355.2025 Financial Audit Services.pdf

Oakland Community Health Network

Request for Proposal (RFP)

Financial Audit Services

RFP #355.2025

Open: April 28, 2025 Close: May 22, 2025

Table of Contents Section Page Section 1 About Oakland Community Health Network (OCHN) 2 Section 2 Administrative Requirements 4 Section 3 Submission Information 8 Section 4 Scope of Work 9 Section 5 Exhibits 16 Section 6 Confirmation of Interest Form Section 7 Attachments

Oakland Community Health Network RFP 355.2025 Financial Audit Services

SECTION 1

ABOUT OAKLAND COMMUNITY HEALTH NETWORK (OCHN)

OCHN is a governmental entity established under the Michigan Mental Health Code and serves as the prepaid inpatient health plan and Community Mental Health Service Program responsible for providing behavioral health and substance use disorder services to residents of Oakland County residents.

OCHN is contracted by the Michigan Department of Health and Human Services to lead a provider service network and manages care for approximately 29,000 Oakland County citizens at more than 400 service sites across the county. People who receive public behavioral health services through OCHN's provider network include those who have an intellectual or developmental disability, mental health concerns, or substance use disorder. Most of these individuals have Medicaid insurance coverage.

OCHN's goal is to ensure these individuals are aware of and have access to services and supports that will improve their health and quality of life, as well as ensure their engagement in full community participation. Its mission to “inspire hope, empower people, and strengthen communities” reflects an unyielding belief in a "Valuable System for Valued People." Programs and supports provided by OCHN's service network are available at www.oaklandchn.org.

Location Oakland Community Health Network (OCHN) is located at 5505 Corporate Drive, Troy, MI 48098 in Oakland County.

The Resource and Crisis Center, located at 1200 N. Telegraph Road, Building 32E, Pontiac, Michigan 48341.

Our Vision OCHN will be a champion for the empowerment of persons seeking quality integration of physical and mental health supports and services. This includes youth and adults with developmental or intellectual disabilities, mental health concerns, and substance use disorders. We listen and respond to our community's needs, providing support and opportunities for people to lead independent and self-directed lives.

Our Core Values These values are expected from all OCHN and Provider Network staff in their day-to-day work:

● We promote equality and personal choice leading towards self-directed lives.

● We use language that promotes dignity and respect for all people.

● We are guided by the goals, needs and desires of people we serve.

● We promote and protect the rights of people served as they seek to achieve their personal life outcomes.

● We lead with integrity, accountability, and transparency.

● We strengthen our community by identifying needs and implementing innovative solutions.

Oakland Community Health Network RFP 355.2025 Financial Audit Services

● We collaborate in shared purpose with individuals served, families, staff, service providers, and the community.

Diversity, Equity, and Inclusion Oakland Community Health Network is committed to building a diverse team and fostering an inclusive and equitable culture. OCHN is proud to be an equal opportunity employer that embraces and encourages our employees' differences. This includes ability, age, color, family type, gender expression and identity, individual expression, medical conditions, national origin, pregnancy, race, religion, sexual orientation, veteran status, and all other diverse and wonderful characteristics. OCHN is seeking proposals from respondents that share in OCHN’s commitment and belief that equity, diversity, inclusion, and accessibility strengthen the community and enhance dignity and respect.

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SECTION 2

ADMINISTRATIVE REQUIREMENTS

1. OCHN is issuing this RFP for the purpose of soliciting bids/proposals in the form of the

Proposer’s Response for goods/services. The specific scope of work is described in Section 4

- Scope of Work (the “Scope of Work”). Proposers will execute and submit all Responses in accordance with these general instructions and the applicable provisions of the specifications of the Scope of Work.

2. Only written proposals will be considered. OCHN requires comprehensive responses to every section within the solicitation to facilitate the review of the responses. Proposers shall follow the described proposal format, content, and sequence. The intent of the proposal format is to expedite review and evaluation. It is not the intent to constrain Proposers with regard to content, but to assure that the specific requirements set forth in this solicitation are addressed in a uniform manner amendable to review and evaluation. Additional information regarding any concerns, barriers, or suggested modifications may be included for consideration and must be clearly identified as such.

3. Proposer shall submit comprehensive responses to all Attachments accompanying this RFP.

4. Proposer must follow these proposal instructions and provide complete responses to each of the items described. The Proposer must ensure that each completed Attachment is labeled with the appropriate Attachment letter and Attachment name with all required information provided for each Attachment response.

5. Proposer must be able to furnish the scope of work by contract start date.

6. Proposer must designate one contact person who will be responsible for the solicitation process and any resulting Contract with OCHN.

7. Neither the Proposer, nor any of its employees or subcontractors shall be excluded from participation in Medicare, Medicaid, or any other Federal programs.

8. The use of hyperlinks within your response is strongly discouraged. OCHN employees are advised not to open links in a new window or tab; therefore, any required information you are submitting via a link will not be evaluated by the Review Committee and scoring will reflect the information as not included in your response to the RFP.

9. To obtain an official answer to any question, the Proposer must submit the question by email as specified in this RFP. All official responses to questions regarding this solicitation will be posted to BidNet and posted to the OCHN website here Contract Opportunities - Smartsheet.com.

OCHN shall not be responsible for any verbal communication between any employee of OCHN and any actual or potential Proposer.

10. Proposer must complete and submit all Attachments included in the RFP in the format specified for receipt by OCHN by the time and date specified. The mere fact that the proposal

Oakland Community Health Network was dispatched will not be considered; the Proposer must ensure the proposal is actually delivered.

11. An authorized representative of the agency must sign as prompted in the Attachments.

12. Proposer’s failure to submit a proposal in accordance with these instructions, including without limitation those pertaining to format and timing, may result in disqualification of the proposal.

13. Proposals must remain valid for at least 120 days after the proposal submission deadline.

14. Proposer acknowledges and understands that any data collected while performing the required work is not permitted to be used or disclosed for any other purpose outside of the scope of work for this contract.

15. MODIFICATIONS TO SOLICITATION

OCHN may modify the solicitation at any time prior to the deadline submission date. Changes to the solicitation will be posted (1) on the OCHN website at www.oaklandchn.org; and (2) sent by email to the email address specified by each Proposer who submits the required confirmation of interest form. This is the only method by which the solicitation can be modified. Any posted changes will revise and supersede the original solicitation.

16. STANDARD CONTRACT

OCHN requires strict adherence to the Contract included as part of this solicitation. OCHN reserves the right to deem a bid non-responsive for failure to honor the Contract. Proposers not willing to sign a Contract without modification may be considered non-responsive.

Nevertheless, the Proposer may submit, with its bid proposal, proposed changes to the Contract accompanied by a detailed explanation as to each change for OCHN consideration. Failure to do so at the time of bid submission will constitute the Proposer’s acceptance of the OCHN Professional Services Contract as-is and will prohibit the Proposer from submitting any proposed Contract changes prior to the Contract effective date. General statements, such as that the Proposer reserves the right to negotiate the terms and conditions, also may be considered non-responsive.

17. RESERVATIONS

OCHN reserves the right to:

A. Discontinue or cancel the solicitation process, in whole or in part, at any time for any or no reason. The issuance of a solicitation, a Proposer’s preparation and submission of a proposal, and OCHN’s subsequent receipt and evaluation of such proposal does not commit OCHN to award funding or to award a Contract to the Proposer or any other individual or entity, even if all the requirements in the solicitation are met.

B. Consider late proposals.

C. Consider an otherwise disqualified proposal, if OCHN believes it is in the best interest of

OCHN.

D. Disqualify a proposal based on the information provided or if it is determined a Proposer

Oakland Community Health Network purposely or willfully submitted false information in response to the solicitation.

E. Reject any and all bids which fail to meet the terms, conditions, and specifications of the solicitation package; or are determined to be not in OCHN’s best interest; or, for which funding is not available.

F. Accept other than the lowest bid.

G. Consider Proposers’ prior performance with OCHN in making its award decision.

H. Consider the overall economic impact to OCHN when evaluating proposal pricing and in the final award recommendation.

I. Refuse to award a contract to any Proposer that has any outstanding debt with OCHN.

J. Enter negotiations with one or more Proposers on price, terms, technical requirements, or other deliverables.

K. Evaluate the proposal outside the scope identified in the solicitation.

L. Seek additional proposals beyond the Submission Deadline if, in its sole discretion, proposals received do not meet the guidelines or intent of this solicitation or the needs of OCHN and/or the population it serves.

M. Cancel this RFP in whole or in part.

18. SOLICITATION RESPONSE COSTS

OCHN shall not be responsible, or reimburse any Proposer, for any expenses incurred in preparing its proposal in response to this solicitation or in the provision of any additional information or presentation, nor any cost of Proposer’s procurement of any contract with

OCHN.

19. EVALUATION AND AWARD OF CONTRACT

OCHN shall award an agreement resulting from this solicitation to the responsible Proposer whose offer conforms to this solicitation deemed to be most advantageous to OCHN, price and other factors considered. OCHN reserves the right to award the contract to other than the lowest priced response. The award shall be made to the Proposer representing the best value to the project and OCHN. OCHN reserves the right to award more than one Proposer. If an Agreement is established as a result of this solicitation, Proposer understands that quantities indicated in the RFP are an estimate only and OCHN does not guarantee the purchase quantity of any item listed.

OCHN intends to evaluate proposals and award an agreement without discussion with the Proposers. Therefore, the Proposer’s initial offer should contain the Proposer’s best terms from a price and technical standpoint. However, OCHN reserves the right to conduct discussions if determined to be necessary by the OCHN Manager of Contracts and Procurement. It is expected all Proposers responding to this solicitation will offer government or comparable most favorable terms. Any and all discounts must be clearly delineated. OCHN participates in the following purchasing cooperatives: MIDeal, MHEC, U.S. Communities / OMNIA Partners and NASPO (National Association of State Procurement Officials).

A written notice of award or acceptance of a proposal, mailed or otherwise furnished to the successful Proposer with the time acceptance specified in the solicitation, shall result in a binding contract.

20. FREEDOM OF INFORMATION ACT (FOIA)

All portions of the Proposer’s proposal and the resulting contract are subject to disclosure as required under Michigan’s Freedom of Information Act, 1976 Public Act 442. All records generated by the successful Proposer and / or their employees assigned to provide services to OCHN shall be subject to FOIA (FREEDOM OF INFORMATION ACT).

21. IRAN LINKED BUSINESS

By executing this Agreement and without need of additional signature, Contractor, for itself and for its owners, officers, shareholders, directors, managers, members and employees (collectively, “Contractor Group”) hereby certifies, represents, and warrants that neither Contractor, nor any member of Contractor Group is an "Iran Linked Business" within the meaning of the Iran Economic Sanctions Act, Michigan Public Act No. 517 of 2012 (the "Act"), and that neither Contractor, nor any member of Contractor Group will become an "Iran Linked Business" at any time during the course of performing any services under this Agreement. Contractor and Contractor Group further acknowledge that any person who is found to have submitted a false certification is responsible for a civil penalty of not more than $250,000.00 or two (2) times the amount of the contract or proposed contract for which the false certification was made, whichever is greater, the cost of OCHN's investigation, and reasonable attorney fees, in addition to the fine. Moreover, any person who submitted a false certification shall be ineligible to bid on a request for proposal for three (3) years from the date it is determined that the person has submitted the false certification.

22. PATRIOT ACT

Contractor shall comply with the USA Patriot Act (Public Law 107-56, 115 Stat. 272 [2001]) ("USAPA") with respect to the system and services.

23. PROHIBITION ON CONTRACCTING FOR COVERED TELECOMMUNICAITON

EQUIPMENT OR SERVICES

To the extent applicable to any services to be provided to OCHN, Contractor acknowledges and agrees that Section 889(b) of the John S. McCain National Defense Authorization Act for Fiscal Year 2019, Pub. L. No. 115-232 (the “McCain Act”), and 2 C.F.R. §200.216, prohibit the obligation or expending of federal award funds on certain telecommunication products or with certain entities for national security reasons on or after August 13, 2020 and agree to comply with any applicable requirements of the McCain Act.

SECTION 3

SUBMISSION INFORMATION

OCHN CONTACT INFORMATION

Contact Information:

Oakland Community Health Network (OCHN) Contracts & Procurement 5505 Corporate Drive Troy, MI 48098 Telephone (248) 764-4434 • Fax (947) 218-3837

Procurement Contact Information:

Name: Jen Hillier Phone: (248)975-9765 Email: hillierj@oaklandchn.org

CONTRACT INFORMATION

Type of Contract: Fixed Price Term of Contract: Three-year contract This Procurement Supports: Budget and Finance Team

TARGET DATES

DESCRIPTION DATE

Solicitation release April 28, 2025 Questions from Proposers due Proposers shall submit questions to Jen Hillier at hillierj@oaklandchn.org.

2:00 PM EST

May 7, 2025

Comprehensive question and answer document shall be emailed to all Proposers that submitted a confirmation of interest form. May 12, 2025 Confirmation of interest form due Proposers shall submit confirmation of interest form to Jen Hillier at hillierj@oaklandchn.org.

2:00 PM EST

May 13, 2025

Proposals due Proposers shall submit proposals to Jen Hillier at hillierj@oaklandchn.org.

On or before

2:00 PM EST

May 22, 2025

Meetings with select Proposers Specific appointments to be coordinated with selected Proposers. Beginning July 11, 2025 Approximate date contract issued / Contract award to successful Proposer(s) October 1, 2025

METHOD OF PROPOSAL SUBMISSION

Proposals shall be submitted electronically to: hillierj@oaklandchn.org

Electronic submission MUST include the following subject line:

RFP 355.2025 Financial Audit Services – Proposal Submission

SECTION 4

SCOPE OF WORK

DEFINITIONS

Term Definition OCHN Oakland Community Health Network

Proposer An individual or entity who submits a proposal in response to this RFP.

RFP Request for Proposal GAO United States General Accounting Office OMB United States Office of Management and Budget GAAS Generally Accepted Auditing Standards MDHHS Michigan Department of Health and Human Services

SCOPE OF WORK

1. INTRODUCTION

The Oakland Community Health Network, hereafter known as OCHN, is requesting proposals from qualified certified public accountants, hereafter known as Auditors, to audit its financial statements for each of fiscal years ending September 30, 2025, through September 30, 2027, with an option for three additional individual years.

These audits are to be performed in accordance with generally accepted auditing standards, the standards set forth for financial audits in the U.S. General Accounting Office's (GAO) Government Auditing Standards (2011), the provisions of the federal Single Audit Act of 1984 (as amended 1996) and U.S. Office of Management and Budget (OMB) Circular Guidance Code 2 CFR 200, Audits of States and Local Governments and Nonprofit Organizations, as well as the laws and standards prescribed by the State of Michigan and it’s Treasurer.

The Auditor must be able to begin furnishing financial audit services by the contract start date, October 1, 2025.

Fund Structure OCHN’s fiscal year begins on October 1 and ends on September 30 and uses the following fund type for its financial reporting:

Fund Type Number of Individual Funds

Number with Legally Adopted Annual Budgets

Enterprise Fund One One Internal Service Fund One One

Budgetary Basis of Accounting OCHN prepares its budget on a basis consistent with generally accepted accounting principles.

Pension Plans OCHN has an employer Defined Contribution pension plan substantially covering most full-time employees. It also offers its employees a Deferred Compensation Money Purchase Plan. In compliance with State law, both plans are established as Trust Funds and are reported as "Pension Trust Funds." OCHN has no legal access to Trust Fund Assets. Both systems are funded as accrued.

Magnitude of Finance Operations The Budget and Finance Team is headed by Robert Blumenfeld, Chief Financial Officer, and consists of 16 employees. The principal functions performed and the number of employees assigned to each is as follows:

Function Number of Employees Administration 3 Financial Analysts / Accountants 7 Support 2 Facilities 4

Financial and Data Processing Systems The accounting transactions are posted on the accrual basis.

OCHN uses Microsoft Dynamics 365 Business Central accounting system for the functions of accounting, purchasing, asset management, cost allocation and budgeting. The application is a cloud-based ERP software. For invoicing OCHN also uses PN3 application. This application fully integrates with Business Central. . No software is installed on any client hardware. Human Resources has outsourced payroll and performance evaluations to a secure hosting provider, ADP.

Internal Audit Function The Oakland Community Health Network currently does not have an internal audit function.

Notification and Contract Dates: (all stated dates are tentative) Announcement of Proposer Selection August 18, 2025 Contract Start Date October 1, 2025

Date Preliminary Audit Work May Commence The Auditor shall be prepared to commence audit work on the FY19 fiscal year immediately. This includes completing the scope and establishing pre-audit engagement criteria by October 15, 2025.

OCHN and Auditor shall determine the field work start date during the October 15, 2025, pre-audit meeting.

Audit Schedule A schedule for the 2015-2027 Fiscal Year Audit shall be submitted with the Auditor’s proposal and shall contain the following milestones:

1. Interim work plan

Oakland Community Health Network

2. Detailed audit plan

3. Fieldwork

4. Draft reports

Entrance Conferences, Progress Reporting and Exit Conferences At a minimum, the following conferences shall be held by the dates indicated in the schedule submitted in the audit Auditor’s proposal:

Entrance Conference with the Chief Financial Officer, and the Controller of Accounting, Audit Committee/Business Operations Committee of the Board, other staff as necessary. The purpose of this meeting shall be to discuss prior audit problems and interim work to be performed. This meeting shall also be used to establish overall liaison for the audit and to make arrangements for the workspace and other needs of the Auditors.

Progress Conference with the Chief Financial Officer and Controller of Accounting, other staff as necessary. The purpose of this meeting shall be to summarize the results of the preliminary review and to identify the essential internal controls or other matters to be tested. The audit plan is also to be presented by the selected Auditors and discussed.

Exit Conference with the Chief Financial Officer, Controller of Accounting, and other staff as necessary. The purpose of this meeting shall be to summarize the results of the fieldwork and to review significant findings.

A similar time schedule shall be developed for audits for each future fiscal year if the OCHN exercises its option for additional audits.

Date Final Report is Due A draft audit report shall be delivered to the Chief Financial Officer by March 31, 2026, for year one of the contract.

The Chief Financial Officer shall complete the review of the draft report as expeditiously as possible. It is not expected this process shall exceed one week. During that period, the Auditors shall be available for any meetings that may be necessary to discuss the audit reports. Once all issues for discussion are resolved, the final signed report shall be delivered to the Chief Financial Officer and the Audit Committee/Business Operations Committee of the Board within five working days. It is anticipated this process shall be completed and the final report will be delivered by April 15, 2026.

The final report with an additional 15 copies shall be delivered to the Chief Financial Officer at the OCHN, 5505 Corporate Drive, Troy, Michigan 48098 for distribution to the members of the Audit Committee/Business Operations Committee of the Board, the OCHN Board, and the OCHN Administrative Staff.

Other reports, particularly the management letter, shall be due on April 15, 2026.

ASSISTANCE TO BE PROVIDED TO THE AUDITORS AND REPORT PREPARATION

Oakland Community Health Network

Fiscal Services Division and Clerical Assistance OCHN Budget and Finance staff and responsible management personnel shall be available during the audit to assist the Auditors by providing information, documentation and explanations. The preparation of confirmations shall be the responsibility of OCHN.

Information Systems Assistance Information Systems personnel shall be available to provide systems documentation and explanations. The Auditors shall be provided with reasonable computer time and the use of OCHN computer hardware and software.

Statements and Schedules to be Prepared by the Staff of OCHN The Budget and Finance staff shall prepare statements and schedules for the Auditors wherever possible and appropriate.

Work Area, Telephones, Photocopying and Fax Machines OCHN shall provide the Auditors with a reasonable workspace, desks and chairs. The Auditors shall also be provided with reasonable access to telephone lines, photocopying facilities and fax machines.

Report Preparation Report preparation, editing and printing shall be the responsibility of the selected Auditors.

OCHN In-Kind Services Other than the items listed above, the Auditors proposal shall contain any in-kind services, which may be necessary to the successful completion of the contract.

General OCHN is soliciting the services of qualified certified public accountants to audit its financial statements for the fiscal years ending September 30, 2025, through September 30, 2027, with an option for three additional individual fiscal years. These audits are to be performed in accordance with the provisions contained in this RFP. The OCHN Budget for the Fiscal Year Ending September 30, 2025, is attached to the RFP as Exhibit 1.

Scope of Work to be Performed OCHN desires the Auditors to express an opinion on the fair presentation of its financial statements in conformity with generally accepted accounting principles. In addition to the Financial and Single Audit, the Auditors shall be asked to perform a compliance examination as outlined by the Michigan Department of Health and Human Services (Exhibit 2). OCHN may identify special topics to be included in the scope of the annual audit.

Auditing Standards to be Followed To meet the requirements of this request for proposals, the audit shall be performed in accordance with generally accepted auditing standards as set forth by the American Institute of Certified Public Accountants.

Reports to be Issued

Oakland Community Health Network

Following the completion of the audit of the Fiscal year's financial statements, the Auditors shall issue a report on the fair presentation of the financial statement in conformity with generally accepted accounting principles. In addition, the Auditors shall issue a report on the compliance with Department of Health and Human Services (which shall be forwarded to the State of Michigan Department of Health and Human Services) and issue an A-133 Single Audit Report. The Auditors shall present completed reports to the OCHN Board as requested.

Auditors shall assure themselves that the Business Operations Committee and the OCHN Board are informed in writing of each of the following:

1. The Auditors’ responsibility under generally accepted auditing standards

2. Significant accounting policies

3. Management judgments and accounting estimates

4. Significant audit adjustments

5. Other information in documents containing audited financial statements

6. Disagreements with management

7. Difficulties encountered in performing the audit

The Auditors shall communicate in a letter to OCHN’s Chairperson of the Business Operations Committee any reportable conditions found during the audit. A reportable condition shall be defined as a significant deficiency in the design or operation of the internal control structure, which could adversely affect the organization's ability to record, process, summarize, and report financial data consistent with the assertions of management in the financial statements. In addition, the following conditions shall be considered reportable.

Reportable conditions that are also material weaknesses shall be identified as such in the report. Non-reportable conditions discovered by the Auditors shall be reported in a separate letter to management, which shall be referred to in the reports on compliance and internal controls.

The report on compliance and internal controls shall include all material instances of noncompliance. All nonmaterial instances of noncompliance shall be reported in a separate management letter, which shall be referred to in the report on compliance and internal controls.

Irregularities and illegal acts. Auditors shall be required to make an immediate, written report of all irregularities and illegal acts of which they become aware to the following parties:

Business Operations Committee Executive Director Chief Financial Officer

Special Considerations

OCHN shall send its annual compliance report to the Michigan Department of Health and Human Services for review. It is anticipated the Auditors may be required to provide special assistance to OCHN to meet the requirements of that regulatory agency.

A list of findings and other weaknesses from OCHN’s most recent financial statement audit shall be available to the selected Auditors. OCHN believes the identified weaknesses have been resolved.

Financial Accounting and Audit Guidelines The successful Auditor shall obtain an external peer review sufficient in scope to provide a reasonable basis for determining whether, for the period under review, the reviewed audit organization’s system of quality control was suitably designed and whether the audit organization is complying with its quality control system in order to provide the audit organization with reasonable assurance of conforming with applicable professional standards.

The successful Auditor shall allow authorized representatives or agents of the State, and Federal, including OCHN to have access to the accounting records upon reasonable notice and at reasonable times during the performance and/or retention period of the contract for purposes of review, analysis, inspection, audits, and/or reproduction. Copies of any accounting records related to the contract shall be made available by the organization within ten (10) days of receiving a written request from OCHN for specified records. Throughout the duration of the contract term, or until other pending matters are closed, whichever is later, and for a period of seven (7) years after the termination or expiration of a contract, the provider in accordance with 45 CFR, Part 74.164 (b) shall agree that any authorized individuals of the State, and where federal funds are involved, the Comptroller General of the United States, shall have access to, and the right to examine, audit, and excerpt, and transcribe any pertinent records or documents of the organization.

Working Paper Retention and Access to Working Papers All working papers and reports must be retained, at the Contractor’s expense, for a minimum of seven (7) years, unless the Contractor is notified in writing by the OCHN of the need to extend the retention period. The Contractor shall make working papers available in accordance with the “Retention of Working Papers and Records” Section of Exhibit 2 and Exhibit 3 hereto. Reports, documents, and working papers shall only be released with specific written permission and direction from the OCHN. In addition, the Contractor shall respond to reasonably inquiries of successor firms and allow successor firms to review working papers relating to matters of continuing accounting significance.

Additional Support Occasionally, OCHN may request technical consultation from Auditors on specific accounting matters.

Subcontracting Auditors submitting proposals are to disclose subcontracting of any portion of the engagement to other Auditors and identify the Auditors in the proposal. If this is to be done, that fact, and the name of the proposed subcontracting Auditors, shall be clearly identified in the proposal.

Oakland Community Health Network

Following the award of the audit contract, no additional subcontracting shall be allowed without the expressed prior written consent of OCHN.

Auditors Assurances In that the selected Auditors shall be required to assume responsibility for all services offered in their proposal, OCHN shall consider the selected Auditors. In connection with the performance of work under a contract with OCHN, the contractor shall agree not to discriminate against employees or applicants for employment on the basis of race, religion, color, national origin, or disability.

The aforesaid provision shall include but not be limited to the following: recruitment or recruitment advertising; employment, upgrading, demotion, or transfer; layoff and selection or training, including apprenticeship, in accordance with rules and regulations promulgated by Federal agencies (Compliance Responsibility for Equal Employment Opportunity-Chapter 60-1, 4, Numbers 1-7) and (Standards and Procedures for Executive Directive 1975-1976, Section II-C, IV-C, and V-A & B) and related Federal and State laws and regulations.

EVALUATION AND SELECTION PROCESS

OCHN shall evaluate and analyze proposals utilizing multiple criteria including:

Experience and depth of organization Demonstrated successful experience in implementing services similar to those requested in the RFP Ability to meet the contractual requirements set forth in the RFP and OCHN General

Contract Conditions Ability to meet all requested specifications Licensing Membership in industry-related professional organizations Employee Training References The proposal’s completeness, thoroughness, accuracy, compliance with instructions, timelines, and the organization and conciseness of the text materials

SECTION 5

EXHIBIT(S)

Exhibit Description Exhibit 1 OCHN FY25 Initial Budget Exhibit 2 Compliance Examination Guidelines – Michigan Department of Health and Human

Services

Oakland Community Health Network

MEDICAID

Specialty Medicaid -

Mental Health

Specialty Medicaid - Substance Use

Disorder

Healthy Michigan -

Mental Health Healthy Michigan - Substance Use

Disorder Children's

Waiver SED Waiver TOTAL Budgeted Revenue 331,985,372 5,295,530 26,689,272 10,687,249 3,596,141 1,143,989 379,397,553

Budgeted Expenditures 326,614,853 5,295,530 32,078,454 10,687,249 3,596,141 1,143,989 379,416,216

Surplus/ (Deficit) 5,370,519 - (5,389,182) - - - (18,663)

OTHER MENTAL HEALTH General Fund Local Grants Non -MDHHS BHH CCBHC TOTAL Budgeted Revenue 10,765,822 7,313,786 5,878,015 1,127,573 2,386,946 68,563,300 96,035,442

Budgeted Expenditures 11,976,156 4,638,552 5,878,015 1,127,573 2,386,946 67,877,667 93,884,909

Local 10% Match on State Funds (750,000) 750,000 - - - - -

Net Expenditures 11,226,156 5,388,552 -

Surplus/ (Deficit) (460,334) 1,925,234 - - - 685,633 2,150,533 Disposition of Deficit from excess GF - - -from excess local 460,334 (460,334) - - - - -

Net Surplus/ (Deficit) - 1,464,900 - - - 685,633 2,150,533

OTHER SUBSTANCE USE DISORDER PA2 Community Grant SOR Grant SUD Covid-19 Supplement Grant TOTAL Budgeted Revenue 4,000,000 5,340,535 850,000 859,377 11,049,912

Budgeted Expenditures 2,326,293 6,574,405 850,000 859,377 10,610,075

Surplus/ (Deficit) 1,673,707 (1,233,870) - - 439,837 from excess local (1,233,870) 1,233,870 - - -

Net Surplus/ (Deficit) 439,837 - - - 439,837

TOTAL BUDGET TOTAL

Budgeted Revenue 486,482,907

Budgeted Expenditures 483,911,200

Surplus/ (Deficit) 2,571,707

OCHN

FY25 Initial Budget 9.9.2024

* Revenues and expenditures in this budget are projected conservatively. Revenue projections are projected base on MDHHS draft rate setting and not finalized. Will amend once we receive the finalized rates.

*Historical data was used for expense projections related to services and funding models.

Oakland Community Health Network RFP 355.2025 Financial Audit Services

Exhibit 1

Last revision date: March 4, 2024

COMPLIANCE EXAMINATION GUIDELINES

Michigan Department of Health and Human Services

Fiscal Year End September 30, 2023

V2023-1

Exhibit 2

Oakland Community Health Network

Last revision date: March 4, 2024

TABLE OF CONTENTS

INTRODUCTION

RESPONSIBILITIES

MDHHS Responsibilities

PIHP Responsibilities

EXAMINATION REQUIREMENTS

Practitioner Selection

Examination Objective

Practitioner Requirements

Practitioner’s Report

Examination Report Submission

Examination Reporting Package

Penalty

Incomplete or Inadequate Examinations

Management Decision

COMPLIANCE REQUIREMENTS

A. FSR Reporting

B. Medical Loss Ratio (MLR) Report

C. Procurement

D. Internal Service Fund (ISF)

E. Medicaid Savings

F. Match Requirement

RETENTION OF WORKING PAPERS AND RECORDS

EFFECTIVE DATE AND MDHHS CONTACT

GLOSSARY OF ACRONYMS AND TERMS

V2023-1

INTRODUCTION

These Compliance Examination Guidelines are issued by the Michigan Department of

Health and Human Services (MDHHS) to assist independent audit personnel and Prepaid

Inpatient Health Plan (PIHP) personnel in preparing and performing compliance examinations as required by contracts between MDHHS and PIHPs, and to assure examinations are completed in a consistent and equitable manner.

These Compliance Examination Guidelines require that an independent auditor examine compliance issues related to contracts between PIHPs and MDHHS to manage the

Concurrent 1915(b)/(c) Medicaid, Healthy Michigan, and the Flint 1115 demonstration.

These Compliance Examination Guidelines, however, DO NOT replace or remove any other audit requirements that may exist, such as a Financial Statement Audit and/or a Single

Audit. An annual Financial Statement audit is required. Additionally, if a PIHP expends

$750,000 or more in federal awards1, the PIHP must obtain a Single Audit.

PIHPs are ultimately responsible for the Medicaid funds received from MDHHS and are responsible for monitoring the activities of network provider CMHSPs as necessary to ensure expenditures of Medicaid Contract funds are for authorized purposes in compliance with laws, regulations, and the provisions of contracts. Therefore, PIHPs must either require their independent auditor to examine compliance issues related to the Medicaid funds awarded to the network provider CMHSPs or require the network provider CMHSP to contract with an independent auditor to examine compliance issues related to contracts between PIHPs and CMHSPs to manage the Medicaid Contract. Further detail is provided in the Responsibilities – PIHP Responsibilities Section (Item #’s 8, 9, & 10).

These Compliance Examination Guidelines will be effective for contract years ending on or after September 30, 2023, and replace any prior Compliance Examination Guidelines or instructions, oral or written.

Failure to meet the requirements contained in these Compliance Examination Guidelines may result in the withholding of current funds or the denial of future awards.

1 Medicaid payments to PIHPs and CMHSPs for providing patient care services to Medicaid eligible individuals are not considered Federal awards expended for the purposes of determining Single Audit requirements.

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RESPONSIBILITIES

MDHHS Responsibilities MDHHS must:

1. Periodically review and revise the Compliance Examination Guidelines to ensure compliance with current Mental Health Code, and federal and state audit requirements; and to ensure the COMPLIANCE REQUIREMENTS contained in the Compliance Examination Guidelines are complete and accurately represent requirements of PIHPs and distribute revised Compliance Examination Guidelines to PIHPs.

2. Review the examination reporting packages submitted by PIHPs to ensure completeness and adequacy within eight months of receipt.

3. Issue a management decision (as described in the Examination Requirements –

Management Decision Section) on findings, comments, and examination adjustments contained in the PIHP examination reporting package within eight months after the receipt of a complete and final reporting package.

4. Monitor the activities of PIHPs as necessary to ensure the Medicaid Contract is used for authorized purposes in compliance with laws, regulations, and the provisions of contracts. MDHHS will rely primarily on the compliance examination engagements conducted on PIHPs by independent auditors to ensure

Medicaid Contract are used for authorized purposes in compliance with laws, regulations, and the provisions of contracts. MDHHS will rely on PIHPs compliance examination engagements conducted on PIHPs by independent auditors to ensure funds are used for authorized purposes in compliance with laws, regulations, and the provisions of contracts. MDHHS may, however, determine it is necessary to also perform a limited scope compliance examination or review of selected areas. Any additional reviews or examinations shall be planned and performed in such a way as to build upon work performed by other auditors. The following are some examples of situations that may trigger an MDHHS examination or review:

a. Significant changes from one year to the next in reported line items on the

FSR.

b. A PIHP entering the MDHHS risk corridor.

c. A large addition to an ISF per the cost settlement schedules.

d. A material non-compliance issue identified by the independent auditor.

e. The CPA that performed the compliance examination is unable to quantify the impact of a finding to determine the questioned cost amount.

f. The CPA issued an adverse opinion on compliance due to their inability to draw conclusions because of the condition of the agency’s records.

PIHP Responsibilities PIHPs must:

1. Maintain internal control over the Medicaid Contract that provides reasonable assurance that the PIHP is managing the contract in compliance with laws, regulations, and the contract provisions that could have a material effect on the contract.

2. Comply with laws, regulations, and the contract provisions related to the Medicaid

Contract. Examples of these would include, but not be limited to: the Medicaid

Contract, the Mental Health Code (Michigan Compiled Laws 330.1001 –

330.2106), applicable sections of the Uniform Administrative Requirements, Cost

Principles, and Audit Requirements for Federal Awards located at 2 CFR 200, the

Medicaid Provider Manual, and Generally Accepted Accounting Principles

(GAAP).

3. Prepare appropriate financial statements.

4. Ensure that the examination required by these Compliance Examination Guidelines is properly performed and submitted when due.

5. Follow up and take corrective action on examination findings.

6. Prepare a corrective action plan to address each examination finding, and comment and recommendation included in the current year auditor’s reports including the name(s) of the contact person(s) responsible for corrective action, the corrective action planned, and the anticipated completion date. If the PIHP does not agree with an examination finding or comment, or believes corrective action is not required, then the corrective action plan shall include an explanation and specific reasons.

7. The PIHP shall not file a revised FSR and Cost Settlement based on the Compliance

Examination. Rather, adjustments noted in the Compliance Examination will be evaluated by MDHHS and the PIHP will be notified of any required action in the management decision.

8. Monitor the activities of network provider CMHSPs as necessary to ensure the

Medicaid Contract funds are used for authorized purposes in compliance with laws, regulations, and the provisions of contracts. PIHPs must either (a.) require the

PIHP’s independent auditor (as part of the PIHP’s examination engagement) to examine the records of the network provider CMHSP for compliance with the

Medicaid Contract provisions, or (b.) require the network provider CMHSP to contract with an independent auditor to examine compliance issues related to contracts between PIHPs and CMHSPs to manage the Medicaid Contract. If the latter is chosen, the PIHP must incorporate the examination requirement in the

PIHP/CMHSP contract and develop Compliance Examination Guidelines specific to their PIHP/CMHSP contract. Additionally, if the latter is chosen, the CMHSP examination must be completed in sufficient time so that the PIHP auditor may rely on the CMHSP examination when completing their examination of the PIHP if they choose to.

9. If requiring an examination of the network provider CMHSP, review the examination reporting packages submitted by network provider CMHSPs to ensure completeness and adequacy.

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10. If requiring an examination of the network provider CMHSP, issue a management decision (as described in the Examination Requirements – Management Decision

Section) on findings and questioned costs contained in network provider CMHSP’s examination reporting packages.

EXAMINATION REQUIREMENTS

PIHPs under contract with MDHHS to manage the Medicaid Contract are required to contract annually with a certified public accountant in the practice of public accounting

(hereinafter referred to as a practitioner) to examine the PIHP’s compliance with specified requirements in accordance with the AICPA’s Statements on Standards for Attestation

Engagements (SSAE) 18–Attestation Standards – Clarification and Recodification AT – C

Section 205. The specified requirements and specified criteria are contained in these

Compliance Examination Guidelines under the Section titled “Compliance Requirements.”

Practitioner Selection In procuring examination services, PIHPs must engage an independent practitioner, and must follow the Procurement Standards contained in 2 CFR 200.318 through 200.320. In requesting proposals for examination services, the objectives and scope of the examination should be made clear. Factors to be considered in evaluating each proposal for examination services include the responsiveness to the request for proposal, relevant experience, availability of staff with professional qualifications and technical abilities, the results of external quality control reviews, the results of MDHHS reviews, and price. When possible, PIHPs are encouraged to rotate practitioners periodically to ensure independence.

Examination Objective The objective of the practitioner’s examination procedures applied to the PIHP’s compliance with specified requirements is to express an opinion on the PIHP’s compliance based on the specified criteria. The practitioner seeks to obtain reasonable assurance that the PIHP complied, in all material respects, based on the specified criteria.

Practitioner Requirements The practitioner should exercise due care in planning, performing, and evaluating the results of his or her examination procedures; and the proper degree of professional skepticism to achieve reasonable assurance that material noncompliance will be detected.

The specified requirements and specified criteria are contained in these Compliance

Examination Guidelines under the Section titled “Compliance Requirements.” In the examination of the PIHP’s compliance with specified requirements, the practitioner should follow the requirements of AT-C 105 and 205.

Practitioner’s Report The practitioner’s examination report on compliance should include the information detailed in AT-C 205.63 through 205.86, which includes the practitioner’s opinion on whether the entity complied, in all material respects, with specified requirements based on the specified criteria. When an examination of the PIHP’s compliance with specified requirements discloses noncompliance with the applicable requirements that the practitioner believes have a material effect on the entity’s compliance, the practitioner should modify the report as detailed in AT-C 205.68 through AT-C 205.75.

In addition to the above examination report standards, the practitioner must prepare:

1. A Schedule of Findings that includes the following:

a. Control deficiencies that are individually or cumulatively material weaknesses in internal control over the Medicaid Contract.

b. Material noncompliance with the provisions of laws, regulations, or contract provisions related to the Medicaid Contract.

c. Known fraud affecting the Medicaid Contract.

Finding detail must be presented in sufficient detail for the PIHP to prepare a corrective action plan and for MDHHS to arrive at a management decision. The following specific information must be included, as applicable, in findings:

a. The criteria or specific requirement upon which the finding is based including statutory, regulatory, contractual, or other citation. The

Compliance Examination Guidelines should NOT be used as criterion.

b. The condition found, including facts that support the deficiency identified in the finding.

c. Identification of applicable examination adjustments and how they were computed.

d. Information to provide proper perspective regarding prevalence and consequences.

e. The possible asserted effect.

f. Recommendations to prevent future occurrences of the deficiency(ies) noted in the finding.

g. Views of responsible officials of the PIHP.

h. Planned corrective actions.

i. Responsible party(ies) for the corrective action.

j. Anticipated completion date.

2. A schedule showing final reported Financial Status Report (FSR) amounts, examination adjustments [including applicable adjustments from the Schedule of

Findings and the Comments and Recommendations Section (addressed below)] and examined FSR amounts. All examination adjustments must be explained. This schedule is called the “Examined FSR Schedule.” Note that Medicaid FSRs must be provided for PIHPs. All applicable FSRs must be included in the practitioner’s report regardless of the lack of any examination adjustments.

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3. A schedule showing a revised cost settlement for the PIHP based on the Examined

FSR Schedule. This schedule is called the “Examined Cost Settlement Schedule.”

This must be included in the practitioner’s report regardless of the lack of any examination adjustments.

4. A Comments and Recommendations Section that includes all noncompliance issues discovered that are not individually or cumulatively material weaknesses in internal control over the Medicaid Contract program only in the event the individual comment or recommendation is expected to have an impact greater than or equal to

$25,000; and recommendations for strengthening internal controls, improving compliance, and increasing operating efficiency.

Examination Report Submission The examination must be completed, and the reporting package described below must be submitted to MDHHS within the earlier of 30 days after receipt of the practitioner’s report, or June 30th following the contract year end. The PIHP must submit the reporting package by e-mail to MDHHS at MDHHS-AuditReports@michigan.gov. The required materials must be assembled as one document in PDF file compatible with Adobe Acrobat (read only). The subject line must state the agency name and fiscal year end. MDHHS reserves the right to request a hard copy of the compliance examination report materials if for any reason the electronic submission process is not successful.

Examination Reporting Package The reporting package includes the following:

1. Practitioner’s report as described above.

2. Corrective action plan prepared by the PIHP.

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