Audit 31020

ALN, Federal Agency, and Program Name 93.498, U.S. Department of Health and Human Services, COVID 19: Provider Relief Fund and American Rescue Plan Rural Distribution (PRF) Federal Award Identification Number and Year N/A, 2022 Pass through Entity N/A, Direct funded Finding Type Significant deficiency and material noncompliance with laws and regulations Repeat Finding No Criteria Per the Provider Relief Fund Distributions and American Rescue Plan Rural Distributions Post Payment Notice of Reporting Requirements dated October 27, 2022, published by the U.S. Department of Health and Human Services (HHS), allowable expenses paid with general and targeted PRF distributions may be reported as a use of PRF funds, provided that the expenses have not been reimbursed by another source. Additionally, per the HRSA PRF Reporting Portal User Guide, "the reporting entity must report the use of these payments by indicating the quarterly expenses reimbursed for these payments" once these expenses have been entered, and the portal will automatically calculate an unreimbursed expense amount for any PRF expenses entered that exceed PRF funding received. As a result of this calculation, the directions from HRSA require users to only input expenses related to the current period's payments in the current portal submission. Condition The Corporation's controls in place for reporting submissions did not identify that guidelines were not followed related to the reporting of expenses. Questioned Costs None Identification of How Questioned Costs Were Computed N/A Refer to context below for additional information. Context The reporting submission for health care expenses did not follow the guidelines published by HHS. The Corporation's Period 3 portal submission overstated expenses by $10,329,866 that were included within the Period 1 portal submission. These expenses should not have been re entered in the Period 3 submission. Due to the Corporation having additional health care expenses and lost revenue that could have been utilized to support the retention of the PRF funds, the Corporation still would have qualified to recognize all PRF payments received in Period 3. Cause and Effect Appropriate review of the expenses reported was not completed to ensure that the expenses were properly reported. As a result, the report submitted was inaccurate, but the schedule of expenditure of federal awards was not impacted. Recommendation We recommend the Corporation implement controls, including levels of review, to ensure reports are completed and submitted in accordance with the guidelines established by HHS. Views of Responsible Officials and Corrective Action Plan The Corporation accepts the finding and will implement additional layers of review regarding expense submission to ensure the reports are submitted within the established guidelines. As stated above, the lost revenue from the COVID 19 pandemic more than offsets this finding, and there are no resulting PRF recognition issues.

ALN, Federal Agency, and Program Name 93.498, U.S. Department of Health and Human Services, COVID 19: Provider Relief Fund and American Rescue Plan Rural Distribution (PRF) Federal Award Identification Number and Year N/A, 2022 Pass through Entity N/A, Direct funded Finding Type Significant deficiency and material noncompliance with laws and regulations Repeat Finding No Criteria Per the Provider Relief Fund Distributions and American Rescue Plan Rural Distributions Post Payment Notice of Reporting Requirements dated October 27, 2022, published by the U.S. Department of Health and Human Services (HHS), allowable expenses paid with general and targeted PRF distributions may be reported as a use of PRF funds, provided that the expenses have not been reimbursed by another source. Additionally, per the HRSA PRF Reporting Portal User Guide, "the reporting entity must report the use of these payments by indicating the quarterly expenses reimbursed for these payments" once these expenses have been entered, and the portal will automatically calculate an unreimbursed expense amount for any PRF expenses entered that exceed PRF funding received. As a result of this calculation, the directions from HRSA require users to only input expenses related to the current period's payments in the current portal submission. Condition The Corporation's controls in place for reporting submissions did not identify that guidelines were not followed related to the reporting of expenses. Questioned Costs None Identification of How Questioned Costs Were Computed N/A Refer to context below for additional information. Context The reporting submission for health care expenses did not follow the guidelines published by HHS. The Corporation's Period 3 portal submission overstated expenses by $10,329,866 that were included within the Period 1 portal submission. These expenses should not have been re entered in the Period 3 submission. Due to the Corporation having additional health care expenses and lost revenue that could have been utilized to support the retention of the PRF funds, the Corporation still would have qualified to recognize all PRF payments received in Period 3. Cause and Effect Appropriate review of the expenses reported was not completed to ensure that the expenses were properly reported. As a result, the report submitted was inaccurate, but the schedule of expenditure of federal awards was not impacted. Recommendation We recommend the Corporation implement controls, including levels of review, to ensure reports are completed and submitted in accordance with the guidelines established by HHS. Views of Responsible Officials and Corrective Action Plan The Corporation accepts the finding and will implement additional layers of review regarding expense submission to ensure the reports are submitted within the established guidelines. As stated above, the lost revenue from the COVID 19 pandemic more than offsets this finding, and there are no resulting PRF recognition issues.