Finding 50281 (2022-001)

Significant Deficiency
Requirement
I
Questioned Costs
-
Year
2022
Accepted
2023-02-26
Audit: 53786
Auditor: Forvis LLP

AI Summary

  • Core Issue: The Hospital failed to verify that vendors were not suspended or debarred before making purchases with federal funds.
  • Impacted Requirements: This violates the Hospital's own policy and federal regulations regarding suspended and debarred vendors.
  • Recommended Follow-Up: The Hospital should educate staff on the policy and conduct an annual review to align with Uniform Guidance.

Finding Text

Rural Health Care Services Outreach, Rural Health Network Development and Small Health Care Provider Quality Improvement Federal Assistance Listing No. 93.912 U.S. Department of Health and Human Services Award No. 1 G29RH43316-01-00 Program Year 2022 Criteria or Specific Requirement ? Suspension and Debarment ? 2 CFR 180 Condition ? The Hospital did not follow its policy governing suspended and debarment requirements for the purchase of goods or services charged to federal awards. Specifically, the Hospital did not verify that vendors were not suspended, debarred, or otherwise excluded. Questioned Costs ? None Context ? A sample of one procurement was tested out of a population of seven procurements totaling $512,220. The sample was not, and is not intended to be, statistically valid. For the procurement tested, totaling $264,830, it was determined the Hospital did not follow it?s procurement policy for vendor selection, specifically it did not ensure vendors were not suspended, debarred, or otherwise excluded. Effect ? Purchases were made that did not adhere to the Hospital?s suspended and debarment policy. Cause ? The Hospital did not comply with their federal suspended and debarment policy. Identification as a Repeat Finding ? Not a repeat finding. Recommendation ? The Hospital should review its suspended and debarment policy and ensure proper staff education on the policy is established. In addition, the Hospital should review the policy on an annual basis to ensure it is consistent with the Uniform Guidance.

Corrective Action Plan

Views of Responsible Officials and Planned Corrective Actions ? Citizens Memorial Hospital District (?CMH?) has developed and implemented a policy within its Grants Management Department to apply the above recommended corrective action. The purpose of this internal process is to inspect potential vendors, suppliers, organizations, individuals, or other entities who may be partnered or contracted with CMH and may receive state or federal grant funding. Although spearheaded by the Grants Management Department, this process includes several departments within the CMH organization. Steps for the grant funded vendor procurement process include: 1) Any CMH department that has received grant funding requests purchase orders through established purchase order processes and includes the Grant Management Department in the request. 2) Prior to purchase approval, all vendors, companies, entities, or individuals who may receive state or federal funds are vetted against the latest Exclusions List found on www.sam.gov by the Grants Management Department. 3) A master log sheet that includes the time, date, vendor name, and screen shot of the exclusion list query is updated before every purchase and kept by the Grants Management department. 4) All departments responsible for procurement within normal CMH purchasing processes (Materials Management, Hospital/Foundation Finance, IS) have been trained to include the grant funded vendor procurement process before any transactions move forward in the purchasing process. 5) The Grants Management Department will provide final approval/disapproval on all purchases made with state or federal grant funding to the appropriate department head. 6) Final approval to disperse grant funds is made in collaboration with the hospital/foundation finance department after purchase order requests have already gone through established internal purchasing processes and received approval from the Grants Management Department. All processes were developed in order to formalize compliance according to 2CFR 180 guidelines. The internal processes which had led to an oversight of a vendor within the RHC Services Outreach and RH Network Development grant has been remediated. The CMH grant related procurement process includes investigation before purchases are made (such as vetting several vendors from whom CMH received quotes) and after a purchase order has been approved (i.e. when a vendor has been chosen but has not yet been paid). This safety net has been put in place in order to ensure compliance continuity for all purchases and process integrity. Contact person: Christina Bravata Director of Grants Management Citizens Memorial Hospital 1500 N. Oakland Ave. Bolivar, MO 65613 Christina.Bravata@citizensmemorial.com 417-328-7571 Anticipated completion date of Corrective Action Plan: Processes have been implemented as of September, 2022.

Categories

Procurement, Suspension & Debarment

Other Findings in this Audit

  • 626723 2022-001
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
93.498 Provider Relief Fund $14.40M
93.697 Covid-19 Testing for Rural Health Clinics $1.09M
93.461 Covid-19 Testing for the Uninsured $844,453
93.912 Rural Health Care Services Outreach, Rural Health Network Development and Small Health Care Provider Quality Improvement $841,529