Rural Health Corporation of Northeastern Pennsylvania

Finding No. 2025-001 - Sliding Fee Determination and Related Patient Billing U.S. Department of Health and Human Services Assistance Listing Number 93.224 Consolidated Health Centers Program Cluster Criteria: All section 330-funded health centers must prepare and apply a sliding fee discount schedule (SFDS), which adjusts amounts owed for health center services by eligible patients based on the patient’s ability to pay. The National Health Services Corps (NHSC) statute mandates that NHSC-approved sites “not deny requested health care services and shall not discriminate in the provision of services to an individual because the individual is unable to pay for the services.” It stipulates, “the entity shall prepare a schedule of discounts (including, in appropriate cases, waivers) to be applied to the payment of such fees or payments. In preparing the schedule, the entity shall adjust the discounts on the basis of a patient’s ability to pay.” (42 U.S.C. § 254g) Condition: As part of our compliance testing procedures for the HRSA 330 grant program, we tested sixty patients billed under a sliding fee discount schedule. Of the patients tested, four (7%) were found to have exceptions in the amount charged to the patient. Cause: Based on the audit procedures performed, in four instances, the patient was not charged at the discount applicable to the patient’s income level. Effect: Four patients, out of a sample of sixty patients, were inaccurately billed for the services provided by Rural Health Corporation of Northeastern Pennsylvania. Two patients were overbilled by an amount of $26. Two patients were underbilled by a total amount of $146. Questioned Costs: None Repeat finding: None Recommendation: Rural Health Corporation of Northeastern Pennsylvania has established policies and controls which did not operate effectively in these instances. We recommend that management strengthen and expand the procedures for review of manual data inputs and enhance their training programs on sliding fee scale processes and procedures. View of the Responsible Official: RHC of NEPA has taken significant steps to improve and rectify their sliding fee deficiency over its last 3 audits. RHC of NEPA has improved from 2 consecutive material weakness findings to having substantial improvement and reduced its status to a significant deficiency. It is important to note that 2 of the outstanding claims identified had timely sliding fee documents completed, however they were out of compliance due to human error of calculation of the sliding fee percentage. Education and internal audits which were implemented throughout the organization which have driven the marked improvement will continue to be disseminated throughout the organization. Clearly based on the improvement that has occurred, current processes and level of attention are the correct items to rectify and become fully compliant with sliding fee requirements. These policies will be the focus of additional training with a separate session being dedicated to the updated sliding fee implementation in February of 2026.

Finding 2024-001 – Sliding Fee Determination and Related Patient Billing U.S. Department of Health and Human Services Assistance Listing No. 93.224/93.527, Health Center Program Cluster Criteria: All section 330-funded health centers must prepare and apply a sliding fee discount schedule (SFDS), which adjusts amounts owed for health center services by eligible patients based on the patient’s ability to pay. Management is responsible to make sure controls are in place for patients to be charged in accordance with the SFDS and that income verifications are performed at least annually. Condition: As part of our compliance testing procedures for the HRSA 330 grant programs, we tested sixty patients billed under a sliding fee discount schedule. Of the patients tested, four patients (7%) were found to have exceptions as the income verification was either not performed or had not been performed within the past 12 months. Cause: Based on audit procedures performed, the income verification process was never performed or not performed on an annual basis for patients to be charged the correct amount for their service. Effect: The lack of controls and processes over the income verification process could cause revenue to be over or understated. The impact of the four patients that did not have appropriate documentation is not able to be quantified. Questioned costs: None. Repeat finding: Repeat of finding 2023-002. Recommendations: The established policies and controls did not operate effectively in these instances. Management should ensure processes are in place to make sure the income verification process is being performed annually for each patient. Views of responsible officials and corrective action plan: Although this was identified as a material weakness for FY ’23 and FY’24, training programs and staff education were not implemented until well into FY ’24. Training has and will continue to occur in the future through documented Front Desk Training sessions. Accountability measures have been implemented for staff who do not provide sufficient documentation for sliding fee as well as other patient visit requirements. For FY ‘25, RHC has already implemented a process whereby each quarter every patient is identified as a participant in sliding fee. Those participants are distributed to the general managers of each center who affirm the correct information has been obtained or, if not, the patient is removed from sliding fee participation and charges are reflected accordingly.

Finding 2023-001 – Patient Services Receivable Allowances Criteria: Management is responsible to ensure that medical records are completed and to make reasonable estimates and assumptions on the allowance for contractual adjustments and doubtful accounts. Condition: Based on audit procedures performed, an adjustment of $878,000 was made to record an additional allowance related to patient services receivable for the year ended June 30, 2023. Rural Health Corporation of Northeastern Pennsylvania did not record an appropriate allowance at the end of the current year. Further, revenue and receivables testing during the audit indicated that several medical records were missing at least one supporting document, including consent to treat forms or incomplete patient records. Cause: Based on audit procedures performed, management has incomplete medical records and did not record an adequate allowance for contractual adjustments and doubtful accounts due to the implementation of a new billing system and turnover of their medical billing team. Effect: The lack of supporting documentation and accurate estimates on the allowance for contractual adjustments and doubtful accounts presents the potential for incorrect reporting of significant financial statement balances Recommendations: Management should ensure complete medical records containing all supporting documents. Additionally, management should review their allowance for contractual adjustments and doubtful accounts on a monthly basis to ensure the accuracy of the account balances. Views of responsible officials and corrective action plan: In June of 2022, Rural Health Corporation of Northeastern Pennsylvania implemented a new Electronic Medical Records System. This implementation, combined with turnover in the billing department, and the hiring of an outsourced claims processor, led to billing delays and various other challenges related to accounts receivable. An internal biller was hired, and processes are in place to monitor and reconcile accounts receivable on at least a monthly basis. The CFO acknowledges and is responsible for this corrective action plan.

Finding 2023-002 – Sliding Fee Determination and Related Patient Billing U.S. Department of Health and Human Services Assistance Listing No. 93.224/93.527, Health Center Program Cluster Criteria: All section 330-funded health centers must prepare and apply a sliding fee discount schedule (SFDS), which adjust amount owed for health center services by eligible patients based on the patient’s ability to pay. Management is responsible to make sure controls are in place for patients to be charged in accordance with the SFDS and that income verifications are performed at least annually. Condition: As part of our compliance testing procedures for the HRSA 330 grant programs, we tested sixty patients billed under a sliding fee discount schedule. Of the patients tested, five patients (8%) were found to have exceptions as the income verification was either not performed or had not been performed within the past 12 months. Cause: Based on audit procedures performed, the income verification process was never performed or not performed on an annual basis for patients to be charged the correct amount for their service or an application. Effect: The lack of controls over the income verification process could cause revenue to be over or understated. The impact of the ten patients that did not have appropriate documentation is not able to be quantified. Questioned costs: None. Repeat finding: Repeat of finding 2022-002. Recommendations: The established policies and controls did not operate effectively in these instances. Management should ensure processes are in place to make sure the income verification process is being performed annually for each patient. Views of responsible officials and corrective action plan: Due to significant turnover at Rural Health Corporation of Northeastern Pennsylvania, several income verifications were not completed in time. Additional hiring and training are required to ensure that these processes are followed. The outsourced billing company is routinely scheduled to participate in training with the front desk personnel and main office personnel. Another internal practice manager/front desk manager has been promoted to work with the parties involved to remedy the situation. The CFO acknowledges and is responsible for this corrective action plan.

Finding 2022-002 ? Sliding Fee Determination and Related Patient Billing U.S. Department of Health and Human Services Assistance Listing No. 93.224, Consolidated Health Centers Program Cluster Condition: As part of our compliance testing procedures for the HRSA 330 grant programs, we tested sixty patients billed under a sliding fee discount schedule. Of the patients tested, ten patients (16%) were found to have exceptions as the income verification was either not performed or had not been performed within the past 12 months. Criteria: All section 330-funded health centers must prepare and apply a sliding fee discount schedule (SFDS), which adjust amount owed for health center services by eligible patients based on the patient?s ability to pay. Management is responsible to make sure controls are in place for patients to be charged in accordance with the SFDS and that income verifications are performed at least annually. Cause: Based on audit procedures performed, the income verification process was not performed on an annual basis for patients to be charged the correct amount for their service. Effect: The lack of controls over the income verification process could cause revenue to be over or understated. The impact of the ten patients that did not have appropriate documentation is not able to be quantified. Recommendations: The established policies and controls did not operate effectively in these instances. Management should ensure processes are in place to make sure the income verification process is being performed annually for each patient.

2021-002: Significant Deficiency - 93.224, Health Center Program Criteria: The Corporation is required to submit an annual Federal Financial Report by April 30, 2021 based on the budget period end date of the grant award. Condition/Context: The Corporation was required to submit an annual Federal Financial Report by April 30, 2021 and the report was submitted on May 5, 2021. Questioned Costs: There are no questioned costs associated with this finding. Cause: The Corporation did not file annual Federal Financial Report timely due to turnover within the organization at the CFO position, which resulted in notification emails for required reports being sent to the incorrect email address. Effect: The Corporation did not comply with the reporting requirements for the submission of the annual Federal Financial Report. Recommendation: The Corporation should implement procedures to identify and ensure compliance with all reporting requirements for each project.