A federal audit discovered 9 of 30 assisted dwelling suppliers misstated or improperly spent Covid-19 pandemic-era aid funding, in response to a report by the U.S. Division of Well being and Human Companies’ Workplace of the Inspector Common (OIG).
Federal auditors discovered the chosen assisted dwelling suppliers had complied with Supplier Aid Fund (PRF) guidelines however some operators reported a complete of $283,000 in “unallowable PRF expenditures,” and two AL suppliers inaccurately reported $11 million in misplaced income, the report acknowledged.
Throughout the pandemic, Congress authorised $178 billion for supplier bills and misplaced income because of the influence of Covid-19. Between 2020 and 2021, 3,690 AL suppliers acquired and saved a number of PRF funds totaling $640.7 million. The “nonstatistical pattern” of 30 suppliers acquired $156.1 million based mostly on “threat evaluation” tied to “high-impact areas” of the pandemic spanning each rural and concrete areas, whole PRF fee quantities and organizational construction.
Findings for the report had been collected between April 2023 and August 2025.
The 9 suppliers implicated within the report for improper use of funds acquired a complete of $25.6 million in PRF funds. The OIG recommends the Well being Assets and Companies Administration (HRSA) require the suppliers return the unallowed funds in query or “correctly account for these” bills and misplaced income. HRSA concurred with the advice.
The HRSA recommends the seven AL suppliers that used PRF funds for unallowable bills return the funds, whereas recommending that two suppliers that had been discovered to have inaccurately calculated and reported misplaced income of $11 million return that quantity to the federal authorities.
The report additionally concluded that lawmakers and federal companies ought to “search for further methods to safeguard federal funds when quickly disbursing help funds to suppliers in response to future public well being emergencies.”
The problems from AL suppliers stemmed from making clerical errors in reporting, not appropriately deciphering HRSA steerage or not having procedures to confirm misplaced income calculations, the report discovered. Within the context of “extraordinary challenges” from Covid-19.
The HRSA’s objective in the beginning of the general public well being emergency was to shortly eliminate funds to suppliers that requested it.
“These and different unprecedented challenges of the pandemic could have contributed to clerical errors when reporting PRF expenditures or brought about workers to misread HRSA’s steerage,” auditors wrote.
One supplier referenced within the report used PRF funds to compensate two executives making $300,000 respectively, which exceeded the Government Degree II wage scale by $205,400, the report acknowledged.
The report discovered lacking or inadequate help for about $57,000 in reported prices, with points together with unsupported estimates or lacking receipts. For instance, one AL supplier used $52,856 to cowl meals bills and “didn’t preserve supporting documentation for the precise meals prices.” In response, the supplier believed sustaining documentation for estimated meals price “was satisfactory.”
One other supplier used funds to cowl a subsidiary’s bills of $3,780, for which the supplier didn’t present obligatory documentation. In that occasion, the supplier advised federal auditors the wanted documentation was not obtainable because of the subsidiary being bought.
In a 3rd instance, a supplier referenced within the report didn’t hold documentation associated to the acquisition of blood-oxygen readers for $300, with the supplier noting it had misplaced the receipt for the acquisition.
Recipients of PRF {dollars} had been required to reveal monetary outcomes of every federal award and establish the supply and software of the funds. In a single occasion, an AL supplier recorded $57,616 of bills based mostly on buy order quantities, however the “precise invoices and fee quantities totaled $46,326.”
One supplier used PRF funds to cowl bills that weren’t attributable to the pandemic, the report discovered.
The supplier used help funds to cowl the acquisition of “alcoholic drinks” totaling $1,430. The supplier advised federal auditors the expense was misstated and the corporate reviewed whether or not Covid-19 associated funding quantities “had been appropriately coded.”
Recording of misplaced income points additionally emerged within the report, with two AL suppliers inaccurately calculating reported misplaced income of $11 million. The entities “overstated” misplaced income by $9.3 million and $1.7 million, respectively, tied to communities “they not owned.”
“This occurred as a result of the ALFs included 2020 budgeted internet affected person service revenues for these services within the baseline to calculate their misplaced revenues,” the report acknowledged.
