Audit 323140

FY End
2023-12-31
Total Expended
$11.39M
Findings
2
Programs
7
Organization: Whatley Health Services, Inc. (AL)
Year: 2023 Accepted: 2024-09-30

Organization Exclusion Status:

Checking exclusion status...

Findings

ID Ref Severity Repeat Requirement
500384 2023-001 Material Weakness Yes J
1076826 2023-001 Material Weakness Yes J

Contacts

Name Title Type
LLKKWKC9GJY7 Rajuan Sherman Auditee
2056146070 William P. Bach Auditor
No contacts on file

Notes to SEFA

Title: Note 2. Relationship of the Schedule to Program Financial Reports Accounting Policies: Note 1. Basis of Presentation - The accompanying Schedule of Expenditures of Federal Awards (the schedule) summarizes the federal expenditures of the Corporation under programs of the federal government for the year ended December 31, 2023. The amounts reported as federal expenditures were obtained from the Corporation’s general ledger. Because the schedule presents only a selected portion of the operations of the Corporation, it is not intended to and does not present the financial position, changes in net assets, and cash flows for the Corporation. For purposes of the schedule, federal awards include all grants, contracts, and similar agreements entered into directly with the federal government and other pass through entities. Payments received for goods or services provided as a vendor do not constitute federal awards for purposes of the schedule. The Corporation has obtained Assistance Listing Numbers to ensure that all programs have been identified in the schedule. Federal programs with different Assistance Listing Numbers that are closely related because they share common compliance requirements that are defined as a cluster by the Uniform Guidance. One cluster is separately identified in the SEFA and is the following: Health Center Program Cluster – The purpose of the Health Center Program (HCP) cluster is to improve the health of the Nation’s underserved communities and vulnerable populations by assuring continued access to comprehensive, culturally competent, quality primary health care services. HCP grants support a variety of community-based and patient-directed public and private nonprofit organizations that provide primary and preventative health care services to the Nation’s underserved. De Minimis Rate Used: N Rate Explanation: Note 7. The Corporation has elected to not use the 10% de minimis indirect cost rate. The amounts reflected in the financial reports submitted to the awarding federal and/or pass-through agencies and the schedule may differ. Some of the factors that may account for any difference include the following: The Corporation’s fiscal year end may differ from the program’s year end. Accruals recognized in the schedule, because of year end procedures, may not be reported in the program financial reports until the next program reporting period. Fixed asset purchases and the resultant depreciation charges are recognized as property and equipment, net in the Corporation’s financial statements and as expenditures in the program financial reports.
Title: Note 3. Federal Pass-Through Funds Accounting Policies: Note 1. Basis of Presentation - The accompanying Schedule of Expenditures of Federal Awards (the schedule) summarizes the federal expenditures of the Corporation under programs of the federal government for the year ended December 31, 2023. The amounts reported as federal expenditures were obtained from the Corporation’s general ledger. Because the schedule presents only a selected portion of the operations of the Corporation, it is not intended to and does not present the financial position, changes in net assets, and cash flows for the Corporation. For purposes of the schedule, federal awards include all grants, contracts, and similar agreements entered into directly with the federal government and other pass through entities. Payments received for goods or services provided as a vendor do not constitute federal awards for purposes of the schedule. The Corporation has obtained Assistance Listing Numbers to ensure that all programs have been identified in the schedule. Federal programs with different Assistance Listing Numbers that are closely related because they share common compliance requirements that are defined as a cluster by the Uniform Guidance. One cluster is separately identified in the SEFA and is the following: Health Center Program Cluster – The purpose of the Health Center Program (HCP) cluster is to improve the health of the Nation’s underserved communities and vulnerable populations by assuring continued access to comprehensive, culturally competent, quality primary health care services. HCP grants support a variety of community-based and patient-directed public and private nonprofit organizations that provide primary and preventative health care services to the Nation’s underserved. De Minimis Rate Used: N Rate Explanation: Note 7. The Corporation has elected to not use the 10% de minimis indirect cost rate. The Corporation is also the sub-recipient of federal funds that have been subjected to testing and are reported as expenditures and listed as federal pass-through funds. Federal awards other than those indicated as pass-throughs are considered to be direct.
Title: Note 4. Basis of Accounting Accounting Policies: Note 1. Basis of Presentation - The accompanying Schedule of Expenditures of Federal Awards (the schedule) summarizes the federal expenditures of the Corporation under programs of the federal government for the year ended December 31, 2023. The amounts reported as federal expenditures were obtained from the Corporation’s general ledger. Because the schedule presents only a selected portion of the operations of the Corporation, it is not intended to and does not present the financial position, changes in net assets, and cash flows for the Corporation. For purposes of the schedule, federal awards include all grants, contracts, and similar agreements entered into directly with the federal government and other pass through entities. Payments received for goods or services provided as a vendor do not constitute federal awards for purposes of the schedule. The Corporation has obtained Assistance Listing Numbers to ensure that all programs have been identified in the schedule. Federal programs with different Assistance Listing Numbers that are closely related because they share common compliance requirements that are defined as a cluster by the Uniform Guidance. One cluster is separately identified in the SEFA and is the following: Health Center Program Cluster – The purpose of the Health Center Program (HCP) cluster is to improve the health of the Nation’s underserved communities and vulnerable populations by assuring continued access to comprehensive, culturally competent, quality primary health care services. HCP grants support a variety of community-based and patient-directed public and private nonprofit organizations that provide primary and preventative health care services to the Nation’s underserved. De Minimis Rate Used: N Rate Explanation: Note 7. The Corporation has elected to not use the 10% de minimis indirect cost rate. The schedule was prepared on the modified accrual basis of accounting. The modified accrual basis differs from the full accrual basis of accounting in that expenditures for property and equipment are expensed when incurred, rather than being capitalized and depreciated over their useful lives, and expenditures for the principal portion of debt service are expensed when incurred, rather than being applied to reduce the outstanding principal portion of the debt, which conforms to the basis of reporting to grantors for reimbursement under the terms of the Corporation’s federal grants.
Title: Note 5. Contingencies Accounting Policies: Note 1. Basis of Presentation - The accompanying Schedule of Expenditures of Federal Awards (the schedule) summarizes the federal expenditures of the Corporation under programs of the federal government for the year ended December 31, 2023. The amounts reported as federal expenditures were obtained from the Corporation’s general ledger. Because the schedule presents only a selected portion of the operations of the Corporation, it is not intended to and does not present the financial position, changes in net assets, and cash flows for the Corporation. For purposes of the schedule, federal awards include all grants, contracts, and similar agreements entered into directly with the federal government and other pass through entities. Payments received for goods or services provided as a vendor do not constitute federal awards for purposes of the schedule. The Corporation has obtained Assistance Listing Numbers to ensure that all programs have been identified in the schedule. Federal programs with different Assistance Listing Numbers that are closely related because they share common compliance requirements that are defined as a cluster by the Uniform Guidance. One cluster is separately identified in the SEFA and is the following: Health Center Program Cluster – The purpose of the Health Center Program (HCP) cluster is to improve the health of the Nation’s underserved communities and vulnerable populations by assuring continued access to comprehensive, culturally competent, quality primary health care services. HCP grants support a variety of community-based and patient-directed public and private nonprofit organizations that provide primary and preventative health care services to the Nation’s underserved. De Minimis Rate Used: N Rate Explanation: Note 7. The Corporation has elected to not use the 10% de minimis indirect cost rate. Grant monies received and disbursed by the Corporation are for specific purposes and are subject to revied by the grantor agencies. Such audits may result in request for reimbursement due to disallowed expenditures. Based upon experience, the Corporation does not believe that such disallowance, if any, would have a material effect on the financial position of the Corporation.
Title: Note 6. Noncash Assistance Accounting Policies: Note 1. Basis of Presentation - The accompanying Schedule of Expenditures of Federal Awards (the schedule) summarizes the federal expenditures of the Corporation under programs of the federal government for the year ended December 31, 2023. The amounts reported as federal expenditures were obtained from the Corporation’s general ledger. Because the schedule presents only a selected portion of the operations of the Corporation, it is not intended to and does not present the financial position, changes in net assets, and cash flows for the Corporation. For purposes of the schedule, federal awards include all grants, contracts, and similar agreements entered into directly with the federal government and other pass through entities. Payments received for goods or services provided as a vendor do not constitute federal awards for purposes of the schedule. The Corporation has obtained Assistance Listing Numbers to ensure that all programs have been identified in the schedule. Federal programs with different Assistance Listing Numbers that are closely related because they share common compliance requirements that are defined as a cluster by the Uniform Guidance. One cluster is separately identified in the SEFA and is the following: Health Center Program Cluster – The purpose of the Health Center Program (HCP) cluster is to improve the health of the Nation’s underserved communities and vulnerable populations by assuring continued access to comprehensive, culturally competent, quality primary health care services. HCP grants support a variety of community-based and patient-directed public and private nonprofit organizations that provide primary and preventative health care services to the Nation’s underserved. De Minimis Rate Used: N Rate Explanation: Note 7. The Corporation has elected to not use the 10% de minimis indirect cost rate. The Corporation did not receive any federal noncash assistance for the fiscal year ending December 31, 2023.
Title: Note 8. Subrecipients Accounting Policies: Note 1. Basis of Presentation - The accompanying Schedule of Expenditures of Federal Awards (the schedule) summarizes the federal expenditures of the Corporation under programs of the federal government for the year ended December 31, 2023. The amounts reported as federal expenditures were obtained from the Corporation’s general ledger. Because the schedule presents only a selected portion of the operations of the Corporation, it is not intended to and does not present the financial position, changes in net assets, and cash flows for the Corporation. For purposes of the schedule, federal awards include all grants, contracts, and similar agreements entered into directly with the federal government and other pass through entities. Payments received for goods or services provided as a vendor do not constitute federal awards for purposes of the schedule. The Corporation has obtained Assistance Listing Numbers to ensure that all programs have been identified in the schedule. Federal programs with different Assistance Listing Numbers that are closely related because they share common compliance requirements that are defined as a cluster by the Uniform Guidance. One cluster is separately identified in the SEFA and is the following: Health Center Program Cluster – The purpose of the Health Center Program (HCP) cluster is to improve the health of the Nation’s underserved communities and vulnerable populations by assuring continued access to comprehensive, culturally competent, quality primary health care services. HCP grants support a variety of community-based and patient-directed public and private nonprofit organizations that provide primary and preventative health care services to the Nation’s underserved. De Minimis Rate Used: N Rate Explanation: Note 7. The Corporation has elected to not use the 10% de minimis indirect cost rate. The Corporation did not provide federal funds to subrecipients for the fiscal year ending December 31, 2023.
Title: Note 9. Loans and Loan Guarantees Accounting Policies: Note 1. Basis of Presentation - The accompanying Schedule of Expenditures of Federal Awards (the schedule) summarizes the federal expenditures of the Corporation under programs of the federal government for the year ended December 31, 2023. The amounts reported as federal expenditures were obtained from the Corporation’s general ledger. Because the schedule presents only a selected portion of the operations of the Corporation, it is not intended to and does not present the financial position, changes in net assets, and cash flows for the Corporation. For purposes of the schedule, federal awards include all grants, contracts, and similar agreements entered into directly with the federal government and other pass through entities. Payments received for goods or services provided as a vendor do not constitute federal awards for purposes of the schedule. The Corporation has obtained Assistance Listing Numbers to ensure that all programs have been identified in the schedule. Federal programs with different Assistance Listing Numbers that are closely related because they share common compliance requirements that are defined as a cluster by the Uniform Guidance. One cluster is separately identified in the SEFA and is the following: Health Center Program Cluster – The purpose of the Health Center Program (HCP) cluster is to improve the health of the Nation’s underserved communities and vulnerable populations by assuring continued access to comprehensive, culturally competent, quality primary health care services. HCP grants support a variety of community-based and patient-directed public and private nonprofit organizations that provide primary and preventative health care services to the Nation’s underserved. De Minimis Rate Used: N Rate Explanation: Note 7. The Corporation has elected to not use the 10% de minimis indirect cost rate. The Corporation did not have any loans or loan guarantee programs required to be reported on the schedule.

Finding Details

2023-001 Program Income - Sliding Fee Scale Health Center Program Cluster # 93.224 - U.S. Department of Health and Human Services Contract H80CS00094. Condition - Out of 60 encounters tested we noted the following: Five (5) instances where there was no registration form in patient file, fifteen (15) instances where the sliding fee scale discount was not properly applied, and six (6) instances where proper proof of identification was not in patient file. Criteria - Health centers are required to have a corresponding schedule of discounts applied and adjusted based on the patient's ability to pay (42 USC 254b(k)(3)(G)(i). The patient's ability to pay is based on the official poverty guideline, as revised annual by HHS (42 CFR sections 51c. l 07(b)(5), 56.108(b)(5), and 56.303(f). Cause - Failure to obtain the required documentation was due to failure of the Corporation to properly monitor the process. Errors in calculating and/or applying the sliding fee discounts were primarily due to staff not properly following the process of entering and substantiating income within the software and the Corporation not properly monitoring the process. Conditions No. 1, and No. 2 are repeat findings from the prior year. See Summary Schedule of Prior Audit Findings 2022-001. Effect - The Corporation could be incorrectly billing for services and maintaining customer account balances at incorrect amounts. Recommendation - Staff should make every effort to obtain documentation of patient income, identification, and registration in accordance with internal policies and procedures. Patients should be billed full billing rates for all services until all documentation is received. We recommend additional staff training focusing on software familiarization and additional monitoring of the process by the Corporation. Management's Response - Management agrees with the finding. The Corporation is increasing its efforts to ensure that its policies and procedures surrounding documentation of patient income, identification, and registration is followed, and specifically that this documentation is archived correctly within every patient file. The Corporation has conducted several staff trainings and has revised its review procedures for checking compliance to improve monitoring of the process by the Corporation.
2023-001 Program Income - Sliding Fee Scale Health Center Program Cluster # 93.224 - U.S. Department of Health and Human Services Contract H80CS00094. Condition - Out of 60 encounters tested we noted the following: Five (5) instances where there was no registration form in patient file, fifteen (15) instances where the sliding fee scale discount was not properly applied, and six (6) instances where proper proof of identification was not in patient file. Criteria - Health centers are required to have a corresponding schedule of discounts applied and adjusted based on the patient's ability to pay (42 USC 254b(k)(3)(G)(i). The patient's ability to pay is based on the official poverty guideline, as revised annual by HHS (42 CFR sections 51c. l 07(b)(5), 56.108(b)(5), and 56.303(f). Cause - Failure to obtain the required documentation was due to failure of the Corporation to properly monitor the process. Errors in calculating and/or applying the sliding fee discounts were primarily due to staff not properly following the process of entering and substantiating income within the software and the Corporation not properly monitoring the process. Conditions No. 1, and No. 2 are repeat findings from the prior year. See Summary Schedule of Prior Audit Findings 2022-001. Effect - The Corporation could be incorrectly billing for services and maintaining customer account balances at incorrect amounts. Recommendation - Staff should make every effort to obtain documentation of patient income, identification, and registration in accordance with internal policies and procedures. Patients should be billed full billing rates for all services until all documentation is received. We recommend additional staff training focusing on software familiarization and additional monitoring of the process by the Corporation. Management's Response - Management agrees with the finding. The Corporation is increasing its efforts to ensure that its policies and procedures surrounding documentation of patient income, identification, and registration is followed, and specifically that this documentation is archived correctly within every patient file. The Corporation has conducted several staff trainings and has revised its review procedures for checking compliance to improve monitoring of the process by the Corporation.