Finding 1222792 (2025-003)

Program Income Federal Department – U.S. Department of Health and Human Services Pass-through Chicago Department of Public Health and AIDS Foundation of Chicago Federal Award Identification Number(s) and Year(s): H8900008 and 2025 H89HA00008 and 2023 HIV Emergency Relief Program Grants, Federal Assistance Listing #93.914 County Department –Cook County Health (CCH) Finding 2025 – 003 CRITERIA Per the U.S Department of Health and Human Services, Health Resources & Services Administration (HRSA) Policy Clarification Notice # 15-03, Clarification Regarding the Ryan White HIV/AIDS Program (RWHAP) and Program Income, Grant Policy Update 9/15/2025, states that in the context of the RWHAP, program income is most commonly generated by recipients and subrecipients as a result of charging for services and receiving payment from third-party reimbursement. Under the uniform administrative requirements, to the extent available, recipients and subrecipients must disburse funds available from program income, rebates, refunds, contract settlements, audit recoveries and interest earned on such funds before requesting additional cash payments. Also, recipients are required to track and account for all program income in accordance with 2 CFR § 200.302(b)(3). Additionally, it is the responsibility of the recipient to monitor and track program income earned by subrecipients. Subrecipients should retain program income for “additive” use within their own programs. 2 CFR Part 200.307, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, Program income. (a) General. The recipient or subrecipient is encouraged to earn income to defray program costs when appropriate. Program income must be used for the original purpose of the Federal award. Program income earned during the period of performance may only be used for costs incurred during the period of performance or allowable closeout costs. See § 200.472(b). Program income must be expended prior to requesting additional Federal funds. Program income exceeding amounts specified in the Federal award may be added to or deducted from the total allowable costs in accordance with the terms and conditions of the Federal award. CONDITION During the current audit period, Cook County Health (CCH) did not comply with federal regulations regarding the use and reporting of program income as it relates to funds awarded through the RWHAP. CAUSE Based on discussions with management, the HIV grants transitioned to CCH from an external organization in July 2025. Award amounts were granted in multiple phases, requiring four budget revisions, with the final revision approved in December 2025. The contractual period covered March 2025 through December 2025. During the transition period, CCH lacked formal operational procedures to identify, record, and track program income, as well as several operational and administrative challenges which contributed to this issue. EFFECT Failure to adequately track and report program income is a violation of Federal regulations and could result in the return of funds to the Federal government. QUESTIONED COSTS None. CONTEXT Based on initial discussions with CCH management, the RWHAP did not generate any program income during the period from December 1, 2024 to November 30, 2025. However, during our review of patient’s eligibility documentation, we noted certain participants insurance were billed for services performed under the federal program, thereby representing payments received from third-party reimbursements. Consequently, CCH was able to provide a patient payment report showing HIV diagnosis via its Invision and CPA Cerner systems which included $2,937,999 in total payments and $47,784 in total patient payments received during the period. We noted this information was not reported as program income to the two grantor agencies during the period ended November 30, 2025. IDENTIFICATION OF REPEATED FINDINGS None. RECOMMENDATION We recommend that CCH implement written policies and procedures to ensure that program income is tracked and monitored to ensure accurate reporting to its grantor agencies. Also, procedures should be in place to properly allocate all program income to the RWHAP and to ensure that future funds disbursed from available program income are utilized for eligible program activities prior to requesting any additional reimbursement (cash payments) from the grantor agencies as required by 2 CFR Part 200.307. VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTIONS The County agrees with the finding and recommendation. The County’s corrective action plan is on pages 46-47.