It's one of the findings of a new report by the health watchdog.
Clonakilty Community Hospital has 122 residents, and provides long-term, respite, palliative and dementia care.
HIQA says it had a significant outbreak of Covid-19 in April and May, with a large number of residents and staff testing positive.
The regulator says the HSE wasn't sticking to and implementing HPSC guidelines.
HIQA says it wasn't isolating and quarantining residents who were confirmed or suspected Covid cases or known close contacts.
It says this posed a risk to staff and residents, and was escalated to the HSE at a national level in April.
The watchdog says the HSE needs to undertake a review of the recent Covid-19 outbreak.
It found the hospital non-compliant with infection control measures during an unannounced inspection in June.
