Finding Text
Finding 2022-002 ? Reporting Identification of the federal program: Federal Grantor: United States Department of Health and Human Services (HHS), Health Resources and Services Administration (HRSA) Assistance Listing No.: 93.498, COVID-19 Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution Provider Relief Fund Reporting Entity: Northwestern Memorial HealthCare Group Tax Identification Number (TIN): 364724966 Period of Availability: 01/01/2020?06/30/2022 (Period 3) Criteria or Specific Requirement (Including Statutory, Regulatory, or Other Citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework,? issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the award require the recipient to submit reports as the secretary of HHS determines are needed to ensure compliance with the conditions that are imposed on the payment, and such reports shall be in such form, with such content, as specified by the secretary of HHS in future program instructions directed to all recipients. Condition: The amounts reported for net patient service revenue (NPSR) by payer for calendar year 2022 Quarter 1 (Q1 2022) and Quarter 2 (Q2 2022) were incorrect for Commercial Insurance and Medicare A+B for Northwestern Memorial HealthCare Group TIN?s Period 3 Provider Relief Fund (PRF) Report. Cause: Management?s review of out-of-period adjustments made to NPSR was not sufficiently precise to detect that the incorrect amounts were included in management?s lost revenue calculation workbook used to prepare the Period 3 PRF Report for Northwestern Memorial HealthCare Group?s reporting TIN. Effect or potential effect: NPSR by payer was incorrectly reported for Q1 2022 and Q2 2022 for Commercial Insurance and Medicare A+B. The total NPSR was correct as reported, and there was no impact on resulting lost revenues. Questioned costs: None. Context: We tested five of 10 Periods 2 and 3 PRF Reports submitted to HRSA. For one of the five reports tested, the NPSR amounts reported by payer for two of the six financial classes were incorrect for Q1 2022 and Q2 2022 for Northwestern Memorial HealthCare Group?s reporting TIN as follows: Total Revenue/Net Changes from Patient Care (2022 Actuals) ? As Reported (See Schedule of Findings and Questioned Costs for chart/table) Total Revenue/Net Changes from Patient Care (2022 Actuals) ? Corrected (See Schedule of Findings and Questioned Costs for chart/table) Total Revenue/Net Changes from Patient Care (2022 Actuals) ? Increase/(Decrease) (See Schedule of Findings and Questioned Costs for chart/table) There was no impact on lost revenues reported for these quarters. Federal expenditures for Assistance Listing 93.498 totaled $199,865,192 for the year ended August 31, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The Company should ensure that internal controls over the review of PRF Reports are enhanced to include sufficient precision to allow for accurate reporting of NPSR by payer. Views of responsible officials: While there was no impact on lost revenues reported in the Northwestern Memorial HealthCare Group?s TIN Period 3 PRF Report, we agree that the amounts used for out-of-period adjustments were incorrect. Going forward, we will provide additional peer review of PRF Reports to confirm accuracy.