Audit 372059

COVID-19 Provider Relief Fund Federal Assistance Listing Number 93.498 U.S. Department of Health and Human Services Criteria or Specific Requirement: Reporting (45 CFR 75.342) and Activities Allowed/Unallowed and Allowable Costs/Cost Principles (Pub. L. No. 116-136, 134 Stat. 563 and Pub. L. No. 116-139, 134 Stat. 622 and 623) Condition: The District is required to prepare and submit period one provider relief fund report to the U.S. Department of Health and Human Services. This report is to be prepared using accurate financial information and submitted by the deadline established. Questioned costs: Unknown Context: The period one provider relief fund report was tested. The District selected option 2 to report lost revenues based on quarterly gross patient service revenue by department in comparison to budgeted gross patient service revenue. A material error in the calculation of the patient service revenue for the quarters reported was identified. Additionally, budgets were not reviewed and approved by the board within the required timeline. Finally, there was no documented review and approval of the reporting prior to submission. Effect: Errors were made in reporting quarterly total revenue/net charges from patient care. Lost revenue was not accurately reported. Cause: Internal controls over compliance were not in place to ensure the District properly calculated lost revenue including a lack of documented approval by management of the reporting prior to submission. Identification as a repeat finding: Not a repeat finding. Recommendation: Policies and procedures over federal grant reporting should be modified to ensure reports are prepared using complete and accurate information. Views of responsible officials and planned corrective actions: See attached corrective action plan for the District’s response to finding.

COVID-19 Provider Relief Fund Federal Assistance Listing Number 93.498 U.S. Department of Health and Human Services Criteria or Specific Requirement: Reporting (45 CFR 75.342) and Activities Allowed/Unallowed and Allowable Costs/Cost Principles (Pub. L. No. 116-136, 134 Stat. 563 and Pub. L. No. 116-139, 134 Stat. 622 and 623) Condition: The District is required to prepare and submit period one provider relief fund report to the U.S. Department of Health and Human Services. This report is to be prepared using accurate financial information and submitted by the deadline established. The funds cannot be used for expenses reimbursed or obligated to be reimbursed by other sources. Questioned costs: Approximately $1,217,000. Questioned costs were estimated by applying the error percentages separately for construction related expenditures and non-construction related expenditures to the related populations. Construction related claimed expenditures totaled $1,214,061 with one error noted of $1,124,595. Other claimed expenditures not related to construction totaled $467,154 with six errors noted amounting to $36,444. Context: The period one provider relief fund report was tested. The District was unable to provide supporting documentation to support all of the $467,154 expenditures not related to construction claimed on the period one reporting. Additionally, the District claimed expenditures for construction in the amount of $1,214,061 which included amounts that were not completed as of the end of the covered period. Finally, there was no documented review and approval of the reporting prior to submission. Effect: The District submitted expenses under the PRF program for which adequate support could not be provided. Cause: The guidance provided by HHS to providers across the country as to how to report their COVID-19-related expenses and lost revenues is, at times, difficult to comprehend and apply. Internal controls were not in place to ensure the District correctly applied the guidance including a lack of documented approval by management of the reporting prior to submission. Identification as a repeat finding: Not a repeat finding. Recommendation: Management should ensure proper internal controls are put into place to ensure that allowable expenses reported are properly supported and in accordance with program terms. Views of responsible officials and planned corrective actions: See attached corrective action plan for the District’s response to finding.