Revision 19-1, Effective March 1, 2019
8.1 Internal Controls
The term internal controls refers to a process implemented and designed to provide reasonable assurance that the necessary objectives under the following categories will be achieved:
- Effectiveness and efficiency of operations;
- Reliability of reporting for internal and external use; and
- Compliance with applicable laws and regulations.
The service provider must:
- Establish and maintain effective internal control that provides reasonable assurance that the federal funds awarded under the contract are being managed in compliance with federal statutes, regulations, and the terms and conditions of the award.
- Comply with federal statutes, state laws, ILS Standards, regulations, and the terms and conditions of the awards.
- Evaluate and monitor compliance with statutes, regulations, and the terms and conditions of awards.
- Take prompt action when instances of noncompliance are discovered, including when identified in audit findings.
The service provider must establish internal controls to promote employee awareness of the nature of workplace fraud. The controls may include employee training programs and policies that ensure careful oversight when purchasing goods and services for the Independent Living Services Program.
8.2 Confidentiality of Information
The service provider adopts and implements written policies and procedures to safeguard confidential personal information, including photographs and lists of names.
These policies and procedures comply with 34 Code of Federal Regulations, Subtitle B, Chapter III, Part 364, §364.56, and assure that:
- specific safeguards protect current and stored personal information;
- all consumers of independent living services and, as appropriate, consumers’ representatives, and interested persons are informed and the conditions for gaining access to and releasing this information; and
- all consumers and consumers’ representatives are informed about the service providers need to collect personal information, and the policies governing its use.
8.2.1 Data Encryption
HHSC policy and federal law mandates all emails containing consumer or agency confidential information must be sent under encryption. Contractors must send HHSC consumer confidential information in a secure manner when emailing information to HHSC employees or to any other individual.
HHSC requires FIPS 140-2 level of encryption. If a contractor does not have this level of data encryption, the provider shall ask HHSC staff to send an encrypted email related to the consumer to the contractor's email address and this email can be used to send encrypted information back to HHSC if the directions are followed accurately.
Upon request, the contractor must make available to HHSC any documents, papers, and records that are directly pertinent to the goods or services being provided to HHSC consumers.
Examples include, but are not limited to:
- service authorizations;
- consumer service reports;
- company financials;
- insurance certificates;
- staff information sheets;
- any documentation required under the entity’s contract; and
- the HHSC Standard Procurement Terms and Conditions, and/or Independent Living Services Standards.
8.3.1 Record Storage
When original records are electronic and cannot be altered, there is no need to create and retain paper copies. When original records are paper, electronic versions may be created through the use of duplication or other forms of electronic media, provided that they are subject to periodic quality control reviews, provide reasonable safeguards against alteration, and remain readable. However, the original paper record (e.g., invoices, medical records) must be maintained. If records are maintained on company or personal server(s) or computer(s), these records must be protected in a secure manner.
8.3.2 Record Retention
All records must be maintained in a paper format for seven years from the date of submission of the final bill or until all billing-related questions are resolved, whichever is later. Local servers and personal computers may be used to complete records and to store copies of records. All local servers and/or personal computers are required to maintain a level of security that ensures records are maintained in a safe and confidential manner, as defined in the cccccc.
In addition to the requirements above, the service provider complies with the information and security and confidentiality requirements in the contract uniform terms and conditions.
8.4 Staff Qualifications
8.4.1 General Independent Living Services Staff Requirements
The service provider organizational and personnel assignment practices, as documented in written board policy, must comply with Section 503 of the Act, including taking affirmative action to employ and promote qualified individuals with significant disabilities.
A service provider must also document that the majority of its staff members, including members in decision-making positions, are people with disabilities.
126.96.36.199 Staff Qualifications
The service provider staff members must include specialists in developing and providing independent living services and in developing and supporting a service provider. To the greatest extent possible, staff should be available who are able to communicate
- with individuals with significant disabilities who rely on alternative modes of communication, such as manual communication, nonverbal communication devices, braille, or audiotapes;
- with people who apply for or receive independent living services under Title VII of the Act; and
- in the native languages of individuals with significant disabilities whose English proficiency is limited and who apply for or receive independent living services under Title VII of the Act.
188.8.131.52 Staff Training and Development
The service provider must establish and maintain a program of staff development for those involved in providing independent living services. Staff development programs should emphasize improving the skills of staff members directly responsible for providing independent living services, including knowledge and practice of the independent living philosophy. The service provider must provide training to its staff on how to serve unserved and underserved populations, including minority groups and urban and rural populations, as evidenced by in-service training records.
184.108.40.206 Contractors Standards of Conduct
Service providers must maintain and implement written standards of conduct for staff members.
Service providers are expected to perform contractual services in a professional manner at all times to include:
- interaction with consumers and HHSC staff in a professional manner;
- appropriate dress (generally business casual attire) when providing services;
- maintaining the confidentiality of all consumer information in full compliance with state and federal regulations and in accordance with sound professional practices;
- obtaining a confidentiality release for any person attending the meeting with the consumer who is not the consumer's legal guardian;
- accepting liability for the actions and/or contract performance of all individuals, sub-contractors, and other personnel who may be working for the contractor; and
- not performing acts which are or could be perceived as being inappropriate behavior with any consumer or consumer's family member, including, but not limited to:
- abuse of any consumer or consumer's family member;
- negative impacts to the health, safety, or welfare of any consumer or consumer's family member;
- relationships with consumers or HHSC staff that would impair the contractor's objectivity in performing their duties or that would endanger confidentiality;
- allowing the presence of any third party when meeting with the consumer at their home or business unless that third party is an attendant to the contractor; or
- contacting the liaison for verification of confidentiality releases when other parties are present.
220.127.116.11 Conflict of Interest
Service providers and potential contractors may not offer, give, or agree to give HHSC staff anything of value. This includes, but is not limited to, prepared foods, gift baskets, promotional items, gift cards or meals. If a violation occurs, corrective action may be required, up to and including contract termination or disqualification from receiving a future contract.
8.4.2 Qualifications for Staff Members Who Provide Services to Individuals With Significant Disabilities
Staff members managing independent living services cases, determining eligibility, writing independent living plans and providing or coordinating services for adults who have a significant disability, must have a bachelor’s degree in an appropriate field. This qualification additionally requires a minimum of one year of experience in rehabilitation services or two years of experience in providing similar independent living services, such as education, human services, or counseling, for individuals who have a significant disability.
The qualifications for subcontractor and vendor staff members are covered in the Appendices for Purchased Services, as referenced under 6.3 Description of Purchased Services.
8.4.3 Qualifications for Staff Members Who Provide Services to Individuals Who Are Deafblind
Staff members must have a bachelor's degree in education or a related field, with a working knowledge of the following:
- The medical, psychological, social, and independent living issues faced by persons who are deafblind, visually impaired and/or hard of hearing, or otherwise disabled with a dual sensory loss
- Assessment techniques and tools
- American Sign Language, augmentative communication, manual communication, and other appropriate communication systems, as well as knowledge of agencies, individuals, and facilities that serve people who are deafblind (with or without additional disabilities) or serve the culture and adaptive needs of people who are deafblind
The ability to:
- adapt teaching methods to the needs of persons who are deafblind and/or multiply disabled and are elderly;
- assist consumers to adapt or modify common items in the home to make the items accessible; assess, formulate, organize, and implement an individualized program of instruction with consumers; teach consumers to read and write all aspects of uncontracted braille;
- communicate using American Sign Language, including tactile sign language;
- teach assistive technology, as required for the consumer’s access to independent living skills; and
- deliver, install, and set up adaptive aids and/or devices.
8.4.4 Qualifications for Staff Members Who Provide Orientation and Mobility (O&M) Services
Staff members will need to meet one of the following requirements:
- The service provider is certified by either the Academy for Certification of Vision Rehabilitation and Education Professionals (ACVREP) or the National Blindness Professional Certification Board (NBPCB).
- The service provider is not certified at the start of employment, but he or she:
- has a degree in O&M from an accredited college or university with an established O&M training curriculum and will be certified within one year of the contract date by ACVREP or NBPCB; or
- has at least two years of full-time work experience teaching O&M skills for a recognized entity, such as a rehabilitation center, Veterans Affairs Hospital, or educational system; and also:
- has three professional references indicating the person's ability to teach O&M skills to blind or visually impaired people; and
- will be certified within one year of the hire date by ACVREP or NBPCB.
8.4.5 Qualifications for Staff Members Who Provide Diabetes Education or Self-Management Skills Training
Staff members must be health professionals who meet all of the following requirements:
- Be licensed or registered, as required by the staff members profession
- Have completed the basic academic requirements for his or her field
- Have practiced for at least one year
- Have one year of diabetes education experience
A diabetes educator must be a registered nurse (RN), registered dietician (RD), or certified diabetes educator (CDE). For RNs and RDs, the educator must keep a copy of the employee’s active license on file. For a CDE, the educator keeps a copy of the service provider’s current certification from the National Certification Board for Diabetes Education or the American Association of Diabetes Educators on file.
Through academic preparation, continuing education, or on-the-job training, the employee will have developed:
- a knowledge and understanding of diabetes and its management, including the nutritional and pharmaceutical aspects of care;
- a knowledge and understanding of basic educational and behavioral science;
- a knowledge of the evidence-based nutritional, pharmaceutical, and therapeutic care needed for a person with diabetes; and
- the additional skills necessary to work in a thorough and efficient manner, such as planning, organizing, communicating, cooperating, delegating, and working without direct supervision.
A CDE, RN, or RD must have at least one year of paid experience providing diabetes education. RNs and RDs must have completed 15 hours of continuing education units (CEUs) on diabetes from an accredited agency within the 12 months immediately preceding employment. A CDE must have completed 10 hours of CEUs on diabetes from an accredited agency within the 12 months immediately preceding employment.
The CEUs must be from an agency approved by the individual's licensing or certifying body.
8.5 Voter Registration
Based on federal and state laws, a service provider must establish a written policy to ensure that consumers are offered an opportunity to register to vote when they first apply for services or when they report a change of address. Federal and state laws require HHSC to provide voter registration services to consumers.
Federal and state laws include the following:
The policy applies to consumers who are at least 17 years and 10 months of age.
The voter registration coordinator for HHSC serves in a liaison role to the Office of the Secretary of State regarding training and compliance. The voter registration coordinator for HHSC ensures that the service provider receives the approved State Voter Registration Card (English and Spanish versions available). The service provider must use the State Voter Registration Card provided by the voter registration coordinator for HHSC. This State Voter Registration Card contains an identification number associated with HHSC for compliance monitoring.
The service provider offers the consumer the opportunity to register to vote at the time of application for services or when the consumer reports a change of address.
Service providers are prohibited from:
- influencing a consumer’s political preference or party registration;
- displaying political preference or party affiliation;
- making any statement or taking any action to discourage a consumer from registering to vote; and
- documenting in the consumer case file the response and action that the consumer takes after being given the opportunity to register to vote.
Service providers must refer consumers to the Elections Office of the Secretary of State, 1-800-252-8683, and to the County Voter Registration Officials for questions that HHSC employees cannot answer.
8.5.1 Procedures - Application for Services
When a consumer applies for services, the service provider:
- offers the consumer the opportunity to register to vote;
- provides a voter registration card for the consumer to mail or helps in filling out the voter registration card, if help is requested; and documents in the consumer’s case file that the consumer was given the opportunity to register to vote but does not document the consumer's response or actions.
8.5.2 Change of Address
When a consumer reports a change of address, the service provider:
- offers the consumer the opportunity to register to vote at the new address;
- mails the consumer a voter registration card when the change of address is reported by telephone, or provides a voter registration card for the consumer to mail (or helps the consumer fill out the voter registration card, if help is requested), when the change of address is reported in the service provider’s office or in the consumer’s home; and
- documents in the consumer’s case file that another opportunity to register to vote was given but does not document the consumer's response or action taken.
All services purchased by the service provider for consumers must be provided in an accessible manner.
Each service provider subject to the Independent Living Services Standards will provide the results of a self-evaluation along with a written explanation, if necessary, of how its services will be provided in an accessible manner:
- before being approved to provide services to consumers for the first time;
- before the renewal of the service provider’s contract;
- before being approved to provide services at a new address; or
- at the request of HHSC.
A self-evaluation instrument is available on the ADA Checklist for Existing Facilities page of the New England ADA Center’s website.
If HHSC receives a complaint regarding the accessibility of the services of a particular service provider, HHSC investigates to determine whether a violation of contract terms has taken place.
The Architectural and Transportation Barriers Compliance Board has issued ADA Accessibility Guidelines (ADAAG), which must be applied during the design, construction, and alteration of buildings and facilities covered by titles II and III of the Americans with Disabilities Act (ADA). These guidelines have been adopted by the U.S. Department of Justice as Appendix A to its ADA Title III rules.
The guidelines are published on the ADA Standards page of the United States Access Board’s website.
To obtain a copy of the ADAAG or other information from the U.S. Department of Justice, call 1-800-514-0301 Voice, (202) 514-0381 TTY, or 1-800-514-0383 TTY. For technical questions, contact the Architectural and Transportation Barriers Compliance Board at 1-800-USA-ABLE.
In addition, the Texas Department of Licensing and Regulation administers the state Architectural Barriers Act, Article 9102, Texas Civil Statutes. The Texas Accessibility Standards (TAS) are based on the ADAAG standards and apply to buildings and facilities constructed on or after April 1, 1994.
The TAS are published on the Architectural Barriers Texas Accessibility Standards page of the Texas Department of Licensing and Regulation’s website.
Copies of TAS can be purchased from the:
Office of the Secretary of State Texas Register Division
PO Box 13824
Austin, Texas 78711-3824
8.7 Financial Management System
The financial management system of the service provider must provide for the following:
- Identification, in its accounts, of all federal awards received and expended and the federal programs under which they were received. Federal award Catalog of Federal Domestic Assistance numbers will be provided as invoices are received and reimbursements are made.
- Accurate, current, and complete disclosure of the financial results of each federal award or program, in accordance with the reporting requirements set forth under 2 Code of Federal Regulations (CFR), Subtitle A, Chapter II, Part 200, Uniform Guidance, Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards §200.327 Financial reporting, and §200.328 Monitoring and reporting program performance.
- Records that identify adequately the source and application of funds for federally funded activities; contain information pertaining to federal awards, authorizations, obligations, unobligated balances, assets, expenditures, income, and interest; and are supported by source documentation.
- Effective control over, and accountability for, all funds, property, and other assets.
- Comparison of expenditures with budget amounts for each federal award.
- Written procedures to implement the requirements of 2 CFR, §200.305 Payment.
- Written procedures for determining the allowability of costs, in accordance with 2 CFR, Part 200, Subpart E—Cost Principles, and the terms and conditions of the federal award.
The service provider must maintain an accounting system and records in which separate records are maintained for each funding source provided by HHSC and other funding sources. A cost center objective must be set up for the Independent Living Services (ILS) Program contract separate from other HHSC grants or contracts.
The service provider must be able to account for ILS Program costs applicable to consumers served in accordance with the rules in the 40 TAC Chapter 104, Independent Living Services, and with the Independent Living Services Standards.
The methods used to account for these costs, as documented, recorded, and tracked, include:
- identifying the eligible consumers served and recording the services provided from intake to closure;
- setting up separate account codes for budget categories applicable to costs for the services provided and other non-purchased service costs
- establishing a system for employees to record the time and/or resources spent and the costs for salaries, wages and fringe benefits, based on records that accurately reflect the work performed;
- recording and allocating all expenses applicable to program activities by budget category;
- reporting separate expenses by funding sources on invoices that bill for ILS Program costs; and
- entering information in the Independent Living Services Data Reporting System, as required.
8.7.1 Request for Payment
Service providers can request payment as a cost reimbursement contract or an advance payment contract.
- Cost Reimbursement ─ Service providers classified as cost reimbursement contracts are reimbursed for allowable incurred costs. Monthly expenses will be reported using the HHSC ILS Invoice Workbook. Both the HHSC ILS Invoice Workbook and a signed monthly invoice should be submitted by the 10th day of the month following the month the expenses were paid. Service providers classified as cost reimbursement contracts are not eligible to receive advance payments.
- Advance Payment ─ Service providers classified as advance payment, that meet the contract requirements, may request advance payments. Advance payment for operating funds for no more than 90 days in advance may be requested each quarter. If advanced funds are not expended during the quarter of the request, they must be adjusted on the next request. Advance requests will be made using the HHSC ILS Invoice Workbook. The HHSC ILS Invoice Workbook and a signed Quarterly Advance, printed from the workbook, should be submitted when requesting an advance. In addition, the HHSC ILS Invoice Workbook and a signed monthly invoice should be submitted by the 5th day of each month.
If the service provider does not meet the requirements of the contract, HHSC may:
- adjust payments;
- reimburse based on actual costs already incurred;
- require additional supporting documentation to make payments; and
- take other action as appropriate.
If reimbursement funds are requested, the HHSC ILS Invoice Workbook must be submitted to HHSC within five days after the end of the month for which reimbursement is requested.
8.7.2 Cost Allocation
The service provider is reimbursed for allowable budgeted expenses incurred and is paid for providing services that are consistent with the terms of the contract.
Title 2 Code of Federal Regulations (CFR), Subtitle A, Chapter II, Part 200, Subpart E Cost Principles, part of the Uniform Guidance, provides for guidance for allowability of contract award costs. All costs are to be billed and reimbursed based on the approved cost allocation plan, during the contract application or updated after the award.
For facilities and administration (F&A) costs, the service provider may elect to charge a de minimis rate of 10 percent of modified total direct costs (MTDC) or use a federally approved indirect cost rate. HHSC must be provided with a copy of the federally approved indirect cost rate in order to allow that rate. Any indirect cost rate in the contract budget should be included on the approved cost allocation plan.
8.7.3 Program Income
Program income is gross income earned and directly generated by a supported activity of the contract award. Program income will supplement the funds awarded by HHSC and expended during the contract term they are earned. Program income funds will be applied to purchases before HHSC funds are expended. Program income not expended in the term in which it is earned shall be refunded to HHSC or deducted from future payments.
When a consumer participates in the purchase of goods or services, as required by the Independent Living Services Standards (such as purchasing complex rehabilitation technology), the service provider is required to record the funds received from the consumer as program income applicable to the Independent Living Services Program.
The service provider must ensure that it has sufficient controls for:
- billing consumers for their share of financial participation;
- receiving the funds from the consumer;
- depositing the monies with other funds;
- properly recording the monies in Independent Living Services Program accounts; and
- reporting on the program income, as required.
The service provider must ensure that program income is spent during the current fiscal year to provide the independent living services that are outlined in Chapter 3: Scope of Independent Living Services, 3.1 Scope of Services.
Records must include:
- the sources of the program income;
- the amount of the program income received; and
- the quarterly financial reports, consistent with accounting records.
8.8 Records Management
The service provider must establish records management policies and procedures that ensure compliance with the HHSC contract and applicable recordkeeping requirements under 2 Code of Federal Regulations (CFR), Part 200, including applicable safeguards for confidential information.
The service provider’s records must fully disclose and document:
- the amount and disposition of grant funds;
- the cost of the project for which grant funding is given or used;
- the amount of project cost funding supplied by other sources, to include comparable services or benefits, insurance, and consumer financial participation; and
- compliance with the requirements of 29 U.S.C. 796c(m)(4) and 34 CFR §364.35, pertaining to maintenance and management of records.
The service provider’s recordkeeping system must contain data concerning the grant program's funds, including the information necessary to receive payment.
Other program records requirements are covered under the service delivery process.
8.9 Veterans Services
The service provider must include the following statement created by HHSC, based on Texas Senate Bill 1677, in the application process:
Men and women who serve or have ever served in any branch of the United States Armed Forces, including Army, Navy, Marines, Air Force, Coast Guard, Reserves or National Guard may be eligible for additional services. For more information, visit www.tvc.texas.gov, the Texas Veterans Portal or call TexVets at 800-252-8387.
8.10 Physical Locations
Any service provider that owns, leases or uses dedicated space in which HHSC consumers will be provided services is considered to have a physical location.
The service provider must complete the Services Provider Physical Location Information form for each facility.
8.10.1 Occupation Permit or Building Permit
Environmental safety must comply with local building occupancy codes. Providers must provide documentation of compliance to HHSC at application and to the liaison whenever the physical location changes. Renters should contact their landlords to obtain such documentation.
8.10.2 Fire Safety
Each provider must:
- comply with the local fire code to gain a fire inspection report, or gain an inspection by the fire marshal with local jurisdiction; and
- provide a copy of the appropriate certificate of compliance at application and to the HHSC liaison when updated.
Providers who rent must contact their landlords for appropriate documentation.
Most fire departments conduct inspections but need advance notice to schedule an inspection. If the contractor's local fire department does not conduct inspections, the contractor may request an inspection from the Texas Department of Insurance, State Fire Marshal's Inspection Services Division, 333 Guadalupe, Austin, Texas 78701, Telephone 512-305-7900.
In each physical location where services are provided, the provider must have:
- working smoke detectors;
- visible (flashing) and audible fire warning signals;
- fire extinguishers that are "in date" with annual inspections placed in accessible locations; and
- identified accessible fire escape routes free and clear of obstructions.
Each entity must have a policy that requires all fires to be reported to the HHSC liaison within one workday.
8.10.3 General Building Safety
Aisles and work safety zones must be accessible.
Hazardous or flammable materials must be appropriately identified, used and stored in a safe manner. These materials should be stored in a secured metal cabinet.
Machinery with moving parts must be equipped with appropriate protective guarding and instructions for safety.
Each facility and the entity headquarters must maintain a paper copy of the completed "ADA Checklist for Existing Facilities" found at ADA Checklist for Existing Facilities. HHSC staff members may inspect the physical location for accuracy of responses provided on the "ADA Checklist for Existing Facilities" and for compliance with meeting the consumer's needs related to accessibility. HHSC may also request access to the completed checklist at any time, such as at liaison visits and monitoring reviews.
If an item or location on the checklist is found to not be accessible, describe how the physical location will ensure services will be provided to HHSC consumers who will be using the area(s) found to not be accessible.
8.10.5 Safety Plan
Each provider must have a safety plan for each physical location that ensures the safety and health of the staff, the consumers, and the visiting public. The plan must include:
- quarterly fire drills;
- emergency evacuation procedures;
- emergency exit diagrams;
- procedures for obtaining emergency medical services from a doctor, hospital or emergency medical service unit; and
- special procedures for consumers with disabilities who require particular attention or action, including those whose behavior may be detrimental to the health, safety, or require assistance from others to successfully engage in services.
Each provider must have an incident reporting system in place. A form for staff reporting of incidents must be developed.
The minimum information required on the incident report form must include:
- date, time and place of the incident;
- nature of the incident;
- names of HHSC consumers, witnesses or others involved;
- name of the person making the report;
- description of the incident; and
- actions taken and planned by the provider as a result of the incident.
Upon request, copies of incident reports pertinent to HHSC consumers must be made available to HHSC staff members.
The following incidents must be reported to the referring HHSC liaison and program manager by close of business the next workday:
- emergency evacuations;
- emergency medical services (EMS);
- emergency room treatment;
- hospitalization; or