FAC Explorer

Audit 311075

FY End
2023-09-30
Total Expended
$124.73M
Findings
2
Programs
15
Organization: Umass Memorial Health Care, Inc. (MA)
Year: 2023 Accepted: 2024-06-28
Auditor: Pricewaterhousecoopers LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
404702 2023-001 - - L
981144 2023-001 - - L

Programs

ALN Program Spent Major Findings
97.036 Covid-19 Disaster Grants - Public Assistance (presidentially Declared Disasters) $104.61M Yes 0
93.498 Covid-19 Provider Relief Fund and American Rescue Plan (arp) Rural Distribution $9.38M Yes 1
93.958 Block Grants for Community Mental Health Services $1.00M - 0
93.829 Section 223 Demonstration Programs to Improve Community Mental Health Services $712,340 - 0
10.557 Wic Special Supplemental Nutrition Program for Women, Infants, and Children $637,907 - 0
16.575 Crime Victim Assistance $326,511 - 0
93.243 Substance Abuse and Mental Health Services_projects of Regional and National Significance $286,618 - 0
93.788 Opioid Str $185,702 - 0
14.241 Housing Opportunities for Persons with Aids $138,503 - 0
93.959 Block Grants for Prevention and Treatment of Substance Abuse $100,000 - 0
14.267 Continuum of Care Program $72,985 Yes 0
14.231 Emergency Solutions Grant Program $62,600 - 0
21.023 Emergency Rental Assistance Program $51,083 - 0
84.181 Special Education-Grants for Infants and Families $732 - 0
93.461 Covid-19 Hrsa Covid-19 Claims Reimbursement for the Uninsured Program and the Covid-19 Coverage Assistance Fund $-868 - 0

Contacts

Name Title Type
JM3QWP4D6MY1 Sergio Melgar Auditee
5083340252 Christopher Cox Auditor
No contacts on file

Notes to SEFA

Title: Pass-Through Funds from The Commonwealth Accounting Policies: The information in the accompanying Schedule of Expenditures of Federal Awards (the Schedule) is presented in accordance with Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) and therefore, some amounts may differ from amounts presented in or used in the preparation of the UMass Memorial Health Care, Inc. and Affiliates (the System) consolidated financial statements. The purpose of the Schedule is to present a summary of those activities of the System for the year ended September 30, 2023, which have been funded by the U.S. Government (federal awards). For purposes of the Schedule, federal awards include all grants, contracts and similar federal assistance agreements entered directly between agencies and departments of the federal government and the System and federal awards passed through to the System by primary recipients of federal awards. Since the Schedule presents only a selected portion of activities of the System, it is not intended to and does not, present the balance sheet, results of operations, changes in net assets or cash flows of the System. Negative amounts reported in the Schedule represent adjustments to expenditures reported in the prior year. Assistance Listing Numbers (ALN) and agency or pass-through numbers are provided when available. De Minimis Rate Used: N Rate Explanation: The System has not elected to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance and has recovered indirect costs under certain federally funded grants for the year ended September 30, 2023 under an indirect cost rate of 16.2%. The indirect cost rate has been established by a letter dated June 6, 2021, from the System’s cognizant agency, the Department of Health and Human Services, for the effective period from October 1, 2021 to September 30, 2024. Federal pass-through funds from The Commonwealth of Massachusetts (the Commonwealth) included in the Schedule totaling $5,820,084 (5% of the total expenditures of federal awards) are presented for the Commonwealth’s fiscal year (July 1, 2022 through June 30, 2023) and were taken directly from balances provided to the System by the Commonwealth. The System expended federal and non-federal pass-through funds for the period October 1, 2022 through September 30, 2023 of $8,252,173 compared to $9,212,654 for the period October 1, 2021 through September 30, 2022. Of these expenditures, the Commonwealth is unable to identify for the System what portion of the October 1, 2022 through September 30, 2023 expenditures are related to federal funding. During the period July 1, 2023 through September 30, 2023, the amount of pass-through funds expended (Federal and Commonwealth) totaled $1,307,619 compared to $2,027,524 for the period from July 1, 2022 through September 30, 2022.
Title: Special Supplemental Nutrition Program for Women, Infants and Children (WIC) Accounting Policies: The information in the accompanying Schedule of Expenditures of Federal Awards (the Schedule) is presented in accordance with Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) and therefore, some amounts may differ from amounts presented in or used in the preparation of the UMass Memorial Health Care, Inc. and Affiliates (the System) consolidated financial statements. The purpose of the Schedule is to present a summary of those activities of the System for the year ended September 30, 2023, which have been funded by the U.S. Government (federal awards). For purposes of the Schedule, federal awards include all grants, contracts and similar federal assistance agreements entered directly between agencies and departments of the federal government and the System and federal awards passed through to the System by primary recipients of federal awards. Since the Schedule presents only a selected portion of activities of the System, it is not intended to and does not, present the balance sheet, results of operations, changes in net assets or cash flows of the System. Negative amounts reported in the Schedule represent adjustments to expenditures reported in the prior year. Assistance Listing Numbers (ALN) and agency or pass-through numbers are provided when available. De Minimis Rate Used: N Rate Explanation: The System has not elected to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance and has recovered indirect costs under certain federally funded grants for the year ended September 30, 2023 under an indirect cost rate of 16.2%. The indirect cost rate has been established by a letter dated June 6, 2021, from the System’s cognizant agency, the Department of Health and Human Services, for the effective period from October 1, 2021 to September 30, 2024. In fiscal year 2023, the Special Supplemental Nutrition Program for WIC issued vouchers to program participants to be used at local grocery stores. Included in the WIC program federal expenditures is $2,290,181 which represents the value of the vouchers, which is not directly received by the System, but is included in the Schedule.
Title: Department of Health and Human Services Provider Relief Funds Accounting Policies: The information in the accompanying Schedule of Expenditures of Federal Awards (the Schedule) is presented in accordance with Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) and therefore, some amounts may differ from amounts presented in or used in the preparation of the UMass Memorial Health Care, Inc. and Affiliates (the System) consolidated financial statements. The purpose of the Schedule is to present a summary of those activities of the System for the year ended September 30, 2023, which have been funded by the U.S. Government (federal awards). For purposes of the Schedule, federal awards include all grants, contracts and similar federal assistance agreements entered directly between agencies and departments of the federal government and the System and federal awards passed through to the System by primary recipients of federal awards. Since the Schedule presents only a selected portion of activities of the System, it is not intended to and does not, present the balance sheet, results of operations, changes in net assets or cash flows of the System. Negative amounts reported in the Schedule represent adjustments to expenditures reported in the prior year. Assistance Listing Numbers (ALN) and agency or pass-through numbers are provided when available. De Minimis Rate Used: N Rate Explanation: The System has not elected to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance and has recovered indirect costs under certain federally funded grants for the year ended September 30, 2023 under an indirect cost rate of 16.2%. The indirect cost rate has been established by a letter dated June 6, 2021, from the System’s cognizant agency, the Department of Health and Human Services, for the effective period from October 1, 2021 to September 30, 2024. The Schedule includes grant activity related to the Department of Health and Human Services (HHS) Provider Relief Fund and American Rescue Plan (ARP) Distribution Assistance Listing Number 93.498. As required based on guidance in the 2023 OMB Compliance Supplement, the Schedule includes lost revenues and direct expenditures reported for Period 4 on March 31, 2023 and Period 5 on September 30, 2023 as reported to HHS via the PRF Reporting Portal. The amount included on the Schedule includes $872 of direct expenditures and $9,382,080 in lost revenue. Additionally, lost revenue does not represent an expenditure in the System’s consolidated financial statements and thus is a reconciling item between the federal expenses in the System’s consolidated financial statements and the amount included on the Schedule.
Title: Federal Emergency Management Agency (FEMA) Public Assistance Accounting Policies: The information in the accompanying Schedule of Expenditures of Federal Awards (the Schedule) is presented in accordance with Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) and therefore, some amounts may differ from amounts presented in or used in the preparation of the UMass Memorial Health Care, Inc. and Affiliates (the System) consolidated financial statements. The purpose of the Schedule is to present a summary of those activities of the System for the year ended September 30, 2023, which have been funded by the U.S. Government (federal awards). For purposes of the Schedule, federal awards include all grants, contracts and similar federal assistance agreements entered directly between agencies and departments of the federal government and the System and federal awards passed through to the System by primary recipients of federal awards. Since the Schedule presents only a selected portion of activities of the System, it is not intended to and does not, present the balance sheet, results of operations, changes in net assets or cash flows of the System. Negative amounts reported in the Schedule represent adjustments to expenditures reported in the prior year. Assistance Listing Numbers (ALN) and agency or pass-through numbers are provided when available. De Minimis Rate Used: N Rate Explanation: The System has not elected to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance and has recovered indirect costs under certain federally funded grants for the year ended September 30, 2023 under an indirect cost rate of 16.2%. The indirect cost rate has been established by a letter dated June 6, 2021, from the System’s cognizant agency, the Department of Health and Human Services, for the effective period from October 1, 2021 to September 30, 2024. The System applied for reimbursement of certain expenses related to the COVID-19 pandemic under Assistance Listing Number 97.036, FEMA Public Assistance. Expenditures are reflected in the Schedule in the year in which a project application is obligated. The Schedule includes $104,612,637 of expenditures incurred in fiscal years 2021 and 2022, which were obligated in fiscal year 2023 and represents a reconciling item between the federal expenses in the System’s financial statements and the amount included on the Schedule.

Finding Details

Finding 2023-001
2023-001 Provider Relief Fund Lost Revenue Reporting Cluster: Not applicable Grantor: Health Resources and Services Administration Award Name: COVID-19 Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution Award Year: PRF Period 4 of Availability from January 1, 2020 to December 31, 2022 Award Number: Not applicable Assistance Listing Number: 93.498 Criteria Step 8 of the Steps on Reporting on Use of Funds section of the April 22, 2024 Provider Relief Fund (PRF) General and Targeted Distribution Post-Payment Notice of Reporting Requirements requires recipients that apply PRF payments toward lost revenues, calculated as the difference between actual patient care revenues, to submit revenues from patient care in the PRF Reporting Portal by quarter from January 1, 2019 to December 31, 2022, the end of the Period 4 period of availability. Condition UMass Memorial Health – Harrington, Inc. and Affiliates (Harrington), a wholly controlled subsidiary of the System, understated patient care revenues reported in the PRF Reporting Portal for the third and fourth quarters of calendar year 2021 by approximately $6.2 million. Specifically, Harrington Hospital, Inc. (HMH) and Harrington Physician Services (HPS) reported incorrect values for patient care revenues in these quarters resulting in an understatement of patient care revenues in the PRF Reporting Portal by approximately $5.7 million and $0.5 million, respectively. This is a recurring finding that was identified as part of the Harrington program-specific standalone audit for the year ended September 30, 2022. Cause Harrington did not have an effective control in place to ensure a sufficient review was performed over the accuracy of revenues from patient care used as inputs to the lost revenue calculation prior to completing the PRF Period 4 Reporting Portal submissions. Effect While revenues from patient care were inaccurately reported in the PRF Period 4 Reporting Portal Submission, Harrington had sufficient lost revenues and unreimbursed COVID-19-related expenses to support the amount of Period 4 PRF funding received. Questioned Costs None identified. Recommendation We recommend that management ensure there is an effective control in place whereby a detailed review is performed and evidenced of the lost revenue calculation detail prior to PRF Reporting Portal submissions. Management’s Views and Corrective Action Plan Management’s Views and Corrective Action Plan are included at the end of this report after the summary schedule of prior audit findings and status.
Finding 2023-001
2023-001 Provider Relief Fund Lost Revenue Reporting Cluster: Not applicable Grantor: Health Resources and Services Administration Award Name: COVID-19 Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution Award Year: PRF Period 4 of Availability from January 1, 2020 to December 31, 2022 Award Number: Not applicable Assistance Listing Number: 93.498 Criteria Step 8 of the Steps on Reporting on Use of Funds section of the April 22, 2024 Provider Relief Fund (PRF) General and Targeted Distribution Post-Payment Notice of Reporting Requirements requires recipients that apply PRF payments toward lost revenues, calculated as the difference between actual patient care revenues, to submit revenues from patient care in the PRF Reporting Portal by quarter from January 1, 2019 to December 31, 2022, the end of the Period 4 period of availability. Condition UMass Memorial Health – Harrington, Inc. and Affiliates (Harrington), a wholly controlled subsidiary of the System, understated patient care revenues reported in the PRF Reporting Portal for the third and fourth quarters of calendar year 2021 by approximately $6.2 million. Specifically, Harrington Hospital, Inc. (HMH) and Harrington Physician Services (HPS) reported incorrect values for patient care revenues in these quarters resulting in an understatement of patient care revenues in the PRF Reporting Portal by approximately $5.7 million and $0.5 million, respectively. This is a recurring finding that was identified as part of the Harrington program-specific standalone audit for the year ended September 30, 2022. Cause Harrington did not have an effective control in place to ensure a sufficient review was performed over the accuracy of revenues from patient care used as inputs to the lost revenue calculation prior to completing the PRF Period 4 Reporting Portal submissions. Effect While revenues from patient care were inaccurately reported in the PRF Period 4 Reporting Portal Submission, Harrington had sufficient lost revenues and unreimbursed COVID-19-related expenses to support the amount of Period 4 PRF funding received. Questioned Costs None identified. Recommendation We recommend that management ensure there is an effective control in place whereby a detailed review is performed and evidenced of the lost revenue calculation detail prior to PRF Reporting Portal submissions. Management’s Views and Corrective Action Plan Management’s Views and Corrective Action Plan are included at the end of this report after the summary schedule of prior audit findings and status.