ASCENSION HEALTH ALLIANCE D/B/A ASCENSIONNon-Profit

Finding 2025-001 – Activities Allowed or Unallowed and Allowable Costs/Cost Principles Identification of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing Number: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Entity: State of Tennessee Department of Health Ascension Ministry Market: Saint Thomas Medical Partners dba Ascension Medical Group (Ascension, Tennessee) Pass-Through Award Number: Not applicable Pass-Through Award Period: 11/1/2022 – 06/30/2026 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: “The recipient and subrecipient must establish, document, and maintain effective internal control over the Federal award that provides reasonable assurance that the recipient or subrecipient is managing the federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. The internal controls should align with the 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).” Condition: Time and Effort (T&E) certification reports related to certain employees’ salary charged during the year to the federal award were not reviewed timely. Cause: T&E certification reports were processed without timely Project Manager review and approval at Ascension Medical Group Effect or potential effect: Costs may be charged to the federal award that do not comply with federal or pass-through grant requirements. Questioned costs: None. Context: Of the 14 T&E certification reports sampled (totaling $144,738), six T&E certification reports (totaling $31,596) did not evidence timely review and approval by the employee's Project Manager for Ascension Medical Group. For Assistance Listing No. 21.027, total payroll costs for Ascension, Tennessee, were $525,874, representing 3.3% of total federal expenditures of $15,919,235 for the year ended June 30, 2025. Identification as a repeat finding, if applicable: This finding is a repeat finding from the prior year (2024-001, 2023-002). Recommendation: Management at Ascension Medical Group should reinforce the importance of adhering to its internal controls and timely review over the T&E certification reports. Views of responsible officials: Ascension Grants & Research Department will reinforce the importance of timely approval of Time & Effort reports with appropriate personnel at Saint Thomas Medical Partners.

Finding 2025-002 – Procurement and Suspension and Debarment Identification of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing Number: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: Kansas Department for Aging and Disability Services Ascension Ministry Market: Kansas Pass-Through Award Number: N0237723 Pass-Through Award Period: 07/01/2023 – 06/30/2026 Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: Not applicable Pass-Through Award Period: 03/03/2021 – 06/30/2026 Criteria or specific requirement (including statutory, regulatory, or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: “The recipient and subrecipient must establish, document, and maintain effective internal control over the Federal award that provides reasonable assurance that the recipient or subrecipient is managing the federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. The internal controls should align with the 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).” Section 200.318 states the following regarding general procurement standards: “(i) Procurement records. The recipient or subrecipient must maintain records sufficient to detail the history of each procurement transaction. These records must include the rationale for the procurement method, contract type selection, contractor selection or rejection, and the basis for the contract price.” Section 200.320 states the following regarding procurement methods: “(c) Noncompetitive procurement. There are specific circumstances in which the recipient or subrecipient may use a noncompetitive procurement method. The noncompetitive procurement method may only be used if one of the following circumstances applies: (1) The aggregate amount of the procurement transaction does not exceed the micro-purchase threshold (see paragraph (a)(1) of this section); (2) The procurement transaction can only be fulfilled by a single source; (3) The public exigency or emergency for the requirement will not permit a delay resulting from providing public notice of a competitive solicitation; (4) The recipient or subrecipient requests in writing to use a noncompetitive procurement method, and the Federal agency or pass-through entity provides written approval; or (5) After soliciting several sources, competition is determined inadequate.” Condition: Ascension Health did not prepare a sole source justification memo timely for two procurement transactions executed in fiscal year 2025. Cause: Internal controls were not enforced to ensure a sole-source justification memo was completed before the procurement transaction occurred. Effect or potential effect: Lack of or untimely preparation of the sole source justification memo results in noncompliance with the documentation requirements under the Uniform Guidance procurement standards and could potentially result in inadequate or inappropriate procurement methods followed. Questioned costs: $24,707 calculated as follows: Pass-Through Grantor: Kansas Department for Aging and Disability Services Pass-Through Award Number: N0237723 Questioned costs (COVID-19): $16,167, representing the costs reported on the schedule of expenditures of federal awards for the year ended June 30, 2025, for one procurement transaction that lacked sole-source justification memo at the time of procurement. Pass-Through Grantor: State of Tennessee Department of Health Pass-Through Award Number: Not applicable Questioned costs (COVID-19): $8,540, representing the costs reported on the schedule of expenditures of federal awards for the year ended June 30, 2025, for one procurement transaction that lacked sole-source justification memo at the time of procurement. Context: We tested a sample of five procurement transactions totaling $3,916,620 and noted exceptions related to two procurement transactions totaling $24,707. Total procurement transactions were $14,560,955, representing 91% of total federal expenditures of $15,919,235 for the year ended June 30, 2025. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Management should implement more robust internal controls to ensure sole source justification memos are prepared and reviewed timely. Views of responsible officials: Personnel responsible for procurement transactions will be educated on the proper procedures for obtaining and retaining sole source memo justification letters before entering into these transactions.

Finding 2025-003 – Activities Allowed or Unallowed and Allowable Costs/Cost Principles, and Reporting Identification of the federal program: Federal Grantor: U.S. Department of Homeland Security – Federal Emergency Management Agency (FEMA) Assistance Listing Number: 97.036, COVID-19 Disaster Grants - Public Assistance (Presidentially Declared Disasters) Pass-Through Grantor: Michigan State Police Emergency Management & Homeland Security Division Ascension Entity: Ascension Providence Rochester Hospital (125-U0BDI-00) Pass-Through Award Number: DR4494 – PW811 Pass-Through Award Period: 07/01/2021 – 06/30/2022 Criteria or specific requirement (including statutory, regulatory, or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: “The recipient and subrecipient must establish, document, and maintain effective internal control over the Federal award that provides reasonable assurance that the recipient or subrecipient is managing the federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. The internal controls should align with the 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).” Section 200.403(g) of the Uniform Guidance requires that costs charged to Federal awards be adequately documented. In addition, Section 200.406 of the Uniform Guidance requires that costs charged to a Federal award be reduced by applicable credits, including any amounts that offset or reduce costs allocable to the Federal award. Condition: The System calculated a COVID-19 attribution percentage based on patient-level data extracted from the patient system that classified patients as COVID-19, suspected COVID-19, or non-COVID based on diagnosis codes. The COVID-19 percentage was then applied to the contractor costs to determine the allowable costs that could be charged to FEMA. During our testing, we noted 1 instance out of 25 patient files tested where the System could not support a COVID-19 diagnosis. Cause: The System relied on automated system logic and extracted a report that had patients’ classification as COVID-19, Suspected COVID-19 or non-COVID for purposes of the COVID-19 attribution calculation; however, controls were not sufficient to ensure that all patient accounts classified as COVID-19 were supported by sufficient underlying clinical documentation. Effect or potential effect: Costs may be charged to the federal award that do not comply with federal or pass-through grant requirements. Questioned costs: One of the 25 patient accounts tested did not retain consistent medical documentation supporting the COVID-19 classification. However, the amount of questioned costs cannot be calculated on a per-patient basis because the contractor’s costs charged are not directly attributable to individual patient accounts because of FEMA calculation methodology. Instead, the COVID-19 classification affects the overall percentage used to calculate the total allowable costs charged to FEMA. As a result, a specific overcharge attributable to the unsupported patient account could not be quantified. Context: During testing of 25 patient accounts selected to verify the accuracy of patient classification, one patient account at Ascension, Michigan, lacked documentation supporting a COVID-19 diagnosis, despite being classified as COVID-related in the patient system. Contract labor costs at Ascension Providence Rochester Hospital were $951,135. Total contract labor costs of $36,775,859 were calculated using COVID-19 attribution percentages. Total COVID FEMA federal expenditures for the year ended June 30, 2025, were $101,313,434. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Management should enhance its review controls to ensure that the patient classifications derived from the patient systems are supported by underlying clinical documentation. Views of responsible officials: Ascension acknowledges the inability to locate relevant documentation pertaining to the COVID classification for a specific patient with services during the COVID-19 public health emergency. Although the documentation was not located in this instance, patient care was appropriately provided. However, Ascension will sample patient-level encounter records at Ascension Providence Rochester Hospital prior to future revenue recognition to ensure appropriate documentation.

Finding 2024-001 – Activities Allowed or Unallowed, Allowable Costs/Cost Principles, and Period of Performance Identification of the federal program: Federal Grantor: United States Department of Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: SLFRP0127 Pass-Through Award Period: 12/01/2021-09/30/2023 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).” Condition: Timecards for employees submitted to substantiate funding for the federal program were not consistently reviewed and approved at Ascension, Michigan. Cause: Timecards were processed without manager approval at Ascension, Michigan. Effect or potential effect: Expenses may be charged to the federal award that are not in compliance with the federal or pass-through grant agreement. Questioned costs: $0 Context: For 14 (totaling $24,083) of 35 (totaling $60,085) (40%) payroll timecards sampled for the Michigan location during the fiscal year, the employee’s timecard did not have evidence of review and approval by the employee’s manager. For Assistance Listing No. 21.027, total payroll costs for the Michigan location were $5,625,000, representing 77% of total federal expenditures of $7,292,682 reported in the schedule of expenditures of federal awards (SEFA) for the year ended June 30, 2024. Identification as a repeat finding, if applicable: The finding is a repeat finding from the prior year (2023-002). Recommendation: Ascension, Michigan should reinforce the importance of adhering to its internal controls over the review and approval of timecards. Views of responsible officials: Ascension, Michigan will reinforce the importance of timely approval of timecards for those participating in grant activities. For this grant, Ascension, Michigan was allowed to identify eligible expenditures retrospectively; thus, grant-specific approval processes were not performed. All expenditures submitted for reimbursement were validated for adherence to the terms and conditions of the award.

Finding 2024-002 – Procurement, Suspension and Debarment Identification of the federal program: Federal Grantor: United States Department of Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: Kansas Department for Aging and Disability Services Ascension Ministry Market: Kansas Pass-Through Award Number: N0237723 Pass-Through Award Period: 07/01/2023-06/30/2026 Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: Not applicable Pass-Through Award Period: 03/03/2021-12/31/2026 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).” Condition:Ascension Health (the System) did not timely perform the reconciliation between the vendor files transferred to the third-party vendor and the third-party’s reports outlining the number of vendor units processed for fiscal year 2024. Cause: The System’s internal control over the review of the completeness of the vendor files was not completed prior to the end of the fiscal year in accordance with the System’s relevant internal procedures. Effect or potential effect: Federal funds may be used to pay a vendor that is suspended or debarred. Questioned costs: $0 Context: The System has an internal control procedure to perform a reconciliation between the vendor files transferred to the System’s third-party vendor engaged to perform the suspension and debarment screening and the third-party’s reports outlining the number of vendor units processed. However, review was delayed and was not completed until November 2024. For Assistance Listing No. 21.027, total federal portion of procurement expenditures subject to suspension and debarment review was $1,107,944, which represents approximately 15% of total federal expenditures of $7,292,682 reported on the SEFA for the year ended June 30, 2024. Identification as a repeat finding, if applicable: The finding is a repeat finding from the prior year (2023-003). Recommendation: The System should ensure that the established procedures over review of the completeness of the vendor files are followed and performed in a timely manner. Views of responsible officials: Controls were subsequently performed during fiscal year 2025 for the 2024 fiscal year files, with no errors identified. Management has emphasized to the Compliance Investigations & Incidents team the importance of the timely execution of these controls going forward. Management will update the validation process document to set expectations of timely quarterly reconciliations of the vendor files sent to the third-party vendor.

Information of the federal program: Federal Grantor: United States Department of Housing and Urban Development Assistance Listing No.: 14.241, Housing Opportunities for Persons with AIDS Ascension Ministry Market: Illinois Pass-Through Grantor: AIDS Foundation of Chicago Federal Grantor: United States Department of Justice Assistance Listing No.: 16.560, National Institute of Justice Research, Evaluation, and Development Project Grants Ascension Ministry Market: Texas Federal Grantor: United States Department of Justice Assistance Listing No.: 16.710, Public Safety Partnership and Community Policing Grants Ascension Ministry Market: Illinois Pass-Through Grantor: The Village of Arlington Heights Police Department Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Ascension Ministry Market: Maryland Pass-Through Grantor: Mayor and City Council of Baltimore, through MONSE Federal Grantor: United States Department of Health and Human Services Assistance Listing No.: 93.650, Accountable Health Communities Ascension Ministry Market: Illinois Federal Grantor: United States Department of Health and Human Services Assistance Listing No.: 93.958, Block Grants for Community Mental Health Services Ascension Ministry Market: Illinois Pass-Through Grantor: The State of Illinois Department of Human Services Federal Grantor: United States Department of Homeland Security Assistance Listing No.: 97.036, Disaster Grants – Public Assistance (Presidentially Declared Disasters) Ascension Ministry Market: Florida Pass-Through Grantor: Florida Division of Emergency ManagementFederal Grantor: United States Department of Homeland Security Assistance Listing No.: 97.039, Hazard Mitigation Grant Ascension Ministry Market: Florida Pass-Through Grantor: Florida Division of Emergency Management 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 Uniform Guidance 2 CFR section 200.510 states, “(b) Schedule of expenditures of Federal awards. The auditee must also prepare a schedule of expenditures of federal awards (SEFA) for the period covered by the auditee’s financial statements which must include the total Federal awards expended as determined in accordance with §200.502 Basis for determining Federal awards expended.” Condition: A grant with expenditures of $55,702 under Assistance Listing No. 14.241 was not included on the preliminary schedule of expenditures of federal awards (the Schedule) provided by management; the final Schedule was corrected. (Alexian Brothers-Bonaventure House, Illinois) A grant with expenditures of $204,574 under Assistance Listing No. 16.560 was not included on the preliminary Schedule provided by management; the final Schedule was corrected. (Ascension Seton, Texas) Expenditures in the amount of $89,084 under Assistance Listing No. 16.710 were improperly classified as Assistance Listing No. 93.958; the final Schedule was corrected. (Presence Behavioral Health, Illinois) A grant with expenditures of $230,108 under Assistance Listing No. 21.027 was included on the preliminary Schedule and was subsequently excluded when it was identified as a beneficiary award and not a subrecipient award; the final Schedule was corrected (Ascension Via Christi Hospitals Wichita, Inc., Kansas). A grant with expenditures of $164,195 under Assistance Listing No. 21.027 was not included on the preliminary Schedule provided by management; the final Schedule was corrected. (St. Agnes Healthcare, Inc., Maryland) Expenditures under Assistance Listing No. 93.650 were reported twice on the preliminary Schedule, resulting in overstatement of $314,551; the final Schedule was corrected. (Alexian Brothers Hospital Network, Illinois) A grant with expenditures of $232,713 under Assistance Listing No. 97.039 was misclassified as Assistance Listing No. 97.036; the final Schedule was corrected. (St. Vincent’s Health System, Florida) Cause: Ascension’s (the System) internal controls in place over the preparation of the Schedule were not sufficient to properly accumulate and accurately report all expenditures of federal awards. Effect or Potential Effect: Inaccurate or improper reporting of expenditures results in a misstated Schedule and can also potentially result in insufficient testing of the major programs or improper identification of major programs for audit purposes. Questioned costs: None. Context:The table below shows the preliminary and adjusted assistance listing on the Schedule. See table/chart in the finding. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Management should implement more robust internal controls to ensure the assistance listing numbers are appropriately listed on the Schedule and all federal expenditures are appropriately identified and reported on the Schedule. Views of responsible officials: The System will enhance grant management award processes by revising its onboarding procedures and add additional controls to monitor for accuracy of the core data. Management will reinforce the importance of timeliness and accuracy of the SEFA reporting totals to facilitate accurate reporting. Award amounts were changed on the SEFA reporting schedules after management’s review was executed. Management will implement preventive controls to lock down market SEFA templates after management final review.

Information of the federal program: Federal Grantor: United States Department of Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Illinois Department of Healthcare and Family Services Ascension Ministry Market: Illinois Pass-Through Award Number: ARPA230159, ARPA230263, ARPA230050 Pass-Through Award Period: 05/01/2022-06/30/2023 Pass-Through Grantor: Mayor and City Council of Baltimore, Through MONSE Ascension Ministry Market: Maryland Pass-Through Award Number: Not applicable Pass-Through Award Period: 07/01/2022-06/30/2023 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 Uniform Guidance 2 CRF Subpart E section 200.403 states the following: “Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.”In addition, per the State of Illinois, Department of Healthcare and Family Services and Presence Senior Services Agreement No. ARPA230050, Nazarethville Retirement Home Agreement No. ARPA230159, and Presence Life Connections Agreement No. ARPA230263, Exhibit A requires the awards pursuant to this program to comply with the following criteria: “1. 65% of the funds awarded under this grant shall comply with the following criteria. a) Shall be expended only for premium pay for eligible workers; in addition to any wages or remuneration the eligible worker has already received; and shall be subject to the other requirements and limitations set forth in the American Rescue Plan Act of 2021 and related federal guidance. b) Upon receipt of funds, recipients shall distribute funds such that eligible workers receive an amount up to $13 per hour, but no more than $25,000 for the duration of the program. Recipients shall provide a written certification to the Department acknowledging compliance with this paragraph. d) Each recipient under this paragraph shall submit appropriate documentation acknowledging compliance with State and federal law. For purposes of this section, “eligible worker” means a permanent staff member, regardless of union affiliation, of a facility licensed by the Department of Public Health under the Nursing Home Care Act as a skilled nursing facility or intermediate care facility engaged in “essential work”, as defined by Section 9901 of the American Rescue Plan Act of 2021 and related federal guidance, as well as whose total pay is below 150% of the average annual wage for all occupations in the worker’s county of residence, as defined by the Bureau of Labor Statistics Occupational Employment and Wage Statistics; or is not exempt from the federal Fair Labor Standards Act overtime provisions.” Condition: Illinois – Internal controls over the review and approval of program expenditures for allowability and period of performance under the federal program were not in place for Presence Senior Services (Agreement No. ARPA230050), Nazarethville Retirement Home (Agreement No. ARPA230159), and Presence Life Connections (Agreement No. ARPA230263) administering the federal program.Illinois – Nazarethville Retirement Home (Agreement No. ARPA230159) did not meet the criteria per Exhibit A, paragraph 1.a. In addition, Presence Senior Services (Agreement No. ARPA230050), Nazarethville Retirement Home (Agreement No. ARPA230159), and Presence Life Connections (Agreement No. ARPA230263) did not comply with the criteria per Exhibit A, paragraphs 1.b and 1.d. St. Agnes Healthcare, Inc., Maryland – Timecards for employees that were submitted for substantiation of funding for the federal program were not consistently reviewed and approved. Cause: Ascension Living, Illinois: •Ascension Living did not have effective internal controls in place over the review and approval of expenses and period of performance for certain locations administering the grant. •Ascension Living did not have internal controls in place to review and approve the requirements in Exhibit A and the analysis performed over the requirements included in Exhibit A of the program grant agreements. St. Agnes Healthcare, Inc., Maryland – Timecards were processed without manager approval. Effect or potential effect: Expenses may be charged to the federal award that are not in compliance with the federal or pass-through grant agreement. The System was not in noncompliance with the terms and conditions of the federal program. Questioned costs: $59,425 – Assistance Listing No. 21.027, Pass-Through Award Number ARPA230050 Context: Ascension Living, Illinois: • At one location, per Exhibit A, paragraph 1.a., only 62% of the funds were spent for premium pay versus the required 65%, resulting in a shortage of premium pay of $57,700. • At one location, per Exhibit A, paragraph 1.b., one employee’s salary exceeded the limit of $25,000 allowable to be funded by the award by $1,725. Total expenses subject to the requirements of Exhibit A of the grant agreement were $2,105,470, representing 44% of total federal expenditures of $4,798,357. For Assistance Listing No. 21.027, total expenses for Ascension Living, Illinois, were $3,474,484, representing 72% of total federal expenditures of $4,798,357 for the year ended June 30, 2023. St. Agnes Healthcare, Inc., Maryland – For two (totaling $4,526) of ten (totaling $21,950) (11%) payroll transactions sampled during the fiscal year, the employee’s timecards did not have evidence of review and approval by the employee’s manager for two months. For Assistance Listing No. 21.027, total payroll costs for the Maryland location were $113,188, representing 2% of total federal expenditures of $4,798,357 for the year ended June 30, 2023. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Ascension Living, Illinois – Ascension Living should implement internal controls to review the limitations requirement included in Exhibit A of the grant agreement and that the requirements are met prior to drawing down funds, required communication with the grantor is submitted, and required analysis is performed to be in compliance with the terms and conditions of the grant agreements. St. Agnes Healthcare, Inc., Maryland – The System should reinforce the importance of adhering to its internal controls over the review and approval of timecards. Views of responsible officials: Ascension Living management acknowledges that internal controls were not working effectively regarding review of the calculated limitations and allocations. Management has reserved the questioned costs and has communicated with the State on their desired method of repayment. For future grants, Ascension Living will implement controls for appropriate review and approval and to have a secondary review to validate calculations. St. Agnes Healthcare, Inc., Maryland - This finding pertains to retroactive grants where expenses were incurred in previous periods but were subsequently eligible for grant reimbursement. Management is working on creating a report to identify timecards lacking manager approval for exclusion as allowable grant expenses. Grant Accounting is incorporating a Time and Effort tracking feature, a separate approval control to mitigate the issue of timecards lacking manager approval.

Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Illinois Department of Healthcare and Family Services Ascension Ministry Market: Illinois Pass-Through Award Number: ARPA230159, ARPA230263, ARPA230050 Pass-Through Award Period: 05/01/2022-06/30/2023 Pass-Through Grantor: State of Illinois Department of Public Health Ascension Ministry Market: Illinois Pass-Through Award Numbers: 38080717K, 38080718K Pass-Through Award Period: 07/01/2022-06/30/2023 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).” Condition: Internal controls over suspension and debarment related to new vendor set up were not in place for Ascension Living. Specifically, documentation was not retained evidencing the review of new vendors for suspension and debarment prior to adding them into MatrixCare, Ascension Living’s current vendor management platform.The System has an internal control to review the accuracy of the vendor files transferred from the System’s vendor management system to ProviderTrust, the System’s third-party vendor engaged to perform its suspension and debarment review. The review of the completeness and accuracy of the data transferred to ProviderTrust was only performed for three of the twelve months during fiscal year 2023. The System has several IT applications that contain source vendor listings. Internal controls were not in place over the accuracy and completeness of the vendor listings from MatrixCare used to monitor the suspension and debarment (Ascension Living, Illinois). Cause: Management at Ascension Living did not have a requirement to retain the supporting documentation evidencing the review of new vendors for suspension and debarment. The System’s internal control over the review of the accuracy of the data transfer to ProviderTrust was not designed to review the completeness and accuracy of the data each time it is transferred to the third-party vendor. Internal controls were not in place at Ascension Living over the accuracy and completeness of the vendor listings from MatrixCare used to monitor the suspension and debarment. Effect or potential effect: New vendors may be used that are suspended or debarred. Suspension and debarment vendor files provided to the third-party vendor may not be accurate or complete. The data from MatrixCare transferred to the third-party vendor for suspension and debarment may not be complete and accurate. Federal funds may be used to pay a contractor that is suspended or debarred. Questioned costs: None. Context: For Assistance Listing No. 21.027, procurement expenditures subject to suspension and debarment review for Ascension Living, Illinois, totaled $1,369,015, which represents approximately 29% of total federal expenditures of $4,798,357 reported in the SEFA for the year ended June 30, 2023. Total federal portion of procurement expenditures subject to suspension and debarment review was $2,279,109, which represents approximately 47% of total federal expenditures of $4,798,357 reported in the SEFA for the year ended June 30, 2023. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Ascension Living should formalize the review and approval process of new vendors for suspension and debarment by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. The System should develop internal controls to ensure the integrity of data transfer to the third-party vendor is validated each time the data is transferred. Views of responsible officials: Ascension Living will provide education to their associates performing initial suspension and debarment screening as part of onboarding control activities to retain evidence of their review and the supporting documentation. Management will reassess controls over the data transfer application used to send the vendor data file to the third-party vendor, ProviderTrust. The System will explore implementing compensating controls for MatrixCare. The application is anticipated to be sunset in early 2025, when the process is migrated to Oracle Cloud and the established ProviderTrust processes.

Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Illinois Department of Healthcare and Family Services Ascension Ministry Market: Illinois Pass-Through Award Number: ARPA230159, ARPA230263, ARPA230050 Pass-Through Award Period: 05/01/2022-06/30/2023 Pass-Through Grantor: State of Illinois Department of Public Health Ascension Ministry Market: Illinois Pass-Through Award Numbers: 38080717K, 38080718K Pass-Through Award Period: 07/01/2022-06/30/2023 Pass-Through Grantor: Mayor and City Council of Baltimore, Through MONSE Ascension Ministry Market: Maryland Pass-Through Award Number: Not applicable Pass-Through Award Period: 07/01/2022-06/30/2023 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 pass-through agreements with the states required the submission of the following special reports during the fiscal year. See table/chart in the finding Condition: The Quarterly Reimbursement Certifications and Quarterly Metrics Reports required by the state of Illinois were not submitted timely for various quarters during fiscal year 2023. The Quarterly Progress and Performance Metrics Report required by the state of Maryland was filed with incomplete information. Cause:Internal controls were not effective to ensure submission of the reports in accordance with the due dates under the pass-through agreement with the State of Illinois. In addition, internal controls were not effective to ensure all required data is reported on the reports required by the state of Maryland. Effect or potential effect: The System and Ascension Living did not file reports with the state of Illinois on a timely basis and was not in compliance with the terms and conditions of the federal program reporting requirements for the state of Maryland. Questioned costs: None. Context: 15 reports out of 21 required report submissions for the Illinois market were not submitted or submitted late. 1 report required for submission for the Maryland market did not include a required key year-to-date data field required by the state of Maryland. St. Agnes Healthcare, Inc., Maryland and Ascension Living, Illinois federal expenditures totaled $164,195 and $4,474,484, respectively, representing 3% and 93%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $4,798,357 for the year ended June 30, 2023. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. The System should ensure internal controls over the review of required reports are enhanced to include review of key data. Views of responsible officials: Ascension Living management acknowledges that nine reports were not submitted to the State as required by the grant terms. Ascension Living management will coordinate with the State representatives regarding any past reports that are needed and submit them timely according to the agreement requirements. The System implemented a team calendar that tracks due dates of all reports required to be submitted under federal and state programs. This calendar is accessible to all team members, including management. However, the System will reinforce the importance to operations of oversight and accountability to submit required reports.

Information of the federal program: Federal Grantor: United States Department of Health and Human Services, Health Resources and Services Administration (HRSA) Assistance Listing No.: 93.461, COVID-19 HRSA COVID-19 Claims Reimbursement for the Uninsured Program and the COVID-19 Coverage Assistance Fund (Uninsured Program) Ascension Ministry Market: Various Pass-Through Award Numbers: Various Pass-Through Award Period of Performance: 07/01/2021?06/30/2022 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).? Health and Human Services (HHS) ? Health Resources and Services and Administrative (HRSA) issued Terms and Conditions for Participation in the HRSA COVID-19 Claims Reimbursement to Health Care Providers and Facilities for Testing, Treatment, and Vaccine Administration for the Uninsured Program (T&Cs) outlining requirements that recipients of funding from the HRSA COVID-19 Uninsured Program must comply with, including the following sections: Testing Services, Treatment Services and Vaccine Administration, and General Provisions in FY2020 Consolidated Appropriations. Per the HRSA T&Cs (for COVID-19 testing and testing-related items): ?FFCRA Uninsured Individuals means individuals who, as of the date of service for which Recipient seeks Payment, are not enrolled in? ? A Federal health care program (as defined under section 1128B(f) of the Social Security Act (42 U.S.C. 1320a-7b(f)), including an individual who is eligible for medical assistance only because of subsection (a)(10)(A)(ii)(XXIII) of Section 1902 of the Social Security Act; or ? A group health plan or health insurance coverage offered by a health insurance issuer in the group or individual market (as such terms are defined in section 2791 of the Public Health Service Act (42 U.S.C. 300gg-91)), or a health plan offered under chapter 89 of title 5, United States Code.? Per the HRSA T&Cs (for COVID-19 treatment): Uninsured individuals are ?individuals who do not have any health care coverage at the time the services were provided.? Under the HRSA T&Cs, ?the Recipient certifies that it will not engage in ?balance billing? or charge any type of cost sharing for any items or services provided to Uninsured Individuals receiving a COVID-19 testing and/or testing related items, vaccination or care or treatment for a positive diagnosis of COVID-19 for which the Recipient receives a Payment from the Uninsured Program Fund. The Recipient must not sell or seek reimbursement from an Uninsured Individual for any COVID-19 vaccine and any adjuvant, syringes, needles, or other constituent products and ancillary supplies that the federal government provides at no cost to the Recipient. The Recipient shall consider Payment received from the Uninsured Program Fund to be payment in full for such COVID-19 testing and/or testing-related items, vaccine administration, care, or treatment.? Condition: Ascension Health Alliance d/b/a Ascension (the System) did not retain supporting documentation over the Uninsured COVID-19 report query logic (the Report) that was developed to identify patients who meet the allowability and eligibility requirements of the federal program. In addition, supporting documentation was not retained to validate who had access to modify the script, what changes were made to the script, and how the changes to the script were tested and implemented during the entirety of the fiscal year based on changes to HRSA guidance. Further, management did not maintain supporting documentation to demonstrate how it validated the completeness and accuracy of the data extracted by the script. Furthermore, in certain instances, the System billed HRSA and received payments for claims that were not allowable under the Uninsured Program, including instances where the patient had health insurance. In addition, we noted that the System?s statement-hold internal control, which is placed on each account that has COVID-19 diagnosis and uninsured status to prevent billing of the patient, was not operating consistently for all patient accounts billed under the Uninsured Program during the fiscal year. Cause: Development of the Report occurred outside of the Information Technology (IT) department that would require a formal process for the development of IT reports, access, and program changes; the Report resided in the Revenue Cycle department. The Revenue Cycle department did not develop internal control over program changes and user access. In addition, while management represented that the Report?s logic and subsequent changes to the Report?s logic were reviewed, no audit evidence was retained to support that process. The System billing departments did not have robust processes in place over the review for allowability and eligibility for the Uninsured Program, including identification of health insurance coverage. The statement hold control was not properly designed to include a statement hold on all patient accounts billed under the Uninsured Program. Effect or potential effect: The Report used to identify eligible federal program participants could be inaccurate or incomplete. Claims were submitted and reimbursed by HRSA for patients who had independent health insurance or the service was not supported by underlying medical records. A patient may be inappropriately billed for any outstanding balance remaining after HRSA payment. Questioned costs: COVID-19 Assistance Listing No. 93.461 ? $8,972. Context: For three claims with total payments of $8,972 out of 60 claims sampled with total payments of $396,317, we noted the following: ?For two of the claims, the patients were not uninsured at the time the claim was submitted to HRSA. The claims were submitted to HRSA and payment was received. ?For one of the claims, there was no evidence that COVID-19 was the primary diagnosis. The claim was submitted to HRSA and the payment was received. For seven claims with total payments of $97,340 out of 60 claims sampled with total payments of $396,317, we noted deficiencies in the design and operating effectiveness of the System?s statement hold internal control. For these seven claims, no statement hold was placed on the account. Total federal expenditures for Assistance Listing 93.461 totaled $39,064,571 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: A part of this finding is a repeat of Finding 2021-001 from the prior year. Recommendation: Should the federal program be reinstated by the U.S. Department of Health and Human Services (HHS), the System should implement internal controls related to access and change management over the Report. In addition, the System should implement more robust procedures to validate that the patient billed meets the allowability and eligibility requirements of the HRSA Uninsured Program, including sufficient review of health insurance coverage. Furthermore, the System should assess the internal controls over the balance billing requirement under the federal program to ensure it is designed properly and operating effectively. Views of responsible officials: The Uninsured Program administered by HHS stopped accepting claims due to lack of funding. All claims for testing or treatment had a deadline of March 22, 2022; thus, no further action plan is needed. Any patient accounts billed in error have been refunded to HRSA.

Information of the federal program: Federal Grantor: United States Department of Health and Human Services, Health Resources and Services Administration (HRSA) Assistance Listing No.: 93.498, COVID-19 Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution Ascension Ministry Market: Various Tax Identification Numbers: Various Payment Received Period: 07/01/2020?12/31/2020 (Period 2) and 01/01/2021?06/30/2021 (Period 3) Deadline to Use Funds: June 30, 2022 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 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: Evidence of management?s review of the Periods 2 and 3 Provider Relief Fund (PRF) Reports was not retained related to adjustments to net patient service revenue (NPSR) for out-of-period transactions used in the lost revenue calculations.In addition, supporting documentation was not consistently retained to support the allowability of adjustments for out-of-period transactions made to NPSR used in the lost revenue calculations. Cause: Management did not have suitably designed internal controls to ensure that all adjustments to NPSR for out-of-period transactions were reconciled to the final lost revenue calculations. Effect or potential effect: The lost revenue calculations could be inaccurate or incomplete. Questioned costs: None. Context: We tested 21 of 127 Periods 2 and 3 PRF Reports submitted to HRSA. We tested 8 of 44 adjustments that related to our selected 21 PRF Reports. For 2 of the 8 adjustments tested, the out-of-period adjustment to NPSR was incorrect. The effect on NPSR and lost revenues for these findings is as follows (see Schedule of Findings and Questioned Costs for chart/table). Total federal expenditures for Assistance Listing 93.498 reported in the schedule of expenditures of federal awards totaled $687,514,438 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is a repeat of Finding 2021-002 from the prior year. Recommendation: The System should ensure internal controls over the review of PRF Reports are enhanced to include testing of adjustments to NPSR used in the lost revenue calculations for proper supporting documentation. Views of responsible officials: Ascension completed a review on September 30, 2022 of the NPSR adjustments file to the detailed lost revenue calculation file and saved a final copy of the NPSR adjustments file to prevent further revisions. Ascension had significant excess unused loss revenues to cover the impact of the NPSR adjustment errors identified and is still able to support funding received. Ascension updated the loss revenue calculation file to reflect the corrected NPSR adjustments that will be used for future PRF Reporting. Ascension will input the corrected loss revenue calculations for all unsupported adjustments in Report Period 4 due March 31, 2023.

Information of the federal program: Federal Grantor: United States Department of the Treasury Pass-Through Grantor: Michigan Health & Hospital Association Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 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).? Condition: The System has an internal control to review the accuracy of the suspension and debarment search results performed by its third-party contractor. The internal control was not performed over a new third-party contractor that was used for two months of fiscal year 2022. Cause: During fiscal year 2022, the System changed its third-party contractor beginning May 2022. The third-party contractor does not have a SOC 1 (System and Organization Controls Report) report that covers the suspension and debarment services provided. Management did not perform testing over the results of the third-party contractor to assess the accuracy of its procedures. Effect or potential effect: Suspension and debarment results provided by the third-party contractor may not be accurate. As a result, federal funds may be used to pay a contractor that is suspended or debarred. Questioned costs: None. Context: For Assistance Listing No. 21.027, the federal portion of procurement expenditures subject to suspension and debarment review totaled $1,636,000, which represents approximately 5.4% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System?s independent testing of the internal controls performed by the third-party contractor to ensure they are functioning as designed, inclusive of all contractors and subcontractors, and the results provided by the third-party contract are consistent with the System?s expectations, should be reevaluated when there are changes in facts and circumstances, such as a change in third-party contractors. Views of responsible officials: Effective February 1, 2023, Ascension has formally updated its documented procedures related to this key internal control. These procedures now provide specific guidance to address the impact of a change in third-party contractors.

Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 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 pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.

Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 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 Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.

Information of the federal program: Federal Grantor: United States Department of Health and Human Services, Health Resources and Services Administration (HRSA) Assistance Listing No.: 93.461, COVID-19 HRSA COVID-19 Claims Reimbursement for the Uninsured Program and the COVID-19 Coverage Assistance Fund (Uninsured Program) Ascension Ministry Market: Various Pass-Through Award Numbers: Various Pass-Through Award Period of Performance: 07/01/2020?06/30/2021 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).? Under the terms and conditions of the award, ?the Recipient certifies that it will not engage in ?balance billing? or charge any type of cost sharing for any items or services provided to Uninsured Individuals receiving a COVID-19 testing and/or testing related items, vaccination or care or treatment for a positive diagnosis of COVID-19 for which the Recipient receives a Payment from the Uninsured Program Fund. The Recipient must not sell or seek reimbursement from an Uninsured Individual for any COVID-19 vaccine and any adjuvant, syringes, needles, or other constituent products and ancillary supplies that the federal government provides at no cost to the Recipient. The Recipient shall consider Payment received from the Uninsured Program Fund to be payment in full for such COVID-19 testing and/or testing-related items, vaccine administration, care, or treatment.? Condition: Ascension did not retain supporting documentation over the Uninsured COVID-19 report query logic (the Report) that was developed to identify patients who meet the allowability and eligibility requirements of the federal program. In addition, supporting documentation was not retained to validate who had access to modify the script, what changes were made to the script, and how the changes to the script were tested and implemented during the fiscal year based on changes to HRSA guidance. Further, management did not maintain supporting documentation to demonstrate how it validated the completeness and accuracy of the data extracted by the script. In addition, we noted that Ascension?s statement-hold internal control, which is placed on each account that has COVID-19 diagnosis and uninsured status to prevent billing of the patient, was not operating consistently for all patient accounts billed under the Uninsured Program during the fiscal year. Cause: Development of the Report occurred outside of the Information Technology (IT) department that would require a formal process for the development of IT reports, access and program changes; the Report resided in the Revenue Cycle department. The Revenue Cycle department did not develop internal control over program changes and user access. In addition, while management represented that the Report?s logic and subsequent changes to the Report?s logic were reviewed, no audit evidence was retained to support that process. The statement hold control was not properly designed to include a statement hold on all patient accounts billed under the Uninsured Program. Effect or potential effect: The Report used to identify eligible federal program participants could be inaccurate or incomplete. A patient may be inappropriately billed for any outstanding balance remaining after HRSA payment. Questioned costs: $75. Context: For six of 60 claims sampled (totaling $402,891 in Uninsured payments included in federal expenditures), we noted deficiencies in the design and operating effectiveness of Ascension?s statement hold internal control as follows: ?For two of the six claims, no statement hold was placed on the account due to omission. ?For two of the six claims, the statement hold dropped off the account due to multiple changes in the patient?s insurance status. For one of the two claims, the patient was billed and the patient paid the bill. HRSA was then billed and payment was received. ?For one of the six claims, the statement hold was not placed as the diagnosis codes were not updated in the system to include Z32.02. ?For one of the six claims, although a statement was not generated, there was no evidence of the placement of the statement hold on the account in the host billing system. Total federal expenditures for Assistance Listing 93.461 totaled $74,946,343 for the year ended June 30, 2021. Identification as a repeat finding, if applicable: The Uninsured COVID-19 report query portion of the finding is a repeat of Finding 2020-005 from the prior year. Recommendation: Ascension should implement internal controls related to access and change management over the Report. In addition, Ascension should assess the internal controls over the balance billing requirement under the federal program to ensure it is designed properly and operating effectively. Views of responsible officials: The Uninsured Program administered by the U.S Department of Health and Human Services (HHS) stopped accepting claims due to lack of funding. All claims for testing or treatment had a deadline of March 22, 2022; thus, no further action plan is needed. Any patient accounts billed in error have been refunded to HRSA as of August 30, 2022.

Information of the federal program: Federal Grantor: United States Department of Health and Human Services, Health Resources and Services Administration (HRSA) Assistance Listing No.: 93.461, COVID-19 HRSA COVID-19 Claims Reimbursement for the Uninsured Program and the COVID-19 Coverage Assistance Fund (Uninsured Program) Ascension Ministry Market: Various Award Numbers: Not applicable Award Period of Performance: 07/01/2020?06/30/2021 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 Uniform Guidance 2 CFR section 200.510 states, ?(b) Schedule of expenditures of Federal awards. The auditee must also prepare a schedule of expenditures of federal awards for the period covered by the auditee?s financial statements which must include the total Federal awards expended as determined in accordance with ?200.502 Basis for determining Federal awards expended.? Condition: Ascension was unable to determine the complete population of patients who were billed and/or reimbursed under the Uninsured program to determine the expenditures to include on the schedule of expenditures of Federal awards. Cause: The Ascension billing departments did not consistently code the payments related to the Uninsured Program as HRSA COVID-19 Uninsured. Effect or potential effect: Federal program expenditures could be understated. Questioned costs: None. Context: Federal program expenditures did not include all payments made by HRSA. For four of 60 claims sampled (6.7%) that originally reported an expected balance to be received, we noted that a payment was received from HRSA, but the payment was not captured in the population file. Total federal expenditures for Assistance Listing 93.461 reported in the schedule of expenditures of Federal awards totaled $74,946,343 for the year ended June 30, 2021. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Ascension should ensure billing department personnel are appropriately coding the payments related to the program to the proper payor class, including sufficient review. Views of responsible officials: The Uninsured Program administered by the U.S. Department of Health and Human Services (HHS) stopped accepting claims due to lack of funding. All claims for testing or treatment had a deadline of March 22, 2022; thus, no further action plan is needed.

Information of the federal program: Federal Grantor: United States Department of Health and Human Services, Health Resources and Services Administration (HRSA) Assistance Listing No.: 93.498, COVID-19 Provider Relief Fund Ascension Ministry Market: Various Tax Identification Numbers: Various Payment Received Period: 04/10/2020?06/30/2020 Deadline to Use Funds: June 30, 2021 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 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: Evidence of management?s review of the Period 1 Provider Relief Fund (PRF) Reports was not retained related to (1) adjustments to net patient service revenue (NPSR) for out-of-period transactions used in the lost revenue calculations and (2) tying NPSR queries to the general ledger for completeness and accuracy. In addition, supporting documentation was not consistently retained to support the allowability of adjustments for out-of-period transactions made to NPSR used in the lost revenue calculations. Cause: Management did not have suitably designed internal controls to ensure that all adjustments to NPSR for out-of-period transactions were reconciled to the final lost revenue calculations. NPSR queries from the general ledger were relied upon with no validation performed. Effect or potential effect: The lost revenue calculations could be inaccurate or incomplete. Questioned costs: None. Context: We tested 18 of 173 Period 1 PRF Reports submitted to HRSA. For 2 of the 18 Period 1 PRF Reports tested, we noted certain adjustments to NPSR did not have adequate supporting documentation for the out-of-period adjustments made to NPSR as follows: Recipient Billing TIN Q2 CY19 Adjustments Q4 CY19 Adjustments Q2 CY20 Adjustments Q4 CY20 Adjustments Total 380997730 $(1,927,567) $108,823 $(407,947) $(717,831) $(2,944,522) 390806315 875,000 875,000 $(1,927,567) $108,823 $(407,947) $ 157,169 $(2,069,522) Total federal expenditures for Assistance Listing 93.498 reported in the schedule of expenditures of Federal awards totaled $1,074,696,426 for the year ended June 30, 2021. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Ascension should ensure internal controls over the review of PRF Reports are enhanced to include (1) testing of adjustments to NPSR used in the lost revenue calculations for proper supporting documentation and (2) tying NPSR queries to the general ledger for completeness and accuracy. Evidence of the review should be maintained. Views of responsible officials: Ascension will review the NPSR adjustments file and save a final copy to prevent further revisions. Ascension will maintain evidence of the review of the NPSR adjustments file along with the reconciliation to the input of the adjustments in the PRF reporting file. Ascension will test a sample of reporting entities to ensure the NPSR queries tie to the general ledger for completeness and accuracy. Completion date will be September 30, 2022. Ascension will input the corrected loss revenue calculations for the unsupported adjustments on the future PRF Reporting due March 31, 2023.

Information on the federal program: Federal Grantor: United States Department of Homeland Security Pass-Through Entity: State of Florida, Division of Emergency Management Assistance Listing No.: 97.036, Disaster Grants Public Assistance (Presidentially Declared Disasters) Ascension Ministry Market: Florida Pass-Through Award Numbers: PA-04-FL-4399-PW-0833(0) PA-04-FL-4399-PW-0845(0) PA-04-FL-4283-PW-0359(0) PA-04-FL-4283-PW-0375(0) PA-04-FL-4177-PW-0878(1) Pass-Through Award Periods of Performance: 10/11/2018?04/11/2020 10/11/2018?04/11/2020 10/01/2016?04/08/2017 10/08/2016?04/08/2018 05/06/2014?11/06/2015 Criteria or specific requirement (including statutory, regulatory or other citation): The Uniform Guidance 2 CFR section 200.303 states, ?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 Uniform Guidance 2 CFR section 200.510 states, ?(b) Schedule of expenditures of Federal awards. The auditee must also prepare a schedule of expenditures of federal awards (SEFA) for the period covered by the auditee?s financial statements which must include the total Federal awards expended as determined in accordance with ?200.502 Basis for determining Federal awards expended.? Condition: Ascension did not provide a complete and accurate listing of all Federal Emergency Management Agency (FEMA) expenditures and present in the SEFA. Cause: Ascension misinterpreted the FEMA guidance for reporting Assistance Listing 97.036 expenditures in the SEFA, which is based on when (1) FEMA has approved (i.e., obligated) the non-federal entity?s project worksheet (PW), and (2) the non-federal entity has incurred the eligible expenditures. Ascension interpreted the date the PW is approved (i.e., obligated) as the date the State of Florida, Division of Emergency Management approved the PW for payment rather than the date FEMA obligated the PW. Questioned costs: None. Context: Expenditures for Assistance Listing 97.036 were overstated by $854,546, or 90% of the balance originally reported on the SEFA. These expenditures related to PWs approved and expenditures incurred in fiscal 2018 and 2019 and consequently should have been recorded in those respective fiscal years? SEFAs. Effect or potential effect: The SEFA prepared by Ascension was misstated but was subsequently corrected. A misstated SEFA could result in the improper selection of federal award major programs or an incorrect percentage of coverage being calculated resulting in a restatement of a previously issued Uniform Guidance report. Identification as a repeat finding, if applicable: This is not a repeat finding. Recommendation: Ascension should update its policies and procedures and internal controls, specifically the process to accumulate and report FEMA expenditures of federal awards to be in accordance with the FEMA SEFA requirements outlined above. Views of responsible officials: Ascension agrees with the comment and has developed a plan to correct the finding.

Information on the federal program: Federal Grantor: United States Department of Agriculture Pass-Through Entity: Indiana State Department of Health Assistance Listing No.: 10.557, Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) Ascension Ministry Market: Indiana Pass-Through Award Numbers: See Schedule of Findings and Questioned Costs for chart/table Pass-Through Award Periods of Performance: See Schedule of Findings and Questioned Costs for chart/table Federal Grantor: United States Department of Justice Pass-Through Entity: Michigan Department of Health and Human Services Assistance Listing No.: 16.575, Crime Victim Assistance Ascension Ministry Market: Michigan Pass-Through Award Numbers: 10/1/18?9/30/19 and 10/1/19?9/30/20 Pass-Through Award Periods of Performance: E20192072-001 and E20202826-00 Federal Grantor: United States Department of Justice Pass-Through Entity: Children?s Advocacy Centers of Illinois Assistance Listing No.: 16.575, Crime Victim Assistance Ascension Ministry Market: Ascension ? Amita (Illinois) Pass-Through Award Number: 217003 Pass-Through Award Period of Performance: 7/01/2019?06/30/2020 Research and Development Cluster: Federal Grantor: United States Department of Health and Human Services Assistance Listing No.: 93.395, Cancer Treatment Research Ascension Ministry Market: Kansas Award Number: 5UG1CA189808-05 Award Period of Performance: 8/1/18?7/31/20 Federal Grantor: United States Department of Health and Human Services Pass-Through Entity: St. Vincent Hospital of the Hospital Sisters of the Third Order of St. Francis Assistance Listing No.: 93.399, Cancer Control Ascension Ministry Market: Wisconsin Pass-Through Award Numbers: 2019-01 Ascension WI Pass-Through Award Periods of Performance: 8/1/19?7/31/20 Federal Grantor: United States Department of Health and Human Services Pass-Through Entity: Various Assistance Listing Nos.: 93.242, 93.273, 93.395, 93.399, 93.839, and 93.853 Ascension Ministry Market: Texas Pass-Through Award Numbers: Various Pass-Through Award Periods of Performance: Various 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).? Section 200.431 Compensation ? fringe benefits of the Uniform Guidance states the following: ?(a) General. Fringe benefits are allowances and services provided by employers to their employees as compensation in addition to regular salaries and wages. Fringe benefits include, but are not limited to, the costs of leave (vacation, family-related, sick or military), employee insurance, pensions, and unemployment benefit plans. Except as provided elsewhere in these principles, the costs of fringe benefits are allowable provided that the benefits are reasonable and are required by law, non-Federal entity-employee agreement, or an established policy of the non-Federal entity.? Condition: Research and Development Cluster ? As part of our testing of the operating effectiveness of internal controls over the activities allowed and allowable costs compliance requirement, we noted there was no review and approval of the establishment of the annual benefit rate or benefit rate per full-time equivalent (FTE) used in the computation of fringe benefits requested for reimbursement from the federal programs at the beginning of the fiscal year. Additionally, there was no supporting documentation for the benefit rate used. Assistance Listing Nos. 10.557 and 16.575 ? There was no supporting documentation for the benefit rate used. Cause: Ascension did not follow its policies and procedures or internal controls in place that require the review and approval of the annual benefit rate per FTE charged to the federal program during the fiscal year or the retention of supporting documentation for the annual benefit rate. Questioned costs: Assistance Listing 10.557 ? $151,086 - See Schedule of Findings and Questioned Costs for chart/table Assistance Listing 16.575 ? $147,447 (Federal ? $114,955 and Match ? $32,492)-See Schedule of Findings and Questioned Costs for chart/table Research and Development Cluster ? $107,465 - See Schedule of Findings and Questioned Costs for chart/table Context: Assistance Listing 10.557 ? Fringe benefits totaled $151,086 for the year ended June 30, 2020, representing 19.9% of total federal expenditures for Assistance Listing 10.557 of $758,076. Assistance Listing 16.575 (Michigan) ? Fringe benefits charged to the federal portion of Assistance Listing 16.575 (Michigan) totaled $63,258 for the year ended June 30, 2020, representing 7.9% of total federal expenditures for Assistance Listing 16.575 of $802,973. In addition, fringe benefits charged to the match portion of the grant at Michigan totaled $27,899 for the year ended June 30, 2020, representing 36.0% of total match expenditures at Michigan for Assistance Listing 16.575 of $77,405. Assistance Listing 16.575 (Ascension ? Amita (Illinois)) ? Benefits per FTE charged to the federal portion of Assistance Listing 16.575 (Ascension ? Amita (Illinois)) totaled $51,697 for the year ended June 30, 2020, representing 6.4% of total federal expenditures for Assistance Listing 16.575 of $802,973. In addition, benefits per FTE charged to the match portion of the grant at Ascension ? Amita (Illinois) totaled $4,593 for the year ended June 30, 2020, representing 5.8% of total match expenditures at Ascension ? Amita (Illinois) for Assistance Listing 16.575 of $79,337. Assistance Listing 93.399 (Wisconsin) ? Fringe benefits charged to the federal program for Assistance Listing 93.399 (Wisconsin) totaled $28,103 for the year ended June 30, 2020, representing 2.3% of total federal expenditures for the R&D Cluster of $1,208,945. Assistance Listing 93.395 (Kansas) ? Fringe benefits charged to the federal program for Assistance Listing 93.395 (Kansas) totaled $33,551 for the year ended June 30, 2020, representing 2.8% of total federal expenditures for the R&D Cluster of $1,208,945. Assistance Listing 93.242, 93.273, 93.395, 93.399, 93.853, 93.839 (Texas) ? Fringe benefits charged to the federal program for the above Assistance Listings (Texas) totaled $45,811 for the year ended June 30, 2020, representing 3.8% of total federal expenditures for the R&D Cluster of $1,208,945. Effect or potential effect: Fringe benefits and benefits per FTE were charged directly to the federal programs and for Assistance Listing 16.575, also charged as a component of the required match that could not be supported with the books and records of Ascension, could result in either an overstated or understated cost charged to the federal programs or used as a match. Identification as a repeat finding, if applicable: The finding is not a repeat finding. Recommendation: Ascension should reinforce the importance of adherence to policies and procedures and internal controls over the determination of the fringe benefit rate or benefit rate per FTE. Evidence of review and approval, including elements of the review process validated by the reviewer, and related underlying support for the calculation should be maintained. Views of Responsible Officials: Ascension agrees with the finding and has developed a plan to correct the finding.

Information on the federal program: Federal Grantor: United States Department of Justice Pass-Through Entity: Children?s Advocacy Centers of Illinois Assistance Listing No.: 16.575, Crime Victim Assistance Ascension Ministry Market: Ascension ? Amita (Illinois) Pass-Through Award Number: 217003 Pass-Through Award Period of Performance: 7/01/2019?06/30/2020 Federal Grantor: United States Department of Justice Pass-Through Entity: Michigan Department of Health and Human Services Assistance Listing No.: 16.575, Crime Victim Assistance Ascension Ministry Market: Michigan Pass-Through Award Numbers: 10/1/18?9/30/19 and 10/1/19?9/30/20 Pass-Through Award Periods of Performance: E20192072-001 and E20202826-00 Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): Uniform Guidance Section 200.306 Cost sharing or matching of the Uniform Guidance states the following: ?(b) For all Federal awards, any shared costs or matching funds and all contributions, including cash and third-party in-kind contributions, must be accepted as part of the non-Federal entity?s cost sharing or matching when such contributions meet all of the following criteria: (1) Are verifiable from the non-Federal entity?s records; (2) Are not included as contributions for any other Federal award; (3) Are necessary and reasonable for accomplishment of project or program objectives; (4) Are allowable under subpart E of this part; (5) Are not paid by the Federal Government under another Federal award, except where the Federal statute authorizing a program specifically provides that Federal funds made available for such program can be applied to matching or cost sharing requirements of other Federal programs; (6) Are provided for in the approved budget when required by the Federal awarding agency; and (7) Conform to other provisions of this part, as applicable.? ?(e) Volunteer services furnished by third-party professional and technical personnel, consultants, and other skilled and unskilled labor may be counted as cost sharing or matching if the service is an integral and necessary part of an approved project or program. Rates for third-party volunteer services must be consistent with those paid for similar work by the non-Federal entity. In those instances in which the required skills are not found in the non-Federal entity, rates must be consistent with those paid for similar work in the labor market in which the non-Federal entity competes for the kind of services involved. In either case, paid fringe benefits that are reasonable, necessary, allocable, and otherwise allowable may be included in the valuation.? Section 200.431 Compensation?fringe benefits of the Uniform Guidance states the following: ?(a) General. Fringe benefits are allowances and services provided by employers to their employees as compensation in addition to regular salaries and wages. Fringe benefits include, but are not limited to, the costs of leave (vacation, family-related, sick or military), employee insurance, pensions, and unemployment benefit plans. Except as provided elsewhere in these principles, the costs of fringe benefits are allowable provided that the benefits are reasonable and are required by law, non-Federal entity-employee agreement, or an established policy of the non-Federal entity.? Pass-Through Grant Agreement #217003 for the period July 1, 2019 through June 30, 2020 ? Part Three ? The Project Specific Terms, Section 1. Match of the grant agreement with the pass-through entity states: ?1.2. To meet this matching funds requirement, Grantee shall apply non-federal financial support to the program, as described in the Budget.? 1.3. Grantee shall maintain records that clearly show the source and amount of the program match amount, and the period of time for which such contributions were allocated. The basis for determining the value of personal services, material, equipment, and space and facilities shall be documented. Volunteer services shall be substantiated by the same methods used by the Grantee for its paid employees. The value of volunteer services must be consistent with the rate of compensation (which may include fringe benefits) paid for similar work in the program, but if the similar work is not performed in the program, the rate of compensation shall be consistent with the rate found in the labor market which the program competes.? Pass-Through Grant Agreement #217003 for the period July 1, 2019 through June 30, 2020 ? Part Two ? The Grantor-Specific Terms, Section 23. Timekeeping of the grant agreement with the pass-through entity states: ?23.1. Grantee shall, in furtherance of its performance of all aspects of the program description and budget as set forth in the attached exhibits and the Budget, maintain time keeping records for all grant-funded and match personnel as follows: A. Personnel who spend less than 100% of their time on the funded program must maintain Personnel Activity Reports (PAR) that accurately reflects the time the employee spends performing the program and any other duties. The PAR must: 1. Reflect an after-the-fact distribution of the employee?s actual activity (not budgeted time); 2. Account for attendance and the daily total activity for which the employee is compensated (by all funding sources); 3. Be prepared at least monthly and coincide with one or more pay periods; 4. Be signed by the employee and approved by a supervisor having firsthand knowledge of the work performed; and 5. Be supplemented with daily attendance timesheets.? Condition: We noted a lack of maintenance of supporting documentation over certain costs used to meet the matching requirement and reported in the monthly financial reports during the fiscal year as follows: Ascension ? Amita (Illinois): ? Benefit rate per FTE calculation ? The benefit rate per FTE used was a historical rate and was not updated for the current fiscal year nor could documentation of the historical rate be located. ? PARs were not prepared for two employees to support the percentage of their time applied in the match calculation. ? Allocated rent calculation ? Occupancy cost used in the match calculation was based a historical calculation and was not updated for the current year nor could the documentation to support the historical inputs to the calculation be located. ? Volunteer time that was not included in the federal budget was applied to the match for the months of September 2019 through March 2020, and not reversed until May 2020. Ascension ? Michigan: ? Benefit rate ? No supporting documentation for the benefit rate used was retained. Cause: The review and approval of the monthly match calculation reported in the monthly financial reports was not robust enough to identify that there was insufficient supporting documentation to support key inputs into the matching calculation. Questioned costs: Assistance Listing 16.575 ? $107,109 - See Schedule of Findings and Questioned Costs for chart/table 1 Ascension ? Amita (Illinois): $79,210, representing personnel, fringe, and occupancy costs of $29,996, $6,890 ($2,297 related to FICA and $4,593 related to benefits per FTE ? which are also included in Finding 2020-003), and $42,324, respectively, applied to the match during the fiscal year. 2 Ascension ? Michigan: $27,899 (which is also included in Finding 2020-003), representing fringe costs applied to the match during the fiscal year. Context: Ascension ? Amita (Illinois): The total annual match reported for Illinois was $79,337 for the year ended June 30, 2020, representing 20.7% of the total award for this location. Total federal expenditures for Assistance Listing 16.575 at Ascension ? Amita (Illinois) were $304,573, representing 37.9% of total federal expenditures for Assistance Listing 16.575 of $802,973. Ascension ? Michigan: The total annual match reported for Michigan was $77,405 for the year ended June 30, 2020, representing 15.5% of the total award for this location. Total federal expenditures for Assistance Listing 16.575 at Michigan were $498,400, representing 61.6% of total federal expenditures for Assistance Listing 16.575 of $802,973. Effect or potential effect: Costs used to meet the matching requirement could not be supported. Identification as a repeat finding, if applicable: The finding is not a repeat finding. Recommendation: Ascension should review its internal controls over the review and approval of the matching calculation to ensure it includes obtaining and reviewing support for all key components to the matching calculation. This should include the determination of the benefit rate per FTE rate and monthly occupancy costs applied to the match. In addition, PARs should be prepared, reviewed, and approved for personnel who spend less than 100% of their time on the federal program that accurately reflects the time the employee works directly on the program. Evidence of approval, including elements of the review process validated by the approver, and adequate source documents for costs applied to the match should be maintained. Views of Responsible Officials: Ascension agrees with the finding and has developed a plan to correct the finding.

Information on the federal program: Federal Grantor: United States Department of Health and Human Services, Health Resources and Services Administration (HRSA) Assistance Listing No.: 93.461, COVID-19 Testing for the Uninsured Ascension Ministry Market: Various Pass-Through Award Numbers: Various Pass-Through Award Period of Performance: 02/04/2020?06/30/2020 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).? Condition: Ascension did not retain supporting documentation over the Uninsured COVID-19 report query logic (the Report) that was developed to identify patients that meet the allowability and eligibility requirements of the federal program. In addition, supporting documentation was not retained to validate who had access to modify the script, what changes were made to the script, and how the changes to the script were tested and implemented during the fiscal year based on changes to HRSA guidance. Further, management did not maintain supporting documentation to demonstrate how it validated the completeness and accuracy of the data extracted by the script. Cause: Development of the Report occurred outside of the Information Technology (IT) department that would require a formal process for the development of IT reports, access and program changes; the Report resided in the Revenue Cycle department. The Revenue Cycle department did not develop internal control over program changes and user access. In addition, while management represented that the Report?s logic and subsequent changes to the Report?s logic were reviewed, no audit evidence was retained to support that process. Questioned costs: None. Context: Total federal expenditures for Assistance Listing 93.461 totaled $19,804,109 for the year ended June 30, 2020. Effect or potential effect: The Report used to identify eligible federal program participants could be inaccurate or incomplete. Identification as a repeat finding, if applicable: The finding is not a repeat finding. Recommendation: Ascension should implement internal controls related to access and change management over the Report. Views of Responsible Officials: Ascension agrees with the finding and has developed a plan to correct the finding.

Information on the federal program: Federal Grantor: United States Department of Agriculture Pass-Through Entity: Indiana State Department of Health Assistance Listing No.: 10.557, Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) Ascension Ministry Market: Indiana Pass-Through Award Numbers: See Schedule of Findings and Questioned Costs for chart/table Pass-Through Award Periods of Performance: See Schedule of Findings and Questioned Costs for chart/table Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): Section 200.403 of the Uniform Guidance states, ?Factors affecting allowability of costs. Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards Condition: We noted there was a lack of maintenance of supporting documentation over internal space costs (and other costs allocated based on square footage) charged to the federal program through a cost allocation plan. Cause: The review and approval process over the written cost allocation plans that are submitted to the pass-through grantors with the annual budget is not formalized. There was insufficient supporting documentation to support key inputs into the space cost allocation and other costs allocated based on square footage. Questioned costs: Assistance Listing 10.557 ? $40,342. See Schedule of Findings and Questioned Costs for chart/table Context: Space and other allocated costs charged to the WIC program through the cost allocation plans totaled $40,342, representing 5.3% of total federal expenditures of $758,076 for the year ended June 30, 2020. Effect or potential effect: Allocated costs charged to the federal program could not be supported. Identification as a repeat finding, if applicable: The finding is not a repeat finding. Recommendation: Ascension should formalize the review and approval process over the cost allocation plan. Evidence of review and approval, including elements of the review process validated by the reviewer, and adequate supporting documents for allocated costs charged should be maintained. Views of Responsible Officials: Ascension agrees with the finding and has developed a plan to correct the finding.

Information on the federal program: Federal Grantor: United States Department of Education Pass-Through Entity: Florida Department of Health Assistance Listing No.: 84.181, Special Education ? Grants for Infants and Families Ascension Ministry Market: Florida Pass-Through Award Number: COQZN Pass-Through Award Period: 7/1/18?6/30/21 Criteria or specific requirement (including statutory, regulatory or other citation): The Uniform Guidance 2 CFR section 200.320 states, ?(a)(2) Small purchases ? (i) Small purchase procedures. The acquisition of property or services, the aggregate dollar amount of which is higher than the micro-purchase threshold but does not exceed the simplified acquisition threshold. If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources as determined appropriate by the non-Federal entity.? Per Attachment I, section B.4.b. Professional Qualifications of the grant agreement with the Florida Department of Health, ?Persons who provide early intervention services, includes LES (Local Early Steps) staff, subcontractors, or fee for service consultants, must meet state and federal requirements and submit a completed application for enrollment as a Florida Medicaid provider before providing services.? Condition: The qualifications of contracted service providers are periodically evaluated; service reimbursement rates are based on the Medicaid rate and not subject to procurement procedures. Ascension ? Florida completes the Ascension procurement checklist for procurement transactions representing a small purchase (i.e., purchases over the micro-purchase threshold, but below the simplified acquisition threshold). However, documentation to support the employing agency?s assessment of qualifications of its employees was not obtained for contracted service providers who work for those agencies. As such, documentation was not complete to evidence compliance with the Uniform Guidance small purchase procedures related to ?qualified? sources. Cause: There are insufficient internal controls in place to require supporting documentation be maintained to support the conclusions that are documented in the Ascension procurement checklist that is prepared for small purchases. Questioned costs: Assistance Listing 84.181 ? $205,376, representing the federal portion of procurements for certain contracted service providers for the fiscal year ended June 30, 2020, as described under Context below. Context: For Assistance Listing 84.181, total program expenditures are $2,167,735, of which $1,351,414 (approximately 62%) represents state resources and $816,321 (approximately 38%) represents federal expenditures reported in the SEFA for the year ended June 30, 2020. Total procurement expenditures are $1,228,355, representing approximately 56.7% of total program expenditures. The federal portion of procurement expenditures subject to Uniform Guidance procurement procedures totaled $461,098. Contracted service providers are screened, interviewed, and required to complete a state mandated credentialing process to ensure selection of qualified service providers. We selected a sample of 13 Ascension procurement checklists prepared for contracted service providers totaling $651,548. For 9 of the 13 Ascension procurement checklists for contracted service providers totaling $547,118 (federal portion totaling $205,376), we noted documentation to support the employing agency?s assessment of qualifications of its employees was not obtained by Ascension ? Florida. Effect or potential effect: Ascension ? Florida did not follow the Uniform Guidance requirements related to small purchases. Contracted service providers used in the federal program may not be qualified. Identification as a repeat finding, if applicable: The finding is not a repeat finding. Recommendation: Ascension should reinforce the importance of adhering to its procurement policy and provide specific training for all program personnel. Missing or incomplete documentation related to qualification assessments performed for contracted service providers who work for contracted agencies should be obtained and retained in the procurement files. Views of responsible officials: Ascension agrees with the comment and has since corrected the finding.

Information on the federal program: Federal Grantor: United States Department of Health and Human Services Pass-Through Entity: St. Joseph Mercy Health System Research and Development Cluster Assistance Listing No.: 93.395, Cancer Treatment Research Ascension Ministry Market: Michigan Pass-Through Award Numbers: MI013 Pass-Through Award Periods of Performance: June 1, 2016?ongoing Criteria or specific requirement (including statutory, regulatory or other citation): The Uniform Guidance 2 CFR section 200.303 states, ?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).? Condition: Time cards for employees who charge 100% of their time to the federal program were not consistently reviewed and approved. Cause: Time cards were processed without manager approval. Questioned costs: None. Context: For 6 (totaling $13,527) of 38 (totaling $83,628) (16.2%) payroll transactions sampled during the fiscal year, the employee?s time card did not have evidence of review and approval by the employee?s manager. For Assistance Listing 93.395, total federal expenditures for the two hospital locations at Ascension ? Michigan totaled $160,875, which represents total payroll costs for the year ended June 30, 2020, representing 13.3% of total federal expenditures for the R&D Cluster of $1,208,945. Effect or potential effect: Payroll costs could be unallowable. Identification as a repeat finding, if applicable: This is not a repeat finding. Recommendation: Ascension should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Views of responsible officials: Ascension agrees with the comment and has developed a plan to correct the finding.

Information on the federal program: Federal Grantor: United States Department of Justice Pass-Through Entity: Michigan Department of Health and Human Services Assistance Listing No.: 16.575, Crime Victim Assistance Ascension Ministry Market: Michigan Pass-Through Award Numbers: E20192072-001 and E20202826-00 Pass-Through Award Periods of Performance: 10/1/18?9/30/19 and 10/1/19?9/30/20 Federal Grantor: United States Department of Justice Pass-Through Entity: Children?s Advocacy Centers of Illinois Assistance Listing No.: 16.575, Crime Victim Assistance Ascension Ministry Market: Ascension ? Amita (Illinois) Pass-Through Award Number: 217003 Pass-Through Award Period of Performance: 7/01/2019?06/30/2020 Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): Illinois Articles XIII and XIV of the Children?s Advocacy Centers of Illinois grant agreement outline the periodic financial reports (including closeout financial reports) and periodic performance reports (including closeout performance reports) required to be submitted. Michigan Part I.6., Part II.IV.C., Part II.IV.E., and Attachment C of the Michigan Department of Health and Human Services grant agreement outline the periodic financial and performance/progress reports required to be submitted. Condition: The monthly financial report is required to be submitted to the pass-through grantor and serves as the report used to perform the monthly reimbursement request and report matching funds to the pass-through grantor. We noted insufficient supporting documentation for certain amounts disclosed in the monthly financial reports submitted during the fiscal year. ? Ascension ? Michigan: There was insufficient supporting documentation to support the fringe benefit rate used to calculate fringe benefits (federal and match) reported in the monthly Financial Status Report. ? Ascension ? Amita (Illinois): There was insufficient supporting documentation to support key inputs into the matching calculation and certain payroll costs (federal and match) reported in the monthly Periodic Financial Report and annual Financial Closeout Report. Additionally, for both locations, we noted a lack of supporting documentation for certain amounts disclosed in the periodic performance reports. ? Ascension ? Michigan: There was insufficient documentation to support the ?total number of individuals served? as reported in the quarterly Performance Measurement Report. ? Ascension ? Amita (Illinois): There was insufficient documentation to support the ?number of hours paid staff,? ?number of hours volunteer,? and ?number of clients served? as reported in the quarterly Data Report. Furthermore, there was insufficient documentation to support the ?number of hours paid staff? and ?number of hours volunteer? as reported in the quarterly Progress Report. Cause: There was a lack of adherence to Ascension policies and procedures and internal controls over the review, approval, and retention of supporting documentation for periodic financial and performance reports submitted during the fiscal year. Questioned costs: Assistance Listing 16.575 ? $222,064 (Federal ? $114,955 and Match ? $107,109). See Schedule of Findings and Questioned Costs for chart/table ? Ascension ? Amita (Illinois): $79,210, representing personnel, fringe, and occupancy costs of $29,996 (which is also included in Finding 2020-003), $6,890 (which is also included in Findings 2020-003 and 2020-004), and $42,324 (which is also included in Finding 2020-004), respectively, applied to the match during the fiscal year and reported in the monthly financial reports; $51,697 (which is also included in Finding 2020 003), representing fringe costs applied to the federal award during the fiscal year. ? Ascension ? Michigan: $63,258 and $27,899 (which are also included in Finding 2020 003), representing fringe costs applied to the federal award and to the match, respectively, during the fiscal year. Context: Ascension ? Amita (Illinois) was required to submit monthly Periodic Financial Reports, quarterly Progress Reports, quarterly Data Reports, an annual Financial Closeout Report, and an annual Performance Closeout Report during the fiscal year. We sampled three monthly Periodic Financial Reports, two quarterly Progress Reports, two quarterly Data Reports, and the annual Financial Closeout Report submitted during the fiscal year and selected key line items for further testing. We noted insufficient supporting documentation for personnel, fringe, and occupancy costs disclosed in the monthly Periodic Financial Reports and annual Financial Closeout Report submitted during the fiscal year (see Questioned Costs section above). In addition, we noted there was no documentation to support the ?number of hours paid staff,? ?number of hours volunteer,? and ?number of clients served? as reported in the two sampled quarterly Data Reports and the ?number of hours paid staff? and ?number of hours volunteer? as reported in the two sampled quarterly Progress Reports. Ascension ? Michigan was required to submit monthly Financial Status Reports and quarterly Performance Measurement Reports during the fiscal year. We sampled three monthly Financial Status Reports and two quarterly Performance Measurement Reports submitted during the fiscal year and selected key line items for further testing. We noted insufficient supporting documentation for fringe costs disclosed in the monthly Financial Status Reports submitted during the fiscal year (see Questioned Costs section above). In addition, we noted there was no documentation to support the ?total number of individuals served? as reported in the two sampled quarterly Performance Measurement Reports. Total federal expenditures for Assistance Listing 16.575 at Michigan and Ascension ? Amita (Illinois) were $498,400 and $304,573, respectively, representing 62.1% and 37.9% of total federal expenditures for Assistance Listing 16.575 of $802,973, respectively. Effect or potential effect: Amounts reported in the monthly financial and quarterly performance reports could be inaccurate or incomplete. Identification as a repeat finding, if applicable: The finding is not a repeat finding. Recommendation: Ascension should formalize the review and approval process for all reports submitted to the pass-through entity. Evidence of review and approval of all financial reports by the secondary reviewer should be maintained, including elements of the review process validated by the reviewer and the underlying support for all reports should be maintained. The review should also include policies and procedures and internal controls over the fringe benefit calculation included within the financial reports. Views of Responsible Officials: Ascension agrees with the finding and has developed a plan to correct the finding.

Information on the federal program: Federal Grantor: United States Department of Justice Pass-Through Entity: Children?s Advocacy Centers of Illinois Assistance Listing No.: 16.575, Crime Victim Assistance Ascension Ministry Market: Ascension ? Amita (Illinois) Pass-Through Award Number: 217003 Pass-Through Award Period of Performance: 7/01/2019?06/30/2020 Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): Pass-Through Grant Agreement #217003 for the period July 1, 2019 through June 30, 2020 ? Part Two ? The Grantor-Specific Terms, Section 23. Timekeeping of the grant agreement with the pass-through entity states: ?23.1. Grantee shall, in furtherance of its performance of all aspects of the program description and budget as set forth in the attached exhibits and the Budget, maintain time keeping records for all grant-funded and match personnel as follows: B. Personnel who spend 100% of their time on the funded program must certify on a semi-annual basis. This time certification form must: 1. Include an after-the-fact certification that 100 of the employee?s time was spent in support of activities associated with the program; 2. Be signed every six months by the employee and a supervisor having firsthand knowledge of the employee?s work; and 3. Be supplemented with daily attendance timesheets. 23.2. Payroll records must reflect either the after-the-fact distribution of an employee?s actual activities or the certification of an employee?s actual work performed.? Condition: Exempt employees who spend 100% of their time on the funded program did not certify their actual work performed on a semiannual basis as required by the grant agreement. Cause: There was no internal control in place to require semiannual certifications from exempt employees who charged 100% of their time to the federal program. Questioned costs: Assistance Listing 16.575 ? $128,915 Context: There were six employees who charged 100% of their time to the federal program during the fiscal year. Two of the six employees were exempt employees whose time is automatically scheduled in the timekeeping system. These two exempt employees were required to complete a semiannual certification during the fiscal year but did not. Salaries and benefits for the two exempt employees totaled $128,915 (salaries of $99,534 and benefits of $29,381) for the year ended June 30, 2020. Salaries and benefits for all six employees totaled $299,443 (salaries of $230,140 and benefits of $69,303 consisting of $17,606 of FICA and $51,697 of benefits per FTE ? see Finding 2020-003) for the year ended June 30, 2020, representing 37.3% of total federal expenditures for Assistance Listing 16.575 of $802,973. Effect or potential effect: Salaries and related benefits charged to the federal program were not supported by semiannual effort certifications required per the grant agreement with the pass-through entity. Identification as a repeat finding, if applicable: The finding is not a repeat finding. Recommendation: Ascension should obtain the semiannual certifications for the two exempt employees pertaining to the fiscal year under audit and document contemporaneously. In addition, an internal control should be implemented to ensure required semiannual effort certifications are obtained from the required employees. Views of Responsible Officials: Ascension agrees with the finding and has developed a plan to correct the finding.

Information on the federal program: Federal Grantor: United States Department of Health and Human Services Pass-Through Entity: St. Vincent Hospital of the Hospital Sisters of the Third Order of St. Francis Research and Development Cluster Assistance Listing No.: 93.399, Cancer Control Ascension Ministry Market: Wisconsin Pass-Through Award Number: 2019-01 Ascension WI Pass-Through Award Period of Performance: 8/1/19?7/31/20 Federal Grantor: United States Department of Health and Human Services Pass-Through Entity: Vanderbilt University Medical Center Research and Development Cluster Assistance Listing No.: 93.279, Drug Abuse and Addiction Research Programs Ascension Ministry Market: Tennessee Pass-Through Award Number: VUMC 75713 Pass-Through Award Period of Performance: 8/1/19?7/31/20 Criteria or specific requirement (including statutory, regulatory or other citation): The Uniform Guidance 2 CFR section 200.303 states, ?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).? Section 200.403 of the Uniform Guidance states, ?Factors affecting allowability of costs. Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: (g) Be adequately documented.? Research and Development Cluster Section I. General Standards for Selected Items of Cost, 2.g. Compensation for Personal Services, within Appendix IX to Part 75?Principles for Determining Costs Applicable to Research and Development Under Grants and Contracts with Hospitals (Hospital Cost Principles) states the following: (2) Payroll Distribution: ??.supplementary data on time or effort as provided in paragraph (3) below, normally need be required only for individuals whose compensation is properly chargeable to two or more research agreements or to two or more of the following broad functional categories: (i) Patient care; (ii) organized research; (iii) instruction and training; (iv) indirect activities as defined in paragraph E.1.; or (v) other hospital activities as defined in paragraph B.5.? (3) Reporting Time or Effort ?For members of the professional staff, current and reasonable estimates of the percentage distribution of their total effort may be used as support in the absence of actual time records.? (4) Preparation of Estimates of Effort ??.estimates of effort spent by a member of the professional staff on each research agreement should be prepared by the individual who performed the services or by a responsible individual such as a department head or supervisor having first-hand knowledge of the services performed on each research agreement. Estimates must show the allocation of effort between organized research and all other hospital activities in terms of the percentage of total effort devoted to each of the broad functional categories referred to in (2) above.? Condition: Ascension ? Wisconsin: Time and effort reports were not signed by either the employee or the responsible individual having firsthand knowledge of the services performed. Ascension ? Tennessee: There were three research coordinators who charged time to the grant for the period October 2019 through February 2020. Time and effort reports were not prepared that met the requirements of Hospital Cost Principles as outlined above, including accounting for the total effort of these employees. In addition, there was no evidence of review and approval. Cause: Ascension ? Wisconsin: Ascension?s policy that an effort report be signed by the employee and a responsible supervisory official having firsthand knowledge of the activities performed by the employee was not followed. Ascension ? Tennessee: Ascension?s time and effort reporting policy was not followed by this location. Questioned costs: $39,787 (Assistance Listing 93.399 ? $19,176 and Assistance Listing 93.279 ? $20,611) Context: Ascension ? Wisconsin: For 13 payroll transactions sampled (totaling $19,176) from a population of 77 payroll transactions (totaling $112,413) processed during the fiscal year, evidence that the employee or immediate supervisor prepared and reviewed the time and effort report was missing. Total payroll costs for the fiscal year at Ascension ? Wisconsin for Assistance Listing No. 93.399 represent 9.3% of total federal expenditures for the R&D Cluster of $1,208,945. Ascension ? Tennessee: Total payroll costs for the fiscal year at Ascension ? Tennessee for Assistance Listing No. 93.279 were $20,611, representing 1.7% of total federal expenditures for the R&D Cluster of $1,208,945. Effect or potential effect: Unsupported payroll costs are unallowable. Identification as a repeat finding, if applicable: This is not a repeat finding. Recommendation: Ascension should reinforce the importance of adhering to its internal controls over the preparation, review and approval of time and effort reports. Views of responsible officials: Ascension agrees with the comment and has developed a plan to correct the finding.

Information on the federal program: Federal Grantor: United States Department of Health and Human Services and United States Department of Defense Pass-Through Entities: See Context Research and Development Cluster Assistance Listing Nos.: See Context Ascension Ministry Market: See Context Pass-Through Award Numbers: Various Pass-Through Award Periods of Performance: Various Criteria or specific requirement (including statutory, regulatory or other citation): The Uniform Guidance 2 CFR section 200.303 states, ?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 Uniform Guidance 2 CFR section 200.510 states, ?(b) Schedule of expenditures of Federal awards. The auditee must also prepare a schedule of expenditures of federal awards (SEFA) for the period covered by the auditee?s financial statements which must include the total Federal awards expended as determined in accordance with ?200.502 Basis for determining Federal awards expended.? Condition: Ascension did not provide a complete and accurate listing of all Research and Development Cluster expenditures as presented in the SEFA. Cause: Ascension?s internal controls in place over the preparation of the SEFA were not sufficient to properly accumulate and accurately report all expenditures of federal awards for the Research and Development Cluster, as well as the assistance listing number, pass-through entity (PTE) name, and PTE identifying number. Questioned costs: None. Context: Expenditures for the major federal program were not reported or adjusted in the SEFA in a timely manner or information on the federal program such as assistance listing number, PTE name, or PTE identifying number were incorrectly reported as follows: Ascension ? Texas ? Assistance Listing No. 93.080 (PTE: UTHSC Houston) ? expenditures of $17,559 were incorrectly included in the Research and Development Cluster. ? Assistance Listing No. 93.395 (PTE: Frontier Science and Technology Research Foundation) ? expenditures of $10,478 were removed from the Research and Development Cluster and the SEFA as they were determined to be nonfederal. ? Assistance Listing No. 93.855 (PTE: The General Hospital Corp dba Massachusetts General Hospital) ? expenditures of $10,240 were incorrectly reported as being funded by Assistance Listing No. 93.865. In addition, the PTE name and identifying number were originally inaccurate. Ascension ? Tennessee ? Assistance Listing No. 93.279 (PTE: Vanderbilt University Medical Center) ? expenditures of $20,611 were incorrectly excluded from the Research and Development Cluster. Ascension ? Florida ? Assistance Listing No. 93.307 (PTE: University of Miami) ? expenditures were overstated by $14,000, or 100% of the balance originally reported for the federal program on the SEFA. ? Assistance Listing No. 93.395 (PTE: Oregon Health & Science University) ? expenditures were understated by $12,000, or 16.8% of the balance originally reported for the federal program on the SEFA. Ascension ? Wisconsin ? Assistance Listing No. 93.837 (PTE: Brigham and Women?s Hospital) ? expenditures were overstated by $1,375, or 100% of the balance originally reported for the federal program on the SEFA. Ascension ? Michigan ? Assistance Listing No. 12.420 (PTE: Wayne State University) ? expenditures were overstated by $518, or 100% of the balance originally reported for the federal program on the SEFA. ? Assistance Listing No. 93.247 (PTE: Wayne State University) ? expenditures of $29,700 were improperly included in the Research and Development Cluster. ? Assistance Listing No. 93.361 (PTE: Wayne State University) ? expenditures were overstated by $6,559, or 100% of the balance originally reported for the federal program on the SEFA. ? Assistance Listing No. 93.395 (PTE: The Children?s Hospital of Philadelphia) ? expenditures of $41,000 were incorrectly reported as all being funded by Assistance Listing No. 93.395 and PTE identifying number FP00026529_SUB121_01. Expenditures should have been reported among various PTE identifying numbers under Assistance Listing Nos. 93.393, 93.395, and 93.399 as identified in the SEFA Effect or potential effect: The SEFA prepared by Ascension was misstated but was subsequently corrected. A misstated SEFA could result in the improper selection of federal award major programs or an incorrect percentage of coverage being calculated resulting in a restatement of a previously issued Uniform Guidance report. Identification as a repeat finding, if applicable: This is a repeat finding and is related to finding 2019-002 from the prior year. Recommendation: Ascension should review its policies and procedures and internal controls over the process of accumulating and reporting expenditures of federal awards for the Research and Development Cluster. In addition, Ascension should re-communicate its written policy and procedure on the preparation of the quarterly SEFA template to locations administering the awards, including the importance of timely review and accurate reporting of federal expenditures and related federal program information. Views of responsible officials: Ascension agrees with the comment and has developed a plan to correct the finding.

Information on the federal program: Federal Grantor: United States Department of Health and Human Services Pass-Through Entity: Oregon Health & Science University Research and Development Cluster Assistance Listing No.: 93.395, Cancer Treatment Research Ascension Ministry Market: Florida Pass-Through Award Number: 1014562_SWOG_SacredHeart Pass-Through Award Period of Performance: 8/1/19?7/31/25 Federal Grantor: United States Department of Health and Human Services Pass-Through Entity: The Children?s Hospital of Philadelphia Research and Development Cluster Assistance Listing Nos.: 93.393, Cancer Cause and Prevention Research; 93.395, Cancer Treatment Research, and 93.399, Cancer Control Ascension Ministry Market: Michigan Pass-Through Award Numbers: FP00026529_SUB121_01 FP00028127_SUB41_01 FP00017458_SUB125_01 FP00021944_A1_SUB30_01 FP00023693_SUB33_01 FP00023869_SUB112_01 FP00017990_SUB106_01 Pass-Through Award Periods of Performance: Various Criteria or specific requirement (including statutory, regulatory or other citation): The Uniform Guidance 2 CFR section 200.303 states, ?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).? Condition: There was no documented evidence of review and approval of the services entered in the pass-through entity?s study portal, which is the mechanism that initiates subsequent reimbursement from the pass-through entity. Cause: Internal controls over the cash management process related to fee-for-service research subawards were not in place for these locations. Questioned costs: None. Context Ascension ? Florida: Total federal expenditures for fee-for-service research subawards under Assistance Listing No. 93.399 are $83,500 for the fiscal year, representing 6.9% of total federal expenditures for the R&D Cluster of $1,208,945. Ascension ? Michigan: Total federal expenditures for fee-for-service research subawards under Assistance Listing Nos. 93.393, 93.395, and 93.399 are $41,000 for the fiscal year, representing 3.4% of total federal expenditures for the R&D Cluster of $1,208,945. Effect or potential effect: Services entered in the pass-through entity?s study portal could be inaccurate or incomplete. Identification as a repeat finding, if applicable: This is a not a repeat finding. Recommendation: Internal controls should be implemented over the fee-for-service cash management process. Views of responsible officials: Ascension agrees with the comment and has developed a plan to correct the finding.

Information on the federal program: Federal Grantor: United States Department of Education, Pass-Through Entity: Florida Department of Health, CFDA No.: 84.181, Special Education ? Grants for Infants and Families, Ascension Ministry Market: Florida, Pass-Through Award Number: COQZN, Pass-Through Award Period: 7/1/18?6/30/21, Criteria or specific requirement (including statutory, regulatory or other citation): The Uniform Guidance 2 CFR section 200.303 states, ?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 Uniform Guidance 2 CFR section 200.320 states, ?(a) Procurement by micro-purchases. Procurement by micro-purchase is the acquisition of supplies or services, the aggregate dollar amount of which does not exceed the micro-purchase threshold (?200.67 Micro-purchase). To the extent practicable, the non-Federal entity must distribute micro-purchases equitably among qualified suppliers. Micro-purchases may be awarded without soliciting competitive quotations if the non-Federal entity considers the price to be reasonable. Procurement by small purchase procedures. Small purchase procedures are those relatively simple and informal procurement methods for securing services, supplies, or other property that do not cost more than the Simplified Acquisition Threshold. If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources.? The Uniform Guidance 2 CFR section 200.67 states, ?Micro-purchase means a purchase of supplies or services using simplified acquisition procedures, the aggregate amount of which does not exceed the micro-purchase threshold. Micro-purchase procedures comprise a subset of a non-Federal entity?s small purchase procedures. The non-Federal entity uses such procedures in order to expedite the completion of its lowest-dollar small purchase transactions and minimize the associated administrative burden and cost. The micro-purchase threshold is set by the Federal Acquisition Regulation at 48 CFR Subpart 2.1 (Definitions).? The Uniform Guidance 2 CFR section 200.88 states, ?Simplified acquisition threshold means the dollar amount below which a non-Federal entity may purchase property or services using small purchase methods. Non-Federal entities adopt small purchase procedures in order to expedite the purchase of items costing less than the simplified acquisition threshold. The simplified acquisition threshold is set by the Federal Acquisition Regulation at 48 CFR Subpart 2.1 (Definitions) and in accordance with 41 U.S.C. 1908. As of the publication of this part, the simplified acquisition threshold is $150,000, but this threshold is periodically adjusted for inflation.? Condition: Ascension ? Florida did not follow its internal control policy of completing a procurement checklist or equivalent alternative documentation for each procurement transaction representing a small purchase (i.e., purchases over the micro-purchases threshold, but below the simplified acquisition threshold). As such, no documentation was completed to evidence compliance with the Uniform Guidance small purchase procedures outlined above. Cause: Though there is a procurement policy in place, oversight in enforcing the policy was inadequate by the program personnel administering the grants. Questioned costs: CFDA No. 84.181 ? $323,463 questioned costs represent total federal procurements during the period from July 1, 2018 through February 27, 2019. Context: Total program expenditures are $2,171,527, of which $1,345,553 represents state resources and $825,974 represents federal expenditures. Our testing of the federal program included total program expenditures. Ascension ? Florida did not complete the required procurement checklists or equivalent alternative documentation per its internal control policy for procurement transactions over the micro-purchases threshold (i.e., small purchase procedures) from July 1, 2018 to February 28, 2019, when the corrective action on the prior year finding was implemented. As such, there was no documentation to evidence compliance with the Uniform Guidance small purchase procedures outlined above for the time period from July 1, 2018 through February 27, 2019. Total procurement transactions from July 1, 2018 through February 27, 2019, were $850,400, of which the federal portion totaled $323,463. For the period February 28, 2019 through June 30, 2019, we selected 40 procurement transactions to test totaling $27,131 (federal portion totaling $10,320), noting compliance with Uniform Guidance procurement requirements during this time frame. Effect or potential effect: Ascension?s internal controls over procurement were not properly followed for the entire fiscal year. Ascension did not follow the Uniform Guidance requirements related to small purchases prior to February 28, 2019. Identification as a repeat finding, if applicable: This is a repeat finding for the major federal program related to finding 2018-005 from the prior year. Recommendation: Ascension should reinforce the importance of adhering to its procurement policy and provide specific training for all program personnel. Views of responsible officials: Ascension agrees with the comment and has developed a plan to correct the finding.

Information on the federal programs:Federal Grantor: United States Department of Education Pass-Through Entity: Florida Department of Health CFDA No.: 84.181, Special Education ? Grants for Infants and Families Ascension Ministry Market: Florida Pass-Through Award Number: COQZN Pass-Through Award Period: 7/1/18?6/30/21 Research and Development Cluster Federal Grantor: United States Department of Health and Human Services Pass-Through Entity: Vanderbilt University Medical Center, The General Hospital Corp. d/b/a Massachusetts General Hospital, St. Joseph Mercy Health System, Northwestern University, Duke University, and Johns Hopkins University CFDA No.: 93.083, 93.310, 93.395, 93.837, and 93.838 Ascension Ministry Market: Texas, Indiana, Tennessee, and Michigan Pass-Through Award Numbers: Various Pass-Through Award Periods: Various State Grantor: State of Wisconsin Pass-Through Entity: Portage County; Outagamie County; Waupaca County; Winnebago County State Identification Number: 435.561, Basic County Allocation Ascension Ministry Market: Wisconsin Pass-Through Contract Numbers: 2018-723 and 1047 (Portage County); 44-18-227 and 44-19-227 (Outagamie County); 23900 and 2019-43001 (Waupaca County) Pass-Through Contract Periods: 1/1/18?12/31/18 and 1/1/19?12/31/19 Criteria or specific requirement (including statutory, regulatory or other citation): The Uniform Guidance 2 CFR section 200.303 states, ?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 Uniform Guidance 2 CFR section 200.510 states, ?(b) Schedule of expenditures of Federal awards. The auditee must also prepare a schedule of expenditures of Federal awards for the period covered by the auditee?s financial statements which must include the total Federal awards expended as determined in accordance with ?200.502 Basis for determining Federal awards expended.? Condition: Ascension did not provide a complete and accurate listing of all federal awards in the preliminary schedule of expenditures of federal awards (SEFA) provided for planning purposes. Cause: Ascension?s internal controls in place over the preparation of the SEFA were not sufficient to properly accumulate and accurately report all expenditures of federal awards. Questioned costs: None. Context: Expenditures for major federal programs were not reported or adjusted in the SEFA in a timely manner as follows: CFDA No. 84.181 (Pass-Through Entity (PTE): Florida Department of Health) ? expenditures were understated by $190,337, or 30% of the balance originally reported on the SEFA. Research and Development Cluster: CFDA No. 93.083 (PTE: Vanderbilt University Medical Center) ? expenditures were overstated by $37,471, or 45% of the balance originally reported for the federal program on the SEFA. CFDA No. 93.395 (PTE: St. Joseph Mercy Health System) ? expenditures were overstated by $21,138, or 14% of the balance originally reported for the federal program on the SEFA. CFDA No. 93.837 (PTE: Northwestern University) ? expenditures totaling $4,359 were improperly included on the original SEFA, representing a change of 100%. CFDA No. 93.837 (PTE: Duke University) ? expenditures were understated by $17,755, or 170% of the balance originally reported for the federal program on the SEFA. CFDA No. 93.838 (PTE: Johns Hopkins University) ? expenditures totaling $9,600 were improperly included on the original SEFA, representing a change of 100%. CFDA No. 93.855 (PTE: The General Hospital Corp. d/b/a Massachusetts General Hospital ? PTE Identifying No. 229365) ? the grant was incorrectly classified as CFDA No. 93.855 and was therefore revised to CFDA No. 93.310 under the federal program titled ?Trans-NIH Research Support? with PTE Identifying No. 233284. No expenditure amount changed. State Identification No. 435.561 (Basic County Allocation) ? expenditures were overstated by $5,660, or 2% of the balance originally reported for the major state of Wisconsin program on the schedule of expenditures of state of Wisconsin awards. Effect or potential effect: The SEFA was misstated and could result in the improper selection of federal award programs being identified as major programs. Identification as a repeat finding, if applicable: This is a repeat finding and is related to finding 2018-001 from the prior year. Recommendation: Ascension should review its internal controls over the process of accumulating and reporting expenditures of federal awards. In addition, Ascension should re-communicate its written policy and procedure on the preparation of the quarterly SEFA template to locations administering the awards, including the importance of timely review and accurate reporting of all federal expenditures. Views of responsible officials: Ascension agrees with the comment and has developed a plan to correct the finding.

Information on the federal programs: Federal Grantor: United States Department of Education, Pass-Through Entity: Florida Department of Health, CFDA No.: 84.181, Special Education ? Grants for Infants and Families, Ascension Ministry Market: Florida, Pass-Through Award Number: COQZN, Pass-Through Award Period: 7/1/18?6/30/21, Research and Development Cluster, Federal Grantor: United States Department of Health and Human Services, CFDA No.: 93.395, Cancer Treatment Research, Ascension Ministry Market: Kansas, Federal Award Number: 5UG1CA189808-05, Federal Award Period: 8/1/18?7/31/19, Criteria or specific requirement (including statutory, regulatory or other citation): The Uniform Guidance 2 CFR section 200.303 states, ?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 Uniform Guidance 2 CFR section 200.213 states, ?Non-federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. These regulations 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: Ascension has a monthly process in place to monitor for suspended and debarred vendors. However, Ascension does not have internal controls in place to address the accuracy of the vendor files provided to a third party with which it contracts to perform the suspension and debarment searches on its behalf. In addition, Ascension does not have internal controls over the search results received from the third-party contractor to ensure the results are all properly concluded on and follow-up actions taken as appropriate. Cause: Ascension uses a third-party contractor that does not have a SOC 1 (System and Organization Controls Report) report that covers the suspension and debarment services provided. Ascension does not have internal controls to ensure the suspension and debarment checks performed by the third-party contractor are accurate. In addition, Ascension does not have internal controls in place to ensure potential matches identified by the third party are resolved. Questioned costs: None. Context: For CFDA 84.181, the federal portion of procurement expenditures subject to suspension and debarment review totaled $453,934, which represents approximately 55% of total federal expenditures of $825,974 reported in the SEFA for the year ended June 30, 2019. For the Research and Development Cluster, the federal portion of procurement expenditures subject to suspension and debarment review totaled $441,371 at Kansas, which represents approximately 16% of total federal expenditures of $2,784,700 reported in the SEFA for the fiscal year ended June 30, 2019. Effect or potential effect: Ascension?s vendors may not be screened for suspension and debarment and/or suspension and debarment results may not be accurate. Additionally, a vendor identified as potentially suspended or debarred may be identified by the third party and not appropriately researched and resolved by Ascension. As a result, federal funds may be used to pay a vendor that is suspended or debarred. Identification as a repeat finding, if applicable: Not applicable as this is not a repeat finding. Recommendation: Ascension should implement controls to address the accuracy of the suspension and debarment search results performed by the third-party contractor. Ascension should perform independent testing of the internal controls performed by the third-party contractor to ensure they are functioning as designed and that the results provided by the third-party contractor are consistent with Ascension?s expectations. Views of responsible officials: Ascension agrees with the comment and has developed a plan to correct the finding.

GSA_MIGRATION

GSA_MIGRATION

GSA_MIGRATION

GSA_MIGRATION

GSA_MIGRATION

GSA_MIGRATION

GSA_MIGRATION

GSA_MIGRATION

GSA_MIGRATION

GSA_MIGRATION

GSA_MIGRATION

GSA_MIGRATION

GSA_MIGRATION

GSA_MIGRATION

GSA_MIGRATION

GSA_MIGRATION