Finding Text
2022-005 Department of Health and Human Services Federal Financial Assistance Listing #93.498 COVID-19 Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution Applicable Federal Award Number and Year ? Period 4 TIN #460274380 Reporting Material Weakness in Internal Control over Compliance and Material Noncompliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. The Center selected option 1 to calculate lost revenue which consists of a comparison of 2019 actual results to 2020, 2021, and 2022 actual results by quarter. Patient care-related revenue should be reported net of adjustments for all third-party payers, charity care adjustments, bad debt, and any other discounts or adjustments, as applicable when reporting patient care-related revenue sources. Condition: The Center?s actual reported revenues for 2019 were incorrectly keyed into the HHS portal submission. Additionally, the revenues for 2022 were reported based upon actual revenue billed and reported within the Center?s electronic medical records (EMR) system which does not include monthly or quarterly adjustments posted to the general ledger. Cause: The Center?s internal control process in place did not ensure patient care revenue submitted to the Department of Health and Human Services for Period 4 agreed to the general ledger for 2022 or the supporting schedules prepared for 2019. The Center used the EMR system to calculate lost revenue due to the required input on the special report by payor type. Effect: The patient care related revenue reported within the special report submitted to the Department of Health and Human Services for 2019 was understated by $245,242 and for 2022 was overstated by $68,936. Lost revenue plus eligible expenses exceeded Period 1 and Period 4 funds received. Questioned Costs: There are no questioned costs related to the lost revenue calculation as the Center did not claim any lost revenue on the Period 4 special report. Context/Sampling: The total revenue for all applicable quarters was tested. Sampling was not used. Repeat Finding from Prior Years: Yes. Recommendation: We recommend the Center implement a secondary review process that reconciles the total revenue to the total revenue on the general ledger. Views of Responsible Officials: Management agrees with the finding.