Neighborhood Health Association of Toledo, Inc.Non-Profit

2024-002 – Special Tests and Provisions Federal Agency: U.S. Department of Health and Human Services (HHS) Federal Program Name: Consolidated Health Centers (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, Public Housing Primary Care, and School Based Health Centers); (HHS Community Health Center Program) Assistance Listing Number: 93.224/93.527 Award Period: Various award periods with the earliest period beginning April 1, 2022 and the latest ending August 31, 2025. Type of Finding: Significant deficiency in internal control over compliance Criteria or Specific Requirement: Health centers must prepare and apply a sliding fee discount schedule so that eligible patient balances are discounted based on the patient’s ability to pay. Condition: The Association received a completed sliding fee application for a patient in our sample; however, the patient’s fee was not adjusted down for the sliding fee. Questioned Costs: None Context: The Association did not properly apply a sliding fee adjustment to 1 of 40 patients tested. Cause: The Front Desk Staff did not properly mark the completed application as received in the Association’s billing system and apply the sliding fee. In addition, since the application was not noted as received the patient’s account was not being flagged in the finance team’s monthly reports that indicate an application is ready for finance to review and approve for sliding fee adjustment to be applied in their billing system. Effect: A patient’s fee was not reduced by their sliding fee application amounts, based to their ability to pay and the Association’s sliding fee scale. Repeat Finding: Yes – 2023-001 Recommendation: We recommend that management hold additional training for front desk staff regarding the collection and verification of patient information for each patient. We also recommend enhancing your sliding fee status feature in your billing system to be completed for all patients to identify if the patient is insured, an application is pending, an application was received, an application was approved by finance for adjustment, and if an application was waived, to enable better tracking of the eligibility of each patient. We also recommend reviewing outstanding patient balances over 180 days to determine if follow up with a patient is required to collect the outstanding balance or to see if something has been collected by the front desk but not communicated to the finance team. Views of Responsible Officials: Management agrees with the recommendations identified above. During April 2025, NHA started a project to review Self Pay balances with service dates prior to January 1, 2025 to follow up on why the balance is still outstanding. This would have caught the error identified above. In addition to this project, they have held additional trainings for front desk staff and will continue to do so and will continue to improve their methods of tracking patient eligibility.

Special Tests and Provisions Federal Program and Specific Federal Award U.S. Department of Health and Human Services (HHS) 93.224/93.527 Consolidated Health Centers (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, Public Housing Primary Care, and School Based Health Centers); (HHS Community Health Center Program) Type of Finding: Compliance and significant deficiency in internal control over compliance Specific Requirement-Criteria Health centers must prepare and apply a sliding fee discount schedule (SFDS) so that the amounts owed for health center services by eligible patients are adjusted (discounted) based on the patients’ ability to pay. Condition-Context During a sample of 60 patient encounter visits; we noted seven encounter visits where the sliding fee adjustment applied to a patient’s account was applied at the incorrect amount per the Association’s sliding fee scale. Cause Due to the employee turnover within the front desk and the finance department, the Organization has had difficulty in training and assuring skilled intake staff are correctly applying the sliding fees. Effect or Potential Effect Applicants assessed are not charged according to the Association’s sliding fee scale and ability to pay. Questioned Costs None. Repeat Finding Yes, see finding 2022-002.Recommendation We recommend that management continue to work and educate front desk and intake staff on the importance of the required patient application documentation so that the required support is filed before applying a sliding fee discount to a patient account. In addition, continue with the system of monitoring that was established during fiscal year 2023 to review random samples of applications and sliding fees applied. Management Response We agreed with the above comment, and we are working with our intake and finance staff to ensure all documentation is maintained on file and scanned into the EMR system to maintain the required supporting documentation. During 2023 we have implemented a system of monitoring sliding fees applied to patient accounts.

Suspension and Debarment Federal Program and Specific Federal Award U.S. Department of Health and Human Services (HHS) 93.224/93.527 Consolidated Health Centers (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, Public Housing Primary Care, and School Based Health Centers); (HHS Community Health Center Program) 93.526 Grants for Capital Development in Health Centers Type of Finding: Significant deficiency in internal control over compliance Specific Requirement-Criteria Nonfederal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. Condition - Context The Association did not verify that certain employees and vendors were not suspended, debarred, or otherwise excluded from or ineligible for participation in federal programs or activities before entering into transactions with them. The condition affected five of ten parties selected for testing. The Association did ultimately verify that the contracted parties were not suspended or debarred; however, it was after initially contracting with them. Cause Due to open positions in the finance department, oversight and communication regarding following the Association’s suspension and debarment process was not followed. During 2022, the Associated hired contract financial consultants to aid in the open positions and bring financial information and process up to date and during 2023 new procedures were implemented to review for suspension and debarment. Effect Ineligible parties could possibly participate in and be reimbursed by a federal program through the Association. Questioned Costs None. Repeat Finding Yes, see finding 2022-003. Recommendation We recommend that management monitors and trains the staff involved in the suspension and debarment process on an annual basis to ensure all parties are following the Association’s policy and process. Management Response We agreed with the above comment and the Association conducted training with the finance department during 2023 to ensure that all members are educated on the required policies for compliance. In addition, a third party vendor system was contracted with by the Association in 2023 to regularly run a utility to review their vendor listing for suspended and debarred entities.

Reporting Federal Program and Specific Federal Award U.S. Department of Health and Human Services (HHS) 93.224 Consolidated Health Centers (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, Public Housing Primary Care, and School Based Health Centers); (HHS Community Health Center Program) Type of Finding: Compliance Specific Requirement - Criteria The Association is required to submit Federal Financial Reports (SF-425 FFR) on an annual and final basis for grant periods. Condition - Context In a sample of three reports, the following two, of the required Federal Financial Report (SF-425 FFR), were not submitted within the required time frame: Report PeriodDate ReportDate ReportReportEnd date DueSubmittedAnnual FFRMarch 31, 2023July 30, 2023September 1, 2023Annual FFRMarch 31, 2023July 30, 2023September 1, 2023 Cause Due to open positions in the finance department, untimely completion of internal financial reporting occurred during fiscal year 2021, 2022 and 2023, accordingly the financial records were being brought up to date to ensure accuracy in reporting on the FFR, resulting in late data to be available for reporting on the FFRs. During 2022, the Associate hired contract financial consultants to aid in the open positions and bring financial information up to date. Effect Noncompliance with the grant agreement requirement reporting due dates. Questioned Costs None. Repeat Finding Yes, see finding 2022-004 Recommendation We recommend that management instills a system on monitoring all reporting due dates and within the finance department to ensure all grant agreement required reporting is met. Management Response We agreed with the above comment and all reporting has been completed and up to date as of November 30, 2023.

Finding 2022-001 – Cash Management Federal program and specific federal award U.S. Department of Health and Human Services (HHS) 93.224 Consolidated Health Centers (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, Public Housing Primary Care, and School Based Health Centers); (HHS Community Health Center Program) Type of Finding: Compliance and significant deficiency in internal control over compliance Specific requirement-criteria Under cash management of federal funds, when funded under the reimbursement method, funds reimbursed under a federal program should be paid or incurred by the Organization prior to the date for which reimbursement was requested, or within the program’s specified time frame. Condition-context In a sample of two request for federal fund draws (draws) under cash management, we noted that one draw included four voided checks that totaled $41,133. The voided checks had been reissued and included on a subsequent draw request as well. Accordingly, the cash disbursements were mistakenly reimbursed twice. The organization was able to identify additional qualifying payroll expenses that occurred in the months of April 2022, May 2022, and June 2022. Cause Due to open positions in the finance department, untimely reconciliation of expenses charged to the grants, misstatements, intentional or unintentional, occurred during fiscal year 2022. During 2022, the Associated hired contract financial consultants to aid in the open positions and bring financial information up to date. The vacancies caused catch up to be completed by the contracted financial consultants. Effect or potential effect Risk that unapproved or unallowable expenditures are reimbursed by federal agency. Questioned costs None Repeat finding Yes, see finding 2021-002.

Finding 2022-002 – Special Tests & Provisions Federal program and specific federal award U.S. Department of Health and Human Services (HHS) 93.224 Consolidated Health Centers (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, Public Housing Primary Care, and School Based Health Centers); (HHS Community Health Center Program) Type of Finding: Compliance and significant deficiency in internal control over compliance Specific requirement-criteria Health centers must prepare and apply a sliding fee discount schedule (SFDS) so that the amounts owed for health center services by eligible patients are adjusted (discounted) based on the patients’ ability to pay. Condition-context During a sample of sixty patient encounter visits; we noted the following errors: 1) two encounter visits were provided a sliding fee; however, both did not have the applicable sliding fee application and the sliding fee was applied to their patient account; 2) three encounter visits that qualified for a Homeless patient adjustment to zero were provided a sliding fee adjustment and, accordingly, the patient account was not slid to zero; and 3) a sliding fee adjustment applied to a patient’s account was applied at the incorrect amount per the Association’s sliding fee scale. Cause Due to the employee turnover within the front desk and the finance department, the Organization has had difficulty in training and assuring skilled intake staff are correctly applying the sliding fees. Effect or potential effect Applicants assessed are not charged according to the Association’s sliding fee scale and ability to pay. Questioned costs None. Repeat finding Yes, see finding 2021-003.

Finding 2022-003 – Suspension & Debarment Federal program and specific federal award U.S. Department of Health and Human Services (HHS) 93.224 Consolidated Health Centers (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, Public Housing Primary Care, and School Based Health Centers); (HHS Community Health Center Program) Type of Finding: Significant deficiency in internal control over compliance Specific requirement-criteria Non-Federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. The Association did not verify that certain employees and vendors were not suspended, debarred, or otherwise excluded from or ineligible for participation in federal programs or activities before entering into transactions with them. The condition affected four of four parties selected for testing. The Organization did ultimately verify that the contracted parties were not suspended or debarred; however, it was after initially contracting with them. Cause Due to open positions in the finance department, oversight and communication regarding following the Association’s suspension and debarment process was not followed. During 2022, the Associated hired contract financial consultants to aid in the open positions and bring financial information and process up to date. Effect Ineligible parties could possibly participate in and be reimbursed by a federal program through the Association. Questioned Costs None. Repeat finding No.

Finding 2022-004 – Reporting Federal program and specific federal award U.S. Department of Health and Human Services (HHS) 93.224 Consolidated Health Centers (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, Public Housing Primary Care, and School Based Health Centers); (HHS Community Health Center Program) Type of Finding: Compliance Specific requirement - criteria The Association is required to submit Federal Financial Reports (SF-425 FFR) on an annual and final basis for grant periods. Condition - context In a sample of four reports, the following two, of the required Federal Financial Report (SF-425 FFR), were not submitted within the required time frame: Cause Due to open positions in the finance department, untimely completion of internal financial reporting occurred during fiscal year 2021 and 2022, accordingly the financial records were being brought up to date to ensure accuracy in reporting on the FFR, resulting in late data to be available for reporting on the FFRs. During 2022, the Associate hired contract financial consultants to aid in the open positions and bring financial information up to date. Effect Noncompliance with the grant agreement requirement reporting due dates. Questioned Costs None. Repeat finding No.

Finding 2022-005 – Data Collection Form Submission Federal program and specific federal award U.S. Department of Health and Human Services (HHS) 93.224 Consolidated Health Centers (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, Public Housing Primary Care, and School Based Health Centers); (HHS Community Health Center Program) Type of Finding: Compliance Specific requirement-criteria The Organization is required to file their audit reporting package and the data collection form thirty days after receipt of the auditor’s report or nine months after the end of their fiscal year, whichever comes first. Condition - context Due to employee turnover in the finance department, the audit was issued in September 2023 and, therefore, the audit reporting package and the data collection form were submitted late. Cause Due to employee turnover in the finance department, the Organization needed additional time to complete the audit schedules while maintaining current operations with their limited staff. Effect or potential effect The audit was issued in September 2023 and, therefore, the audit reporting package and the data collection form were submitted late. Questioned costs None. Repeat finding Yes, see Finding 2021-004.

Finding 2021-001 ? See Section II Federal program and specific federal award U.S. Department of Health and Human Services (HHS) 93.224 Consolidated Health Centers (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, Public Housing Primary Care, and School Based Health Centers); (HHS Community Health Center Program) See finding 2021-001 described in Section II - Financial Statement Findings Questioned costs None Repeat finding No Finding 2021-001 Specific requirement-Criteria The Organization is to maintain a proper segregation of duties for accounting functions over financial reporting. Condition Due to employee turnover in the finance department, there were areas within the accounting process that lacked the appropriate review and timely reconciliation process. It was noted that the bank reconciliation obtained for our audit was prepared by the accountant who prepares journal entries. The bank reconciliation was not reviewed by another individual to provide an independent review and segregation of duties of the bank reconciliation process. In addition, we noted that the unapplied cash had an unreconciled debit balance of $29,000 that should be accounted for during the reconciliation of the bank statement and the accounts receivable/cash receipt process. Context Segregation of duties issues were noted while obtaining an understanding of the Organization?s internal controls over significant accounting cycles for cash and accounts receivable. Effect or potential effect There is a reasonable possibility that the Organization?s controls will fail to prevent or detect and correct an intentional or unintentional misstatement. Cause Due to limited staffing, the Organization?s current internal control structure did not provide a proper segregation of duties over certain accounting functions. Recommendation We recommended that the CFO or another authorized individual, that is not a check signer or involved in the bank reconciliation process, complete a review of the bank reconciliation and bank activity, and document their initials and the date as evidence of that review. Management response We agreed with the above comments on segregation of duties, and we have since identified appropriate staff to provide a review of the bank reconciliations, cash receipts, and receivables processes to provide an adequate segregation of duties. We will ensure that documentation as evidence of review is noted on bank reconciliations.

Finding 2021-002 Federal program and specific federal award U.S. Department of Health and Human Services (HHS) 93.224 Consolidated Health Centers (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, Public Housing Primary Care, and School Based Health Centers); (HHS Community Health Center Program) Specific requirement-Criteria Under cash management of federal funds when funded under the reimbursement method, funds reimbursed under a federal program should be paid for by the Organization prior to the date for which reimbursement was requested, or within the program?s specified time frame. Condition During a sample of 25 cash disbursements charged to the federal grant, we noted one transaction in which the amount charged to the grant was $25,807; however, the check was disbursed for $19,957. The difference of $5,850 was not approved for payment and it related to installation services that were not rendered until several months later. Cause Due to the untimely reconciliation of expenses charged to the grants, misstatements, intentional or unintentional, are more likely to occur. In addition, spreadsheets are utilized as the primary source to track the expenditures for the major program. Effect or potential effect Risk that unapproved or unallowable expenditures are reimbursed by federal agency. Questioned costs None over the $25,000 threshold Repeat finding No Recommendation We recommend that management prepare federal draw down schedules more timely to ensure the accuracy and completeness of the support for all grant expenditures. Management response We agreed with the above comment and the Organization has engaged consultants to assist in creating a more robust system to document the supporting expenditures that are charged to the grant to ensure the timing of grant expenditures and allowability are appropriate.

Finding 2021-003 Federal program and specific federal award U.S. Department of Health and Human Services (HHS) 93.224 Consolidated Health Centers (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, Public Housing Primary Care, and School Based Health Centers); (HHS Community Health Center Program) Specific requirement-Criteria Health centers must prepare and apply a sliding fee discount schedule (SFDS) so that the amounts owed for health center services by eligible patients are adjusted (discounted) based on the patient?s ability to pay. Condition During a sample of 25 patient visits we noted that 2 did not have the applicable sliding fee application and the sliding fee was applied to their patient account. Cause Due to the pandemic and employee turnover, the Organization was not able to locate the applicable sliding fee applications for the 2 patient visits in our sample. Effect or potential effect A patient that is not eligible for the sliding fee discount received a discount. Questioned costs None Repeat finding No Recommendation We recommend that management continue to work and educate front desk and intake staff on the importance of the required patient application documentation so that the required support is filed before applying a sliding fee discount to a patient account. Management response We agreed with the above comment and is working with our intake and finance staff to ensure all documentation is maintained on file and scanned into the EMR system to maintain the required supporting documentation.

Finding 2021-004 Federal program and specific federal award U.S. Department of Health and Human Services (HHS) 93.224 Consolidated Health Centers (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, Public Housing Primary Care, and School Based Health Centers); (HHS Community Health Center Program) Specific requirement-Criteria The Organization is required to file their audit reporting package and the data collection form thirty days after receipt of the auditor?s report or nine months after the end of their fiscal year, whichever comes first. Condition Due to employee turnover in the finance department, the audit was issued in October 2022, and therefore the audit reporting package and the data collection form were submitted late. Cause Due to employee turnover in the finance department, the Organization needed additional time to complete the audit schedules while maintaining current operations with their limited staff. The audit was issued in October 2022, and therefore the audit reporting package and the data collection form were submitted late. Questioned costs None Repeat finding No Recommendation We recommend that management continue to recruit for staff to fill the needed positions in the finance department. Management response We agreed with the above comment and are actively recruiting for several positions in the finance department. The Organization has hired consultants experienced in the FQHC industry to assist in supporting the current finance staff with the audit process and the ongoing daily activities. In addition, the consultants are assisting in the development of improved processes and training to educate staff on the best practices for efficiency and accurate financial reporting.