Finding Text
Finding No. 2022?001 ? Activities Allowed or Unallowed, Eligible Uses ? Premium Pay Criteria According to the 31 CFR Subtitle A Part 35 Subpart 35.6 (c)(1) A recipient may use funds to provide premium pay to eligible workers of the recipient who perform essential work or to provide grants to eligible employers that have eligible workers who perform essential work, eligible workers performing essential work during the COVID-19 public health emergency. A recipient uses premium pay or grants provided to eligible workers performing essential work during the COVID-19 public health emergency if: (1) The eligible worker's total wages and remuneration, including the premium pay, is less than or equal to 150 percent of the greater of such eligible worker's residing State's or county's average annual wage for all occupations as defined by the Bureau of Labor Statistics' Occupational Employment and Wage Statistics. Condition During our examination, we noted six (6) instances, which based on the regulation previously indicated, the premium pay was paid to employees whom wages are higher than the 150 percent of the Puerto Rico median annual wage of $30,750. Cause As part of the eligibility criteria to provide Premium Pay, the Administration did not consider the eligible worker?s wages criteria as eligibility requirement in the Premium Pay distribution to employees. The Administration indicates they did not consider these criteria because the Puerto Rico Health Department was exempt of this requirement and as part of this agency, they believe to be exempt too. Effect As a result of this condition, the U.S. Department of Treasury may request the return of funds, issue warnings and/or impose penalties to the Administration. Questioned Cost The known questioned cost was calculated by the amount disbursed ($2,000) to the ineligible employees (185) is equal to $370,000. Context Of the 1,471 employees that received the Premium Pay, we selected 37 employees for testing and noted six (6) instances of noncompliance. When we assessed the entire population the total number of cases amounted to one hundred eighty-five (185) employees that exceed the allowed salary to receive the Premium Pay. Identification of a Repeat Finding This is not a repeat finding from the immediate previous audit. Recommendation The management of the Puerto Rico Medical Services Administration should reinforce its procedures of the administration of federal funds to ensure the compliance with the requirements with each program. Also, the Administration should establish communication with the Health Department of Puerto Rico in order to obtain instructions for the correction of the non-compliance event and the related questioned cost. Views of Responsible Officials of the Auditee and Planned Corrective Actions Management of the Administration does not agree with this finding. Please refer to the corrective action plan on page 91.