Finding Text
2022-02: Significant Deficiency ? Program income compliance and controls Federal Agency: Department of Health and Human Services Program: Certified Community Behavioral Health Clinic Demonstration Grant Assistance Listing Number: 93.829 Criteria In accordance with the NoA, ?Recipients will add program income to funds committed to the project to further eligible project objectives.? Condition Flushing did not have a formal control in place to identify, monitor and report program income collected from providing mental health counseling services to patients under the Certified Community Behavioral Health Clinic Demonstration Grant (?Demonstration Grant?). Questioned Costs During the year ended December 31, 2022, Flushing collected program income of $58,039 from billings related to mental health counseling services provided under the Demonstration Grant. Management did not use program income to further eligible project objectives of the Demonstration Grant. However, the Demonstration Grant?s budget included $165,114 of allowable indirect costs over the award period (May 1, 2020 through December 3, 2022), for which Flushing did not request reimbursement. Cause The Demonstration Grant is Flushing?s only grant that includes a program income compliance requirement. Management?s inexperience with this compliance requirement led to the failure to identify the program income compliance requirement. As a result, Flushing did not design and implement controls over program income. Effect Management did not have a control in place to ensure compliance with the program income requirement of the Demonstration Grant and did not add the program income funds collected during the year ended December 31, 2022 to funds committed to further eligible project objectives, as required by the NoA. Recommendation We recommend Flushing design and implement formal controls around the program income compliance requirement for the Demonstration Grant. Specifically, we recommend management?s controls include performing the following activities on an ongoing basis: (1) Review patient-level program income reports for completeness and accuracy to ensure only patients that received counseling services under the Demonstration Grant are included; (2) Maintain documentation supporting how the program income was used to further eligible project objectives; and (3) Ensure review of the information in steps (1) and (2) prior to requesting reimbursement under the Demonstration Grant. We also recommend that Flushing contact HHS to inform them of the noncompliance with the program income requirement during the year ended December 31, 2022. Management?s Views and Corrective Action Plan Management?s Views and Corrective Action Plan is included at the end of this report.