VALLEY FAMILY HEALTH CARE INCNon-Profit

VALLEY FAMILY HEALTH CARE, INC. (VFHC) BELIEVES THE SIGNIFICANT DEFICIENCIES NOTED IN THE SCHEDULE OF FINDINGS AND QUESTIONED COSTS WERE A COMBINATION OF INSUFFICIENT USER TRAINING ISSUES, SYSTEM (EPIC) ISSUES AND INADEQUATE REVIEW AND INTERNAL AUDITING. TO ADDRESS THE SYSTEM ISSUES, WE HAVE REQUESTED VERIFICATION FROM OUR 3RD PARTY BILLING SYSTEM ON HOW THE EFFECTIVE AND EXPIRATION DATES ENTERED IN THE SYSTEM FOR THE FEDERAL POVERTY LEVEL (FPL) DATA IMPACT THE CALCULATION. IN ADDITION, IN DECEMBER OF 2023, VFHC IMPLEMENTED A NEW FEE SCHEDULE THAT INCREASED THE NUMBER OF SLIDING FEE DISCOUNTS THAT COULD BE AUTOMATICALLY CALCULATED BY THE SYSTEM, TO REMOVE THE OPPORTUNITY FOR USER ERROR. TO ADDRESS USER ERRORS, WE REINSTATED OUR FRONT OFFICE MANAGER POSITION RESPONSIBLE FOR TRAINING FRONT DESK STAFF WHO ASSIST PATIENTS WITH THE COMPLETION OF THE SLIDING FEE DISCOUNT APPLICATION. THE HANDBOOK AND TRAINING MATERIALS HAVE BEEN ENHANCED. IN ADDITION, WE ARE CREATING LOGIC IN THE EPIC SYSTEM TO IDENTIFY MISSING OR INCONSISTENT INFORMATION AND DIRECT THESE ISSUES TO A WORK QUE THAT WILL BE REVIEWED BY STAFF. WE ARE IMPLEMENTING AN INTERNAL AUDIT PROCESS OF THE SLIDING FEE DISCOUNTS. THE FRONT OFFICE MANAGER OR DESIGNEE WILL AUDIT A STATISTICALLY MEANINGFUL RANDOM SAMPLE OF NEW SLIDING FEE DISCOUNT APPLICATIONS FOR COMPLETENESS AND ACCURACY. IN ADDITION, WE WILL AUDIT A STATISTICALLY MEANINGFUL NUMBER OF PATIENT ACCOUNTS WHERE A SLIDING FEE DISCOUNT WAS TAKEN TO ENSURE THE ACCURACY OF THE CALCULATION. WE REVIEWED EACH OF THE AUDIT EXCEPTIONS AND DETERMINED THAT IN TWO OF THE FIVE INSTANCES; WE GAVE A LARGER DISCOUNT THAN THE PATIENT QUALIFIED FOR. WE WILL NOT MAKE ACCOUNT ADJUSTMENTS TO COLLECT. IN ONE INSTANCE, WE GAVE A SMALLER DISCOUNT BY $45.50 AND THE BILLING TEAM IS CORRECTING THIS ACCOUNT TO ISSUE A REFUND FOR THE ADDITIONAL DISCOUNT. IN ONE INSTANCE, NO SLIDING FEE DISCOUNT WAS GIVEN AND THE VERIFICATION RETAINED IN THE SYSTEM INDICATED THAT THIS WAS CORRECT. HOWEVER, IT IS POSSIBLE THAT HAD STAFF REQUESTED ADDITIONAL INCOME VERIFICATION; THE PATIENT MAY HAVE HAD A DIFFERENT FPL ASSIGNED. IN ONE INSTANCE, IT APPEARS THE APPROPRIATE SLIDE FEE DISCOUNT WAS APPLIED BUT THE SUPPORTING DOCUMENTATION WAS NOT RETAINED IN THE PATIENT CHART. VFHC TAKES THESE ISSUES VERY SERIOUSLY AND WILL BEGIN CORRECTIVE ACTIONS IMMEDIATELY. PROPOSED COMPLETION DATE: WE ANTICIPATE THESE ACTIONS TO BE COMPLETED BY THE END OF THE 3RD QUARTER.

Finding: 2023-001 Special Tests and Provisions Name of Contact Person: Cheri Hung, CFO Corrective Action: Valley Family Health Care, Inc. (VFHC) believes the significant deficiency noted in the Schedule of Findings and Questioned Costs was related to the implementation of our new billing software in 2022. It is important to note that in the instance identified, our patient was not harmed and was charged less per visit than indicated by our sliding fee discount guidance. In the short term, VFHC recognizes the need for additional training and heighted internal review of sliding fee discounts. We have submitted this issue to our 3rd party billing software firm to identify the system issues that led to the incorrect automated application of the sliding fee discount to the patient account. If our 3rd party billing software cannot identify and correct the system issues, VFHC is prepared to amend their board-adopted policy to a methodology that can be fully automated. Proposed Completion Date: We anticipate these actions to begin immediately and to be completed by the end of the 3rd quarter.