Finding Text
Assistance Listing Number, Federal Agency, and Program Name 93.498, U.S. Department of Health and Human Services, COVID 19: Provider Relief Fund and American Rescue Plan Rural Distribution
Finding Type Material weakness and material noncompliance with laws and regulations
Repeat Finding Yes
Prior year finding number 2021 004
Criteria Per the Provider Relief Fund, General and Targeted Distribution Post Payment Norice of Reporting Requirements, dated June 11, 2021, expenses that are paid for with General and Targeted PRF payments must be those that are unreimbursed by other sources and that other sources are not obligated to reimburse. Additionally, recipients may choose to apply PRF payments toward lost revenue using one of three options, up to the amount:
Option i: of the difference between actual patient care revenue;
Option ii: of the difference between budgeted (prior to March 27, 2020) and actual patient care revenue; or
Option iii: calculated by any reasonable method of estimating revenue.
Condition HealthSource's controls in place for reporting submissions did not identify that guidelines were not followed related to the lost revenue calculations.
Questioned Costs None
Context The reporting submission for lost revenue did not follow the acceptable options provided by the Department of Health and Human Services. Recipients may choose to apply Provider Relief Fund payments toward lost revenue using one of three options: (i) up to the amount of the difference between actual patient care revenue, (ii) up to the amount of the difference between budgeted (if approved prior to March 27, 2020) and actual patient care revenue, or (iii) up to the amount calculated by any reasonable method of estimating revenue. HealthSource used option ii to calculate lost revenue but reported an incorrect total of budgeted and actual revenue in one of the quarters included in the submission. If HealthSource had reported the accurate actual and budgeted revenue amount, it would still have qualified to recognize all PRF payments received. Additionally, the budgeted amounts used in the submission for all quarters of 2021 and 2022 were not approved by March 27, 2020; therefore, option ii was not allowable. HealthSource should have used option iii to report lost revenue.
Cause and Effect Appropriate review of the reporting submission was not completed to ensure the report followed the required guidelines. As a result, the report submitted was inaccurate.
Recommendation We recommend HealthSource implement controls, including levels of review, to ensure reports are completed and submitted in accordance with guidelines established by HHS.
Views of Responsible Officials and Planned Corrective Actions Management agrees with the finding and all future submissions will be reviewed by the chief executive officer and the president for accuracy and thoroughness prior to submission upload.