Texas Administrative Code › Title 1 - ADMINISTRATION › Part 15 - TEXAS HEALTH AND HUMAN SERVICES COMMISSION › Chapter 355 - REIMBURSEMENT RATES › Subchapter A - COST DETERMINATION PROCESS › Section 355.105 - General Reporting and Documentation Requirements, Methods, and Procedures

Current through Reg. 49, No. 28; July 12, 2024
(a) General
				  reporting. Except where otherwise specified under this title, the Texas Health
				  and Human Services Commission (HHSC) follows the requirements, methods, and
				  procedures set forth in this section to determine costs appropriate for use in
				  the reimbursement determination process.
(b) Cost report requirements. Unless
				  specifically stated in program rules or excused as described in paragraph
				  (4)(D) of this subsection, each provider must submit financial and statistical
				  information on cost report forms provided by HHSC, on facsimiles that are
				  formatted according to HHSC specifications and are pre-approved by HHSC staff,
				  or electronically in HHSC-prescribed format in programs where these systems are
				  operational. The cost reports must be submitted to HHSC in a manner prescribed
				  by HHSC. The cost reports must be prepared to reflect the activities of the
				  provider while delivering contracted services during the fiscal year specified
				  by the cost report. Cost reports or other special surveys or reports may be
				  required for other periods at the discretion of HHSC. Each provider is
				  responsible for accurately completing any cost report or other special survey
				  or report submitted to HHSC.
(1) Accounting
				  methods. All financial and statistical information submitted on cost reports
				  must be based upon the accrual method of accounting, except where otherwise
				  specified in §
											355.102 and §
											355.103 of this subchapter
				  (relating to General Principles of Allowable and Unallowable Costs and
				  Specifications for Allowable and Unallowable Costs) and in the case of
				  governmental entities operating on a cash or modified accrual basis. For
				  cost-reporting purposes, accrued expenses must be incurred during the
				  cost-reporting period and must be paid within 180 days after the end of that
				  cost-reporting period. In situations where a contracted provider, any of its
				  controlling entities, its parent company/sole member, or its related-party
				  management company has filed for bankruptcy protection, the contracted provider
				  may request an exception to the 180-day requirement for payment of accrued
				  allowable expenses by submitting a written request to the HHSC Provider Finance
				  Department. The written request must be submitted within 60 days of the date of
				  the bankruptcy filing or at least 60 days prior to the due date of the cost
				  report for which the exception is being requested, whichever is later. The
				  contracted provider will then be requested by the HHSC Provider Finance
				  Department to provide certain documentation, which must be provided by the
				  specified due date. Such exceptions due to bankruptcy may be granted for
				  reasonable, necessary, and documented accrued allowable expenses that were not
				  paid within the 180-day requirement. Accrued revenues must be for services
				  performed during the cost-reporting period and do not have to be received
				  within 180 days after the end of that cost reporting period in order to be
				  reported as revenues for cost-reporting purposes. Except as otherwise specified
				  by the cost determination process rules of this chapter, cost report
				  instructions, or policy clarifications, cost reports should be prepared
				  consistent with generally accepted accounting principles (GAAP), which are
				  those principles approved by the American Institute of Certified Public
				  Accountants (AICPA). Internal Revenue Service (IRS) laws and regulations do not
				  necessarily apply in the preparation of the cost report. In cases where
				  cost-reporting rules differ from GAAP, IRS, or other authorities, HHSC rules
				  take precedence for provider cost-reporting purposes.
(2) Recordkeeping and adequate documentation.
				  There is a distinction between noncompliance in recordkeeping, which equates
				  with unauditability of a cost report and constitutes an administrative contract
				  violation or, for the Nursing Facility program, may result in vendor hold, and
				  a provider's inability to provide adequate documentation, which results in
				  disallowance of relevant costs. Each is discussed in the following paragraphs.
(A) Recordkeeping. Providers must ensure that
				  records are accurate and sufficiently detailed to support the legal, financial,
				  and other statistical information contained in the cost report. Providers must
				  maintain all work papers and any other records that support the information
				  submitted on the cost report relating to all allocations, cost centers, cost or
				  statistical line items, surveys, and schedules. HHSC may require supporting
				  documentation other than that contained in the cost report to substantiate
				  reported information.
(i) For contracted
				  providers subject to 40 TAC Chapter 49, each provider must maintain records
				  according to the requirements stated in 40 TAC §
													49.307 (relating to Record
				  Retention and Disposition) and according to the HHSC's prescribed chart of
				  accounts, when available.
(ii) If a
				  contractor is terminating business operations, the contractor must ensure that:
(I) records are stored and accessible;
				  and
(II) someone is responsible for
				  adequately maintaining the records.
(iii) For nursing facilities, failure to
				  maintain all work papers and any other records that support the information
				  submitted on the cost report relating to all allocations, cost centers, cost or
				  statistical line items, surveys, and schedules may result in vendor hold as
				  specified in §
													355.403 of this chapter (relating
				  to Vendor Hold).
(iv) For all other
				  programs, failure to maintain all work papers and any other records that
				  support the information submitted on the cost report relating to all
				  allocations, cost centers, cost or statistical line items, surveys, and
				  schedules constitutes an administrative contract violation. In the case of an
				  administrative contract violation, procedural guidelines and informal
				  reconsideration and/or appeal processes are specified in §
													355.111 of this subchapter
				  (relating to Administrative Contract Violations).
(B) Adequate documentation. The relationship
				  between reported costs and contracted services must be clearly and adequately
				  documented to be allowable. Adequate documentation consists of all materials
				  necessary to demonstrate the relationship of personnel, supplies, and services
				  to the provision of contracted client care or the relationship of the central
				  office to the individual service delivery entity level. These materials may
				  include but are not limited to, accounting records, invoices, organizational
				  charts, functional job descriptions, other written statements, and direct
				  interviews with staff, as deemed necessary by HHSC auditors to perform required
				  tests of reasonableness, necessity, and allowability.
(i) The minimum allowable statistical
				  duration for a time study upon which to base salary allocations is four weeks
				  per year, with one week being randomly selected from each quarter so as to
				  assure that the time study is representative of the various cycles of business
				  operations. One week is defined as only those days the contracted provider is
				  in operation for seven continuous days. The time study can be performed for one
				  continuous week during a quarter, or it can be performed over five or seven
				  individual days, whichever is applicable, throughout a quarter. The time study
				  must be a 100% time study, accounting for 100% of the time paid to the
				  employee, including vacation and sick leave.
(ii) To support the existence of a loan, the
				  provider must have available a signed copy of the loan contract, which contains
				  the pertinent terms of the loan, such as amount, rate of interest, method of
				  payment, due date, and collateral. The documentation must include an
				  explanation for the purpose of the loan, and an audit trail must be provided
				  showing the use of the loan proceeds. Evidence of systematic interest and
				  principal payments must be available and supported by the payback schedule in
				  the note or amortization schedule supporting the note. Documentation must also
				  include substantiation of any costs associated with the securing of the loan,
				  such as broker's fees, due diligence fees, lender's fees, attorney's fees, etc.
				  To document allowable interest costs associated with related party loans, the
				  provider is required to maintain documentation verifying the prime interest
				  rate in accordance with §
													355.103(b)(11)(C)
				  of this subchapter for a similar type of loan as of the effective date of the
				  related party loan.
(iii) For
				  ground transportation equipment, a mileage log is not required if the equipment
				  is used solely (100%) for the provision of contracted client services in
				  accordance with program requirements in delivering one type of contracted care.
				  However, the contracted provider must have a written policy that states that
				  the ground transportation equipment is restricted to that use, and that policy
				  must be followed. For ground transportation equipment that is used for several
				  purposes (including for personal use) or multiple programs or across various
				  business components, mileage logs must be maintained. Personal use includes,
				  among other things, driving to and from a personal residence. At a minimum,
				  mileage logs must include for each individual trip the date, the time of day
				  (beginning and ending), driver, persons in the vehicle, trip mileage
				  (beginning, ending, and total), purpose of the trip, and the allocation centers
				  (the departments, programs, and/or business entities to which the trip costs
				  should be allocated). Flight logs must include dates, mileage, passenger lists,
				  and destinations, along with any other information demonstrating the purpose of
				  the trips so that a relationship to contracted client care in Texas can be
				  determined. For the purpose of comparison to the cost of commercial
				  alternatives, documentation of the cost of operating and maintaining a private
				  aircraft includes allowable expenses relating to the lease or depreciation of
				  the aircraft; aircraft fuel and maintenance expenses; aircraft insurance,
				  taxes, and interest; pilot expenses; hangar and other related expenses;
				  mileage, vehicle rental or other ground transportation expense; and airport
				  parking fees. Documentation demonstrating the allowable cost of commercial
				  alternatives includes commercial airfare ticket costs at the lowest fare
				  offered (including all discounts) and associated expenses, including mileage,
				  vehicle rental or other ground transportation expenses; airport parking fees;
				  and any hotel or per diem due to necessary layovers (no scheduled flights at
				  the time of return trip).
(iv) To
				  substantiate the allowable cost of leasing a luxury vehicle as defined in
				  §
													355.103(b)(10)(C)(i)
				  of this subchapter, the provider must obtain at the time of the lease a
				  separate quotation establishing the monthly lease costs for the base amount
				  allowable for cost-reporting purposes as specified in §
													355.103(b)(10)(C)(i)
				  of this subchapter. Without adequate documentation to verify the allowable
				  lease costs of the luxury vehicle, the reported costs shall be
				  disallowed.
(v) For adequate
				  documentation purposes, a written description of each cost allocation method
				  must be maintained that includes, at a minimum, a clear and understandable
				  explanation of the numerator and denominator of the allocation ratio described
				  in words and in numbers, as well as a written explanation of how and to which
				  specific business components the remaining percentage of costs were
				  allocated.
(vi) To substantiate the
				  allowable cost for staff training as defined in §
													355.103(b)(15)(A)
				  of this subchapter, the provider must maintain a description of the training
				  verifying that the training pertained to contracted client care-related
				  services or quality assurance. At a minimum, a program brochure describing the
				  seminar or a conference program with a description of the workshop must be
				  maintained. The documentation must provide a description clearly demonstrating
				  that the seminar or workshop provided training for contracted client
				  care-related services or quality assurance.
(vii) Documentation regarding the allocation
				  of costs related to noncontracted services, as specified in §
													355.102(j)(2) of
				  this subchapter, must be maintained by the provider. At a minimum, the provider
				  must maintain written records verifying the number of units of noncontracted
				  services provided during the provider's fiscal year, along with adequate
				  documentation supporting the direct and allocated costs associated with those
				  noncontracted services.
(viii)
				  Adequate documentation to substantiate legal, accounting, and auditing fees
				  must include, at a minimum, the amount of time spent on the activity, a written
				  description of the activity performed which clearly explains to which business
				  component the cost should be allocated, the person performing the activity, and
				  the hourly billing amount of the person performing the activity. Other legal,
				  accounting, and auditing costs, such as photocopy costs, telephone costs, court
				  costs, mailing costs, expert witness costs, travel costs, and court reporter
				  costs, must be itemized and clearly denote to which business component the cost
				  should be allocated.
(ix) Providers
				  who self-insure for all or part of their employee-related insurance costs, such
				  as health insurance and workers' compensation costs, must use one of the two
				  following methods for determining and documenting the provider's allowable
				  costs under the cost ceilings and any carry forward as described in §
													355.103(b)(13)(E)
				  of this subchapter.
(I) Providers may obtain
				  and maintain each fiscal year's documentation to establish what their premium
				  costs would have been had they purchased commercial insurance for total
				  coverage. The documentation should include, at a minimum, bids from two
				  commercial carriers. Bids must be obtained no less frequently than every three
				  years.
(II) If providers choose not
				  to obtain and maintain commercial bids as described in subclause (I) of this
				  clause, providers may claim as an allowable cost the health insurance actual
				  paid claims incurred on behalf of the employees that do not exceed 10% of the
				  payroll for employees eligible for receipt of this benefit. In addition,
				  providers may claim as an allowable cost the workers' compensation actual paid
				  claims incurred on behalf of the employees, an amount each cost report period
				  not to exceed 10% of the payroll for employees eligible for receipt of this
				  benefit.
(III) Providers who
				  self-insure must also maintain documentation that supports the amount of claims
				  paid each year and any allowable costs to be carried forward to future
				  cost-reporting periods.
(x) Providers who self-insure for all or part
				  of their coverage for nonemployee-related insurance, such as malpractice
				  insurance, comprehensive general liability, and property insurance, must
				  maintain documentation for each cost-reporting period to establish what their
				  premium costs would have been had they purchased commercial insurance for total
				  coverage. The documentation should include, at a minimum, bids from two
				  commercial carriers. Bids must be obtained no less frequently than every three
				  years. Providers who self-insure must also maintain documentation that supports
				  the amount of claims paid each year and any allowable costs to be carried
				  forward to future cost-reporting periods. Governmental providers must document
				  the existence of their claims management and risk management
				  programs.
(xi) Regarding
				  compensation of owners and related parties, providers must maintain the
				  following documentation, at a minimum, for each owner or related party: a
				  detailed written description of actual duties, functions, and responsibilities;
				  documentation substantiating that the services performed are not duplicative of
				  services performed by other employees; time sheets or other documentation
				  verifying the hours and days worked; the amount of total compensation paid for
				  these duties, with a breakdown detailing regular salary, overtime, bonuses,
				  benefits, and other payments; documentation of regular, periodic payments
				  and/or accruals of the compensation, documentation that the compensation is
				  subject to payroll or self-employment taxes; and a detailed allocation
				  worksheet indicating how the total compensation was allocated across business
				  components receiving the benefit of these duties.
(I) Regarding bonuses paid to owners and
				  related parties, the provider must maintain clearly defined bonus policies in
				  its written agreements with employees or in its overall employment policy. At a
				  minimum, the bonus policy must include the basis for distributing the bonuses,
				  including qualifications for receiving the bonus and how the amount of each
				  bonus is calculated. Other documentation must specify who received bonuses,
				  whether the persons receiving bonuses are owners, related parties, or
				  arm's-length employees, and the bonus amount received by each
				  individual.
(II) Regarding benefits
				  provided to owners and related parties, the provider must maintain clearly
				  defined benefit policies in its written agreements with employees or in its
				  overall employment policy. At a minimum, the documentation must include the
				  basis for eligibility for each type of benefit available, who is eligible to
				  receive each type of benefit, who actually receives each type of benefit,
				  whether the persons receiving each type of benefit are owners, related parties,
				  or arm's-length employees, and the amount of each benefit received by each
				  individual.
(xii)
				  Regarding all forms of compensation, providers must maintain documentation for
				  each employee which clearly identifies each compensation component, including
				  regular pay, overtime pay, incentive pay, mileage reimbursements, bonuses, sick
				  leave, vacation, other paid leave, deferred compensation, retirement
				  contributions, provider-paid instructional courses, health insurance,
				  disability insurance, life insurance, and any other form of compensation. Types
				  of documentation would include insurance policies; provider benefit policies;
				  records showing paid leave accrued and taken; documentation to support hours
				  (regular and overtime) worked and wages paid; and mileage logs or other
				  documentation to support mileage reimbursements and travel allowances. For
				  accrued benefits, the documentation must clearly identify the period of the
				  accrual. For example, if an employee accrues two weeks of vacation during 20x1
				  and receives the corresponding vacation pay during 20x3, that employee's
				  compensation documentation for 20x3 should clearly indicate that the vacation
				  pay received had been accrued during 20x1.
(I)
				  For staff required to maintain continuous daily time sheets as per §
														355.102(j) of this
				  subchapter and subclause (II) of this clause, the daily timesheet must
				  document, for each day, the staff member's start time, stop time, total hours
				  worked, and the actual time worked (in increments of 30 minutes or less)
				  providing direct services for the provider, the actual time worked performing
				  other functions, and paid time off. The employee must sign each timesheet. The
				  employee's supervisor must sign the timesheets each payroll period or at least
				  monthly. Work schedules are unacceptable documentation for staff whose duties
				  include multiple direct service types, both direct and indirect service
				  component types, and both direct hands-on support and first-level supervision
				  of direct care workers.
(II) For
				  the Intermediate Care Facilities for Individuals with an Intellectual
				  Disability or Related Conditions (ICF/IID), Home and Community-based Services
				  (HCS), and Texas Home Living (TxHmL) programs, staff required to maintain
				  continuous daily timesheets include staff whose duties include multiple direct
				  service types, both direct and indirect service component types and/or both
				  direct hands-on support and first-level supervision of direct care
				  workers.
(xiii)
				  Management fees paid to related parties must be documented as to the actual
				  costs of the related party for materials, supplies, and services provided to
				  the individual provider and upon which the management fees were based. If the
				  cost to the related party includes owner compensation or compensation to
				  related parties, documentation guidelines for those costs are specified in
				  clause (xi) of this subparagraph. Documentation must be maintained that
				  indicates stated objectives, periodic assessment of those objectives, and
				  evaluation of the progress toward those objectives.
(xiv) For central office and/or home office
				  costs, documentation must be maintained that indicates the organization of the
				  business entity, including position, titles, functions, and compensation. For
				  multi-state organizations, documentation must be maintained that clearly
				  defines the relationship of costs associated with any level of management above
				  the individual Texas contracted entity allocated to the individual Texas
				  contracted entity.
(xv)
				  Documentation regarding depreciable assets includes, at a minimum, historical
				  cost, date of purchase, depreciable basis, estimated useful life, accumulated
				  depreciation, and the calculation of gains and losses upon disposal.
(xvi) Providers must maintain documentation
				  clearly itemizing their employee relations expenditures. For employee
				  entertainment expenses, documentation must show the names of all persons
				  participating, along with a classification of the person attending, such as
				  employee, nonemployee, owner, family of employee, client, or vendor.
(xvii) Adequate documentation substantiating
				  the offsetting of grants and contracts from federal, state, or local
				  governments prior to reporting either the net expenses or net revenue must be
				  maintained by the provider. As specified in §
													355.103(b)(18) of
				  this subchapter, such offsetting is required prior to reporting on the cost
				  report. The provider must maintain written documentation as to the purpose for
				  which the restricted revenue was received and the offsetting of the restricted
				  revenue against the allowable and unallowable costs for which the restricted
				  revenue was used.
(xviii) During
				  the course of an audit or an audit desk review, the provider must furnish any
				  reasonable documentation requested by HHSC auditors within ten working days of
				  the request or a later date as specified by the auditors. If the provider does
				  not present the requested material within the specified time, the audit or
				  audit desk review is closed, and HHSC automatically disallows the costs in
				  question.
(xix) Any expense that
				  cannot be adequately documented or substantiated is disallowed. HHSC is not
				  responsible for the contracted provider's failure to adequately document and
				  substantiate reported costs.
(xx)
				  Any cost report that is determined to be unauditable through a field audit or
				  that cannot have its costs verified through a desk review will not be used in
				  the reimbursement determination process.
(3) Cost report and methodology
				  certification. Providers must certify the accuracy of cost reports submitted to
				  HHSC in the format specified by HHSC. Providers may be liable for civil and/or
				  criminal penalties if the cost report is not completed according to HHSC
				  requirements or is determined to contain misrepresented or falsified
				  information. Cost report preparers must certify that they read the cost
				  determination process rules, the reimbursement methodology rules, the cost
				  report cover letter, and cost report instructions, and that they understand
				  that the cost report must be prepared in accordance with the cost determination
				  process rules, the reimbursement methodology rules and cost report
				  instructions. Not all persons who contributed to the completion of the cost
				  report must sign the certification page. However, the certification page must
				  be signed by a responsible party with direct knowledge of the preparation of
				  the cost report. A person with supervisory authority over the preparation of
				  the cost report who reviewed the completed cost report may sign a certification
				  page in addition to the actual preparer.
(4) Requirements for cost report completion.
(A) A completed cost report must:
(i) be completed according to the cost
				  determination rules of this chapter, program-specific allowable and unallowable
				  rules, cost report instructions, and policy clarifications;
(ii) contain a signed, notarized, original
				  certification page or an electronic equivalent where such equivalents are
				  specifically allowed under HHSC policies and procedures;
(iii) be legible with entries in sufficiently
				  dark print to be photocopied;
(iv)
				  contain all pages and schedules;
(v) be submitted on the proper cost report
				  form;
(vi) be completed using the
				  correct cost reporting period; and
(vii) contain a copy of the state-issued cost
				  report training certificate except for cost reports submitted through the State
				  of Texas Automated Information and Reporting System (STAIRS).
(B) Providers are required to
				  report amounts on the appropriate line items of the cost report pursuant to
				  guidelines established in the methodology rules, cost report instructions, or
				  policy clarifications. Refer to program-specific reimbursement methodology
				  rules, cost report instructions, or policy clarifications for guidelines used
				  to determine the placement of amounts on cost report line items.
(i) For nursing facilities, placement on the
				  cost report of an amount, which was determined to be inaccurately placed, may
				  result in vendor hold as specified in §
													355.403 of this chapter (relating
				  to Vendor Hold).
(ii) For School
				  Health and Related Services (SHARS), placement on the cost report of an amount,
				  which was determined to be inaccurately placed, may result in an administrative
				  contract violation as specified in §
													355.8443 of this chapter (relating
				  to Reimbursement Methodology for School Health and Related Services
				  (SHARS)).
(iii) For all other
				  programs, placement on the cost report of an amount, which was determined to be
				  inaccurately placed, constitutes an administrative contract violation. In the
				  case of an administrative contract violation, procedural guidelines and
				  informal reconsideration and/or appeal processes are specified in §
													355.111 of this
				  subchapter.
(C) A
				  completed cost report must be filed by the cost report due date.
(i) For nursing facilities, failure to file a
				  completed cost report by the cost report due date may result in vendor hold as
				  specified in §
													355.403 of this chapter.
(ii) For SHARS, failure to file a completed
				  cost report by the cost report due date constitutes an administrative contract
				  violation. In the case of an administrative contract violation, procedural
				  guidelines and informal reconsideration and/or appeal processes are specified
				  in §
													355.8443 of this chapter.
(iii) For all other programs, failure to file
				  a completed cost report by the cost report due date constitutes an
				  administrative contract violation. In the case of an administrative contract
				  violation, procedural guidelines and informal reconsideration and/or appeal
				  processes are specified in §
													355.111 of this
				  subchapter.
(D) HHSC may
				  excuse providers from the requirement to submit a cost report. A provider that
				  is not enrolled in Attendant Compensation Rate Enhancement as described in
				  §
												355.112 of this subchapter
				  (relating to Attendant Compensation Rate Enhancement) for a specific program or
				  the Nursing Facility Direct Care Staff Rate enhancement as described in §
												355.308 of this chapter (relating
				  to Direct Care Staff Rate Component) during the reporting period for the cost
				  report in question, is excused from the requirement to submit a cost report for
				  such program if the provider meets one or more of the following conditions:
(i) For all programs, if the provider
				  performed no billable services during the provider's cost-reporting
				  period.
(ii) For all programs, if
				  the cost-reporting period would be less than or equal to 30 calendar days or
				  one entire calendar month.
(iii)
				  For all programs, if circumstances beyond the provider's control, such as the
				  loss of records due to natural disasters or removal of records from the
				  provider's custody by a regulatory agency, make cost-report completion
				  impossible.
(iv) For all programs,
				  if all of the contracts that the provider is required to include in the cost
				  report have been terminated before the cost-report due date.
(v) For the Nursing Facility, ICF/IID,
				  Assisted Living/Residential Care (AL/RC), and Residential Care (RC) programs,
				  if the total number of days that the provider performed service for recipients
				  during the cost-reporting period is less than the total number of calendar days
				  included in the cost-reporting period.
(vi) For the Day Activity and Health Services
				  (DAHS) program, if the provider's total units of service provided to recipients
				  during the cost-reporting period is less than the total number of calendar days
				  included in the cost-reporting period times 1.5.
(vii) For the Home-Delivered Meals program,
				  if a provider agency served an average of fewer than 500 meals a month for the
				  designated cost report period.
(viii) On or after September 1, 2023, for the
				  Department of Family and Protective Services (DFPS) 24-Hour Residential
				  Child-Care program, if:
(I) the provider has
				  no current contract(s) within the state for 24-Hour Residential Child-Care
				  program;
(II) the total number of
				  DFPS-placed days and Single Source Continuum Contractor (SSCC)-placed days was
				  10 percent or less of the total days of service provided during the
				  cost-reporting period;
(III) for
				  facilities that provide Emergency Care Services only, the occupancy rate was
				  less than 30 percent during the cost-reporting period; or
(IV) for all other facility types except
				  child-placing agencies and those providing Emergency Care Services, the
				  occupancy rate was less than 50 percent during the cost-reporting
				  period.
(5) Cost report year. A provider's cost
				  report year must coincide with the provider's fiscal year as used by the
				  provider for reports to the Internal Revenue Service (IRS) or with the state of
				  Texas' fiscal year, which begins September 1 and ends August 31, except for
				  SSCC providers in the DFPS 24-Hour Residential Child Care program whose cost
				  report year must coincide with the state fiscal year.
(A) Providers whose cost report year
				  coincides with their IRS fiscal year are responsible for reporting to HHSC
				  Provider Finance Department any change in their IRS fiscal year and subsequent
				  cost report year by submitting written notification of the change to HHSC
				  Provider Finance Department along with supportive IRS documentation. HHSC
				  Provider Finance Department must be notified of the provider's change in IRS
				  fiscal year no later than 30 days following the provider's receipt of approval
				  of the change from the IRS.
(B)
				  Providers who chose to change their cost report year from their IRS fiscal year
				  to the state fiscal year or from the state fiscal year to their IRS fiscal year
				  must submit a written request to HHSC Provider Finance Department by August 1
				  of state fiscal year in question.
(6) Failure to report allowable costs. HHSC
				  is not responsible for the contracted provider's failure to report allowable
				  costs; however, any omitted costs identified during the desk review or audit
				  process will be included in the cost report or brought to the attention of the
				  provider to correct by submitting an amended cost report.