Finding Text
Identification: 93.498 United States Department of Health and Human Services, Provider Relief Fund and American Rescue Plan Rural Distribution; Noncompliance Finding/Significant Deficiency; Activities Allowed or Unallowed and Allowable Costs/Cost Principles Compliance Requirements
Criteria: Provider Relief Fund (PRF) and American Rescue Plan Rural Distribution (ARPA) was established under the Coronavirus, Aid, Relief, and Economic Security Act (Pub. L. No. 116‐136, 134 Stat. 563), the Coronavirus Relief and Response Supplemental Appropriations Act (Pub. L. No. 116‐260), and the American Rescue Plan Act of 2021 (Pub. L. No. 117‐2). The PRF and ARPA funds are to be used to prevent, prepare for, and respond to coronavirus. The PRF and ARPA funds are to be used to reimburse recipients only for health care related expenses or lost revenues that are attributable to coronavirus. The PRF and ARPA funds may not be used to reimburse expenses or losses that have been reimbursed by other sources or that other sources are obligated to reimburse.
Condition: The Medical Center did not meet the requirement that the ARPA funds be used to reimburse
expenses that have not been reimbursed by other sources or that other sources are obligated to reimburse.
Cause: The Medical Center's spreadsheet for tracking federal grant expenditures for PRF and ARPA included an account that contained COVID‐19 testing expenses that were also included in the cost per test for the expenditures claimed for the Rural Health Clinic Testing and Mitigation (RHC T&M) grant (Assistance Listing 93.967) for the years ended September 30, 2023 and 2022.
Effect: The Medical Center included $48,665 of Cepheid COVID‐19 testing costs as ARPA expenditures. The Cepheid expenditures were also included in the RHC T&M grant expenditures average cost per test. In addition, the Medical Center included $160,292 of COVID‐19 testing costs for tests processed by an external vendor. These expenditures were part of the average cost per test used in the determination of the RHC T&M grant expenditures. The Medical Center did not specifically identify where these expenditures were posted in the general ledger or identify specific invoices associated with these tests for the RHC T&M grant.
Questioned costs: $208,957. The Medical Center had unused lost revenues of $902,410 from the PRF Period 1 reporting submission that carried forward for availability of use for Period 4 reporting for PRF and ARPA funds. The Medical Center had findings reported on the Schedule of Findings and Questioned Costs for the year ended September 30, 2021, related to the Period 1 reporting submission that had a net increase to unused lost revenues of $1,228,594, for total unused lost revenues of $2,131,004 available. After consideration of the questioned costs, the Medical Center has $1,922,047 of unused lost revenues.
Perspective information: In the sample of 51, there were seven instances noted from the sample that were identified as known or likely duplicated expenditures. Extrapolation was not necessary as the instances were isolated to two vendors. We were able to identify in the complete population the expenditures claimed for these vendors. The sample was a statistically valid sample.
Repeat finding: N/A
Recommendations: We recommend policies and procedures over federal grant reporting be strengthened to ensure expenditures are not already included for another grant and that only amounts not reimbursed by other sources or obligated to be reimbursed by other sources are included.
Views of Responsible Officials: The Medical Center agrees with this finding. The Medical Center has fully expended federal funds from all grant programs as of September 30, 2023. The Medical Center does not anticipate receiving future federal grants. If future federal grants are received, controls will be added to verify allowable expenditures are for items that have not already been reimbursed by other sources.