The information in this section will govern cost reports for providers' fiscal years ending in calendar year 1997 and subsequent years. The Texas Department of Human Services (DHS) may delay or withhold vendor payment to a provider in order to investigate or correct financial or accounting irregularities or to obtain required documentation.

1. (1) Circumstances which may result in vendor hold are:

   1. (A) failure to maintain records that support the information submitted on the cost report in a form which is in compliance with DHS's chart of accounts for long-term care providers;
   2. (B) failure to file an acceptable cost report pursuant to Chapter 20 by the cost report due date;
   3. (C) failure to allow access to any and all records necessary to verify information submitted to DHS on cost reports including records pertaining to related party transactions or other business activities engaged in by the provider;
   4. (D) failure to disclose a change in an allocation method used for cost reporting purposes or failure to use the allocation method approved or required by DHS; or
   5. (E) failure to reimburse DHS for the actual costs for DHS staff to travel and review the records necessary to verify information submitted to DHS on cost reports when such records are not available to DHS audit staff within the State of Texas.
2. (2) Vendor payments will be held until the circumstances resulting in vendor hold are corrected.
3. (3) A provider has the right to appeal a vendor hold as specified in 40 TAC §79.1602 (Right to a Hearing).

Source Note:The provisions of this §355.403 adopted to be effective April 1, 1996, 21 TexReg 1432; amended to be effective September 1, 1996, 21 TexReg 7861; duplicated effective September 1, 1997, as published in the Texas Register October 17, 1997, 22 TexReg 10311.