OLATHE HEALTH SYSTEM, INC.

Criteria or Specific Requirement ?Allowable Costs/Cost Principles (Pub L. No. 116-136, 134 Stat. 563 and Pub L. No. 116-139, 134 Stat. 622 and 623). The Provider Relief Fund (PRF) was established in the Coronavirus Aid, Relief, and Economic Security Act (CARES Act, P.L. 116-136) to reimburse, through grants or other mechanisms, eligible health care providers for increased expenses or lost revenue attributable to Coronavirus Disease (COVID-19). Entities that received more than $10,000 (either one time or in the aggregate) are required to report the uses of their funds, including the lost revenue reimbursement and documentation of how the lost revenue was calculated. Condition ? The System reported expenses within the HHS PRF portal that were not tangible expenses related to healthcare services used to prevent, prepare for, and respond to coronavirus. Questioned Costs - $221,074 of forgiven rent payments by the System to its lessees were included in the expenses reported for the federal program per review of all expenses submitted under the federal program for period one and period two. Context- In the sample selected for testing eligible expenses, two out of the 25 sample selections were for expenses related to rental income that was forgiven. Per review of the complete expense listing totaling $2,478,452, the amount of rent forgiven of $221,074 was identified as occurring only during the period April 2020 through June 2020. Effect ? The System submitted expenses under the PRF program that were not eligible based on the terms and conditions. Cause ? The guidance provided by HHS to providers across the county as to which expenses are eligible under the PRF program changed during the period and were, at times, difficult to comprehend and apply. The System incorrectly applied guidance. Identification as a Repeat Finding ? Not applicable. Recommendation ? The System should continue to improve its understanding of the guidance related to eligible expenses. View of Responsible Official and Planned Corrective Actions ? The System agrees with this finding, however does note that their remaining COVID-19 related expenses and lost revenues still exceed the amount of PRF program money they received. See separate auditee document for planned corrective action.

Finding: Allowable Costs Management Response: We concur Views of Responsible Officials and Corrective Action: The System is going to review the current guidance and FAQs available related allowable costs and evaluate if other expenses were included that should be excluded. The System also has additional expenses and lost revenues which greatly exceed the amount of PRF received. Personnel Responsible for Corrective Action: Krystal Claymore, Chief Financial Officer Anticipated Completion Date: Review is in process and anticipated completion is expected by September 30, 2022.