence of  required monitoring and key monitoring documents. Third, we conducted  structured interviews with POs that had responsibility for monitoring  grantees selected for our file review about the grantee files, and obtained  their views on their roles and responsibilities and on HRSA’s policies and  procedures. We also conducted structured interviews with all 25 of the  grantees selected for our file review to learn about how HRSA oversees  its grantees. In addition, we interviewed staff from national organizations  with HIV/AIDS expertise, including the Kaiser Family Foundation, the  National Alliance of State and Territorial AIDS Directors (NASTAD), the  Communities Advocating Emergency AIDS Relief Coalition, the ADAP  Advocacy Association, and the National Association of County and City  Health Officials. Fourth, we analyzed data provided by HRSA on its  oversight of grantees, including PO staffing and HRSA site visits. To  assess the reliability of these data we compared the data provided to us  by HRSA with information provided to us by our selected 25 grantees  when possible. We asked HRSA to resolve discrepancies either within the  data or between the data and information provided by our selected  grantees. We generally found all of the data reliable for our purposes. We  also assessed HRSA grantee monitoring processes described in  documentary and testimonial evidence against relevant criteria, including  HHS policies, HRSA policies, Office of Management and Budget (OMB)  guidelines, and federal regulations for grants management.

To examine steps HRSA has taken to assist CARE Act grantees in  monitoring their service providers, we conducted interviews of grantees  and service providers, interviewed HRSA staff, and reviewed HRSA  standards. First, we conducted structured interviews with all 25 of the  grantees selected for our file review and a nongeneralizable sample of   6 service providers to learn about how grantees monitor their service  providers. We included only those service providers that provide medical  services. We selected our sample of 6 service providers based on the  grantees’ responses to our questions about frequency of service provider  site visits, the frequency and type of TA they provide to their service  providers. HRSA provided us with a spreadsheet listing all of the service  providers for each of our 25 grantees. We limited this list to service  providers that received at least $100,000 in CARE Act funding and  provided medical services. We then selected one service provider from  this limited list for each of 6 grantees using the information indicated  above. Second, we interviewed HRSA staff about policies and procedures  for overseeing grantees and service providers. Third, we reviewed the  HRSA National Monitoring Standards, which were developed by HRSA to  help Part A and Part B grantees meet federal requirements for program  and financial monitoring of their service providers. These standards were  implemented in 2011.

We conducted this performance audit from April 2011 to June 2012 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: Under the CARE Act, Part A and Part B grantees are awarded grants to  provide a range of services—both medical and support—to uninsured   and underinsured clients with HIV/AIDS. In fiscal year 2011, most   CARE Act funding was distributed to grantees either as base or  supplemental grants. Base grants are distributed by formula, which  includes a grantee’s share of living HIV/AIDS cases. Supplemental  grants are generally awarded through a competitive process based on the  demonstration of severe need and other criteria. Part A provides for  grants to EMAs and TGAs. EMA and TGA funding is primarily provided  through three categories of grants: (1) formula grants, (2) supplemental  grants, and (3) Minority AIDS Initiative (MAI) grants. Part B provides for  grants to states, the District of Columbia, and U.S. territories and  associated jurisdictions. These grants include (1) formula grants,   (2) supplemental grants, (3) ADAP formula grants, (4) ADAP   supplemental grants, (5) MAI grants, and (6) supplemental grants for  states with “emerging communities”. Part A and Part B grantees apply  for funding annually.

The PO is the HRSA official responsible for working with grantees in  overseeing the programmatic and technical aspects of the Part A and  Part B grants. Within HRSA, POs in the HIV/AIDS Bureau’s (HAB)  Division of Service Systems are responsible for the oversight of Part A  and Part B grantees. POs are supervised by HAB Division of Service  Systems branch chiefs, who are responsible for ensuring that POs are  meeting their oversight responsibilities. The PO works with the HRSA Office of Financial Assistance Management’s grants management  specialists (GMS). GMSs are responsible for providing nonprogrammatic  administrative assistance to grantees, including assistance in interpreting  provisions of grants administration, law, regulation and policy. These  provisions include how grantees can draw down grant funds and how  grantees are to administer and close out grants. GMSs are supervised by  Grants Management Officers. Additionally, within the Office of Federal  Assistance Management, staff in the Division of Financial Integrity (DFI)  provide TA and advice to the POs and GMSs.

HRSA POs conduct their oversight of Part A and Part B grantees in  accordance with regulations and guidance. HHS grants management  regulations and guidance govern all HHS grants, including CARE Act  grants. The regulations and guidance provide for the creation of agency  and program-specific guidance. Where HRSA has not created specific  guidance, POs and GMS follow the overarching HHS regulation and  guidance. Therefore, POs follow HHS regulations and guidance and any  additional HRSA-specific grants management guidance when it is  available. HRSA officials told us POs are to follow the Division of Service  System Operations Manual (HRSA Operations Manual), which provides  guidance and protocols specifically for PO oversight of CARE Act Part A  and Part B grantees. The HRSA Operations Manual was first provided to   Because the  us in August 2011 and updated in December 2011.updated HRSA Operations Manual was not in existence during the  majority of the period covered by our review, we primarily refer to HHS  grants management regulations and guidance in our evaluation of  HRSA’s oversight. HRSA’s grantee oversight includes several elements,  described below.
subsections: section_title: Routine Monitoring
paragraphs: HRSA POs are responsible for overseeing the Part A and Part B  programs by conducting routine monitoring of grantees’ performance and  compliance with statutory requirements, regulations, and guidance.  Routine monitoring includes regularly scheduled monitoring calls, reviews  of grantee reports, and the provision of TA to grantees. HHS guidance  indicates that monitoring activities are to be documented. This guidance  also indicates that the documentation is to include information about the  type of follow-up actions recommended or taken. We found that POs  were assigned an average of six Part A and Part B grantees to oversee at  a time. If during the course of routine monitoring a PO finds that a grantee  has not met its program or financial requirements, the PO is responsible  for determining, in consultation with his or her branch chief, whether a  grantee requires more intensive monitoring including a special condition  of award, such as restrictive drawdown. The PO is responsible for  monitoring any of these special conditions put in place. POs are HRSA’s  primary contact with Part A and Part B grantees, and they are to  communicate with their assigned grantees at least monthly. In addition to  a scheduled routine monitoring conference call with grantee  management, POs are to respond to interim grantee e-mails and calls  and to provide guidance and TA as needed.

As part of routine monitoring, POs are also responsible for reviewing  reports filed by grantees to fulfill HRSA’s annual reporting requirements.  These reports are intended to help HRSA identify grantee problems with  program implementation and ensure grantees’ compliance with federal  statutes, regulations, and guidelines. In fiscal year 2012, Part A grantees  are required to submit 11 different reports while Part B grantees are  required to submit 16 reports. The reports contain important  programmatic and financial information such as descriptions of funded  services, annual expenditures, and grantee accomplishments and  challenges in meeting program goals. POs are to provide feedback to  grantees based on their review of these reports and provide written  requests for changes to reports which are submitted through EHB. The  PO and GMS are also responsible for reviewing grantee reports to ensure  that grantees are spending funds in accordance with the grant terms and  conditions and POs and GMSs are to coordinate in their review of  grantees’ reports. Grantee reporting requirements are listed in appendix I.

When a PO identifies a problem during routine monitoring the PO is to  provide TA to help the grantee understand the changes needed to  address the problem. TA is a targeted means of addressing a particular  issue or problem and is provided to ensure that program implementation  reflects the most recent requirements. The overall intent of TA is to assist  the grantee in improving its capacity, effectiveness, and efficiency. A PO  may provide the TA by phone, email, on-site or at grantee conferences.  POs may provide the TA or assist grantees in obtaining TA from HRSA  consultants.

section_title: Site Visits
paragraphs: In addition to their overall routine monitoring responsibilities, POs are to  participate in site visits for Part A and Part B grantees. Site visits are  intended to provide the PO with an opportunity to review the program,  and may act as a TA session for the grantee. HRSA guidance states that  site visits should be viewed as an opportunity to expand on information  grantees have provided in their CARE Act grant application, responses to  reporting requirements, and conference calls. During a site visit, the PO  may meet with grantee and service provider staff to obtain feedback on  how the program is functioning, visit various locations at which service  providers deliver services, and review grantee and service provider  program documentation. For the Part A and Part B programs, HRSA does  not have written guidance describing its policy for the selection of  grantees to visit; however, agency officials told us that they prioritize site  visits based on two elements—grantees without a recent site visit and  grantees with problems. In addition, a federal course which HRSA has  offered to all of its employees for several years and requires all new POs  to take indicates that agencies should determine which grantees to visit  based on an analysis of risk, which includes a consideration of grant  funding level as an indicator of potential risk, among other things.

When planning a site visit, POs are to provide advance notice in writing to  the grantee of the intended site visit along with a copy of the site visit  agenda and the tool the PO will be using to evaluate the grantee. The tool  addresses the priorities listed below during the site visit. If the site visit will  involve the review of a priority item in which the PO does not have  specialized training, such as clinical quality management, the PO can  consider bringing one or more HRSA consultants for the visit.

According to HRSA guidance, POs are to focus on the following priorities  during the grantee site visit (listed below in order of highest to lowest  priority): assure grantee compliance with CARE Act provisions and HRSA  guidance by reviewing compliance with the basic funding  requirements, such as the presence of an adequate plan for the use  of grant funds and administrative, program, and financial  requirements; assure basic functioning of the Part A and Part B programs by  reviewing, for example, the grantee’s ability to disburse funds to  service providers in a timely fashion and the grantee’s ability to  conduct program and financial monitoring of service providers; assure access to care by reviewing the grantee’s clinical quality  management processes and the grantee’s assessment of unmet need  for HIV/AIDS services in their jurisdiction; assure coordinated systems of care by reviewing the grantee’s efforts  to coordinate with other CARE Act programs, HIV counseling, testing  and prevention programs in their area, and other programs that  provide access to HIV/AIDS treatment including Medicaid and  Medicare; and document and report the impact of the grantees’ use of CARE Act  funds including any program innovations and/or program successes.

Upon arrival at the site visit location, the PO is to meet with the grantee  leadership and the Part A or Part B program staff. During the initial  meeting, the PO is to review the intent of the visit and the site visit  agenda. This meeting is also an opportunity for the grantee to provide an  update on the status of the program and the delivery of services. During  the site visit, the PO is to take notes on the priorities listed above, and be  prepared to conduct an exit conference with the grantee leadership and  program staff to explain both preliminary positive and problem findings.  The PO is to prepare a site visit report to document his findings and  recommended corrective actions. Additionally, recommendations are to  be provided for follow-up TA if appropriate and any special action steps  that the PO will take to help the grantee address the site visit findings.  HRSA guidance updated during our review states that the site visit report  is to be provided to the grantee within 30 days of the visit.

section_title: Single Audits
paragraphs: Part A and Part B grantees are subject to the requirements of the Single  Audit Act, as amended, and the act’s implementing OMB guidance.  These provisions require grantees that expend $500,000 or more in  federal awards in a fiscal year to have a single audit for that year  conducted by an independent auditor. HRSA’s Division of Financial  Integrity (DFI) reviews grantees’ single audit reports with findings related  to CARE Act programs along with corrective action plans provided by the  grantee in response to any audit findings.HRSA to use single audits as a tool to monitor Part A and Part B grantee  compliance with program and financial requirements.

section_title: Restrictive Drawdown
paragraphs: In accordance with federal regulations, HRSA may impose special  restrictive conditions on a grantee’s award if HRSA determines that the  grantee violated program or financial requirements, or has insufficient  management systems or practices to ensure stewardship of grant funds  or achievement of award objectives. These issues may be identified  through routine monitoring activities, site visits, or single audits. One such  condition is called restrictive drawdown. Restrictive drawdown requires  that prior to spending any grant funds, grantees must submit a request for  funds for HRSA review by the 20th of each month, for the upcoming  month, or no less than 10 days before the grantee intends to expend the  funds. With each request, the grantee must submit supporting  documentation including all grantee invoices, and other financial  documents related to the request. Upon PO review and approval of the  request and related documentation, HRSA is to make CARE Act funds  available to the grantee. In December 2011, during the course of our  review, HRSA created agency-specific guidance that specified the  reasons Part A and Part B grantees might be placed on restrictive  drawdown, how a grantee is to be notified of this special condition, and  under what conditions a grantee can be removed from restrictive  drawdown. However, this guidance was not in place during the period  covered by our review.

section_title: National Monitoring Standards for Grantee Monitoring of Service Providers
paragraphs: Federal regulations require grantees to oversee their service providers. In  April 2011 HRSA compiled existing requirements into a comprehensive  document called the National Monitoring Standards.designed to help Part A and Part B grantees meet federal requirements  for program and financial management, and to improve program  efficiency. Prior to HRSA’s issuance of the standards, guidance on how to  ensure grantee compliance with program requirements and how to  monitor service providers was found in multiple sources. HRSA expects  the standards to provide direction to grantees for monitoring their own  compliance with CARE Act program and financial requirements and the  performance of their service providers.

HRSA officials told us that the national monitoring standards were  developed in response to two HHS Office of Inspector General reports  that identified the need for a specific standard regarding the frequency  and nature of grantee monitoring of service providers and a clear PO role  in monitoring grantee oversight of service providers.were compiled by HRSA with assistance from a national team of financial  and program experts and a working group of Part A and Part B grantees.  According to HRSA, the working group provided feedback on drafts of the  standards. Additionally, according to HRSA, the standards were  presented to all Part A and Part B grantees in a 2010 Grantee Meeting.  Grantees were notified of their obligation to comply with these standards  in fiscal year 2011.

section_title: Grantee Files
paragraphs: HRSA maintains three different grantee files to assist in its provision of  oversight, monitoring, and TA to Part A and Part B grantees and there is  a different record retention period for each of these three files. Single  audit reports and related financial documentation are maintained in hard  copy audit files by HRSA’s DFI. HRSA’s record management program  requires these files to be kept onsite at HRSA for at least 2 years after the  final close of the audit or upon resolution of any adverse audit findings.  The files are then to be sent to the Federal Records Centers to be  maintained for an additional 4 years.official grantee reports in response to CARE Act grantee reporting  requirements listed in appendix I. It is maintained electronically by the  HRSA Division of Grants Management Operations and the Division of  Service Systems and documents in EHB are accessed by POs and other  grants management staff as part of their routine monitoring  responsibilities. Currently, HRSA maintains the EHB for 6 years, but is   The EHB includes the NOA and  working to finalize a record retention period. Additionally, PO files, which  include the only documentation of routine monitoring, site visits, and TA,  and duplicate copies of the required grantee reports that are also found in  EHB, are maintained in hard copy by the PO. During the course of our  review, HRSA officials told us that HRSA’s record management program  requires these files to be maintained for the current and previous grant  year, after which they were to be destroyed. The December 2011  update to HRSA’s Operations Manual now suggests that POs should  maintain copies of site visit reports for at least 5 years, and that any  documents related to issues under investigation not be discarded.  However, this change does not apply to other key documentation in PO  files, such as regularly scheduled conference calls and copies of relevant  e-mails.

section_title: HRSA Does Not Consistently Follow Guidance on Oversight of Grantees and Faces Other Challenges
paragraphs: HRSA does not consistently follow HHS or its own guidance for grantee  oversight when monitoring CARE Act grantees. A lack of records and  frequent changes in PO assignments further challenge HRSA’s ability to  oversee grantees and to assist them with program implementation.
subsections: section_title: HRSA Does Not Consistently Follow Applicable Guidance for Grantee Oversight
paragraphs: HRSA did not consistently follow guidance for documenting routine  monitoring, prioritizing grantee site visits, reviewing annual single audit  findings, or clearly communicating with grantees about the restrictive  drawdown process.

POs do not consistently document routine monitoring or follow up on that  monitoring to help grantees address problems. HHS guidance indicates  that monitoring activities performed in order to evaluate grantees’  programmatic performance, including any discussions with grantees,  should be documented. This guidance also indicates that documentation  of monitoring actions is to include information about the type of follow-up  actions recommended or taken. However, we found that most of the PO  files that we reviewed did not contain documentation of routine monitoring  calls—of the 25 PO files for grantees in our sample, only 4 PO files  contained documentation of monitoring calls at least quarterly in the 2010  grant files we reviewed, and only 8 contained documentation of quarterly  calls in the 2011 grant files. Though most of the files we reviewed  contained documentation of e-mails between POs and grantees indicating  that communication was taking place, HRSA POs are to conduct and  document regularly scheduled calls. Despite the lack of documentation in  PO files, most grantees we interviewed reported having regular  communication, via phone or e-mail, with their POs. Seventeen of the   25 grantees confirmed that their PO conducted regularly scheduled  conference calls, and 7 noted that these calls included a set agenda.

Most grantees said they had received feedback at least once from a PO  on a required report, but eight noted that such feedback was uncommon.  Grantees submit numerous reports throughout the year containing  important programmatic and financial information. HHS guidance states  that monitoring is to include a review of reports, and that review of reports  may help officials identify performance or financial issues that require  follow-up. Further, HRSA POs are to review and provide feedback and  guidance to grantees on program and fiscal reports. However, seven  grantees said that feedback on reports was not specific or timely. Only  four grantees told us that they received PO comments on their reports  during monthly monitoring calls, though HRSA states that reporting  requirements are to be discussed during routine calls, which are intended  to provide POs with an opportunity to provide such feedback. While a lack  of feedback might indicate that a PO had no concerns about a grantee’s  reports, POs may be missing opportunities to use the information  provided in reports to better communicate with grantees about their  compliance with program requirements and help grantees make  improvements. Seven grantees stated that they would appreciate  receiving more feedback on the reports they submit to ensure they were  meeting HRSA’s standards.

Some grantees told us that TA was not helpful because POs sometimes  provide conflicting or delayed guidance. TA is a key step toward  addressing grantee challenges with program implementation identified  during routine monitoring. Though eight grantees described occasions  when they received helpful TA from HRSA staff or contractors, eight  noted that PO responses to their questions were sometimes delayed or  inconsistent with past verbal guidance provided by their current or a past  PO, making it difficult for them to understand what changes were needed.  For example, one grantee told us it takes an excessive amount of time for  their PO to answer their questions, and another said that PO  responsiveness varied.

Further, four of the 25 grantees said they were told that HRSA could not  provide needed TA due to budget constraints, forcing the grantees to  seek TA from other sources or using their own administrative funds.  Three of those grantees told us that they hired TA providers using their  administrative funds, but one added that the TA cost $30,000 out of their  limited administrative budget, which they noted might not be an option for  many grantees. The CARE Act requires that grantees spend no more  than 10 percent of their grant on administrative activities, which include  TA and service provider monitoring activities. Three other grantees told  us they turned to NASTAD for TA when HRSA could not provide it or  when PO responses to their questions were delayed. Some grantees  noted that HRSA had provided assistance through national TA calls and  webinars, and one added that calls and webinars were a useful substitute  for on-site TA when travel funds are limited. One grantee explained that  they received helpful TA from their PO by phone after a planned TA visit  by the PO was cancelled by HRSA due to constrained travel funds.

We found that 6 of the 25 grantee files we reviewed from 2010 and just 2  of the 25 files from 2011 contained documentation of TA reports and that  few files contained documentation of PO discussions of corrective actions  with grantees. HHS guidance states that monitoring activities and any  resulting follow-up on identified performance issues must be documented,  and issues are to be addressed as soon as possible by providing TA and  ensuring grantees take needed corrective actions. Three grantees told us  that PO follow-up on TA was vague or delayed, though two grantees told  us that their POs did conduct follow-up on TA in monthly conference calls.  Two grantees told us that though they informed HRSA in writing of their  proposed action steps in response to TA recommendations, HRSA did  not provide feedback on their proposed corrective actions. Another  grantee said that they were unable to address site visit findings due to a  lack of timely TA related to the findings.

Some grantees said that their need for TA was exacerbated by the lack of  a current program manual. For example, one grantee explained that a  manual would help them with matters such as grantee reports. HRSA  officials confirmed that the most recent Part A and Part B manuals were  issued in 2006, and stated that these printed manuals were not updated  to reflect the 2009 CARE Act reauthorization. While HRSA officials stated  that policies and procedures had been made available on the CARE Act  website, they acknowledged that information for grantees is not available  in the form of a comprehensive program manual similar to the printed  manual that was last provided in 2006. Seven grantees noted that more  written guidance, including an up-to-date electronic program manual,  would help them with many of their routine questions or TA needs, which  often revolve around questions about CARE Act program requirements.  Two grantees added that such written guidance would be especially  beneficial for new grantee staff or newer grantees. Further, one of the  service providers we spoke with stated that it did not find the HRSA  website to be helpful because links were not always kept up to date. The  Comptroller General of the United States’ Domestic Working Group found  that establishing departmentwide policies and procedures on an internet  site is beneficial to grantees because it allows grantees to find detailed   HRSA officials said that they recently  information in a single location.issued a survey to obtain feedback from grantees about HRSA’s program  operations and processes, including the frequency and timeliness of PO  communication with grantees and their satisfaction with TA provided by  HRSA through conference calls, the HRSA website, and HRSA  contractors. They said that they plan to use the results of this survey to  improve their interactions with grantees.

HRSA did not follow its own policies for selecting the grantees it visited  from 2008 through 2011, and varied in its timeliness for providing site visit  follow-up. According to HRSA officials, the agency cannot visit all of its  111 Part A and Part B grantees each year due to staff and budget  constraints. Therefore, it is necessary for HRSA to be strategic in  selecting which grantees to visit in any given year. HRSA does not have  written guidance describing its policy for the selection of grantees to visit;  however, agency officials told us that they prioritize site visits based on  two elements—grantees without a recent site visit and grantees with  problems. In addition, the Monitoring Grants and Cooperative  Agreements for Federal Personnel manual, which accompanies a federal  course which HRSA has offered to its employees for several years and  requires all new POs to take suggests that agencies should determine  which grantees to visit based on an analysis of risk, which may include  the two elements HRSA told us it uses, as well as a consideration of grant  funding level, among other things. However, our review of HRSA site visit  data suggests that HRSA did not consistently select the grantees it visited  based on these three elements.

First, HRSA did not prioritize site visits based on the amount of time that  had passed since a grantee’s last visit. Specifically, although many HRSA  POs we spoke with said that site visits were a valuable and effective form  of oversight, we found that 44 percent of all Part A and Part B grantees  did not receive a site visit from 2008 through 2011. In addition, 6 of the   25 grantees we interviewed told us that there had been a significant  amount of time between HRSA site visits they had received or since their  most recent site visit, ranging from 5 to 12 years. One of these grantees  said that its first HRSA site visit after 12 years led to the grantee being  placed on restrictive drawdown. Grantee officials said that they believed  that if HRSA had not waited 12 years to conduct a site visit there would  have been far fewer findings because they would have been making  necessary adjustments with each periodic site visit. An additional  indication that HRSA does not consider time since last visit when  scheduling site visits is the fact that HRSA does not maintain a  centralized list of site visits that have been conducted. In order to provide  data on their site visits for the purpose of our review, HRSA extracted  data from travel records. Without centralized site visit data, HRSA would  not be able to readily track this element when determining which grantees  to visit  Second, HRSA did not always appear to prioritize site visits based on a  grantee’s history of problems. Based on HRSA data, we found that   30 percent of all Part A and Part B grantees with a history of problems did  not receive a single HRSA site visit from 2008 through 2011. In addition,  only three of the nine Part A and Part B grantees with the most HRSA site  visits from 2008 through 2011 had been placed on restrictive drawdown.  While HRSA visited these grantees three or more times, other grantees  that were placed on restrictive drawdown received two or fewer HRSA  site visits during these 4 years. Although HRSA officials told us that  restrictive drawdown is not the only indication of grantee problems, they  said they impose it when the grantee has a history of serious problems.  We found that some grantees with numerous site visits had not been  placed on restrictive drawdown, while other grantees with fewer site visits  had. In fact, two grantees that were placed on restrictive drawdown in  2011 did not have a HRSA site visit at any time from 2008 through 2011.

Third, some of the grantees that HRSA visited most during these 4 years  had relatively small grant awards, indicating fewer people being served by  that grantee, which suggests that the agency did not prioritize site visits  based on grant funding level. For instance, the Virgin Islands received  approximately $1 million in 2011 CARE Act Part B funding, based on an  estimated 568 living HIV/AIDS cases at the end of 2009, but HRSA  conducted six site visits there over 4 years. In contrast, California  received the second largest 2011 grant award, approximately   $150 million, based on an estimated 117,869 living HIV/AIDS cases at the  end of 2009, but HRSA did not conduct any site visits there over the   4 years. See table 1 for the Part A and Part B grantees with the most  HRSA site visits and their 2011 grant award and estimated HIV/AIDS  cases, and see appendix II for a complete listing of this information for all  Part A and Part B grantees. HRSA officials explained that the Virgin  Islands had been placed on restrictive drawdown and had a history of  severe problems that included both fiscal and administrative issues and  problems with service delivery. However, other Part B grantees, with  significantly larger grant awards, and a history of problems during the  period covered by our review did not receive a HRSA site visit.  Furthermore, the District of Columbia, which received approximately   $21 million in 2011 CARE Act Part B funding based on an estimated  17,250 living HIV/AIDS cases at the end of 2009, had a history of  problems and would require HRSA to spend little in travel funds to  conduct site visits, but received only one visit over the 4 years. HRSA  officials stated that there is no direct correlation between the amount of  grant funding and the size of a grantee’s problems. However, because  the Part A and Part B grant awards are based on the number of reported  living HIV/AIDS cases in each metropolitan area or state, the grantees  with larger awards serve more affected people.

Furthermore, HRSA often was not timely in providing site visit follow-up to  grantees. HHS guidance states that agencies are to document in writing  site visit reports to grantees as soon as possible after completion of the  visit. At the time of our file review, HRSA did not have guidance for POs  specifying time frames with which to provide site visit reports. Our file  review for grant years 2010 and 2011 found that 12 of the PO files for the  13 grantees that received site visits that occurred during that time period  contained a copy of the site visit report. However, many of the grantees  we interviewed that had a HRSA site visit during the period of our review  said that it took HRSA a long time to provide the site visit report.  Specifically, 15 of the 25 grantees we interviewed told us they had a  HRSA site visit from 2008 through 2011. Eight of those 15 grantees said  that it took over 30 days to receive the site visit report; it took HRSA   4 months or longer to provide 6 of those grantees with the site visit report.  In a December 2011 update to its Operations Manual, which was not in  place during the majority of the period covered by our review, HRSA  specified that POs are to provide site visit reports to grantees within   30 days of the visit.

Some POs we interviewed said that they were not always aware of  grantees’ single audit findings or corrective actions developed in  response to audit findings. According to HHS guidance, HRSA is to  review annual single audit reports as part of its grantee oversight, and  may use annual single audit information in decisions about implementing  special award conditions such as restrictive drawdowns. Though DFI is  the HRSA division primarily responsible for helping to ensure that  grantees take appropriate corrective actions in response to single audit  findings, POs, within HAB, are responsible for providing overall  monitoring of grantees’ compliance with program requirements. We have  found in past work that audits may provide important information on  grantee performance and can serve as an accountability mechanism to  help determine whether grantees used funds in accordance with program  rules and regulations.enhanced by the timely review of single audit findings.

For this reason, PO monitoring could be  However, some POs told us that DFI does not consistently share  information about single audit findings and corrective actions. Though  POs are able to access a summary of a grantee’s HRSA-related single  audit findings in EHB, the EHB summary does not specify whether the  findings are related to CARE Act programs in particular, which might  make it difficult for POs to determine whether the audit contains  information pertinent to their monitoring efforts without explanation from  DFI. DFI officials told us they may contact POs or other HRSA staff to  help review and ensure the adequacy of grantee corrective actions, but  according to POs they do not always do so. Given their knowledge of  grantees through routine monitoring activities, POs could provide DFI with  valuable input regarding grantees’ corrective actions. However, one PO  told us that DFI did not notify her when the grantees in her portfolio had  audit findings, and another told us that DFI did not consistently share  grantee corrective action plans in response to audit findings with her,  though DFI might on occasion alert her if there was an issue with a  grantee audit. One PO reported that she was recently consulted by DFI to  provide input into a grantee’s audit findings, but added that this was the  first time such consultation had occurred. HRSA officials said that they  have enhanced the ways in which DFI communicates audit information to  POs through EHB by including citations about audit findings specific to  CARE Act programs along with grantee corrective actions designed to  address the findings. HRSA officials said that they began doing this as of  April 30, 2012.

The lack of consistent communication about single audit findings across  HRSA divisions limits opportunities for POs to incorporate single audit  information into their monitoring and help HRSA ensure that grantees  take timely and effective corrective actions, as required. This is especially  important given that HRSA may on occasion use single audit findings as  a basis for implementing restrictive drawdowns, which require POs to  work with grantees in reviewing financial information as part of grantees’  drawdown requests, even if the restrictive drawdown was recommended  by DFI. In addition, opportunities for POs to help grantees implement  timely corrective actions may also be affected by the lengthy time frames  of the single audit process. For example, DFI officials told us that a  grantee may be cited for a repeat finding in an audit before they have had  time to correct the finding from the prior year’s audit. We previously  reported that in the Single Audit process it could take 15 months or more  from the end of the fiscal year in which an audit finding is initially identified  before a grantee’s corrective action plan is approved by the responsible  federal agency.opportunity to correct audit findings and POs may not have the   Thus, in some cases, grantees may not have the  opportunity to help ensure that the grantee corrects audit findings before  the following year’s audit is conducted.

Though single audits may contain information important to PO monitoring  of grantees such as an assessment of how grantees are monitoring their  service providers or whether the grantee is properly documenting client  eligibility, some grantees told us that neither POs nor other HRSA staff  generally communicate with them about single audits. Six grantees said  that they did not recollect having any communication with HRSA about  audit findings, though five others noted they had discussed audit findings  with HRSA staff on at least one occasion, including one who said they  discussed their annual single audit with HRSA staff during a site visit.  Three POs told us that grantees sometimes initiate communication about  their single audits. For example, one PO said that although she generally  does not get involved with the audits or receive information from DFI, she  had been contacted by one of her grantees regarding an audit finding,  and therefore reviewed the proposed corrective actions as part of her  routine monitoring.

HRSA often did not communicate or document the reasons for  implementing a restrictive drawdown. Only 2 of the 11 grantees from our  sample of 25 that were on restrictive drawdown said that HRSA  communicated the reasons they were placed on restrictive drawdown. In  five cases, the grantee said they only learned about the restrictive  drawdown upon receiving a new NOA, without prior warning or  explanation from their PO or other HRSA staff. Though the issuance of a  new NOA is the official means of notifying the grantee of the new  condition on their grant award, NOAs do not enumerate the reasons for  the restrictive drawdown. Though HRSA officials stated that grantees  were notified verbally or in some cases by e-mail about their restrictive  drawdown status, we found that the PO files for many of the 11 grantees  in our sample that were on restrictive drawdown did not contain  documentation of the reasons the restrictive drawdown was imposed.  Federal regulations state that when an agency implements a condition on  a grantee award such as a restrictive drawdown, it is to notify the grantee  of the nature of the condition and the reason it is being imposed, and  HHS guidance states that the agency is to document the reasons for use  of the condition in the grant file. According to HRSA, 6 of the 52 Part A  grantees and 13 of the 59 Part B grantees were on restrictive drawdown  from 2008 through 2011.

HRSA also has not consistently provided grantees placed on restrictive  drawdown with instructions about how to meet the conditions for drawing  down funds. HHS guidance states that the agency is to explain the nature  of, and requirements for meeting, the conditions of the restrictive  drawdown. However, 5 of the 11 sampled grantees that were on  restrictive drawdown told us that HRSA did not provide clear instructions  at the time the restriction was imposed for submitting drawdown requests  or the supporting documentation they were required to submit with each  request. Four grantees said that when they were first put on restrictive  drawdown, they had to repeatedly submit their drawdown requests to  their PO before clear expectations were established. One grantee said  that they believed that HRSA was “making up the rules about restrictive  drawdown as they went along,” and another stated that they received no  guidance or written instruction specifying the documentation required as  part of a drawdown request, which caused delays in the processing of  their requests.

Further, HRSA has not consistently provided grantees with guidance on  the types of corrective actions needed, including time frames for making  the required changes, in order to have the restrictive drawdown removed.  Federal regulations state that needed corrective actions and timelines are  to be explained to the grantee at the time a restrictive drawdown is  implemented. Most of the grantees in our sample said that they were not  given a written set of action steps or specific corrective actions needed in  order to have the restrictive drawdown removed. For example, one  grantee told us that although they are willing to do what is needed to have  the restriction removed, HRSA has not provided them with a set of  requirements and timelines either verbally or in writing. Another grantee  said that HRSA did not offer training to the grantee on the requirements  for its restrictive drawdown until over a year after the condition was  imposed. A third grantee stated that though after the restrictive drawdown  process they made a change that will help them hold their service  providers more accountable, the process would have been more  beneficial had they been given a clear picture of the end goals at the  outset.

HRSA officials said that when a restrictive drawdown is lifted, the grantee  is to be notified through a new NOA which is signed by the GMO. HRSA’s  recently issued guidance states that the agency will revisit a grantee’s  restrictive drawdown status once the grantee completes steps such as  submitting documentation of compliance with corrective actions,  completing recommended TA, and implementing a corrective action plan  developed as part of a site visit. However, HRSA has lifted the restrictive  drawdown condition for only two of the grantees in our sample since this  guidance was in place, and it is unclear whether HRSA provided grantees  with a clear plan for the removal of the condition even upon completion of  recommended TA or corrective actions. One grantee explained that each  time they made the changes requested by HRSA, they were given a new  set of requirements to meet. For example, according to a TA report by  HRSA consultants about 1 month after the restrictive drawdown was  implemented, the grantee had taken important steps to address its  financial challenges. Further, documents provided by the grantee indicate  that following the consultant TA report, the PO indicated he would  recommend that the grantee be removed from restrictive drawdown.  However, despite documenting its ongoing work to address its financial  challenges, the grantee was told more than a month later that further  steps would be required before the condition would be removed, and the  grantee remained on restrictive drawdown for approximately 4 more  months. The grantee stated that they were not clearly told what they  could do to have the condition removed despite repeated requests for that  information, and that the costs to the program of remaining on restrictive  drawdown interfered with the possible benefits.

HRSA officials said that HRSA is revising the restrictive drawdown  language to be included in the NOA to include the reasons for the  restriction, needed corrective actions, and the type of documentation  required for the drawdown requests to be processed, and would begin  using this updated language on NOAs for grantees placed on restrictive  drawdown after May 1, 2012. HRSA officials said that grantees are to be  informed in writing of all conditions on their awards and how to proceed in  order to have the conditions removed. They said that, where that is not  occurring, they will work to ensure that it does.

We found that HRSA did not always provide grantees with additional TA  or time to correct deficiencies before placing them on restrictive  drawdown. HHS guidance states that an agency will generally afford the  grantee an opportunity to correct any deficiencies before imposing  conditions such as restrictive drawdown. Two grantees told us they were  placed on restrictive drawdown after a site visit, but one noted that they  were not given an opportunity to address the site visit findings before  being placed on restrictive drawdown. The grantee stated that they  submitted a corrective action plan in response to site visit findings  approximately 2 months after receiving the site visit report, but according  to HRSA the grantee was placed on restrictive drawdown right after the  plan was submitted, suggesting the grantee did not have an opportunity  to implement the corrective action plan before the condition was put in  place.

HRSA has stated that the restrictive drawdown process is a means of  doing more intensive monitoring of grantees experiencing problems with  program implementation, financial management, or other administrative  issues. Two of the grantees in our sample told us that they had more  frequent communication with their PO during monitoring calls or through  e-mails after restrictive drawdown was implemented. In some cases,  however, the restrictive drawdown process may have exacerbated a  grantee’s existing challenges. For example, one grantee said they were  told that they were put on restrictive drawdown because they had an  unobligated balance that resulted from not spending funds at a quick  enough pace. However, the grantee told us that, in part due to a lack of  clear instructions from HRSA, the restrictive drawdown process caused  further delays in their ability to spend grant funds and therefore  aggravated the unobligated balance problem. In another case, a HRSA  financial TA consultant reported that the restrictive drawdown itself was  causing delays in a grantee’s ability to spend its grant funds, which the  consultant feared might lead to a finding in the grantee’s next single audit.

section_title: HRSA’s Lack of Records and Changes in PO Assignments Further Challenge Its Oversight of CARE Act Grantees
paragraphs: HRSA’s lack of records and frequent staff changes in PO assignments  further challenge the agency’s oversight of grantees. HRSA officials told  us that records of grantee oversight are located across three types of the  agency’s files— HRSA’s EHB, which includes official NOAs and required  reports, annual single audit reports, and PO files, which include  monitoring documentation, such as notes from routine calls and TA, and  site visit reports—not just those documents available electronically in  HRSA’s EHB. Therefore, we consider all three of these files together to  be a complete record of grantee oversight. While conducting our file  review, we found that this complete oversight record was only maintained  for the current and previous grant years because, prior to that, consistent  with its records management program, HRSA destroyed documentation  of grantee monitoring only available in the paper PO files. At the time of  our file review midway through the 2011 grant year, all three grantee files  were only available for the first half of grant year 2011 and grant year  2010, which was only approximately a year and a half of documentation.  Therefore, HRSA’s ability to correct previously noted problems with  grantee performance could be limited because easily accessible  documentation of such problems was not maintained. In fact, a HRSA  official told us that he believed that one grantee with a history of problems  should be placed on restrictive drawdown. However, HRSA did not take  this step because they had destroyed the site visit reports containing  findings that would have supported placement on restrictive drawdown. In  a December 2011 update to HRSA’s Operations Manual, which was not  in place during the majority of our review, HRSA specified that POs are to  maintain copies of site visit reports for at least 5 years, and any  documents related to issues under investigation for as long as necessary.  However, this change does not apply to other key documentation in PO  files, such as regularly scheduled conference calls and copies of relevant  emails.

Furthermore, frequent PO changes in monitoring assignments could  compound the challenges created by HRSA’s lack of long-standing  documentation and possibly limit HRSA’s institutional memory for a given  grantee. Specifically, according to HRSA data, from 2008 through 2011,  93 of the 111 Part A and Part B grantees had at least two or three  different POs and 2 grantees had four different POs during this time.

HRSA’s frequent changes in PO assignments could leave a recently  transitioned PO and his new grantee at a disadvantage. For example,  during our file review, we found that one of the grantees in our sample, a  grantee with a history of problems that had been placed on restrictive  drawdown, was missing documentation of monitoring calls for the 2010  grant year. That grantee’s current PO began monitoring the grantee near  the beginning of the 2011 grant year and she explained that she did not  receive documentation of any monitoring calls that had occurred under  the previous PO.

Some of the grantees we interviewed said that frequent PO changes  resulted in variation in HRSA oversight. Eight of the 25 grantees we  spoke with expressed concern about changes in their POs and 13  described the variation in PO monitoring styles that grantees had to  adjust to when a new PO was assigned. For example, 1 grantee that had  three POs from 2008 through 2011 told us that the PO changes resulted  in delayed responses from HRSA and contradictory information being  provided by different POs, which created confusion for the grantee and  delays in funding distribution to service providers. Conversely, a grantee  that had one PO during this time period told us that having a  knowledgeable PO who serves for a long period of time creates better  management of the grant because the PO develops important institutional  memory about the grantee and its program.

section_title: HRSA Recently Issued National Standards for Grantee Monitoring of Service Providers, but HRSA’s Implementation Created Challenges for Grantees
paragraphs: Federal regulations require grantees to oversee service providers and, in  April 2011, HRSA issued the National Monitoring Standards, a  compilation of requirements for grantee monitoring of service providers.  Some grantees said that their implementation of the standards was  hindered by insufficient HRSA assistance and the annual site visit  requirement.
subsections: section_title: Grantees Monitor Service Providers and HRSA Recently Issued National Standards
paragraphs: Federal regulations require grantees to oversee service providers. HRSA  told us that grantees are required to report to HRSA on their approach to  service provider monitoring activities in annual grant applications. HRSA  also verifies this information through grantee site visits and a review of a  list of service providers, which grantees are required to submit annually.  The number of service providers for Part A and Part B grantees ranges  greatly. For example, Nebraska had only 3 service providers in 2011,  whereas New York had 83 providers. Grantees we interviewed said they  use a variety of tools to monitor their service providers, including frequent  phone and e-mail communication, monthly service provider meetings, site  visits, training, or reviews of financial and program reports. Specifically,  most of the 25 grantees we interviewed told us that they are in at least  monthly, if not daily, communication with their service providers. In  addition, all but four grantees conduct service provider site visits at least  annually. Of the four grantees that were not conducting site visits  annually, two large states conducted site visits every 2 years, with one of  those states visiting service providers with performance issues more  frequently; one midsize state conducted site visits every 3 years; and one  small state had not conducted site visits in many years. However, all but  one of these grantees were in the process of beginning annual site visits  at the time of our interview.

In April 2011, HRSA issued the National Monitoring Standards, which it  describes as a compilation of existing requirements for grantee  monitoring of Part A and Part B service providers. The standards include  133 requirements for Part A grantees and 154 requirements for Part B  grantees. These standards describe program and financial requirements,  program-only requirements, and financial-only requirements. (See   table 2.)

According to HRSA, these standards consist of preexisting requirements  for program and financial management, monitoring, and reporting that are  based on federal statutes, regulations, and program guidance and  consolidates these requirements into one location to assist grantees.  Table 3 provides examples of the standards.

More than half of the 25 grantees from our sample said that they found  the training and/or TA HRSA has provided on the National Monitoring  Standards to be insufficient because it has not answered all of their  questions about HRSA’s expectations for how they should implement the  standards. According to HRSA officials, HRSA has offered two webinars,  a national TA call, and workshops at an all-grantees meeting to assist  grantees. Some grantees told us HRSA also discussed the standards  during a recent administrative meeting. Further, 5 of the 10 POs we  interviewed told us they had discussed implementation of the standards  with grantees during routine monitoring. Five grantees told us they had  asked for more in-depth TA on the standards but had not received it. One  grantee, however, did receive additional TA by phone from a HRSA  branch chief targeted to all Part A and Part B providers in the grantee’s  state. Although HRSA stated that it would provide sample tools to  demonstrate how grantees could best meet certain standards, several  grantees indicated that HRSA had not done so. According to most  grantees, inadequate training, TA, or both makes it more difficult to  understand HRSA’s expectations and be assured that they are  adequately implementing the standards, which they were required to put  into practice immediately upon their release in April 2011. HRSA officials  said that they believe that the webinars, conference call, and  presentations they have made at grantee meetings have provided  grantees with useful assistance in implementing the standards. They  further noted that the standards do not represent new requirements and  therefore should have been familiar to grantees. However, in its survey of  grantees, discussed earlier in this report, HRSA asked grantees about  their training needs and any additional information needs they might have  regarding a variety of issues, including the standards.

Seven grantees expressed particular concern about the annual site visit  requirement outlined in the standards, which two of them noted is  especially challenging for grantees with a large number of providers  across a large geographic area or in states with limited staff resources.  Two of those grantees said that the new standard would require them to  change site visit processes that had proven effective over time. They told  us that they conduct routine site visits based on an assessment of risk; if  they determine through regular monitoring that a provider has more  performance issues than other providers, they will prioritize a site visit to  that provider or visit that provider more frequently. They said that the  requirement to visit every service provider annually, regardless of their  performance, will not allow them to continue with this approach. One  grantee with approximately 140 service providers told us that meeting the  annual site visit requirement would be impossible given the grantee’s  large number of providers and limited staff and administrative resources.  One grantee told us the administrative burden of this requirement is  exacerbated by the chart review requirements which will require grantees  to spend more time reviewing provider documents on site, while  sacrificing other monitoring activities focused on the quality of provider  services. Two grantees noted that the annual site visit standard is more  stringent than HRSA’s own standard for site visits to grantees, and that  HRSA therefore may not have a good sense of the time and resources  required to conduct annual site visits of all service providers. Despite  these concerns, several grantees told us they are taking steps to comply  with the requirement.

NASTAD has written that the standards will require some grantees to  largely restructure current monitoring systems and force them to focus on  administrative reviews rather than an assessment of the quality of  services being delivered by service providers, and that the standards are  inconsistent with the National HIV/AIDS Strategy’s goal of streamlining  grant administration and reporting requirements. NASTAD has further  noted that the annual site visit requirement will be especially difficult for  grantees during a time when grantees are experiencing reductions in  funding and staff, and that the requirement will force grantees to dedicate  limited staff resources toward monitoring activities rather than service  delivery. According to NASTAD, grantees may also find it difficult to  conduct all required provider monitoring activities using only the  10 percent of their CARE Act grant allowed for administrative costs.  Many grantees also told us that the standards increase the administrative  burden on their programs. HRSA responded to NASTAD that grantees  should review their current use of administrative resources to ensure they  are efficiently using resources to meet all of the monitoring standards,  which are simply meant to provide clarity about existing requirements. In  light of grantees’ ongoing concerns, however, NASTAD has  recommended that HRSA explore alternatives to the annual site visit  requirement, including requiring a site visit every 2 years instead of  annually. In response to NASTAD’s recommendations, HRSA has stated  that annual provider site visits are a programmatic requirement developed  based on federal regulations permitting HRSA to set the frequency of  monitoring activities, including site visits. HRSA also stated that the site  visit requirement, which is consistent for all Part A and Part B grantees, is  based on HHS OIG recommendations that HRSA set standards for  grantee monitoring of service providers that include some consideration  of regular site visits. NASTAD has written that because HRSA has  authority to set the frequency of monitoring activities, it should consider  alternatives to the annual site visit requirement.

In response to grantee concerns about the standards, HRSA officials  have stated that TA may be requested through individual POs, and that it  will provide future webinars focused on common grantee concerns,  including the annual site visit requirement and eligibility documentation.  HRSA officials further told us that they are encouraging collaboration  between Part A and Part B grantees to jointly conduct site visits of  providers that are funded by both Parts A and B to ease the burden of the  site visit requirement. At least one larger grantee told us they will take  advantage of that opportunity for collaboration. Some grantees stated that  the standards are a helpful tool, and a few noted that the standards will  help them better communicate with their service providers.

section_title: Conclusions
paragraphs: Effective oversight of CARE Act grantees and service providers is critical  to the CARE Act’s mission of providing help for uninsured or underinsured  individuals and families affected by HIV/AIDS. However, our findings  show that deficiencies in HRSA’s oversight may compromise its ability to  ensure that this program is meeting its objectives or that CARE Act funds  are being spent properly. Even though HHS and HRSA guidance exists  regarding the documentation and follow-up of the key elements of grantee  oversight including routine monitoring, the provision of TA, site visits, and  restrictive drawdown, HRSA project officers are not always following  these guidelines. If a grantee is struggling, the lack of systematic  provision and documentation of assistance to improve the grantee’s  performance, and not retaining such documentation over time, present a  great challenge to ensuring that such problems do not recur. Many HRSA  POs we spoke with said that site visits are a valuable and effective  oversight tool. However, in visiting some grantees multiple times while not  visiting others, seemingly without regard to the size of the grantee or  presence of problems, HRSA demonstrated a lack of a strategic, risk- based approach for selecting grantees for site visits. Another challenge is  the lack of an updated and electronically available comprehensive  program manual for grantees. Grantees said that such a manual would  likely decrease their need to consult with POs over relatively routine  issues. Currently, grantees must frequently seek assistance from POs  because there is not a current and complete source of written information  that is readily available to guide their efforts. While HRSA’s compilation of  133 Part A and 154 Part B monitoring standards does provide grantees  with an exhaustive set of guidelines for ensuring that their service  providers are meeting program requirements, our findings on HRSA’s  own oversight of grantees provide evidence of how important training and  follow-up are to ensure that these requirements are consistently followed.  HRSA has provided training to assist grantees in carrying out the  standards, but grantees said that they wanted more guidance and  training. Among the issues about which HRSA surveyed its grantees, was  the additional information its grantees needed regarding the standards.

section_title: Recommendations for Executive Action
paragraphs: In order to improve HRSA’s oversight of Part A and Part B grantees, we  recommend that the Administrator of HRSA:

Ensure that the agency is implementing the key elements of grantee  oversight consistent with HHS and HRSA guidance, including routine  monitoring, the provision of technical assistance, site visits, and  restrictive drawdown.

Assess and revise its record retention management program so that  complete grantee files are available for a period of time that HRSA  determines will satisfy all of the agency’s grantee oversight needs.

Develop a strategic, risk-based approach for selecting grantees for  site visits that better targets the use of available resources to ensure  that HRSA visits grantees at regular and timely intervals.

Update and maintain a program manual for grantees.

Use the results of HRSA’s survey of grantees to identify grantees’  training needs to allow them to comply with the National Monitoring  Standards.

section_title: Agency Comments and Our Evaluation
paragraphs: We provided a draft of this report to HHS for its review, and HHS provided  written comments (see app III). HHS concurred with all five of our  recommendations and indicated that HRSA will work to fully implement  the recommendations to improve oversight of Parts A and B of the CARE  Act program. HHS also offered some specific comments in response to  the report conclusions. HHS acknowledged that PO led site visits,  monitoring calls, single audit reports, and the imposition of restrictive  drawdown are central to HRSA’s routine monitoring, but added that the  agency’s overall oversight strategy is a multilayered approach that  involves review of items such as required grantee reports used for  postaward monitoring, site visits, monitoring calls, review of audit reports,  and the provision of technical assistance on all of these issues. Our  analysis included these elements, as well as a discussion of ways in  which these elements intersect. We interviewed HRSA and grantee staff  on these tools and describe in this report grantees’ observations on  HRSA’s provision of technical assistance and feedback on the large  number of reports that they must routinely provide to HRSA. Findings in  this report include a detailed discussion of issues in Ryan White program  oversight including both the execution and documentation of the elements  listed above.

HHS also acknowledged that HRSA’s documentation of grantee  monitoring should be strengthened, noting that during the period of  GAO’s review, HRSA did not maintain all documentation of oversight in  one centralized file. HHS stated that HRSA has instituted a new quality  improvement process, which strengthens both documentation standards  and communication with grantees. HHS said that this would be done  through an expansion of the use of the EHB as the primary centralized  location for documentation of oversight and monitoring, including site visit  reports. HHS said that this process will also include regular PO meetings  to provide training, and improvements in HRSA’s records management  practices. These steps appear to be consistent with the goals of our  recommendations. In follow-up to its comments, HRSA provided  additional information on the agency’s planned information technology  development efforts to improve and expand the functionality of EHB  between September 2012 and mid-2013.

HHS commented on statements by grantees we interviewed that  indicated that HRSA could not provide needed TA due to budget  constraints, forcing the four grantees to seek TA from other sources,  using their own administrative funds. HHS described a wide array of TA  and training services that HRSA provides to grantees. HHS also provided  information on the extent of grantees’ use of some of these services and  HRSA’s financial resources devoted to providing these services. HHS  acknowledged in this discussion that, due to competing demands for  HRSA’s TA, HRSA does, at times, recommend grantees utilize their  CARE Act funding for TA. In its comments relevant to TA, HHS also noted  our mention of the fact that three grantees had to turn to NASTAD for TA  when HRSA could not provide it or when PO responses to their questions  were delayed. HHS noted that HRSA has had a partnership with  NASTAD in place since 1998 to provide TA to grantees. However, as we  note in our report, the TA to be provided by NASTAD under this  partnership is for the purpose of assisting Part B grantees with their  ADAP. While several Part B grantees told us that they receive important  assistance from NASTAD, there is no similar cooperative agreement in  place or HRSA-recognized organization to provide TA to Part A grantees.

HHS also commented on our finding that HRSA did not prioritize site  visits strategically. HHS stated that there can be indications of grantee  problems beyond those that we included in our site visit analysis, which  we acknowledged in the report. Many of the additional indicators of  grantee problems HHS listed in its comments, such as fiscal and  administrative challenges, are also issues that can cause grantees to  receive annual single audit findings or to be placed on restrictive  drawdown, the two indicators we used in our analysis. HHS then provided  extensive detail on the issues in Puerto Rico and the Virgin Islands that  led to grantees in those jurisdictions receiving significantly more site visits  than other grantees that had received substantially more funding. In our  discussion of HRSA’s site visits, we make the point that the size of the  grant did not appear to play a major role in HRSA’s decisions about which  grantees to visit, including among grantees experiencing problems. Many  POs we spoke with said that site visits were a valuable and effective form  of oversight. Because HRSA cannot visit all of its grantees each year, it  must work to ensure that it uses this valuable tool in such a way as to  gain as much benefit as possible. The Monitoring Grants and Cooperative  Agreements for Federal Personnel manual that we refer to in the report  and HHS cites in its comments lists several grant characteristics that  should be considered in selecting projects for on-site monitoring. “Cost  and Total Support” is the first issue listed in the manual. In our discussion,  we did not question the presence of serious issues in Puerto Rico and the  Virgin Islands. Our point is that even among grantees experiencing  problems, jurisdictions with much larger grants, such as the District of  Columbia, were not similarly prioritized for site visits, even though a site  visit to the District of Columbia would be of low cost to the agency.

HHS commented on the prevalence of HIV/AIDS in the Caribbean as a  justification for its numerous site visits, but we note that the size of Part A  and B CARE Act grants is based upon the number of HIV cases that exist  in the jurisdiction being served by the CARE Act grantee, thereby serving  as a proxy for the prevalence of the disease in that area. Data on HRSA’s  website indicate that CARE Act programs served 146 clients in the Virgin  Islands in 2008, while serving 16,203 in the District of Columbia during  the same period. HRSA’s pattern of site visits indicates that the agency  visited some grantees with smaller grants far more often than other  grantees with much larger grants, and thus a much higher prevalence of  disease, that also experienced challenges in administering their grants. In  its comments, HHS describes numerous elements of HRSA’s routine  monitoring and several instances of TA directed to the District of  Columbia. Nonetheless, it received one HRSA site visit during the period  covered by our review as compared to the Virgin Islands, which received  six HRSA site visits, as well as routine monitoring and TA. The District of  Columbia’s grant was approximately $21 million while the Virgin Islands’  grant was $1.2 million. This suggests that HRSA did not consider the size  of the grant in deciding which grantees to visit. While the size of the grant  would not be the only consideration in a strategic approach to scheduling  site visits, it should be a major consideration.

HHS’s comments also addressed the issue of PO’s awareness of single  audit findings. HHS described how, under HRSA’s process during the  time covered by our review, POs were to be informed about single audit  findings. HHS described an enhancement to HRSA’s process for ensuring  that POs are provided with a more detailed description of single audit  findings and corrective actions taken to address the findings. HHS said  that this improved process was put in place as of April 30, 2012, which  was after the period covered by our review.

In its comments, HHS also describes improvements to HRSA’s  documentation of and communication with grantees about the restrictive  drawdown process, issues which we already discuss in our report. If fully  implemented, these improvements have the potential to remedy many of  the issues we identified in our report.

In acknowledging our findings on HRSA’s records retention practices,  HHS said that HRSA was required to retain records according to  schedules approved by the National Archives and Records Administration  (NARA). However, it further noted that HRSA has engaged in a review of  its records management practices. HHS said that, in December 2011,  during the course of our review, HRSA formed a workgroup on records  management with program and grant staff across the agency to  streamline various retention schedules for program and grant record  retention practices. HHS said that HRSA will be providing additional  training and updated policies for the HAB POs and grants management  specialists on the contents of the official grant file. HHS said that HRSA  would seek approval for any changes to HRSA’s record retention policies.

In commenting on our discussion of the difficulty some grantees  expressed about meeting the requirement for an annual visit of their  service providers, HHS noted that HRSA is working with a small number  of grantees to provide flexibility in meeting the requirement, but did not  describe what that flexibility would entail. In discussions near the end of  our review, HRSA officials said that this would not include excusing  grantees from the requirement that they visit all of their service providers  annually, but could involve leveraging the efforts of other CARE Act  grantees.

HHS concluded its general comments on the report by again noting that  the department concurred with all five of our recommendations. HHS  further commented that HHS is already in the process of planning or  implementing many of our recommendations. In its comments, HHS  provided considerable detail on actions HRSA plans to take or has  already taken to implement our recommendations. The actions HHS  describes are generally responsive to our recommendations. However,  because these actions follow the conclusion of our review or are to be  implemented in the future, and sometimes without a designated time  frame, we are unable to evaluate them specifically.

HHS also provided technical comments, which we incorporated as  appropriate.

As agreed with your offices, unless you publicly announce the contents of  this report earlier, we plan no further distribution until 30 days from the  report date. At that time, we will send copies of this report to the  Administrator of HRSA and the appropriate congressional committees. In  addition, the report is available at no charge on the GAO website at  http://www.gao.gov.

If you or your staff have any questions about this report, please contact  me at (202) 512-7114 or crossem@gao.gov. Contact points for our  Offices of Congressional Relations and Public Affairs may be found on  the last page of this report. GAO staff who made major contributions to  this report are listed in appendix IV.

section_title: Appendix I: Reporting Requirements for Part A and Part B Grantees
paragraphs: Appendix I: Reporting Requirements for     Part A and Part B Grantees The Minority AIDS Initiative Annual Report for Part A grantees is due on January 31, 2012, which is  in federal fiscal year 2013.

section_title: Appendix II: HRSA Site Visits of Part A and Part B Grantees
paragraphs: Caguas, P.R., Dutchess County, NY, Santa Rosa, CA, and Vineland-Millville-Bridgeton, NJ lost their  classification as TGAs before the 2011 grant year, which began March 1, 2011, so the award amount  is from grant year 2010 and the estimated living HIV/AIDS cases are as of December 31, 2008.

HRSA officials explained that when HRSA staff made trips to Puerto Rico that included stops at one  or multiple Part A grantees and/or the Part B grantee. For example, a March 2009 trip to Puerto Rico  included a site visit to the Part B grantee, to the San Juan Part A grantee, and to the Caguas Part A  grantee. From 2008 through 2011, HRSA made 12 separate trips to Puerto Rico.

section_title: Appendix III: Comments from the Department of Health and Human Services

section_title: Appendix IV: GAO Contact and Staff Acknowledgments
subsections: section_title: GAO Contact

section_title: Acknowledgments
paragraphs: In addition to the contact named above, key contributors to this report  were Tom Conahan, Assistant Director; Romonda Bumpus; Cathleen  Hamann; Kathryn Richter; Sara Rudow; and Jennifer Whitworth.


Question-summary annotations: questions: question: In what ways does the HRSA fail to meet HHS regulations?
answer: The Department of Health and Human Services’ (HHS) Health Resources and Services Administration (HRSA) does not consistently follow HHS regulations and guidance in its oversight of Ryan White Comprehensive AIDS Resources Emergency Act of 1990 (CARE Act) grantees when conducting key elements of grantee oversight, including routine monitoring and implementing restrictive drawdowns. Additionally, HRSA did not demonstrate a risk-based strategy for selecting grantees for site visits.
child_questions: question: In what ways did HRSA fail to provide consistent documentation?
answer: Project officers (POs) do not consistently document routine monitoring or follow up on that monitoring to help grantees address problems, as required by HHS and HRSA guidance. However, GAO found that most POs did not document routine monitoring calls with grantees—only 4 of the 25 PO files GAO reviewed from 2010 and 8 of the 25 files GAO reviewed from 2011 contained documentation of monitoring calls at least quarterly.
child_questions: question: What is the purpose of routine monitoring?
answer: The purpose of routine monitoring is to enable POs to answer grantee questions about program requirements, provide technical assistance (TA), and follow up on grantee corrective actions in response to previously provided TA.

question: In what ways did HRSA fail to follow HHS guidelines when implementing restrictive drawdowns?
answer: HRSA often did not follow HHS regulations and guidance in implementing restrictive drawdowns, a special award condition HRSA can place on grantees with serious problems. Six of the 52 Part A grantees and 13 of the 59 Part B grantees were placed on restrictive drawdown from 2008 through 2011. GAO found that HRSA did not consistently provide grantees in GAO’s sample that were on restrictive drawdown with the reasons the restrictive drawdown was implemented, instructions for meeting the conditions of the restrictive drawdown, or guidance on the types of corrective actions needed.
child_questions: question: What do restrictive drawdowns require?
answer: Restrictive drawdown requires that prior to spending any grant funds, grantees must submit a request, along with documentation of the need, for funds for HRSA review.

question: What is the effect of HRSA's failure to follow HHS guidelines when implementing restrictive drawdowns?
answer: This has limited the effectiveness of restrictive drawdown as a tool for improving grantee performance.

question: In what ways did HRSA fail to effectively select grantees for visitation?
answer: Regarding the oversight of grantees through site visits, HRSA did not demonstrate a clear strategy for selecting the grantees it visited from 2008 through 2011. For example, HRSA did not appear to prioritize site visits to grantees based on the amount of time that had passed since a grantee’s last site visit. Although many HRSA POs GAO spoke with said that site visits were a valuable and effective form of oversight, GAO found that 44 percent of all grantees did not receive a site visit from 2008 through 2011 while others received multiple visits.

questions: question: What are grantees required to oversee?
answer: Grantees are required to oversee the service providers with whom they contract and in April 2011, HRSA issued the National Monitoring Standards for grantee monitoring of service providers.
child_questions: question: What requirements do the standards describe?
answer: The standards describe program and financial requirements and include 133 requirements for Part A grantees and 154 requirements for Part B grantees.

question: What issues hindered the program's implementation?
answer: Though the standards were intended to improve grantee monitoring of service providers, some grantees said that a lack of training and TA has hindered its implementation. Additionally, some grantees have found the requirement for annual site visits of service providers to be challenging.
child_questions: question: How did HRSA officials respond to this report?
answer: HRSA officials said that they believe they provided adequate training to grantees in implementing the standards, which did not represent new requirements.

questions: question: What support do HIV and AIDS patients receive through CARE Act grants?
answer: Each year, half a million people affected by human immunodeficiency virus (HIV) and acquired immunodeficiency syndrome (AIDS) receive services funded by CARE Act grants. HRSA, an agency within HHS, awards CARE Act Part A grants to localities and Part B grants to states and territories.
child_questions: question: How do grantees and service providers interact during this process?
answer: These grantees may provide services themselves or may contract with service providers. HRSA POs monitor grantees, but grantees are to monitor their service providers. PO oversight includes routine monitoring, site visits, and monitoring of special award conditions, such as restrictive drawdown.

question: What was GAO Asked to report on?
answer: GAO was asked to 1) evaluate HRSA’s oversight of CARE Act grantees and 2) examine steps HRSA has taken to assist CARE Act grantees in monitoring their service providers.
child_questions: question: How did GAO collect data for this report?
answer: GAO conducted a review of grantee files from 2010 and 2011 for 25 selected Part A and B grantees, reviewed HHS and HRSA policies, interviewed HRSA officials, analyzed HRSA data on site visits and interviewed grant officials from GAO’s 25 selected grantees and 6 selected service providers.