In relation to Family Health Center of San Diego’s annual financial statement audit and the single audit for the year ended June 30, 2025, the Health Center hereby submits a corrective action plan, as required by Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements,...
In relation to Family Health Center of San Diego’s annual financial statement audit and the single audit for the year ended June 30, 2025, the Health Center hereby submits a corrective action plan, as required by Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, Section 511 Audit findings follow-up. 2025-001 – Special Tests and Provisions (Sliding Fee Discounts) Information on the Federal Program: Assistance Listing Number(s): 93.224, 93.527 Federal Program Name: Health Center Program Cluster Federal Agency: U.S. Department of Health and Human Services Pass-Through Entity: Direct Program Federal Award Number and Award Year: 5 H80CS00224‐23‐00 – 2023-2024 5 H80CS00224‐24‐00 – 2024-2025 Criteria: In accordance with the Health Resources & Services Administration Health Center Program Compliance Manual, Chapter 9: Sliding Fee Discount Program, health centers must prepare and apply a sliding fee discount schedule so that amounts owed for health center services by eligible patients are adjusted based on the patients’ ability to pay. In accordance with 42 CFR 56.303, health centers must have a schedule of fees or payments for the provision of their health services consistent with locally prevailing rates or charges and designed to cover their reasonable costs of operation. They are also required to have a corresponding schedule of discounts applied and adjusted based on the patient’s ability to pay. The patient’s ability to pay is determined based on the official poverty guidelines, as revised annually by U.S. Department of Health and Human Services (HHS). The schedule of discounts must provide for a full discount to individuals and families with annual incomes at or below those set forth in the most recent poverty income guidelines (except that nominal fee for service may be collected from such individuals and families) and for no discount to individuals and families with annual incomes greater than twice those set forth in such guidelines. Condition and Context: The Health Center determines the sliding fee discount charged to the patients based on their annual gross income and household size. During our testing of sliding fee discount, we noted the following: • Four (4) out of 60 encounters selected were given a sliding fee discount in an amount that did not match the recalculated sliding fee discount based on annual gross income and household size per the sliding fee policy. There was a total of 65,495 encounters and the sample procedures were not statistical. Questioned Costs: None. 2025-001 – Special Tests and Provisions (Sliding Fee Discounts) (Continued) Cause: During a system transition period, monitoring controls were ineffective, resulting in documentation variances and system-related issues. Contributing factors included documentation timing differences, manual data entry variances, and previously identified electronic health record system mapping defects affecting fee calculation and form generation. Effect: Patients were given an improper sliding fee discount based on their income and family size. Indication of Repeat Finding: No. Recommendation: We recommend that the Health Center strengthen documentation practices and monitoring procedures related to the Sliding Fee Discount Program, particularly during periods of system or workflow transition. Views of Responsible Officials and Planned Corrective Actions: Management concurs in part with the finding. While isolated documentation variances were identified in a non-statistical sample, management determined the condition was limited in scope, not systemic, and resulted in no questioned costs. The variances were associated with a temporary system transition period and documentation timing issues, not a deficiency in internal controls. Corrective actions were implemented, system issues were resolved, and results were validated through a full-population review. Management will continue ongoing monitoring to ensure sustained compliance. Contact person responsible for corrective action: Ricardo Roman, Chief Financial Officer Anticipated completion date: June 30, 2026