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Office of Mental Health

New York State Consolidated Budget and Claiming Manual Subject: Service Provider Responsibilities Section: 7
For the Periods:
January 1, 2009 to December 31, 2009
July 1, 2009 to June 30, 2010
Issued: September 9, 2009

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This section of the manual describes the minimum requirements service providers must comply with if they receive Aid to Localities (State Aid) funding from one or more of the DMH State Agencies. These requirements cover fiscal record keeping and the completion and submission of intra-year and year-end fiscal reports under the Consolidated Fiscal Reporting System (CFRS).

Requirements for reporting fiscal information are different for service providers receiving State Aid through a contract with a Local Governmental Unit (LGU) and those service providers receiving State Aid through a direct contract with a DMH State Agency.

Fiscal Record Keeping Requirements

The policies of the DMH State Agencies regarding service provider accountability and fiscal record keeping are indicated below. These policies apply to all county operated service providers, all local contract funded not-for-profit service providers and all direct contract funded not-for-profit service providers receiving State Aid from a DMH State Agency.

  1. Service providers are required to account for expenditures and revenues by program category as budgeted and approved by the funding DMH State Agency(ies).
  2. Journals and ledgers must comply with generally accepted accounting standards and should be maintained as prescribed by the funding DMH State Agency(ies).
  3. Service providers must maintain all documentation supporting the fiscal data reported in accordance with generally accepted accounting standards.
  4. DMH State Agency standards and requirements are the minimum standards and requirements required of funded service providers. LGUs may establish additional documentation and/or submission requirements consistent with LGU practices.
  5. Service providers must maintain records and supporting documentation for a period of six (6) years after the date of the last State Aid payment made by the funding DMH State Agency(ies). These records and supporting documentation must be made available at all times, without prior notice, for audit and evaluation by representatives of the funding DMH State Agency(ies) and/or the Office of the State Comptroller (OSC) and/or the Federal Government.
  6. Service providers will require subcontract agencies to make available to the DMH State Agency, OSC and/or the Federal Government during regular business hours all financial data related to the services provided under the contract.

General Fiscal Reporting Requirements

  1. County operated service providers must allocate agency administration expenses to the DMH State Agencies using the ratio value methodology. After allocating each funding DMH State Agency its ratio value share of agency administration, county operated service providers must allocate each DMH State Agency's share between that State Agency's programs using the same methodology utilized in the approved operating budget for the fiscal reporting period.
  2. County operated and not-for-profit service providers must indicate the method of accounting used on the appropriate intra-year and final State Aid claim documents. Service providers cannot change their method of accounting without specific prior approval from the funding DMH State Agency(ies) and, if funded through a local contract, the LGU.
  3. At a minimum, county operated and not-for-profit service providers are required to submit fiscal reports to the LGU or, in the case of direct contracts, to the funding DMH State Agency in accordance with established time frames. At their discretion, LGUs may implement more frequent reporting requirements consistent with existing LGU practices in such matters.
  4. Reimbursable expenditures reported must be within the amounts established in the county operated or not-for-profit service provider's approved budget and contract (if applicable). Reimbursable expenditures are also subject to limits established by the funding DMH State Agency(ies).
  5. County operated and not-for-profit service providers encountering changes in program operations that significantly alter the original budget must modify that budget to better reflect the fiscal activity of the service provider under the changed conditions. (For County operated and not-for-profit service providers funded by OASAS, prior approval of changes in program operations or approved budgets is required.)These budgetary changes should be submitted no later than April 30 (August 15 for New York City) of the following fiscal year. This is particularly critical for LGU administration budgets and in shared programs where shifts in actual service delivery may affect the distribution of funding among/between DMH State Agencies. Please see Section 5 for more information on the modification of service provider approved budgets.
  6. Allowable costs under all State Aid funding arrangements with DMH State Agencies must meet all of the following criteria:
    1. necessary and reasonable for proper and effective program operations;
    2. specifically provided for in the approved budget;
    3. not prohibited by Federal, State or Local laws, regulations and/or policies;
    4. not allocable or included as a cost of any other program in a prior, current, or subsequent fiscal period; and
    5. not specifically prohibited in Appendix X of this manual and the Consolidated Fiscal Reporting and Claiming Manual (CFR Manual).

Intra-Year Fiscal Reporting Requirements (OASAS And OMRDD Only)

Note: OMH does not require the submission of intra-year claims.

However, LGUs may, at their discretion, require intra-year claims from county operated and not-for-profit service providers funded through the OMH Approval Letter process. Service providers funded through the OMH Approval Letter process should contact the appropriate LGU(s) for their specific intra-year reporting requirements.

Intra-year fiscal reporting requirements for OASAS and OMRDD funded county operated and not-for-profit service providers are as follows:

  1. County operated and not-for-profit service providers will use the Agency Quarterly Fiscal Summary (CQR-1) to report intra-year fiscal activity as follows:
    OASAS: OASAS expects all service providers to use approved CFRS Software to complete Intra-Year Fiscal Reporting documents and to submit those documents via the Internet. At this time, paper copies are still required to be sent directly to OASAS' Bureau of Financial Management.
      Direct Contracts: At a minimum, county operated and not-for profit service providers funded through a direct contract with OASAS will submit a mid-year (6 month) intra-year claim covering the first two quarters of the fiscal reporting period. At its discretion, OASAS reserves the right to require more frequent intra-year claim submissions from funded service providers (i.e. quarterly, monthly, etc.).
      LGUs:

    At a minimum, county operated and not-for profit service providers funded through a local contract with an LGU will submit a mid-year (6 month) intra-year claim covering the first two quarters of the fiscal reporting period. At its discretion, OASAS reserves the right to require more frequent intra-year claim submissions from funded service providers (i.e. quarterly, monthly, etc.).

    OMRDD: Direct Contracts:

    Direct contract funded service providers should also refer to Appendix C (Payment Schedule) of their fully executed contract with OMRDD. At its discretion, OMRDD reserves the right to require more frequent intra-year claim submissions from funded service providers (i.e. monthly, etc.).

      LGUs:

    At a minimum, county operated and not-for profit service providers funded through a local contract with an LGU will submit a mid-year (6 month) intra-year claim covering the first two quarters of the fiscal reporting period. At its discretion, OMRDD reserves the right to require more frequent intra-year claim submissions from funded service providers (i.e. quarterly, monthly, etc.).

    Note: Service providers funded through a local contract with an LGU are directed to check with the funding LGU for LGU-specific requirements on fiscal reporting.

  2. County operated and not-for-profit service providers will prepare CQR-1s in accordance with the instructions provided in this manual.
  3. County operated and not-for-profit Article 28 hospitals that are approved by the funding DMH State Agency(ies) to use the "Medicaid Option" will report actual intra-year expenditures and revenues consistent with the "Medicaid Option" procedures described in Appendix Y of this manual and the CFR Manual.
  4. County operated and not-for-profit service providers will prepare CQR-1s within the time frames established by the funding DMH State Agency(ies) and/or LGU for receipt by the funding DMH State Agency as follows:
    OASAS: Direct Contracts: The mid-year claim for direct contracts is due for receipt by OASAS no more than 45 days after the end of the first six months of the fiscal reporting period.
    LGUs: The mid-year claim for LGUs is due for receipt by OASAS no more than 45 days after the end of the first six months of the fiscal reporting period.
    OMH: OMH funded service providers are not required to submit intra-year claims.
    OMRDD: Direct Contracts: Direct contract funded service providers should refer to Appendix C (Payment Schedule) of their fully executed contract with OMRDD.
    LGUs: The mid-year claim for LGUs is due for receipt by OMRDD no more than 45 days after the end of the fiscal reporting period.
  5. County operated and not-for-profit service providers will prepare revised CQR-1s for expenditures and revenues incurred during the fiscal reporting period that were not included on the original CQR-1 submitted for that period or to correct errors on the original CQR-1 submitted. Revised CQR-1s should be completed consistent with the service provider's approved method of accounting and reporting.
  6. Cumulative fiscal data should take into account any adjustments made to the county operated or not-for-profit service provider's CQR-1 as a result of LGU and/or OASAS or OMRDD review and approval.
  7. County operated service providers must allocate agency administration expenses to programs other than LGU administration (program code 0890). LGU administration is considered a unique cost center separate and distinct from agency administration expenses incurred by other county operated programs. Agency administration expenses for the management and oversight of all county operated programs other than program code 0890 cannot be included in the expenses reported under program code 0890. Please see Appendix I and Appendix K of this manual and the CFR Manual for more detailed information on agency administration and LGU administration.
  8. County operated and not-for-profit service providers must report and distribute agency administration expenses using the same methodology utilized in their approved budget.
  9. County operated and not-for-profit service providers with programs serving more than one LGU and/or DMH State Agency must take the total expenditures for the program(s) and distribute them between the affected LGUs' and/or State Agency's(ies') CQR-1s based on the relative units of service provided for each LGU and/or DMH State Agency.

    The approved methodology for distributing these expenditures is as follows:

    Methodology

    1. First, determine the following information from the aggregate statistical information for the fiscal reporting period:
      1. The cumulative total units of service for all funding DMH State Agencies.
      2. The total OASAS-specific units of service.
      3. The total OMH CSS units of service.
      4. The total OMH Local Assistance units of service.
      5. The total OMRDD Chapter 620 units of service.
      6. The total OMRDD non-Chapter 620 units of service.
    2. Second, determine the cumulative total program expenditures for the fiscal reporting period for all funding DMH State Agencies.
    3. Third, divide the total cumulative expenditures by total cumulative units of service to develop the program's gross cost per unit of service.

      Note: Use Six (6) Decimal Places In Applying The Gross Cost Per Unit Of Services For The Calculations Below.

    4. Fourth, determine the gross expenditures attributable to each funding DMH State Agency's funding source(s) by multiplying the units of service for each funding source by the gross cost per unit of service developed in item 6 c above.
  10. For OMRDD funded programs only: Service providers must account for and report revenue and net expenditures in accordance with the revenue allocation methodologies used in their approved budgets. There are two (2) accepted revenue allocation methodologies:
    1. “Participant Specific Revenue Allocation Methodology" allocates the amount of revenue attributable to each funding source in a program based on the revenue generated by the participants specific to the program. After entry of the revenue data on the CQR-1 by program and funding source, net expenditures are determined by subtracting applied revenues from total expenses.
    2. "Non-Participant Specific Revenue Allocation Methodology", allocates revenues and net expenditures to each funding source in a program based on the net cost per unit of service developed using the same methodology illustrated in Item 7 above.

    In brief, after determining the net expenditures for the total program, divide the total net program expenditures by the total units of service to derive the net cost per unit of service. Then, multiply the units of service for each funding source by the net cost per unit of service to develop the net cost by funding source. Revenue is determined by subtracting net expenses from gross expenses for each funding source.

    Note: Use Six (6) Decimal Places In Applying The Net Cost Per Unit Of Services For The Calculations Below.

  11. Total LGU administration expenditures (program code 0890) must be allocated to OASAS and OMRDD CQR-1s using the approved 1988 percentages found in Appendix K of this manual and the CFR Manual.
  12. County operated and not-for-profit service providers must submit their intra-year claims as follows in accordance with the timeframes indicated in Item 4 of this section:
    1. Service providers receiving State Aid solely through a local county contract with an LGU will submit their CQR-1's to the contracting LGU.
    2. Service providers receiving State Aid through both a local county contract with an LGU and a direct contract with OASAS or OMRDD will submit CQR-1s to both the contracting LGU and the funding DMH State Agency simultaneously.
    3. Service providers receiving State Aid solely through a direct contract with OASAS or OMRDD will submit CQR-1s directly to the funding DMH State Agency.
    4. A service provider that provides services for more than one LGU must submit separate CQR-1s for each LGU.

    Note: Service providers funded through a local contract with an LGU or the NYC Department of Health and Mental Hygiene (NYC DOHMH) are directed to check with the funding LGU or NYC DOHMH for their specific requirements on fiscal reporting.

Final Fiscal Reporting Requirements

  1. County operated and not-for-profit service providers will use the State Aid claiming schedules included in the year-end Consolidated Fiscal Report (CFR) as the final claim. These schedules are referred to as the Consolidated Claim Report (CCR) and consist of the CFR-i, CFR-iii, DMH-2, DMH-2A (OASAS and OMRDD Only) and DMH-3 State Aid Claiming schedules included in the complete CFR document.
  2. County operated and not-for-profit service providers will prepare CCRs in accordance with the instructions provided in the Consolidated Fiscal Reporting and Claiming Manual (CFR Manual).
  3. County operated and not-for-profit service providers must prepare CCRs using the same methodologies and principles used to prepare their approved budgets and intra-year State Aid claims.
  4. County operated and not-for-profit hospital providers that are approved by the funding DMH State Agency(ies) to use the “Medicaid Option” will report actual year-end expenditures and revenues on the CCR consistent with the “Medicaid Option” procedures described in Appendix Y of this manual and the CFR Manual.
  5. County operated and not-for-profit service providers will prepare CCRs within the time frames established by the funding DMH State Agency(ies) and/or LGU for receipt by the funding DMH State Agency(ies) as follows:
    OASAS: OASAS expects all service providers to use approved CFRS Software to complete Final Fiscal Reporting documents and to submit those documents via the Internet. At this time, paper copies are still required to be sent directly to OASAS' Bureau of Financial Management.
    Direct Contracts: The CCR for direct contracts is due for receipt by OASAS no more than 120 days after the end of the fiscal reporting period.
    LGUs: The CCR for LGUs is due for receipt by OASAS no more than 120 days after the end of the fiscal reporting period.
    OMH: Direct Contracts: The CCR for direct contracts is due for receipt by OMH no more than 120 days after the end of the fiscal reporting period.
    LGUs: Service providers funded through a local contract with an LGUshould refer to the LGU's fiscal reporting requirements and the OMH Aid to Localities Spending Plan Guidelines.
    OMRDD: Direct Contracts: The CCR for direct contracts is due for receipt by OMRDD no more than 120 days after the end of the fiscal reporting period.
    LGUs: Service providers funded through a local contract with an LGUshould refer to the LGU's fiscal reporting requirements.
  6. County operated service providers must allocate agency administration expenses to programs other than LGU administration (program code 0890). LGU administration is considered a unique cost center separate and distinct from agency administration expenses incurred by other county operated programs. Agency administration expenses for the management and oversight of all county operated programs other than program code 0890 cannot be included in the expenses reported under program code 0890. Please see Appendix I and Appendix K of this manual and the CFR Manual for more detailed information on agency administration and LGU administration.
  7. County operated and not-for-profit service providers must report and distribute agency administration expenses on the CCR using the same methodology utilized in their approved budget.
  8. County operated and not-for-profit service providers with programs serving more than one (1) DMH State Agency must account for these expenditures as follows:
    CFR Cost Report (Core) Schedules: On CFR core schedules CFR-1, CFR-4, CFR-4A and DMH-1, programs are reported as sites on individual DMH State Agency schedules or on shared program schedules.
    CCR Final Claim Schedules:

    On CCR final claim schedules DMH-2, DMH-2A (OASAS and OMRDD only) and DMH-3, programs are reported on DMH State Agency specific, county specific schedules.

    Shared program expenses are reported on DMH State Agency specific schedules. Expenses, revenues and net operating costs are distributed between the applicable DMH State Agencies based on the relative units of service provided.

  9. County operated and not-for-profit service providers with programs serving more than one (1) county must account for these expenditures as follows:
    CFR Cost Report (Core) Schedules: On CFR core schedules CFR-1, CFR-4, CFR-4A and DMH-1 programs serving and/or operating in more than one (1) county are reported as sites on individual DMH State Agency schedules or shared program schedules.
    CCR Final Claim Schedules:

    On CCR final claim schedules DMH-2, DMH-2A and DMH-3 individual programs serving and/or operating in more than one (1) county are reported on DMH State Agency specific, county specific schedules.

    Shared program expenses are reported on DMH State Agency specific, county specific schedules. Expenses, revenues and net operating costs are distributed between the applicable DMH State Agencies and/or counties based on the relative units of service provided.

  10. For OMRDD funded programs only: Service providers must account for and report revenue and net expenditures on the CCR in accordance with the revenue allocation methodologies described in item 9 of Service Provider Intra-Year Fiscal Reporting Requirements.
  11. Total LGU administration expenditures (program code 0890) must be allocated to each funding DMH State Agency's CCR using the approved 1988 percentages found in Appendix K of this manual and the CFR Manual. Agency administration expenses for county operated programs cannot be included in program code 0890 (see item 6 above).
  12. Service providers must submit their CCR final claims as follows in accordance with the timeframes indicated in Item 5 of this section:
    1. Service providers receiving State Aid solely through a local county contract with an LGU will submit their CCRs to the contracting LGU.
    2. Service providers receiving State Aid through both a local county contract with an LGU and a direct contract with a DMH State Agency will submit CCRs to both the contracting LGU and the funding DMH State Agency simultaneously.
    3. Service providers receiving State Aid solely through a direct contract with a DMH State Agency will submit CCRs directly to that DMH State Agency.
    4. A service provider that provides services for more than one LGU must submit separate CCRs for each LGU.

    Note: Service providers funded through a local contract with an LGU or the NYC Department of Health and Mental Hygiene (NYC DOHMH) are directed to check with the funding LGU or NYC DOHMH for their specific requirements on fiscal reporting.

Comments or questions about the information on this page can be directed to the Community Budget & Financial Management (CBFM) Group.