(a) The department will periodically audit a program provider to monitor compliance with §419.219 of this subchapter (relating to Provider Reimbursement) and Division Six (relating to Personal Funds). The department will notify the program provider of the audit date.
(b) A program provider must maintain the following records;
  (1) personal funds records, as described in §419.256(h) of this title (relating to Program Provider-Managed Personal Funds);
  (2) trust fund account ledgers, as described in §419.256(c)(1)(A) and (c)(2)(A) of this title (relating to Program Provider-managed Personal Funds);
  (3) statements from financial institutions regarding trust fund accounts;
  (4) petty cash fund ledgers as described in §419.256(d)(3) of this title (relating to Program Provider-Managed Personal Funds);
  (5) written requests for personal funds from trust fund accounts, as described in §419.257 of this title (relating to Requests for Personal Funds from Trust Fund Accounts);
  (6) documentation of expenditures and deposits of personal funds, as described in §419. 256(i) of this title (relating to Program Provider-Managed Personal Funds);
  (7) documentation of an individual's ability to manage personal funds and decisions regarding management of personal funds, as described in §419.253 of this title (relating to Determining Management of Personal Funds);
  (8) documentation regarding requests for specific types or brands of items and services, as described in §419. 255(a) of this title (relating to Items and Services Purchased With Personal Funds);
  (9) applied income ledgers, as described in §419.260(c) of this title (relating to Applied Income);
  (10) applied income payment plans from TDHS;
  (11) agreements to hold the individual's residential placement in the facility as described in §419.227(j) of this title (relating to Discharge From a Facility);
  (12) statements from financial institutions regarding operating accounts;
  (13) facility census and admission/discharge records;
  (14) leave records as described in §419.226 of this title (relating to Leaves); and
  (15) IPP's and supporting documentation.
(c) If the records required by subsection (b) of this section, or any other records required to be maintained by this subchapter, are not made available by the program provider when requested by the department, or the department determines that the records are not auditable, the department may impose a vendor hold on payments due to the program provider under the provider agreement until the records are available and auditable. If the program provider does not provide such records in accordance with instructions from the department, the department may terminate the provider agreement.
(d) The department will provide the program provider with a report of the audit findings, which may include corrective actions that must be taken by the program provider and internal control recommendations that may be followed by the program provider. Corrective actions include making refunds to individuals or the department, entering ledger adjustments, submitting unidentified funds to the department, and establishing and maintaining records and systems. The program provider may request an administrative hearing in accordance with Division Eight of this subchapter (relating to Administrative Hearings) to contest corrective actions required by the department pursuant to this subsection.
(e) If the report of audit findings requires corrective actions and the program provider does not make a request for an administrative hearing in accordance with Division 8 of this subchapter (relating to Administrative Hearings), the program provider must complete corrective actions within 60 days after receiving the report of audit findings.
(f) If the program provider does not complete corrective actions required by the department within 60 days after receiving the report of audit findings, the department may:
  (1) impose a vendor hold on payments due to the program provider under the provider agreement until the program provider completes corrective actions;
  (2) recoup payments due to the program provider under the provider agreement to make refunds to individuals or the department; and
  (3) terminate the provider agreement.
(g) Notwithstanding the other provisions set forth in this section, the department may terminate the provider agreement for repeated failure to comply with §419.219 of this subchapter (relating to Provider Reimbursement) and Division Six (relating to Personal Funds), as determined by audits conducted in accordance with this section.

Source Note: The provisions of this §261.269 adopted to be effective September 1, 2001, 26 TexReg 5384; transferred effective September 1, 2004, as published in the Texas Register September 10, 2004, 29 TexReg 8841; transferred effective October 1, 2020, as published in the Texas Register August 28, 2020, 45 TexReg 6127