Audit 896

Finding No. 2023-001 – Activities Allowed or Unallowed and Allowable Costs – Significant Deficiency in Internal Control Over Compliance. Identification of the federal program: Federal Grantor: United States Department of Health and Human Services (HHS), Health Resources and Services Administration (HRSA). Assistance Listing No.: 93.498, COVID-19 Provider Relief Fund (PRF) and American Rescue Plan (ARP) Rural Distribution. Award Numbers: Not applicable. Award Period of Performance: 07/01/2022–06/30/2023. Criteria or Specific Requirement (Including Statutory, Regulatory, or Other Citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: “The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).” Specific program terms and conditions established by HHS state that amounts received are to be used to prevent, prepare for, and respond to coronavirus, domestically or internationally, for necessary expenses to reimburse, through grants or other mechanisms, eligible health care providers for health care related expenses or lost revenues that are attributable to coronavirus. Further the terms and conditions state that funds may not be used to reimburse expenses or losses that have been reimbursed from other sources or that other sources are obligated to reimburse and charges to the PRF must be necessary, reasonable, accorded consistent treatment, and conform to the limitations and exclusions of the terms and conditions of the award. Lastly, Providers who received one or more PRF payments exceeding $10,000, in the aggregate per respective reporting period are required to report on their use of funds within the PRF reporting portal. Condition: Management developed a robust process to identify and review the appropriateness of identified amounts of qualifying health care-related expenses incurred throughout the period of availability. During our testing of such controls in place for this program, we were unable to inspect evidence to support the consistent operation of these controls as documentation of the performance of certain controls was not consistently retained. Cause: In certain instances, support that would allow us to inspect evidence as to the consistent operating effectiveness and precision included in the controls was not retained. Questioned costs: None. Context: The total combined qualifying health care-related expenses throughout the period of availability submitted to HRSA’s PRF Reporting Portal amounted to $4,921,015. We selected 60 expenditures totaling $78,461 for testing. We did not identify any instances of noncompliance in the sample we tested. Effect or potential effect: Potential effects include inappropriate amounts of qualifying health care-related expenses that could impact the complete and accurate reporting of such amounts submitted to HRSA’s PRF Reporting Portal and reimbursement for unallowable expenses or for services provided to ineligible patients. Identification as a repeat finding, if applicable: The finding is a repeat finding of Finding 2022-001 in the prior year. Recommendation: Management should retain sufficient appropriate evidence to support the level of precision at which the controls were carried out as designed throughout the fiscal period under audit for amounts qualifying as health care-related expenses in accordance with the terms of the federal program during the period under audit. Views of responsible officials: Management concurs with this finding. See management’s separate Corrective Action Plan.

Finding No. 2023-001 – Activities Allowed or Unallowed and Allowable Costs – Significant Deficiency in Internal Control Over Compliance. Identification of the federal program: Federal Grantor: United States Department of Health and Human Services (HHS), Health Resources and Services Administration (HRSA). Assistance Listing No.: 93.498, COVID-19 Provider Relief Fund (PRF) and American Rescue Plan (ARP) Rural Distribution. Award Numbers: Not applicable. Award Period of Performance: 07/01/2022–06/30/2023. Criteria or Specific Requirement (Including Statutory, Regulatory, or Other Citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: “The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).” Specific program terms and conditions established by HHS state that amounts received are to be used to prevent, prepare for, and respond to coronavirus, domestically or internationally, for necessary expenses to reimburse, through grants or other mechanisms, eligible health care providers for health care related expenses or lost revenues that are attributable to coronavirus. Further the terms and conditions state that funds may not be used to reimburse expenses or losses that have been reimbursed from other sources or that other sources are obligated to reimburse and charges to the PRF must be necessary, reasonable, accorded consistent treatment, and conform to the limitations and exclusions of the terms and conditions of the award. Lastly, Providers who received one or more PRF payments exceeding $10,000, in the aggregate per respective reporting period are required to report on their use of funds within the PRF reporting portal. Condition: Management developed a robust process to identify and review the appropriateness of identified amounts of qualifying health care-related expenses incurred throughout the period of availability. During our testing of such controls in place for this program, we were unable to inspect evidence to support the consistent operation of these controls as documentation of the performance of certain controls was not consistently retained. Cause: In certain instances, support that would allow us to inspect evidence as to the consistent operating effectiveness and precision included in the controls was not retained. Questioned costs: None. Context: The total combined qualifying health care-related expenses throughout the period of availability submitted to HRSA’s PRF Reporting Portal amounted to $4,921,015. We selected 60 expenditures totaling $78,461 for testing. We did not identify any instances of noncompliance in the sample we tested. Effect or potential effect: Potential effects include inappropriate amounts of qualifying health care-related expenses that could impact the complete and accurate reporting of such amounts submitted to HRSA’s PRF Reporting Portal and reimbursement for unallowable expenses or for services provided to ineligible patients. Identification as a repeat finding, if applicable: The finding is a repeat finding of Finding 2022-001 in the prior year. Recommendation: Management should retain sufficient appropriate evidence to support the level of precision at which the controls were carried out as designed throughout the fiscal period under audit for amounts qualifying as health care-related expenses in accordance with the terms of the federal program during the period under audit. Views of responsible officials: Management concurs with this finding. See management’s separate Corrective Action Plan.