Finding 387474 (2023-001)

Significant Deficiency

Requirement

Questioned Costs

Year

2023

Accepted

2024-03-28

Audit: 299640

Organization: Blue Ridge Healthcare Hospitals, INC (NC)

Auditor: Cliftonlarsonallen LLP

AI Summary

Core Issue: Significant deficiencies in internal controls over compliance with Provider Relief Fund requirements.
Impacted Requirements: Funds must only cover healthcare-related expenses or lost revenues due to coronavirus, but incorrect pricing was used in 27 out of 41 disbursements.
Recommended Follow-Up: Review and correct calculations to ensure accurate pricing and compliance with funding criteria.

Finding Text

Federal Agency: U.S. Department of Health and Human Services Federal Program Title: Provider Relief Funding Assistance Listing Number: 93.498 Award Period: July 1, 2022 through June 30, 2023 Type of Finding: • Significant Deficiency in Internal Control over Compliance • Other Matters Criteria or specific requirement: The Provider Relief Funds were provided under the Coronavirus Aid, Relief, and Economic Security Act (Pub. L. No. 116-136, 134 Stat. 563) and are to be used to prevent, prepare for, and respond to coronavirus and that the funds shall reimburse the recipients only for health care related expenses or lost revenues that are attributable to coronavirus. Condition: During our testing, we noted that the Organization used an incorrect price per unit for 27 of 41 disbursement selections. Questioned costs: $66,582 Context: During our testing, we noted that the Organization used an incorrect price per unit for 27 of 41 disbursement selections. Cause: The Organization's inventory management system was not being updated with the current cost per unit. The expense is based on the purchase order and the inventory was adjusted when the actual invoice was received, however; the inventory adjustment does not get posted to the original line item. Effect: The information in the submission could be incorrect. Recommendation: We recommend the Organization review calculations to ensure that the proper amounts are used. Views of responsible officials: There is no disagreement with the audit finding.

Corrective Action Plan

Department of Health and Human Services BRHC respectfully submits the following corrective action plan for the year ended June 30, 2023. Audit period: July 1, 2022 through June 30, 2023 The findings from the schedule of findings and questioned costs are discussed below. The findings are numbered consistently with the numbers assigned in the schedule. FINDINGS—FEDERAL AWARD PROGRAMS AUDITS U.S. Department of Health and Human Services 2023-001 Provider Relief Funding – Assistance Listing No. 93.498 Recommendation: We recommend the Organization review calculations to ensure that the proper amounts are used. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: Blue Ridge’s inventory system reports item prices based on average purchase price. Blue Ridge’s materials management staff has a process in place to update inventory item prices on an as-needed basis. In the event a price is in error, the issuance price is manually updated with a credit given to the department where expense was incorrectly reported. For future reporting of inventory issuance costs, an additional level of review will be added to validate cost reported are accurate. Name(s) of the contact person(s) responsible for corrective action: Pat Moll, Chief Financial Officer Planned completion date for corrective action plan: 03/27/2024 If the Department of Health and Human Services has questions regarding this plan, please call Pat Moll, CFO at 828-580-5003.

Other Findings in this Audit

387475 2023-001

Significant Deficiency
963916 2023-001

Significant Deficiency
963917 2023-001

Significant Deficiency

Programs in Audit

ALN	Program Name	Expenditures
93.498	Provider Relief Fund	$1.14M