2025-003 Internal Control Over Payroll Charged to Federal Awards Program Information Federal Agency U.S. Department of Health and Human Services Assistance Listing Numbers 93.224 Health Centers Program Cluster Award Numbers H80CS00055, H8GCS48089 Criteria Under 2 CFR 200.303, the auditee is required to establish, document, and maintain effective internal control over federal awards, and under 2 CFR 200.430, compensation charged to federal awards must be supported by records that accurately reflect work performed and provide reasonable assurance that charges are accurate, allowable, and properly allocated. [ ] Compliance Finding [X] Significant Deficiency [ ] Material Weakness Condition During fiscal year 2025, we noted that payroll rates used to charge employees’ compensation to the federal award were not reviewed and approved in accordance with the auditee’s established payroll control process. A sample size of 25 employees included 5 employees for which there was no evidence the rate of pay used was approved by the appropriate level per Clinic policy. Cause The auditee did not consistently perform or retain evidence of the payroll-rate approval for employees whose wages were charged to federal awards due to turnover in payroll personnel and insufficient monitoring. Effect Without evidence that payroll rates were reviewed and approved, there is a reasonable possibility that unallowable, inaccurate, or improperly allocated payroll costs could be charged to the federal award and not be prevented, or detected and corrected, on a timely basis. Questioned Costs No questioned costs were identified as a result of this finding. All wages paid were considered reasonable based on the work performed. Recommendation We recommend the Clinic implement a documented payroll-rate approval process, require evidence of approval before payroll costs are charged to federal awards, periodically review payroll-rate changes, and retain approval documentation as part of the official payroll records. Views of responsible officials and planned corrective action White Bird Clinic agrees with this finding. With the onboarding of a new Director of Human Resources, best practices around payroll documentation have been implemented. This includes individual forms for all wage changes per employee. Approval is documented with Supervisors’ signatures on these forms. The wage form is used to update the payroll system and a final accuracy review is performed by the HR Director to verify the updated rate matches the approved change form. The approved wage forms are securely stored in the Human Resources files.
2025-004 Reporting (repeat of finding 2024-004) Program Information Federal Agency U.S. Department of Health and Human Services Assistance Listing Numbers 93.224 Health Centers Program Cluster Award Numbers H80CS00055, H8GCS48089 Criteria Based on the standards of documentation of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards Subpart D requires the Clinic to retain adequate records and other supporting documentation for reports submitted to awarding agencies under the compliance requirements for reporting. [X] Compliance Finding [ ] Significant Deficiency [X] Material Weakness Condition The Clinic did not maintain sufficient supporting records for the information reported in its calendar year 2024 Uniform Data System (UDS) report. This finding appears to be an isolated incident. Cause The Clinic’s internal controls over compliance did not include adequate controls over the retention of supporting documentation for UDS reports submitted to awarding agencies. Effect The Clinic submitted UDS reports for federal awards that may lack supporting documentation. Amounts reported may not be correct. Questioned Costs None identified. Context Amounts reported in Table 4: Selected Patient Characteristics, Income as a Percent of Poverty Guidelines, Universal Report, Line 6 Column a, Table 5: Staffing and Utilization, Line 8, Column b (clinic visits) and b2 (virtual visits), Table 5: Staffing and Utilization, Line 10a, Column b (clinic visits) and b2 (virtual visits), and Table 8A: Financial Costs Line 17 Column c, Table 8A: Financial Costs, Line 1, Column C and Table 8A, Line 3, Column C did not agree to the supporting documentation. Recommendation We recommend the Clinic maintain documentation supporting reports filed with awarding agencies. If changes to the reported amounts are made, the supporting documentation should be updated and the reason for the change should be documented. Views of responsible officials and planned corrective action White Bird Clinic agrees with this finding. White Bird Clinic had to switch EHRs during 2023 and 2024, which required our Dental, Medical, and Behavioral Health programs to use their own separate EHR to alleviate critical functional and capacity deficiencies that were caused by our previous EHR. This resulted in significantly more complexity when calculating our UDS numbers. The process involved combining all of our patient demographics and accounting for overlapping (duplicate encounters) by hand. This was made all the more difficult by name misspellings and other errors during data entry. Relating to our prior year finding, White Bird Clinic had contracted with a third party to implement a custom population health tool to automate our UDS reporting. The contractor did not meet specified deliverable requirements, so reporting was again done manually, which resulted in the errors. White Bird Clinic has been working to evaluate population health tools to aggregate patient data to provide more accurate UDS and clinical quality reporting. In 2026, through the help of our HCCN, Health Efficient, we contracted with Relevant Health to implement their population health tool to streamline and accurately report our population health and our UDS reporting. The Relevant platform is in use by over 100 FQHCs across the country. This tool will aggregate patient data from each EHR, account for duplicates, and accurately report combined UDS demographics from all our systems. They are very experienced with UDS and UDS+ reporting, so the system is designed to seamlessly provide accurate and consistent UDS metrics and address duplicate clients from multiple EHRs.
2025-005 Special Tests (repeat of finding 2024-005) Program Information Federal Agency U.S. Department of Health and Human Services Assistance Listing Numbers 93.224 Health Centers Program Cluster Award Numbers H80CS00055, H8GCS48089 Criteria OMB 2 CFR 200, Subpart F Compliance Supplement, Part 4, Compliance Requirement N, Special Tests and Provisions states, “Health Centers must prepare and apply a sliding fee discount schedule so that the amounts owed for health center services by eligible patients are adjusted (discounted) based on the patient’s ability to pay.” [X] Compliance Finding [ ] Significant Deficiency [X] Material Weakness Condition During our testing of sliding fee discounts for health center patients qualifying for reduced charge visits, we identified incidents in which the sliding fee applied was not consistent with the entities’ policies based on the patient’s level of income. This finding appears to be a systemic problem. Cause Due to turnover in the billing and admitting staff, there was lack of appropriate training relating to the requirements of the sliding fee system to properly administer the sliding fee program. In addition, the billing software was not properly updated for changes in the sliding fee scale to apply the sliding fees correctly based on the levels supported by the patient applications. Effect Patients may have been granted the incorrect sliding fee adjustment. Questioned Costs None identified. Context A sample size of 25 patients included 12 who did not have the correct sliding fee applied. The misapplied sliding fees were due to lack of current application on file. Recommendation We recommend continued effort in training personnel on applying the appropriate sliding fee discount based on the Clinic’s approved policy and in compliance with the OMB Compliance Supplement requirements. An appropriate level of review should be conducted on patient accounts to ensure proper document retention, application of sliding fee discounts, and thirdparty insurance billing. Views of responsible officials and planned corrective action White Bird Clinic agrees with this finding. White Bird Clinic has created and hired for a new position, Revenue Cycle Manager (RCM). The RCM has oversight of Revenue generated through the FQHC Clinics. As part of this oversight the RCM is implementing training for Front Office staff that are responsible for gathering and inputting client data related to calculation of the Slide. In addition to internal training of Front Office staff, White Bird Clinic will be engaging an external expert to review and revise applicable policies and procedures to ensure alignment with best practices. The RCM is also responsible for conducting periodic internal reviews of documentation supporting Slide calculations to ensure support matches with the calculated Slide rate.