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
Finding Type - Material weakness and material noncompliance with laws and regulations
Repeat Finding - No
Criteria - Per the Provider Relief Fund, General and Targeted Distribution Post-Payment Notice 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 expense reporting and the lost revenue calculations.
Questioned Costs - None
Context - The reporting submission for period 2 applied the same Other Provider Relief Fund Expenses to PRF payments that were previously input and applied to payments reported on HealthSource's reporting submission for period 1. Additionally, 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 in period 1. Additionally, the budgeted amounts used in the submission for all quarters of 2021 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.