Audit 290693

Federal agency: U.S. Department of Health and Human Services Other Programs Federal program title: Provider Relief Funding Assistance Listing Number: 93.498 Pass-Through Agency: N/A Pass-Through Number(s): N/A Award Period: Period 1 & 2 Type of Finding: Significant Deficiency in Internal Control in and over Compliance Compliance Requirement: Allowable Costs Criteria or specific requirement: Surrounding reporting activities, the Hospital’s internal controls should be designed to assure all reporting completed under program guidelines. Condition: During our testing, we identified the Hospital did not have internal controls in place to ensure reporting was completed in accordance with HHS guidelines. Questioned costs: $180,000 Context: During our testing, it was identified that the Hospital reported approximately $180,000 in capital expenditures that were not applicable to COVID-19 as required under the program guidelines. Cause: During testing it was noted that there was a formula error within the expense spreadsheet, which caused erroneous expenses to be included with the reporting. Effect: The auditor noted that although $180,000 of non-COVID-19 costs were included in the expenses claimed this had no overall impact on the total provider relief funds reported as there is sufficient lost revenues to more than offset this amount. However, the internal controls around compliance over allowable costs were not effective. Repeat Finding: N/A Recommendation: We recommend the Hospital design controls to ensure documentation is completed timely and sufficiently on how costs are necessary to respond to COVID-19. Views of responsible officials: There is no disagreement with the audit finding. Management has identified a sufficient amount of lost revenue, that were reported, to cover the finding amounts.

Federal agency: U.S. Department of Health and Human Services Other Programs Federal program title: Provider Relief Funding CFDA Number: 93.498 Pass-Through Agency: N/A Pass-Through Number(s): N/A Award Period: Period 1 & 2 Type of Finding: Significant Deficiency in Internal Control in and over Compliance Compliance Requirement: Reporting Criteria or specific requirement: Surrounding reporting activities, the Hospital’s internal controls should be designed to assure all reporting completed under program guidelines. Condition: During our testing, we identified the Hospital did not have internal controls in place to ensure reporting was completed in accordance with HHS guidelines. Questioned costs: None Context: During our testing, it was identified that the Hospital input lost revenue information under Option 1, which compared actual net patient revenue for each quarter during the period of availability against actual for each quarter. In order to utilize this option, all net patient revenue must be included in the calculation and management identified a net percentage within the calculation and intended to report under Option 3. As such, the Hospital calculated lost revenues in accordance with the guidelines of Option 3, but erroneously reported under Option 1. Cause: The Hospital was amidst a pandemic and due to the reporting requirements constantly changing, the Hospital reported under their initial understanding of the lost revenue guidance. Effect: The auditor noted no instances of noncompliance with the provisions of lost revenues claimed, as the approved quarters lost revenues exceeded the amount claimed; however, the internal controls around compliance over reporting were not effective. Repeat Finding: N/A Recommendation: We recommend the Hospital design controls to ensure that reporting is completing in accordance with latest HHS guidelines. Views of responsible officials: There is no disagreement with the audit finding.

Federal agency: U.S. Department of Health and Human Services Other Programs Federal program title: Provider Relief Funding Assistance Listing Number: 93.498 Pass-Through Agency: N/A Pass-Through Number(s): N/A Award Period: Period 1 & 2 Type of Finding: Significant Deficiency in Internal Control in and over Compliance Compliance Requirement: Allowable Costs Criteria or specific requirement: Surrounding reporting activities, the Hospital’s internal controls should be designed to assure all reporting completed under program guidelines. Condition: During our testing, we identified the Hospital did not have internal controls in place to ensure reporting was completed in accordance with HHS guidelines. Questioned costs: $180,000 Context: During our testing, it was identified that the Hospital reported approximately $180,000 in capital expenditures that were not applicable to COVID-19 as required under the program guidelines. Cause: During testing it was noted that there was a formula error within the expense spreadsheet, which caused erroneous expenses to be included with the reporting. Effect: The auditor noted that although $180,000 of non-COVID-19 costs were included in the expenses claimed this had no overall impact on the total provider relief funds reported as there is sufficient lost revenues to more than offset this amount. However, the internal controls around compliance over allowable costs were not effective. Repeat Finding: N/A Recommendation: We recommend the Hospital design controls to ensure documentation is completed timely and sufficiently on how costs are necessary to respond to COVID-19. Views of responsible officials: There is no disagreement with the audit finding. Management has identified a sufficient amount of lost revenue, that were reported, to cover the finding amounts.

Federal agency: U.S. Department of Health and Human Services Other Programs Federal program title: Provider Relief Funding CFDA Number: 93.498 Pass-Through Agency: N/A Pass-Through Number(s): N/A Award Period: Period 1 & 2 Type of Finding: Significant Deficiency in Internal Control in and over Compliance Compliance Requirement: Reporting Criteria or specific requirement: Surrounding reporting activities, the Hospital’s internal controls should be designed to assure all reporting completed under program guidelines. Condition: During our testing, we identified the Hospital did not have internal controls in place to ensure reporting was completed in accordance with HHS guidelines. Questioned costs: None Context: During our testing, it was identified that the Hospital input lost revenue information under Option 1, which compared actual net patient revenue for each quarter during the period of availability against actual for each quarter. In order to utilize this option, all net patient revenue must be included in the calculation and management identified a net percentage within the calculation and intended to report under Option 3. As such, the Hospital calculated lost revenues in accordance with the guidelines of Option 3, but erroneously reported under Option 1. Cause: The Hospital was amidst a pandemic and due to the reporting requirements constantly changing, the Hospital reported under their initial understanding of the lost revenue guidance. Effect: The auditor noted no instances of noncompliance with the provisions of lost revenues claimed, as the approved quarters lost revenues exceeded the amount claimed; however, the internal controls around compliance over reporting were not effective. Repeat Finding: N/A Recommendation: We recommend the Hospital design controls to ensure that reporting is completing in accordance with latest HHS guidelines. Views of responsible officials: There is no disagreement with the audit finding.