Audit 15612

2022 – 001 Procurement Federal Agency: U.S. Department of Health and Human Services Federal Program: COVID-19: FY 2020 Health Center Program Look-Alikes: Expanding Capacity for Coronavirus Testing and COVID-19: American Rescue Plan Act Funding for Look-Alikes AL Number: 93.224 & 93.527 Award Period: 7/1/21 - 6/30/22 Type of Finding: Significant deficiency in Internal Control over Compliance and Compliance Criteria or Specific Requirement 2 CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Award requires compliance with the provisions of procurement and suspension and debarment. The Organization should have internal controls designed to ensure compliance with these provisions. Condition and Context We noted the Organization is not in compliance with requirements related to Procurement, Suspension and Debarment. During our testing, we noted the Organization’s procurement policy did not meet the requirements defined by 2 CFR 200. Effect The auditor noted an instance of noncompliance. Noncompliance results in possible federal funds provided to ineligible subrecipients and/or vendors. Questioned Costs None identified. Cause The Organization lacks a uniform Procurement, Suspension & Debarment policy that is in compliance with the Federal regulations and/or the terms and conditions of the Federal award. Recommendation We recommend the Organization review and update its procurement policy to ensure the policy meets the 2 CFR Part 200 Procurement requirements. Views of Responsible Officials The Organization will compare our procurement policy to the procurement requirements defined by 2 CFR 200 and update the policy accordingly. This will be performed by Andrea Cortez, Chief Operating Officer, and Andrew Shahidi, Chief Financial Officer, in the next 45 days and the revised policy will be submitted to the Board of Directors for approval at the March 27, 2024 meeting.

2022 – 001 Procurement Federal Agency: U.S. Department of Health and Human Services Federal Program: COVID-19: FY 2020 Health Center Program Look-Alikes: Expanding Capacity for Coronavirus Testing and COVID-19: American Rescue Plan Act Funding for Look-Alikes AL Number: 93.224 & 93.527 Award Period: 7/1/21 - 6/30/22 Type of Finding: Significant deficiency in Internal Control over Compliance and Compliance Criteria or Specific Requirement 2 CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Award requires compliance with the provisions of procurement and suspension and debarment. The Organization should have internal controls designed to ensure compliance with these provisions. Condition and Context We noted the Organization is not in compliance with requirements related to Procurement, Suspension and Debarment. During our testing, we noted the Organization’s procurement policy did not meet the requirements defined by 2 CFR 200. Effect The auditor noted an instance of noncompliance. Noncompliance results in possible federal funds provided to ineligible subrecipients and/or vendors. Questioned Costs None identified. Cause The Organization lacks a uniform Procurement, Suspension & Debarment policy that is in compliance with the Federal regulations and/or the terms and conditions of the Federal award. Recommendation We recommend the Organization review and update its procurement policy to ensure the policy meets the 2 CFR Part 200 Procurement requirements. Views of Responsible Officials The Organization will compare our procurement policy to the procurement requirements defined by 2 CFR 200 and update the policy accordingly. This will be performed by Andrea Cortez, Chief Operating Officer, and Andrew Shahidi, Chief Financial Officer, in the next 45 days and the revised policy will be submitted to the Board of Directors for approval at the March 27, 2024 meeting.

2022 – 002 Special Tests: Application of Sliding Fee Discount Federal Agency: U.S. Department of Health and Human Services Federal Program: COVID-19: FY 2020 Health Center Program Look-Alikes: Expanding Capacity for Coronavirus Testing and COVID-19: American Rescue Plan Act Funding for Look-Alikes AL Number: 93.224 & 93.527 Award Period: 7/1/21 - 6/30/22 Type of Finding: Material Weakness in Internal Control over Compliance and Compliance Criteria or Specific Requirement Per Title 42 Chapter 1 Subchapter D Section 51c303(f), “Health centers must have a schedule of fees or payments for the provision of their health services consistent with locally prevailing rates or charges designed to cover their reasonable costs of operation. They are also required to have a corresponding schedule of discounts applied and adjusted on the basis of the patient’s ability to pay.” Condition and Context During our testing of forty sliding fee discounts for health center patients qualifying for reduced charge visits, we identified three visits that received the incorrect sliding fee discount or that the sliding fee application could not be located. Effect Potential that a patient would not receive the appropriate sliding fee discount. Questioned Costs None identified. Cause Clerical error in which the incorrect discount was applied due to lack of an oversight process in place. Recommendation We recommend the Organization to review internal controls in regards to the determination, recording, and monitoring of the sliding fee process to ensure that appropriate sliding fee rates/categories are utilized for each sliding fee encounter. Views of Responsible Officials The Organization will review our procedures for ensuring that sliding fee applications are completed accurately and are properly placed in patient files. We will also research and implement safeguards to ensure that the revised procedures are being followed throughout the year, potentially including audits and additional staff training. This will be performed by Andrea Cortez, Chief Operating Officer, Karina Villagrana, Practice Manager, and Andrew Shahidi, Chief Financial Officer in the next 45 days. If during this process we determine that an update, revision, or re-write of the current Sliding Fee Policy is required, we will do so and it will be submitted to the Board of Directors for approval at the March 27, 2024 meeting.

2022 – 002 Special Tests: Application of Sliding Fee Discount Federal Agency: U.S. Department of Health and Human Services Federal Program: COVID-19: FY 2020 Health Center Program Look-Alikes: Expanding Capacity for Coronavirus Testing and COVID-19: American Rescue Plan Act Funding for Look-Alikes AL Number: 93.224 & 93.527 Award Period: 7/1/21 - 6/30/22 Type of Finding: Material Weakness in Internal Control over Compliance and Compliance Criteria or Specific Requirement Per Title 42 Chapter 1 Subchapter D Section 51c303(f), “Health centers must have a schedule of fees or payments for the provision of their health services consistent with locally prevailing rates or charges designed to cover their reasonable costs of operation. They are also required to have a corresponding schedule of discounts applied and adjusted on the basis of the patient’s ability to pay.” Condition and Context During our testing of forty sliding fee discounts for health center patients qualifying for reduced charge visits, we identified three visits that received the incorrect sliding fee discount or that the sliding fee application could not be located. Effect Potential that a patient would not receive the appropriate sliding fee discount. Questioned Costs None identified. Cause Clerical error in which the incorrect discount was applied due to lack of an oversight process in place. Recommendation We recommend the Organization to review internal controls in regards to the determination, recording, and monitoring of the sliding fee process to ensure that appropriate sliding fee rates/categories are utilized for each sliding fee encounter. Views of Responsible Officials The Organization will review our procedures for ensuring that sliding fee applications are completed accurately and are properly placed in patient files. We will also research and implement safeguards to ensure that the revised procedures are being followed throughout the year, potentially including audits and additional staff training. This will be performed by Andrea Cortez, Chief Operating Officer, Karina Villagrana, Practice Manager, and Andrew Shahidi, Chief Financial Officer in the next 45 days. If during this process we determine that an update, revision, or re-write of the current Sliding Fee Policy is required, we will do so and it will be submitted to the Board of Directors for approval at the March 27, 2024 meeting.

2022 – 001 Procurement Federal Agency: U.S. Department of Health and Human Services Federal Program: COVID-19: FY 2020 Health Center Program Look-Alikes: Expanding Capacity for Coronavirus Testing and COVID-19: American Rescue Plan Act Funding for Look-Alikes AL Number: 93.224 & 93.527 Award Period: 7/1/21 - 6/30/22 Type of Finding: Significant deficiency in Internal Control over Compliance and Compliance Criteria or Specific Requirement 2 CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Award requires compliance with the provisions of procurement and suspension and debarment. The Organization should have internal controls designed to ensure compliance with these provisions. Condition and Context We noted the Organization is not in compliance with requirements related to Procurement, Suspension and Debarment. During our testing, we noted the Organization’s procurement policy did not meet the requirements defined by 2 CFR 200. Effect The auditor noted an instance of noncompliance. Noncompliance results in possible federal funds provided to ineligible subrecipients and/or vendors. Questioned Costs None identified. Cause The Organization lacks a uniform Procurement, Suspension & Debarment policy that is in compliance with the Federal regulations and/or the terms and conditions of the Federal award. Recommendation We recommend the Organization review and update its procurement policy to ensure the policy meets the 2 CFR Part 200 Procurement requirements. Views of Responsible Officials The Organization will compare our procurement policy to the procurement requirements defined by 2 CFR 200 and update the policy accordingly. This will be performed by Andrea Cortez, Chief Operating Officer, and Andrew Shahidi, Chief Financial Officer, in the next 45 days and the revised policy will be submitted to the Board of Directors for approval at the March 27, 2024 meeting.

2022 – 001 Procurement Federal Agency: U.S. Department of Health and Human Services Federal Program: COVID-19: FY 2020 Health Center Program Look-Alikes: Expanding Capacity for Coronavirus Testing and COVID-19: American Rescue Plan Act Funding for Look-Alikes AL Number: 93.224 & 93.527 Award Period: 7/1/21 - 6/30/22 Type of Finding: Significant deficiency in Internal Control over Compliance and Compliance Criteria or Specific Requirement 2 CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Award requires compliance with the provisions of procurement and suspension and debarment. The Organization should have internal controls designed to ensure compliance with these provisions. Condition and Context We noted the Organization is not in compliance with requirements related to Procurement, Suspension and Debarment. During our testing, we noted the Organization’s procurement policy did not meet the requirements defined by 2 CFR 200. Effect The auditor noted an instance of noncompliance. Noncompliance results in possible federal funds provided to ineligible subrecipients and/or vendors. Questioned Costs None identified. Cause The Organization lacks a uniform Procurement, Suspension & Debarment policy that is in compliance with the Federal regulations and/or the terms and conditions of the Federal award. Recommendation We recommend the Organization review and update its procurement policy to ensure the policy meets the 2 CFR Part 200 Procurement requirements. Views of Responsible Officials The Organization will compare our procurement policy to the procurement requirements defined by 2 CFR 200 and update the policy accordingly. This will be performed by Andrea Cortez, Chief Operating Officer, and Andrew Shahidi, Chief Financial Officer, in the next 45 days and the revised policy will be submitted to the Board of Directors for approval at the March 27, 2024 meeting.

2022 – 002 Special Tests: Application of Sliding Fee Discount Federal Agency: U.S. Department of Health and Human Services Federal Program: COVID-19: FY 2020 Health Center Program Look-Alikes: Expanding Capacity for Coronavirus Testing and COVID-19: American Rescue Plan Act Funding for Look-Alikes AL Number: 93.224 & 93.527 Award Period: 7/1/21 - 6/30/22 Type of Finding: Material Weakness in Internal Control over Compliance and Compliance Criteria or Specific Requirement Per Title 42 Chapter 1 Subchapter D Section 51c303(f), “Health centers must have a schedule of fees or payments for the provision of their health services consistent with locally prevailing rates or charges designed to cover their reasonable costs of operation. They are also required to have a corresponding schedule of discounts applied and adjusted on the basis of the patient’s ability to pay.” Condition and Context During our testing of forty sliding fee discounts for health center patients qualifying for reduced charge visits, we identified three visits that received the incorrect sliding fee discount or that the sliding fee application could not be located. Effect Potential that a patient would not receive the appropriate sliding fee discount. Questioned Costs None identified. Cause Clerical error in which the incorrect discount was applied due to lack of an oversight process in place. Recommendation We recommend the Organization to review internal controls in regards to the determination, recording, and monitoring of the sliding fee process to ensure that appropriate sliding fee rates/categories are utilized for each sliding fee encounter. Views of Responsible Officials The Organization will review our procedures for ensuring that sliding fee applications are completed accurately and are properly placed in patient files. We will also research and implement safeguards to ensure that the revised procedures are being followed throughout the year, potentially including audits and additional staff training. This will be performed by Andrea Cortez, Chief Operating Officer, Karina Villagrana, Practice Manager, and Andrew Shahidi, Chief Financial Officer in the next 45 days. If during this process we determine that an update, revision, or re-write of the current Sliding Fee Policy is required, we will do so and it will be submitted to the Board of Directors for approval at the March 27, 2024 meeting.

2022 – 002 Special Tests: Application of Sliding Fee Discount Federal Agency: U.S. Department of Health and Human Services Federal Program: COVID-19: FY 2020 Health Center Program Look-Alikes: Expanding Capacity for Coronavirus Testing and COVID-19: American Rescue Plan Act Funding for Look-Alikes AL Number: 93.224 & 93.527 Award Period: 7/1/21 - 6/30/22 Type of Finding: Material Weakness in Internal Control over Compliance and Compliance Criteria or Specific Requirement Per Title 42 Chapter 1 Subchapter D Section 51c303(f), “Health centers must have a schedule of fees or payments for the provision of their health services consistent with locally prevailing rates or charges designed to cover their reasonable costs of operation. They are also required to have a corresponding schedule of discounts applied and adjusted on the basis of the patient’s ability to pay.” Condition and Context During our testing of forty sliding fee discounts for health center patients qualifying for reduced charge visits, we identified three visits that received the incorrect sliding fee discount or that the sliding fee application could not be located. Effect Potential that a patient would not receive the appropriate sliding fee discount. Questioned Costs None identified. Cause Clerical error in which the incorrect discount was applied due to lack of an oversight process in place. Recommendation We recommend the Organization to review internal controls in regards to the determination, recording, and monitoring of the sliding fee process to ensure that appropriate sliding fee rates/categories are utilized for each sliding fee encounter. Views of Responsible Officials The Organization will review our procedures for ensuring that sliding fee applications are completed accurately and are properly placed in patient files. We will also research and implement safeguards to ensure that the revised procedures are being followed throughout the year, potentially including audits and additional staff training. This will be performed by Andrea Cortez, Chief Operating Officer, Karina Villagrana, Practice Manager, and Andrew Shahidi, Chief Financial Officer in the next 45 days. If during this process we determine that an update, revision, or re-write of the current Sliding Fee Policy is required, we will do so and it will be submitted to the Board of Directors for approval at the March 27, 2024 meeting.