Audit 356367

Finding 2024-003 Special Tests and Provisions Information on Federal Program: Criteria or Specific Requirement (Including Statutory, Regulatory, or Other Citation): Pursuant to OMB Compliance Requirement for Assistance Listing 93.224 Health Center Program Cluster, – Special Tests and Provisions – 1. Sliding Fee Discounts, health centers must prepare and apply a sliding fee discount schedule (“SFDS”) so that the amounts owed for health center services by eligible patients are adjusted (discounted) based on the patient’s ability to pay, family size and income for individuals and families. Conditions: Fifty-one patient visit samples were selected for our internal control and compliance testing over the sliding fee discount program. Testing results noted that following: • For 2 patients, the sliding fee discount applied was incorrect based on their sliding fee application. • For 1 patient, they were never billed for services provided. Questioned Costs: None. Context: Sampling was performed to draw sample selections. See condition above for context of the finding. Effect or Potential Effect: The absence of an appropriate review process may result in MCHWC not being in compliance with grant requirements. Section III – Federal Awards Findings and Questioned Costs (Continued) A. Current Year Findings and Questioned Costs – Major Federal Award Program Audit (Continued) Finding 2024-003 Special Tests and Provisions (Continued) Cause: MCHWC does not have an adequate review process in place to ensure the sliding fee discounts applied are accurately determined and applied. Identification as Repeat Finding, if Applicable: Not applicable. Recommendations: We recommend that MCHWC strengthen its policies and procedures to properly determine, input and document the patient’s eligibility in the program. MCHWC should have a secondary review on the sliding fee application forms and sliding fee discounts applied. We recommend MCHWC establish proper internal controls in reviewing that patient services are billed for patient services provided. View of Responsible Officials and Planned Corrective Actions: MCHWC understands and agrees with the finding. Measures have been taken or will be taken for immediate resolution as follows: a) Sliding fee patients will be scheduled with an enrollment counselor to review options, including sliding fee. b) Sliding fee applications will be reviewed and recommended by the respective clinic manager. c) Sliding fee applications will go through a final approval by the Chief Operations Officer. d) Due to staff limitations, the revenue cycle (billing) team will sample applications through the year.

Finding 2024-004 – Allowable Costs/Cost Principles – Internal Control over Payroll Expenditures Information on Federal Program: Criteria or Specific Requirement (Including Statutory, Regulatory, or Other Citation): Pursuant to OMB Compliance Requirement for Assistance Listing 93.224 Health Center Program Cluster – Allowance Costs/Cost Principles – Payroll, costs charged to federal funds under Health Center Program award funds must comply with the cost principles of 45 CFR part 75, subpart E, and any other requirements or restrictions on the use of federal funding. Conditions: For five out of eight employees selected for testing covering five different payroll pay dates, MCHWC was not able to provide a pay rate change form approved by a personnel in the Human Resources department to support the employees pay rate. Questioned Costs: None. Context: Sampling was performed to draw sample selections. See condition above for context of the finding. Effect or Potential Effect: The lack of internal control over approving pay rate changes charged as payroll expenses to related grants resulted in the inability to test the relative compliance requirements under the grant provision. Cause: MCHWC does not have an adequate process in place to ensure that pay rate changes are properly approved by a personnel in the Human Resources department. Section III – Federal Awards Findings and Questioned Costs (Continued) A. Current Year Findings and Questioned Costs – Major Federal Award Program Audit (Continued) Finding 2024-004 – Allowable Costs/Cost Principles – Internal Control over Payroll Expenditures (Continued) Identification as Repeat Finding, if Applicable: Not applicable. Recommendation: We recommend that MCHWC establish proper internal controls to ensure that pay rate changes are approved by a personnel in the human resources department. View of Responsible Officials and Planned Corrective Actions: MCHWC understands and agrees with the finding. Measures have been taken or will be taken for immediate resolution and the following steps will be implemented: a) Senior Human Resource Staff will prepare Personnel Action Forms. b) Director of Human Resources will review and recommend. c) Payroll Manager will approve.

Finding 2024-003 Special Tests and Provisions Information on Federal Program: Criteria or Specific Requirement (Including Statutory, Regulatory, or Other Citation): Pursuant to OMB Compliance Requirement for Assistance Listing 93.224 Health Center Program Cluster, – Special Tests and Provisions – 1. Sliding Fee Discounts, health centers must prepare and apply a sliding fee discount schedule (“SFDS”) so that the amounts owed for health center services by eligible patients are adjusted (discounted) based on the patient’s ability to pay, family size and income for individuals and families. Conditions: Fifty-one patient visit samples were selected for our internal control and compliance testing over the sliding fee discount program. Testing results noted that following: • For 2 patients, the sliding fee discount applied was incorrect based on their sliding fee application. • For 1 patient, they were never billed for services provided. Questioned Costs: None. Context: Sampling was performed to draw sample selections. See condition above for context of the finding. Effect or Potential Effect: The absence of an appropriate review process may result in MCHWC not being in compliance with grant requirements. Section III – Federal Awards Findings and Questioned Costs (Continued) A. Current Year Findings and Questioned Costs – Major Federal Award Program Audit (Continued) Finding 2024-003 Special Tests and Provisions (Continued) Cause: MCHWC does not have an adequate review process in place to ensure the sliding fee discounts applied are accurately determined and applied. Identification as Repeat Finding, if Applicable: Not applicable. Recommendations: We recommend that MCHWC strengthen its policies and procedures to properly determine, input and document the patient’s eligibility in the program. MCHWC should have a secondary review on the sliding fee application forms and sliding fee discounts applied. We recommend MCHWC establish proper internal controls in reviewing that patient services are billed for patient services provided. View of Responsible Officials and Planned Corrective Actions: MCHWC understands and agrees with the finding. Measures have been taken or will be taken for immediate resolution as follows: a) Sliding fee patients will be scheduled with an enrollment counselor to review options, including sliding fee. b) Sliding fee applications will be reviewed and recommended by the respective clinic manager. c) Sliding fee applications will go through a final approval by the Chief Operations Officer. d) Due to staff limitations, the revenue cycle (billing) team will sample applications through the year.

Finding 2024-004 – Allowable Costs/Cost Principles – Internal Control over Payroll Expenditures Information on Federal Program: Criteria or Specific Requirement (Including Statutory, Regulatory, or Other Citation): Pursuant to OMB Compliance Requirement for Assistance Listing 93.224 Health Center Program Cluster – Allowance Costs/Cost Principles – Payroll, costs charged to federal funds under Health Center Program award funds must comply with the cost principles of 45 CFR part 75, subpart E, and any other requirements or restrictions on the use of federal funding. Conditions: For five out of eight employees selected for testing covering five different payroll pay dates, MCHWC was not able to provide a pay rate change form approved by a personnel in the Human Resources department to support the employees pay rate. Questioned Costs: None. Context: Sampling was performed to draw sample selections. See condition above for context of the finding. Effect or Potential Effect: The lack of internal control over approving pay rate changes charged as payroll expenses to related grants resulted in the inability to test the relative compliance requirements under the grant provision. Cause: MCHWC does not have an adequate process in place to ensure that pay rate changes are properly approved by a personnel in the Human Resources department. Section III – Federal Awards Findings and Questioned Costs (Continued) A. Current Year Findings and Questioned Costs – Major Federal Award Program Audit (Continued) Finding 2024-004 – Allowable Costs/Cost Principles – Internal Control over Payroll Expenditures (Continued) Identification as Repeat Finding, if Applicable: Not applicable. Recommendation: We recommend that MCHWC establish proper internal controls to ensure that pay rate changes are approved by a personnel in the human resources department. View of Responsible Officials and Planned Corrective Actions: MCHWC understands and agrees with the finding. Measures have been taken or will be taken for immediate resolution and the following steps will be implemented: a) Senior Human Resource Staff will prepare Personnel Action Forms. b) Director of Human Resources will review and recommend. c) Payroll Manager will approve.