DHS - Division of Licensing Services - Healthcare and Child Care Facility Licensing Fees Performance

Department ofHealth ServicesDivision of Licensing Services—Healthcare and Child Care FacilityLicensing FeesREPORT Licensing fees couldHIGHLIGHTSPERFORMANCE AUDIT cover more regulatorycostsSubjectThe Department of HealthServices (Department)licenses and regulates The State General Fund subsidizes themore than 7,200cost of licensing and monitoringhealthcare and child carehealthcare and child care facilities.facilities and agencies inArizona. These licensees Although the facilities are charged Licensing fees outdated and not basseeddinclude hospitals, nursing licensing fees, fee revenue covers less oonn rreelleevvaanntt ccoosstt ffaaccttoorrss——Licensing feescare institutions, than 10 percent of the regulatory costs. In for child care facilities have not increasedoutpatient surgical fiscal year 2008, the State spent over in at least 20 years, and, prior to the 2008centers, home healthcare$10.9 million to license and regulate these legislation, fees for healthcare facilitiesagencies, and child carefacilities, but collected less than $1.1 had not increased since 1989.centers.million in fees.Our ConclusionFurther, licensing fees are not adequatelyLicensing fees could be Despite recent changes, costs will based on factors that impact costs. Formodified to cover the continue to exceed revenues—In 2008, example, fees for child care facilityState’s regulatory costs. the Legislature authorized the licenses do not account for differentThe Department ...