Audit 295425

2023-001: Material Weakness in Internal Control Over Compliance Federal Program: COVID -19 – Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution – Period 4 Assistance Listing Number: 93.498 Federal Agency: U.S. Department of Health and Human Services Award Number: N/A Compliance Requirement: Reporting Questioned Costs: None noted Criteria: Non-federal entities in receipt of federal funds must comply with the requirements of 2 CFR 200.303(a), which require an entity to establish and maintain effective internal control over the Federal award to ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution (PRF) payments must be used for allowable expenses and lost revenue described in the PRF terms and conditions and specified in guidance issued by the U.S. Department of Health and Human Services. Activities allowed have been defined as expense used to prevent, prepare for, and respond to coronavirus, domestically or internationally, for necessary expenses to reimburse, through grants or other mechanisms, eligible health care providers for health care related expenses or lost revenues that are attributable to coronavirus. Additionally, all recipients of PRF payments must comply with the reporting requirements described in the PRF terms and conditions and specified in directions issued by the U.S. Department of Health and Human Services. Condition and Context: During the performance of our procedures, we noted that the Hospital did not complete the PRF reporting in accordance with the U.S. Department of Health and Human Services guidance. We noted that the Hospital had errors in the underlying support to the lost revenue calculation, resulting in lost revenues being overstated $246,892. The entity reported lost revenues amounting to $3,973,310 on distributions totaling $2,485,265. The Hospital also had excess lost revenues from prior periods available to be used through June 30, 2023 amounting to $11,388,637. Effect: The amounts reported to HRSA were not in accordance with established U.S. Department of Health and Human Services guidance. Cause: The Hospital's review process was inadequate. Recommendation: We recommend that management implement procedures to ensure that the most recent guidance is reviewed and understood, and that information used in accumulating allowable lost revenues is reviewed, with errors addressed prior to submission. Views of Responsible Officials: The Hospital agrees with the finding.

2023-001: Material Weakness in Internal Control Over Compliance Federal Program: COVID -19 – Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution – Period 4 Assistance Listing Number: 93.498 Federal Agency: U.S. Department of Health and Human Services Award Number: N/A Compliance Requirement: Reporting Questioned Costs: None noted Criteria: Non-federal entities in receipt of federal funds must comply with the requirements of 2 CFR 200.303(a), which require an entity to establish and maintain effective internal control over the Federal award to ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution (PRF) payments must be used for allowable expenses and lost revenue described in the PRF terms and conditions and specified in guidance issued by the U.S. Department of Health and Human Services. Activities allowed have been defined as expense used to prevent, prepare for, and respond to coronavirus, domestically or internationally, for necessary expenses to reimburse, through grants or other mechanisms, eligible health care providers for health care related expenses or lost revenues that are attributable to coronavirus. Additionally, all recipients of PRF payments must comply with the reporting requirements described in the PRF terms and conditions and specified in directions issued by the U.S. Department of Health and Human Services. Condition and Context: During the performance of our procedures, we noted that the Hospital did not complete the PRF reporting in accordance with the U.S. Department of Health and Human Services guidance. We noted that the Hospital had errors in the underlying support to the lost revenue calculation, resulting in lost revenues being overstated $246,892. The entity reported lost revenues amounting to $3,973,310 on distributions totaling $2,485,265. The Hospital also had excess lost revenues from prior periods available to be used through June 30, 2023 amounting to $11,388,637. Effect: The amounts reported to HRSA were not in accordance with established U.S. Department of Health and Human Services guidance. Cause: The Hospital's review process was inadequate. Recommendation: We recommend that management implement procedures to ensure that the most recent guidance is reviewed and understood, and that information used in accumulating allowable lost revenues is reviewed, with errors addressed prior to submission. Views of Responsible Officials: The Hospital agrees with the finding.