Follow-up on corrections·September 29, 2023

Licensing Program Analyst (LPA) Sandra Urena conducted an unannounced Case Management-Deficiencies visit due to deficiencies observed during the course of the audit investigation for C#29-AS-20210310091929. LPA Urena and Jessica Chen, General Auditor III (joined via Microsoft Teams) met with facility representative Molly Aayala, and explained the reason for the visit. During the course of the audit investigation for complaint C#29-AS-20220826155207, the Department’s Audit Section concluded the following three deficiencies: Deficiency #1: Safeguards for Resident Cash, Personal Property, and Valuables The audit review revealed the following -The facility’s cash handling policy and procedures describe that residents sign for their deposits and withdrawal on the ledgers (LIC 405). However, residents’ signature/initials were not found on the ledgers, only the accounting personnel typed initials were recorded on the ledgers. Residents are given a “petty cash slip” to sign when the residents receive cash. The “petty cash slip” is the only place a signature from the resident is obtained, which includes the business manager/staff initials/signature on the slip as facility representative. This system does not allow for the resident to acknowledge their balance including deposits and withdrawal amounts. Residents should be able to see their ledger amounts to ensure they are free of error and deposits are entered in a timely manner. Residents were asked to sign the individual “petty cash slips” which would not allow for the resident to be aware of the total amount they have and how much is credited each month. A LIC 405 ledger was maintained for each resident the facility handles cash for, however, the LIC 405 forms submitted for audit review appear to be entered by the accounting personnel at the corporate office, with accounting personnel initials typed in, and not at the facility.No residents’ signatures were observed on the LIC 405 ledgers, which is inconsistent with their policies and procedures. Continues on LIC 809C-page 2. Page 2. The licensee failed to maintain adequate safeguards and accurate records of cash resources and valuables entrusted to their care, including, but not limited to the following: (1) Records of residents' cash resources maintained as a drawing account shall include a ledger accounting (columns for income, disbursements, and balance) for each resident, and supporting receipts filed in chronological order. Deficiency #2: Surety Bond – Insufficient Coverage The audit review revealed the following -The auditor requested the surety bond from the licensee. The review of the surety bond revealed that the current coverage is for $11,000 thousand. No expiration date was shown on the certificate. Auditor made inquiry to the bond issuer if the bond was still valid and for the expiration date. The bond issuer responded that the surety bond is still valid until it’s next renewal date of 12/4/2023. However, audit review of the residents’ trust accounts noted that the facility normally safeguards between $44,000 to $53,000 per month. The amount of the surety bond shall be according to the following schedule: Amount safeguarded per month $1,501 to $2,500, bond required $3,000. Every further increment of $1,000 or fraction thereof shall be required to have an additional $1,000 on the bond.” The facility failed to maintain sufficient surety bond coverage to safeguard the residents’ resources. The current $11,000 surety bond coverage is not sufficient and needs to be increased for the amount that is being safeguarded. Deficiency #3 : Some residents’ P&I were mishandled, due to lack of supporting documents for cash withdrawals, purchases, other deductions, and rent miscalculation. The audit review revealed the following- Based on documentation and information reviewed by the auditor, the facility handles cash resources for 16 residents, including 3 residents that the facility is the SSI representative payee. Admission Agreements, LIC 602 (Physician Report), financial ledger LIC 405 forms, “petty cash slips” and purchase invoices were requested and reviewed for the residents. Some cash withdrawals and purchases were not accepted for audit due to lack of supporting documentation. Instances noted, “petty cash slip” had no residents’ signature; invoiced amount disagrees with the recorded purchased amount; the “petty cash slip” were from dates out of the audit period. Continues on LIC 809C-page 3. Page 3. During the audit, the residents’ LIC 602 were reviewed, and it revealed that some residents are not able to leave the facility unassisted; are not even able to transfer to and from bed or have dementia. Although these residents do not leave the facility, there were frequent, and material amounts of cash withdrawals recorded on their ledgers and the petty cash slips. The auditor provided the facility the draft of audit working papers, listing questionable transactions, by resident. Auditor made inquiry regarding where, how, when, and who accompanied these residents to spend the cash. The facility did not provide an explanation or supporting documents. The withdrawals are not supported, and the facility is to refund the residents accordingly. The documentation submitted and reviewed disclosed that the facility mishandled some of the residents’ funds. The following amounts show the refund amount determined for each resident: R1-$424; R2-$60; R3-$270; R4-$253; R5-$1,055; R6-$290; R7-$502; R8-$20; R9-$0; R10-$910; R11-$438; R12-$760; R13-$130; R14-$1,678; R15-$1,584; R16-$664. TOTAL Refund for 16 residents: $9,038.00. Based on records review and the information obtained, the following deficiencies were observed. Pursuant to Title 22 of the CA Code of Regulations (CCR), the following deficiencies were cited (refer to LIC 809-D) Citations were issued. Exit interview conducted with facility's representative. Today's reports, and appeal rights were reviewed, and issued.