Finding Text
Finding 2022-005 Identification of the federal program: Federal Agency: U.S. Department of Health and Human Services (HHS) Health Resources and Services Administration (HRSA) Assistance Listing: 93.498 COVID-19 Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution Criteria or specific requirement (including statutory, regulatory or other citation): 2 CFR 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).? The terms and conditions of the award require the recipient to submit reports to the secretary of HHS for each reporting period to ensure compliance with conditions that are imposed on the payment, and such report shall be in such form, with such content, as specified by the sectary of HHS in program instructions directed to all recipients. Condition: Management did not have sufficiently designed internal controls over the review and approval of PRF reports submitted in the HRSA PRF portal. Management did not retain the supporting documentation for each payer amount reported for net patient service revenue (NPSR) by payer for Q3 (2021), Q4 (2021), Q1 (2022) and Q2 (2022). However, support was maintained over the total NPSR by quarter. Cause: Management represented they performed a review and approved HRSA PRF portal submission prior to submitting; however, supporting documentation to evidence that the internal controls were sufficiently designed and operating effectively was not maintained. Management represented they tied out NPSR by payer by quarter to the underlying patient billing systems. However, Management only retained screen prints of the underlying data and was unable to obtain the underlying detail to support the reports used in Management?s tie out. Effect or potential effect: A lack of internal controls over the review of the data submitted in the HRSA PRF portal could result in a misstatement of the amounts reported in the HRSA PRF portal. NPSR by payer could be incorrectly reported. Questioned costs: Not applicable Context: There was a total of three HRSA PRF portal submissions for the year ended September 30, 2022, and seven underlying entity lost revenue calculations. Management did not maintain sufficient documentation over the review and approval of PRF reports submitted to the HRSA PRF portal. We tested five of seven entities? lost revenue calculations that were included in the three HRSA PRF portal submissions. For the five entities, we obtained Management?s supporting documentation of Total Revenue/Net Charges from Patient Care (NPSR) in the HRSA PRF portal submission. We reperformed Management?s tie out of NPSR by payer to Management?s support. However, we were unable to corroborate Management?s support by agreeing NPSR to Management?s underlying patient billing systems. We were able to corroborate Total Revenue/Net Charges from Patient Care. There was no impact to lost revenue reported for Q3 (2021), Q4 (2021), Q1 (2022) and Q2 (2022). Total PRF expenses reported on the SEFA for the year ended September 30, 2022, are $17,594,918. Identification as a repeat finding: Partial repeat of finding 2021-004 Recommendation: Management should implement internal controls over the review and approval of the HRSA PRF report of lost revenue on the HRSA PRF portal. Management should maintain sufficient documentation over their lost revenue calculations by NPSR by payer. Views of responsible officials: Management agrees with the finding. Management will enhance its maintained documentation over lost revenue calculations to the required level of detail and also include evidence of internal controls over review and approval of amounts reported on the HRSA PRF portal.