SUNRISE COMMUNITY HEALTH

Federal Agency: U.S. Department of Health and Human Services Federal Program: Consolidated Health Centers Grant AL Number: 93.224 & 93.527 Award Period: 4/1/25 - 3/31/26 Type of Finding: Material Weakness in Internal Control Over Compliance and Compliance Criteria or Specific Requirement Per Title 42 Chapter 1 Subchapter D Section 51c303(f), “Health centers must have a schedule of fees or payments for the provision of their health services consistent with locally prevailing rates or charges designed to cover their reasonable costs of operation. They are also required to have a corresponding schedule of discounts applied and adjusted on the basis of the patient’s ability to pay.” Condition and Context During our testing of 60 sliding fee discounts for health center patients qualifying for reduced charge visits, we identified two visits where an incorrect sliding fee was given to a patient based on their income and family size. Effect Potential that a patient would not receive the appropriate sliding fee discount. Questioned Costs None identified. Cause The sliding fee discount error was a result of a dental electronic medical record conversion in fiscal year 2025. During quarter three of fiscal year 2025, the Organization’s staff identified an issue within the dental electronic medical record where it was populating the incorrect federal poverty level for patients based on the income level and family size input by the Organization’s staff. This caused the incorrect sliding fee adjustment to be applied to patient balances. Recommendation We recommend the Organization to review internal controls in regards to the determination, recording, and monitoring of the sliding fee process to ensure that appropriate sliding fee rates/categories are utilized for each sliding fee encounter. Views of Responsible Officials Management is aware of this issue and meets regularly to discuss the workflows identified to minimize this issue until the vendor has implemented an interface to resolve this issue. The Organization has procedures in place to address the internal controls related to determining, recording, and monitoring the sliding fee process. The goal is to ensure that the appropriate sliding fee rates/categories are utilized for each encounter for each patient. The Organization has been working with the electronic health record vendor to interface the medical and dental components of the system to ensure the information is flowing across both components of the application. The sliding fee scale information is housed in the medical component of the system and does not consistently flow to the dental component of the system. The tentative go live date for this interface is scheduled for September 2026. Until then the team will continue to assess all dental sliding fee scale patients accounts manually to ensure accurate sliding fee rates/categories are utilized for each sliding fee encounter/patient.

Federal Agency: U.S. Department of Agriculture Federal Program: Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) AL Number: 10.557 Award Period: 4/1/25 - 3/31/26 Type of Finding: Significant Deficiency in Internal Control Over Compliance and Compliance Criteria or Specific Requirement According to §200.303 Internal controls of 2 CFR Part 200, the non-federal entity must 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. Condition and Context During our testing of the completeness of the expenditure detail allocated to the federal award we noted Organization was unable to identify the detail/support for $12,684 of expenditures invoiced to the grant. Also, as part of our payroll testing we noted two samples where the Organization was not maintaining accurate records to support the fringe benefit payroll costs allocated to the grant. Effect Potential that incorrect costs could be allocated to the grant. Questioned Costs $13,108 Cause Management oversight in which documentation of expenditures allocated to the grant were not retained by the organization and fringe benefit allocations were not updated and reviewed. Recommendation We recommend the Organization update their grant allocation process and controls to ensure accurate documentation of expenditures allocated to the grant are retained and accurate fringe benefit costs incurred during the month are used to calculate the allocations. Views of Responsible Officials The Organization has updated the grant allocation process and controls to ensure accurate documentation of expenditures allocated to the grant are retained and accurate fringe benefit costs incurred during the month are used to calculate the allocations. As part of this update management has reassigned responsibilities for various grants to ensure the process is followed.

Federal Agency: U.S. Department of Agriculture and U.S. Department of Health and Human Services Federal Program: Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) and Consolidated Health Centers Grant AL Number: 10.557 and 93.224 & 93.527 Award Period: 4/1/25 - 3/31/26 Type of Finding: Significant Deficiency in Internal Control Over Compliance and Compliance Criteria or Specific Requirement 2 CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Award requires compliance with the provisions of procurement and suspension and debarment. The Organization should have internal controls designed to ensure compliance with these provisions. Condition and Context During our testing over procurement we noted the Organization did not have a Small or Micro-Purchase Threshold in place within their procurement policy. We also noted two instances in which the Organization was unable to locate documentation that agreements with vendors related to the infrastructure project included the Build America, Buy America domestic preference provisions in each agreement or that the Organization obtained a BABA (Build America, Buy America) waiver prior to contracting with the vendor. Effect Noncompliance results in possible federal funds provided to ineligible vendors. Questioned Costs None identified. Cause Management oversight in which the procurement policy did not meet the federal requirements. Recommendation We recommend the Organization update its procurement policy to be in line with the federal requirements. Views of Responsible Officials The Organization will update the Procurement and Purchasing Policy and Procedure to include a Small and Micro-Purchase Threshold and the BABA requirements. The Organization will have this policy and procedure update completed by July 13, 2026.

Criteria or Specific Requirement Per Title 42 Chapter 1 Subchapter D Section 51c303(f), “Health centers must have a schedule of fees or payments for the provision of their health services consistent with locally prevailing rates or charges designed to cover their reasonable costs of operation. They are also required to have a corresponding schedule of discounts applied and adjusted on the basis of the patient’s ability to pay.” Condition and Context During our testing of 40 sliding fee discounts for health center patients qualifying for reduced charge visits, we identified four visits where an incorrect sliding fee was given to a patient based on their income and family size. Effect Potential that a patient would not receive the appropriate sliding fee discount. Questioned Costs None identified. Cause The sliding fee discount error was a result of a dental electronic medical record conversion in fiscal year 2025. During quarter three of fiscal year 2025, the Organization’s staff identified an issue within the dental electronic medical record where it was populating the incorrect federal poverty level for patients based on the income level and family size input by the Organization’s staff. This caused the incorrect sliding fee adjustment to be applied to patient balances. Recommendation We recommend the Organization to review internal controls in regards to the determination, recording, and monitoring of the sliding fee process to ensure that appropriate sliding fee rates/categories are utilized for each sliding fee encounter. Views of Responsible Officials Management will review internal controls in regards to the determination, recording, and monitoring of the sliding fee process to ensure that appropriate sliding fee rates/categories are utilized for each sliding fee encounter. Management meetings will be scheduled with the COO, Director of Operations, and Dental Billing Supervisor(s) to provide updates on progress. Periodic internal auditing of sliding fee scale dental files will be completed. Quarterly management review of sliding fee scale program progress until Athena Dental is fully integrated with Athena Medical, where electronic health record issues were not detected regarding sliding fee scale adjustments.

Criteria or Specific Requirement 2 CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards requires compliance with the provisions of procurement and suspension and debarment. The Organization should have internal controls designed to ensure compliance with these provisions. Condition and Context During our testing over suspension and debarment, we noted the three instances in which the Organization did not perform the suspension and debarment check prior to entering into a transaction with a vendor. Effect The auditor noted instances of noncompliance. Noncompliance could result in possible federal funds being provided to ineligible vendors. Questioned Costs None identified. Cause The Organization lacks established internal controls and procedures over financial grant management. The Organization did not perform the suspension and debarment check prior to entering into the transactions. Recommendation We recommend the Organization implement a process to ensure suspension and debarment checks are performed and documentation to show that the checks are occurring prior to entering into transactions with vendors. Views of Responsible Officials Suspension and Debarment checks were occurring prior to a transaction with a new vendor; however, the checks were not saved. Any new vendor will have a check, and if we check them manually, we will begin to save these checks as documentation. We also implemented Compliatrics early in 2022 where we can enter our vendors into this system to do an auto check every month. It will flag us when a vendor is on the exclusion listing. Dell and NCHA were checked prior to transactions being entered into, but the documentation was not saved. These two vendors began being checked monthly through Compliatrics starting February 1, 2022. Amazon has now been entered into Compliatrics and is being checked monthly. Amazon was checked prior to using them as a vendor, but the documentation was not saved. As of June 8, 2023, Amazon is not on the exclusion list. We have begun to enter all vendors we utilize into this system.

Criteria or Specific Requirement 2 CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Award requires compliance with the provisions of procurement and suspension and debarment. The Organization should have internal controls designed to ensure compliance with these provisions. Condition and Context We noted the Organization is not in compliance with requirements related to Procurement, Suspension and Debarment. During our testing, we noted the following exceptions: • SCH The Organization’s procurement policy did not meet the requirements defined by 2 CFR 200. • The Organization did not retain support to document the procurement methods followed (I.e., sole source, small purchases, sealed bids, proposals, etc.). Effect The auditor noted instances of noncompliance. Noncompliance results in possible federal funds provided to ineligible subrecipients and/or vendors. Questioned Costs None identified. Cause The Organization lacks a uniform Procurement, Suspension & Debarment policy that is in compliance with the Federal regulations and/or the terms and conditions of the Federal award. Recommendation • We recommend the Organization review and update its procurement policy to ensure the policy meets the 2 CFR Part 200 Procurement requirements. • We recommend the Organization retain all documentation and support to show that the procurement policy was followed. Views of Responsible Officials The Organization will be reviewing and updating our procurement policy for any missing items not currently noted in our policies or procedures. Gateway and RC Telecom are our sole-source vendors based on the scope and nature of the work and our unique phone system set up. However, no documentation was recorded or kept for this vendor, besides quotes prior to purchases as well as purchase orders per our current purchasing procedure. Our current policy does mention competitive bidding, and the procedure mentions sole-source documentation and what we use for this documentation (currently a bid or quotation), but we need to expand and not just reference the CFR, but at minimum list our thresholds for procurement methods and other required elements. When we meet the bidding threshold, sealed bids are kept in our files. We have not had any sealed bid purchases in fiscal year 2023.

Criteria or Specific Requirement Per Title 42 Chapter 1 Subchapter D Section 51c303(f), “Health centers must have a schedule of fees or payments for the provision of their health services consistent with locally prevailing rates or charges designed to cover their reasonable costs of operation. They are also required to have a corresponding schedule of discounts applied and adjusted on the basis of the patient’s ability to pay.” Condition and Context During our testing of forty sliding fee discounts for health center patients qualifying for reduced charge visits, we identified two visits that received the incorrect sliding fee discount. Effect Potential that a patient would not receive the appropriate sliding fee discount. Questioned Costs None identified. Cause Clerical error in which the incorrect discount was applied due to lack of an oversight process in place. Recommendation We recommend the Organization to review internal controls in regards to the determination, recording, and monitoring of the sliding fee process to ensure that appropriate sliding fee rates/categories are utilized for each sliding fee encounter. Views of Responsible Officials The Organization’s enrollment and billing department will work together to identify when any errors occur based on the documentation the patient provides. The enrollment team will verify the rate, and the billing and coding team will begin checking to ensure the rate that the patient was screened for is the rate the patient is being charged for and that the correct discount applies.