HHS Office of Inspector General Semiannual Report to Congress (October 1, 2024–March 31, 2025)
Summary
The Office of Inspector General of the Department of Health and Human Services reports to Congress on its work for the 6-month period ending on March 31, 2025, signed by Acting Inspector General Juliet T. Hodgkins. OIG puts its total monetary impact for the period at $16.61 billion: $3.51 billion in investigative receivables, $451 million in audit receivables and $12.65 billion in potential cost savings. It reports 744 civil and criminal actions and 1,503 bad actors excluded from federally funded health care programs. As an example, an operator of a home health agency was sentenced to 12 years in prison and ordered to pay more than $99 million in restitution for billing for services never provided and kickbacks. Seven of thirty hospices reviewed did not comply or may not have complied with the terms for Provider Relief Fund payments, with $12,273,544 questioned.
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Contents
A Message From the Acting Inspector General ........................................................................... ii
At a Glance: OIG Accomplishments ............................................................................................ iv
Introduction ................................................................................................................................ 1
1 | Public Health ......................................................................................................................... 2
2 | Financial Integrity .................................................................................................................. 4
3 | Medicare and Medicaid ......................................................................................................... 8
4 | Beneficiary Safety................................................................................................................ 12
5 | Data and Technology Security ............................................................................................. 13
OIG Impact From Recommendations ........................................................................................ 15
Additional OIG Activities ........................................................................................................... 16
Appendix A: Audits and Evaluations.......................................................................................... 17
Appendix B: Report Details ....................................................................................................... 23
Appendix C: Investigative Actions ............................................................................................. 25
Appendix D: Peer Reviews ........................................................................................................ 27
Appendix E: Reporting Requirements ....................................................................................... 28
i
A Message From
the Acting Inspector General
I am pleased to submit this Semiannual Report to Congress summarizing the
activities of the Department of Health and Human Services (HHS or the
Department), Office of Inspector General (OIG) for the 6-month period
ending on March 31, 2025.
OIG follows the data and adheres to clearly defined accountability standards
to provide HHS and Congress with a well-informed perspective, independent
oversight, and actionable recommendations. OIG’s multidisciplinary
workforce of dedicated experts includes law enforcement agents, auditors,
evaluators, attorneys, program specialists and analysts, and digital and
technology specialists. OIG’s work is uniquely focused on combating fraud,
waste, and abuse in HHS programs to ensure that those served by the
programs receive the intended benefits from the American taxpayers’
investments.
As described in this semiannual report, OIG’s total monetary impact during the reporting period was $16.61
billion, including $3.51 billion in investigative receivables, $451 million in audit receivables, and $12.65 billion
in potential cost savings. OIG consistently delivers a strong return on investment (ROI) through its oversight
and enforcement. OIG’s ROI is $11:$1 (a 3-year rolling average of expected recoveries and receivables from
OIG work). Our enforcement efforts resulted in 744 civil and criminal actions during this reporting period,
including settlements resulting from the use of OIG’s Civil Monetary Penalties Law authority and criminal
convictions. Additionally, we identified and excluded 1,503 bad actors from participation in federally funded
health care programs, ensuring that untrustworthy actors will not receive Federal health care program
payments.
OIG is the leading Federal agency focused on combating health care fraud, holding wrongdoers accountable
through criminal and civil investigations and administrative enforcement actions. As fraudsters grow
increasingly sophisticated with complex schemes that use technology to amplify and swiftly replicate their
reach, OIG’s law enforcement agents use cutting-edge data and investigative techniques to pursue and stop
them. The magnitude of harm identified by OIG is consequential. For example, during this reporting period an
OIG investigation resulted in an operator of a home health agency being sentenced to 12 years in prison and
ordered to pay more than $99 million in restitution for her part in a fraud scheme involving billing for services
never provided, kickbacks, and other unlawful conduct.
OIG audits, evaluations, and investigations consistently identify a high risk of fraud, waste, and abuse in the
Medicare Advantage risk adjustment program, which provides higher payments to Medicare Advantage plans
for sicker enrollees. For example, three audits issued during the reporting period found $13.6 million in net
overpayments to three Medicare Advantage plans resulting from incorrect diagnosis coding used to calculate
risk adjustment payments. An OIG evaluation found that diagnoses reported only on health risk assessments
(HRAs) and HRA-linked chart reviews generated $7.5 billion in Medicare Advantage risk-adjusted payments for
ii
2023, and $4.2 billion of these payments came from in-home HRAs. Inaccurate diagnoses from these in-home
HRAs and associated chart reviews may have resulted in improper payments. Finally, a Medicare Advantage
plan OIG investigated will pay up to $98 million to resolve alleged violations of the False Claims Act from
submitting or causing the submission of invalid diagnosis codes to Medicare to increase the risk-adjusted
payments it received. OIG will be monitoring the Medicare Advantage plan pursuant to a corporate integrity
agreement. With a combination of enforcement, audits, and evaluations, OIG finds improper and fraudulent
payments, holds wrongdoers accountable, and identifies ways the Medicare Advantage program can be
improved to prevent fraud and improper payments in the future.
OIG also has found lapses in administration and monitoring of HHS grants and contracts that have raised costs
and resulted in waste. During the reporting period, OIG audited a contract that ballooned from an initial
award of slightly more than $300,000 to more than $19 million for a 9-month period of performance. Central
to the audit’s findings was a lack of compliance with Federal contract competition and monitoring
requirements.
As evidenced by this report, OIG’s enforcement and oversight not only safeguard taxpayer dollars but also
improve the quality and efficiency of HHS programs. While the statistics of our work are an impressive part of
the story, it is our impact on the lives of nearly every American family that completes the story. No dollar
value can be assigned to these results—harms to patients prevented by keeping bad actors out of Federal
programs; quality services enhanced by maintaining a vigilant and exacting oversight eye; and program
integrity improved to shield Federal programs from the next fraudulent, malicious attack. With sustained
support, OIG is poised to continue to deliver extraordinary outcomes for the American people.
We appreciate the continued support of Congress and HHS for OIG’s important work.
/s/
Juliet T. Hodgkins
Acting Inspector General
iii
At a Glance: OIG Accomplishments
iv
v
Introduction
The Inspector General Act of 1978 (codified at 5 U.S.C. chapter 4), as amended, requires that the Inspector
General report semiannually to the head of the Department of Health and Human Services (HHS or the
Department) and to Congress on the activities of the Office of Inspector General (OIG). This semiannual report
is intended to keep the Secretary and Congress fully informed of significant oversight work completed during
the reporting period (October 1, 2024–March 31, 2025).
OIG’s report on Top Management and Performance Challenges Facing HHS describes five areas with
management challenges:
1) Public Health
2) Financial Integrity
3) Medicare and Medicaid
4) Beneficiary Safety
5) Data and Technology Security
The summaries of OIG’s work in this semiannual report are organized around these areas. The report
identifies key findings, information, and recommendations that could help the Department address these
management challenges and fulfill its mission to enhance the health and well-being of all Americans.
In addition to highlighting significant work, this report includes a comprehensive overview of all of OIG’s work
completed in this semiannual reporting period. This detailed information can be found in the appendices that
provide information on OIG’s oversight, including a full list of OIG audits and evaluations issued to each HHS
Operating Division during the reporting period.
Additional Resources
OIG’s website contains the full breadth of OIG’s oversight and enforcement work outside of this reporting
period, including all reports available by issue area and HHS agency; OIG recommendations to improve
Department programs and reduce vulnerabilities, including the status of those recommendations and those
OIG has identified as top unimplemented recommendations; and OIG enforcement actions.
Additional information on OIG’s positive financial impact on Medicare and Medicaid can be found in the
annual Health Care Fraud and Abuse Control Program Report.
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1 | Public Health
Opioid Epidemic
Combating the overdose crisis continues to be an important national priority, with nearly 55,000 opioid-
related overdose deaths in 2024. In response, OIG takes action to advance prevention, detection, and
enforcement of fraud, waste, and abuse in HHS programs that intersect with the opioid epidemic and help
ensure quality care and treatment for those in need of services. Significant OIG work completed during this
reporting period is detailed below.
ENFORCEMENT ACTION: McKinsey Agreed To Pay $650 Million To Resolve Allegations That It Advised
Purdue Pharma L.P. To Submit Fraudulent Claims
To resolve allegations brought by OIG and our law enforcement partners, McKinsey & Company
(McKinsey), a global management consulting firm, agreed to pay $650 million to resolve civil and criminal
liabilities for the firm’s consulting work with opioid manufacturer Purdue Pharma L.P. (Purdue). McKinsey
advised Purdue on its strategy to market OxyContin to prescribers, including advising Purdue to
“turbocharge” sales of OxyContin. McKinsey entered into a False Claims Act settlement to resolve
allegations that McKinsey’s advice caused the submission of fraudulent claims to Federal health care
programs for Oxycontin that was not for a medically accepted indication. The resolution marks the first
time a management consulting firm has been held criminally responsible for advice resulting in the
commission of a crime by a client. McKinsey entered a 5-year deferred prosecution agreement with the
Department of Justice and agreed to pay fines and forfeiture to resolve criminal misdemeanor misbranding
and felony obstruction of justice charges. McKinsey also entered into a 5-year corporate integrity
agreement with OIG.
Treatment Access
OIG found that not all Medicare enrollees continue treatment for opioid
use disorder. About 40 percent of Medicare enrollees who started
substance use disorder treatment with buprenorphine in 2021 or 2022
continued treatment. In the study period, enrollees who continued
treatment were less likely to die compared with those who did not
continue treatment. Additionally, just one-third of enrollees who started
buprenorphine received at least one behavioral therapy service. Those
who did not receive any behavioral health services were less likely to continue treatment. Finally, the Centers
for Medicare & Medicaid Services (CMS) added new Medicare payments aimed, in part, at helping enrollees
stay in treatment for opioid use disorder; however, OIG found that few enrollees received services billed to
Medicare under these payments (OEI-02-23-00360).
OIG also found that a website intended to assist individuals in finding treatment for substance use and mental
health disorders, FindTreatment.gov, contained some inaccurate information, such as facility addresses and
services information (e.g., incorrect treatment approaches offered). OIG estimated that 14,283 of 22,106
facilities had inaccurately reported information (A-09-23-01003).
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ENFORCEMENT ACTION: Addiction Treatment Center Owner Ordered To Pay More Than $3.5 Million for
Fraud
OIG and law enforcement partners’ work led to the conviction of a defunct owner of a chain of addiction
treatment centers. An owner and operator of addiction treatment centers described as “drive-by” clinics,
was sentenced to 98 months in prison followed by 3 years of supervised release and was ordered to pay
restitution in the amount of $3,515,100 and to forfeit approximately $1 million dollars. Under the guise of
running recovery clinics that supposedly provided medical and therapy services, the owner and operator
provided patients with little to no therapy or support while billing Medicare and other insurers for full
services. For example, the owner and operator and an addiction treatment center billed the Government
or insurance providers for 45-minute sessions when, in fact, patients were seen for less than 15 minutes,
and in some cases substantially less than that.
Drug and Medical Device Safety
The Food and Drug Administration (FDA) regulates crucial consumer products, including human and veterinary
drugs and medical devices, and works to ensure the safety, effectiveness, quality, security, and availability of
these products. In recent years, OIG has conducted a wide variety of work assessing the effectiveness of
FDA approval, inspection, and postmarket surveillance processes. Significant OIG work completed during this
reporting period is detailed below.
Drug Approvals
OIG concluded that FDA’s use of its accelerated approval pathway raised concerns in 3 of 24 drugs reviewed.
The accelerated approval pathway can speed development and review of new drugs to treat serious and life-
threatening conditions; however, there is a risk that an accelerated approval drug will not ultimately provide a
clinical benefit for patients. OIG identified instances in which FDA: (1) approved drugs despite concerns from
its own reviewers and/or advisory panels, (2) deviated from recommended practices by evaluating analyses
not included in the sponsor’s original plan, and (3) did not properly document meetings held during the review
process. Two of the three drugs that raised concerns are now off the market, and completion of the
confirmatory trial for the third drug has been delayed (OEI-01-21-00400).
ENFORCEMENT ACTION: Magellan Ordered To Pay $42 Million for Concealing Device Malfunction
OIG and law enforcement partners’ work resulted in Magellan Diagnostics, Inc. (Magellan), a medical
device company, being ordered to pay a $21.8 million fine, $10.9 million in forfeiture, and a minimum of
$9.3 million to compensate victims. Magellan was criminally charged for the concealment of a medical
device malfunction that produced inaccurately low lead test results for tens of thousands of children and
other patients. Specifically, Magellan failed to notify FDA about serious malfunctions in its LeadCare Ultra
and LeadCare II testing devices.
3
2 | Financial Integrity
Ensuring sound stewardship of HHS funds that provide critical health and human service programs is
paramount. OIG works to ensure the financial integrity of HHS funds through its oversight activities, which
include preventing fraud, waste, and abuse; identifying improper payments; and identifying opportunities for
cost savings. OIG also works to control costs by ensuring prudent payments in programs such as Medicare and
Medicaid.
Improper Payments Effects of Improper Payments
Improper payments duplicate other
An improper payment is any payment that does not meet legal payments, fund ineligible services,
requirements or is made in an incorrect amount. This includes enrich ineligible providers, serve
ineligible recipients, or violate other
payments made to ineligible recipients, for ineligible or duplicate goods
program rules.
or services, or for goods or services not received (unless authorized by
law). It also includes unauthorized payments, such as those not
allowable under a contract or grant. OIG uses its advanced data analytics capacity to aid in the sound
stewardship of Department funds and to combat fraud, waste, and abuse in HHS programs. Significant OIG
work completed during this reporting period is detailed below.
OIG found that CMS made millions of dollars of inappropriate drug payments
causing the Federal Government and taxpayers to incur unnecessary costs. CMS improperly paid
Medicare Part D does not cover drugs for which payment is available under Part up to an estimated
A. However, OIG found that Medicare Part D improperly paid up to an estimated
$465 million for drugs for which payment was available under the Medicare Part $465M
A skilled nursing facility (SNF) benefit over a 3-year period (A-09-21-03008). for certain drugs
OIG found that CMS may have made millions of
dollars of potentially inappropriate payments for COVID-19 tests, the costs of
CMS may have
which are borne by the Federal Government and taxpayers. From April 2022
improperly paid up to
through May 2023, CMS paid for up to eight over-the-counter COVID-19 tests per
$454M month for Medicare enrollees. However, OIG found that Medicare may have
paid up to $454 million in potentially improper payments to providers for nearly
for COVID-19 tests 39 million over-the-counter COVID-19 tests in excess of the monthly limit of eight
tests per enrollee (A-06-23-06000).
OIG found that CMS made millions of dollars of improper payments to
acute-care hospitals. CMS made these payments for outpatient services for CMS improperly paid
hospice enrollees that were already covered as part of the hospices’ per diem an estimated
payments. These services should have been provided directly by the hospices
or under arrangements between the hospices and acute-care hospitals. OIG $190M
estimates that Medicare could have saved $190 million over 5 years if payments for outpatient
had not been made improperly. In addition, OIG estimates that enrollees could services
4
have saved nearly $44 million in deductibles and coinsurance that may have been incorrectly collected from
them or from someone on their behalf (A-09-23-03024).
OIG found that from July 2021 through June 2022, CMS made millions of dollars
of inappropriate payments for catheters, the costs of which are borne by the CMS improperly paid
Federal Government and enrollees. CMS has consistently identified high an estimated
improper payments for urological supplies such as catheters. OIG estimates
that of the more than $303 million Medicare paid for catheters and kits, $35M
approximately $35 million was improperly paid. In addition, OIG estimates that for catheters
enrollees were responsible for nearly $9 million in associated coinsurance. OIG
analyzed claims submitted after our audit period and found a substantial
increase, which may indicate improper claims. Specifically, in 2023, suppliers billed 125,426 claims for
providing female enrollees a more expensive type of catheter. In comparison, suppliers billed only 2,753
claims for that type of catheter provided to female enrollees during our audit period (A-09-22-03019).
OIG found that the Administration for Children and Families (ACF) did not award and monitor the Deloitte
Consulting LLP (Deloitte) contract in accordance with Federal requirements. ACF awarded a $301,747 sole
source contract to Deloitte and subsequently modified the contract 12 times, increasing the value of the
contract to $19.4 million for a 9-month period of performance. ACF paid $5 million for potentially unallowable
costs and may have violated the Antideficiency Act by paying $1.5 million for services outside the period of
performance (A-12-22-10000).
Cost-Effectiveness
OIG’s oversight identifies cost-saving opportunities, promotes efficient and effective ways to address costs,
and ensures good financial stewardship by recommending program improvements. Significant OIG work
completed during this reporting period is detailed below.
Critical Access Hospital Reimbursement Rates
OIG estimates that Medicare could have saved $7.7 billion with
comparable access for enrollees if Critical Access Hospital (CAH)
payments for swing-bed services (which are similar to services
performed at SNFs) were similar to those of the fee-for-service
prospective payment system. As in 2015, OIG again
recommended that CMS seek a legislative change that will allow it
to reimburse CAHs at rates that align with those paid to
alternative facilities when it determines that similar care is
available at alternative facilities (A-05-21-00018).
5
Medicare Advantage Risk-Adjusted Payments
CMS’s risk adjustment program pays Medicare Advantage organizations more for providing benefits to
enrollees with diagnoses associated with more intensive use of health care resources. OIG found that billions
of estimated risk-adjusted payments to Medicare Advantage
companies supported solely through health risk assessments
(HRAs) and chart reviews linked to HRA visits continue to raise
concerns about the validity of diagnoses on HRAs and the quality-
of-care coordination for enrollees. Together, in-home HRAs and
the subset of chart reviews that relied on in-home HRAs
generated an estimated $4.2 billion of the total $7.5 billion in
risk-adjusted payments. OIG recommended that CMS impose
additional restrictions on the use of diagnoses reported only on
in-home HRAs or chart reviews that are linked to in-home HRAs
for risk-adjusted payments (OEI-03-23-00380). OIG also found $13.6 million in estimated net overpayments
through three audits of high-risk diagnosis codes that Medicare Advantage organizations submitted to CMS for
use in its risk adjustment program (A-07-22-01209, A-06-20-02000, A-04-21-07095).
Reducing Drug Spending
The United States, including Medicare and Medicaid, spent nearly $450 billion on prescription drugs in 2023.
In an effort to protect these programs and their enrollees from paying excessive amounts for needed
prescription drugs, OIG has a large body of mandated and other work focused on Medicare and Medicaid
maximizing economy in the purchase of prescription drugs. Significant OIG work completed during this
reporting period is detailed below.
Utilization Data for Part B Coverage Determination of Stelara
OIG found that Medicare Administrative Contractors’ (MACs’) challenges with utilization data when
determining Part B coverage could lead to excluding drugs from Part B coverage inappropriately, potentially
leading to higher costs to Medicare and its enrollees. Specifically, MACs face challenges with utilization data
when following CMS’s coverage guidance for drugs such as Stelara, a high-cost prescription biologic approved
to treat certain autoimmune diseases (OEI-BL-19-00501).
6
Spending on Diabetes and Weight Loss Drugs
OIG examined national Medicaid gross spending on certain diabetes and weight loss drugs. OIG found that
Medicaid gross spending on 10 selected diabetes and 2 selected weight loss drugs totaled more than $9 billion
in 2023, an increase of 540 percent from 2019. If spending continues to grow at similar rates, Medicaid could
potentially spend more than $29 billion on these drugs in 2026 (A-05-24-00016). OIG also found that
Medicare Part D spending for 10 selected diabetes drugs totaled $35.8 billion in 2023, an increase of
364 percent from 2019. If spending continues to grow at similar rates, Medicare Part D could potentially
spend more than $102 billion on these drugs in 2026 (A-05-24-00015).
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3 | Medicare and Medicaid
Program Integrity
In fiscal year (FY) 2024, CMS administered the $839 billion Medicare program to approximately 68 million
enrollees and administered the $584 billion Medicaid program, including the Children’s Health Insurance
Program, to approximately 73 million enrollees. OIG’s oversight of these funds ensures program integrity by
preventing fraud, ensuring that HHS funds are managed effectively and efficiently and that quality services
and health care are delivered to eligible Americans. Significant OIG work completed during this reporting
period is detailed below.
ENFORCEMENT ACTION: Independent Health Agreed To Pay At Least $34.5 Million for Inflating
Medicare Risk Adjustment Payments
OIG and law enforcement partners’ work resulted in Independent Health Association and its subsidiaries,
Independent Health Corporation and DxID (collectively, Independent Health), agreeing to pay $34.5 million
with contingent payments of up to $63.5 million. These payments are to resolve allegations that
Independent Health violated the False Claims Act by knowingly submitting or causing the submission of
invalid diagnosis codes to Medicare for Medicare Advantage Plan enrollees to increase payments that
Independent Health received from Medicare.
Returning Federal Share of Medicaid Collections
OIG found that some States were underreporting the Federal share of
collections made. For example, 12 of the 13 selected States
underreported the Federal share of collections by a net $61.8 million
because they did not use the correct Federal Medical Assistance
Percentage or made calculation errors. Underreporting the Federal
share of collections means States do not return to the Federal
Government everything it is owed (A-06-23-09002).
Medicaid Payments for Autism Services
OIG found that Indiana did not comply with fee-for-service requirements that could have a significant effect
on the quality of care provided to children diagnosed with autism. Specifically, OIG found that Indiana’s
payments for applied behavior analysis, a commonly used therapy for managing autism symptoms, did not
fully comply with Federal and State requirements. For example, improper or potentially improper payments
were associated with services for which documentation requirements were not met or session notes were not
detailed. Additionally, because some services were provided by staff who did not have appropriate
credentials, children with autism may not have received the quality of care they needed (A-09-22-02002).
Hospital Price Transparency
OIG estimates that 46 percent of the 5,879 hospitals that were required to comply with the Hospital Price
Transparency rule did not. Select hospitals are required to make information on their standard charges
available to the public. The hospitals that failed to comply did not publish comprehensive machine-readable
8
files and/or did not display shoppable services in a consumer-friendly manner. CMS and others believe that
price transparency can increase market competition and drive down the cost of health care services (A-07-22-
06108).
Health Care Fraud
OIG is the leading Federal agency focused on combating health care fraud. Investigators work in every State
and actively coordinate with the Department of Justice and other Federal, State, Tribal, and local law
enforcement agencies. Investigations, sometimes generated through hotline referrals, often lead to criminal
convictions, administrative sanctions, exclusion, or civil monetary penalties. Significant OIG work completed
during this reporting period is detailed below.
OIG Hotline
OIG’s hotline accepts tips and complaints from all sources about
potential fraud, waste, abuse, and mismanagement in HHS
programs. During the reporting period, OIG evaluated and
processed nearly 31,000 tips leading to 17,000 referrals to entities
such as OIG’s investigative and legal branches, HHS operating
divisions, and other federal agencies. Additionally, during the
reporting period, cases that were previously initiated through
hotline complaints resulted in 34 criminal and civil actions
associated with expected recoveries of approximately $121 million. Learn more here.
ENFORCEMENT ACTION: Home Health Care Operator Ordered To Pay Nearly $100 Million for Role in
Fraud Scheme
OIG and law enforcement partners’ work led to the conviction of an operator of a home health care
company for her part in a $100 million home health care fraud scheme. The operator was sentenced to
12 years in prison followed by 3 years of supervised release and was ordered to pay restitution in the
amount of $99,734,517 and a fine of $250,000. Specifically, the owner and others conspired to use Arbor
Homecare Services LLC to bill MassHealth for home health services that were never provided and paid
kickbacks for patient referrals, regardless of medical necessity. They also entered sham employment
relationships with patients’ family members to provide home health aide services that were not medically
necessary.
ENFORCEMENT ACTION: Doctor Sentenced to 10 Years in Prison and Ordered To Pay $34 Million in
Restitution
OIG and law enforcement partners’ work led to a Texas doctor being sentenced to 10 years in prison and
ordered to pay more than $34 million for his role in a scheme to defraud Medicare by prescribing durable
medical equipment and cancer genetic testing without seeing, speaking to, or treating patients. The
doctor received more than $466,000 in kickbacks for signed doctor’s orders that were used to submit more
than $54 million in false and fraudulent claims to Medicare.
ENFORCEMENT ACTION: Telemarketer Sentenced for $67 Million Health Care Fraud and Money
Laundering Scheme
OIG and law enforcement partners’ work resulted in a telemarketer being sentenced to 15 years in prison
9
for his role in a conspiracy to defraud Medicare by billing more than $67 million for medically unnecessary
genetic testing. The telemarketer, who managed a call center, contacted the primary care physicians of
targeted Medicare beneficiaries and tricked these medical providers into ordering medically unnecessary
genetic tests based on medical paperwork that the call center created. The telemarketer and his co-
conspirators then used these doctors’ orders to submit claims to Medicare for tests, the results of which
were often not sent to the physicians or used for treating patients.
ENFORCEMENT ACTION: MMM Holdings, LLC, To Pay $15.2 Million for a Fraudulent Gift Card Incentive
Program
OIG and law enforcement partners’ work resulted in MMM Holdings, LLC (MMM), a managed care
organization, agreeing to pay $15.2 million to resolve allegations that it violated the False Claims Act by
paying kickbacks for the referral of new Medicare Advantage plan enrollees. According to the settlement,
MMM allegedly distributed gift cards to administrative assistants of providers to induce the referral,
recommendation, or arrangement for enrollment of thousands of Medicare beneficiaries in an MMM
Medicare Advantage plan. In addition to the settlement, MMM entered into a 5-year corporate integrity
agreement with OIG.
Special Fraud Alert
Suspect Payments in Marketing Arrangements Related to Medicare Advantage and Providers
OIG issued a Special Fraud Alert that warns Medicare Advantage organizations, health care
professionals, agents and brokers, and others about certain marketing schemes involving the
Medicare Advantage program. These schemes involve questionable payments and referrals
between Medicare Advantage plans, health care professionals, and third-party marketers such
as agents and brokers. These schemes can mislead Medicare enrollees into choosing specific
health plans or health care providers that may not meet the enrollees’ needs.
ENFORCEMENT ACTION: Pharmacy Owner Sentenced and
Excluded for Kickback Scheme
OIG excluded a Texas pharmacy owner from participation in all OIG’s Exclusion Authority
federally funded health care programs for 50 years. The OIG has the authority to exclude
pharmacy owner worked with others to create and market individuals and entities from
expensive compounded medications and paid marketers to participation in Federal health care
recruit physicians to prescribe these drugs, engaging in an programs for a variety of reasons,
including a conviction for Medicare or
extensive kickback scheme that defrauded Federal health
Medicaid fraud. Those that are
programs. The pharmacy owner was found guilty of four counts excluded cannot receive payment
of payment and receipt of kickbacks and one count of conspiracy from Federal health care programs for
to launder monetary instruments. He was sentenced to any items or services they furnish,
52 months in prison and ordered to pay approximately order, or prescribe.
$59 million in restitution to Medicare and other Government
health care programs.
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Medicaid Fraud Control Units
OIG administers grants that provide Federal funding to Medicaid Fraud
Control Units (MFCUs) to fight Medicaid fraud and protect nursing home
patients from abuse. In FY 2024, MFCU work resulted in 1,151 convictions,
1,042 exclusions from federally funded programs, 493 civil settlements
and judgments, and $1.4 billion recovered. For additional information, see
the FY 2024 MFCU Annual Report (OEI-09-25-00090). Additionally, OIG
works with MFCUs as State-based law enforcement partners. During the
reporting period, OIG and MFCUs worked together on 975 joint
investigations that resulted in 86 civil actions or Civil Monetary Penalties
Law outcomes and 117 criminal adjudications.
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4 | Beneficiary Safety
Abuse and Neglect
Many HHS beneficiaries, such as children and nursing home residents, are vulnerable to abuse and neglect,
which can have a long-term impact on their health and well-being. OIG works to protect these beneficiaries in
many ways, including investigating specific cases and conducting reviews to examine compliance with program
requirements intended to enhance beneficiary safety and protect patient rights. Significant OIG work
completed during this reporting period is detailed below.
ENFORCEMENT ACTION: Medicaid Caregiver Excluded for 31 Years for Causing Bodily Injury
OIG excluded a caregiver from participation in Federal Government health care programs for a minimum
of 31 years following her conviction for causing serious bodily injury to her daughter, a 28-year-old
Medicaid recipient who suffered from cerebral palsy and had the mental development of an 11-month-old
child. The caregiver was excluded for failure to provide appropriate care. She was also sentenced to
20 years in prison.
ENFORCEMENT ACTION: Nursing Home Owner Excluded for 27 Years for Abuse and Fraud
OIG excluded a nursing home owner from participation in federally funded health care programs for
27 years based on his conviction of eight counts of cruelty to the infirm, five counts of Medicaid fraud, and
two counts of obstruction of justice. The nursing home owner was also ordered to pay $358,000 in
restitution for the pain and neglect caused to eight patients as a result of his failure to provide basic,
adequate, and essential care to them during Hurricane Ida in 2021.
ENFORCEMENT ACTION: Pharmacy Owner Sentenced for Predatory HIV Medication Scheme
OIG and law enforcement partners’ work led to a former pharmacy owner being sentenced to 2–6 years in
prison for a predatory scheme that stole millions of dollars from Medicaid and preyed on low-income
patients with HIV who needed life-saving medications. The pharmacy owner and his associates paid illegal
kickbacks to patients to ensure that these patients would use the more than 20 pharmacies they owned.
The pharmacies then filled their prescriptions with unsafe medications illegally purchased from the black
market or other pharmacy patients.
Child Abuse and Neglect Reporting
OIG found that Maine did not comply with child abuse and neglect
screening, assessment, and investigation requirements in response to
reports of abuse and neglect. OIG estimates that 94 percent of Maine’s
child abuse and neglect reports reviewed did not comply with one or
more of these requirements (A-01-23-02500).
12
5 | Data and Technology
Security
Cybersecurity
HHS faces persistent cybersecurity threats that exacerbate the challenges associated with data and
technologies used to carry out the Department’s vital health and human services missions. OIG conducts
oversight of the cybersecurity of data and information systems that store critical and potentially sensitive
data, such as organ procurement and transplant data and other electronic health information. Significant OIG
work completed during this reporting period is detailed below.
Lacking Adequate Security Controls To Mitigate Risk of a Cybersecurity Compromise
OIG found that from 2018 through 2020, eight HHS Operating Divisions lacked adequate protections to
mitigate cybersecurity risks. Specifically, OIG identified 19 threats during the time of our audits that had been
active on servers and workstations and 138 vulnerabilities related to 19 National Institute of Standards and
Technology Special Publication 800-53, Revision 4, controls that were not effectively implemented (A-18-22-
07002).
Organ Procurement and Transplantation Network Monitoring Was Not Effective
OIG determined that from April 2023 to June 2023, it would likely have taken an attacker a moderate level of
sophistication to be able to compromise the Organ Procurement and Transplantation Network information
technology system or data and cause significant harm. OIG identified 22 vulnerabilities associated with
16 cybersecurity control weaknesses, mostly related to ineffective network monitoring. The vulnerabilities
occurred because certain federally required cybersecurity controls had not been implemented or were not
operating effectively to prevent, detect, or mitigate some of the simulated cyberattacks (A-18-22-03400).
HHS Not Effectively Assessing Electronic Health Information Security
OIG found that from January 2016 to December 2020, the Office of Civil Rights (OCR) fulfilled its requirement
under the Health Information Technology for Economic and Clinical Health Act to perform periodic Health
Insurance Portability and Accountability Act of 1996 (HIPAA) audits. However, OCR’s HIPAA audit
implementation was too narrowly scoped to effectively assess safeguards of electronic protected health
information and demonstrate a reduction of risks within the health care sector. Additionally, OCR oversight of
its HIPAA audit program was not effective at improving cybersecurity protections for covered entities and
business associates (A-18-21-08014).
ENFORCEMENT ACTION: Lab Technician Excluded and Sentenced for Health Care Fraud and Identity
Theft
OIG excluded a lab technician from participation in federally funded health care programs for a minimum
of 27 years for health care fraud and aggravated identify theft. The lab technician and co-conspirators
submitted false claims to multiple health care plans for COVID-19 testing services using stolen personally
identifiable information. The lab technician admitted that he accessed private patient information,
including names, dates of birth, and insurance subscriber numbers, through the various clinics where he
13
worked and then used the patient information to submit claims to insurance providers for COVID-19
testing services that were never performed. The lab technician was also sentenced to 84 months in prison
and ordered to pay restitution of approximately $7 million.
ENFORCEMENT ACTION: Contractor Settled False Claims Act Liability for Failure To Secure Medicare
Enrollee Data
OIG and law enforcement partners’ work led to ASRC Federal Data Solutions LLC (AFDS), a contractor that
provided Medicare support services, paying a $306,000 settlement to resolve False Claims Act allegations
that it and a subcontractor failed to secure Medicare enrollee data. According to the settlement, AFDS
allegedly stored screenshots from CMS systems containing personally identifiable information and
potentially protected health information of Medicare beneficiaries without individually encrypting the files
to protect them against exposure in the event of a breach.
14
OIG Impact From Recommendations
15
Additional OIG Activities
Single Audits
OIG conducts oversight of Single Audits—organizationwide audits of non-Federal entities’ financial statements
and expenditures of Federal awards—to monitor how recipients are using Federal funds for HHS programs. By
working to improve the quality of Single Audits, OIG provides assurance to the public that taxpayer dollars are
being safeguarded and spent for their intended purposes, resulting in millions of Americans receiving
improved health care and human services. See below for the number of Single Audits OIG reviewed during
the reporting period, as well as the amounts those Single Audits covered. Read more on OIG’s Single Audits
website.
Single Audits (October 1, 2024–March 31, 2025)
Whistleblower Retaliation
OIG investigated and substantiated three complaints from whistleblowers who reported wrongdoing
associated with HHS-funded programs and services and were retaliated against because of it. Read more
about these complaints here and more about OIG’s Whistleblower Protection Coordinator role here.
Safe Harbor Proposals
OIG annually solicits proposals for developing new and modifying existing safe harbors to the Federal anti-
kickback statute, section 1128B(b) of the Social Security Act, and for developing special fraud alerts. In
November 2024, OIG published its annual solicitation in the Federal Register. OIG received seven proposals
during the reporting period, all of which are still under review as of March 31, 2025. For information about
the proposals received in response to the 2023 annual solicitation and OIG’s response to those proposals, see
Appendix D in OIG’s Fall 2024 Semiannual Report to Congress.
16
Appendix A: Audits and Evaluations
The following table summarizes OIG’s audit and evaluation reports issued during the reporting period, including, if applicable, the associated
questioned costs, funds put to better use, unsupported costs, and whether a management decision was made during the reporting period.1 During
the reporting period, OIG identified $189 million in questioned costs, $12.65 billion in funds put to better use, and $27 million in unsupported
costs. See Appendix B for more detail about reports with questioned costs and funds put to better use. Note that OIG has not yet received
management decisions for most reports listed below because those decisions are not due to OIG until 6 months following the issuance of a report.
DEFINITIONS
As defined by the Inspector General Act, the term “questioned cost” means a cost that is questioned by OIG because of: (1) an alleged violation of a provision of a law,
regulation, contract, grant, cooperative agreement, or other agreement or document governing the expenditure of funds; (2) a finding that, at the time of the audit, the cost is
not supported by adequate documentation; or (3) a finding that the expenditure of funds for the intended purpose is unnecessary or unreasonable.
Funds put to better use are funds that could be used more efficiently if management took actions to implement and complete the recommendation, through reductions in
outlays, de-obligation of funds, and/or avoidance of unnecessary expenditures.
Unsupported costs are a subset of questioned costs; these are costs that OIG found that, at the time of the audit, are not supported by adequate documentation.
A final management decision is a final decision by management concerning its response to the findings and recommendations included in an audit report, including actions
concluded to be necessary.
1 OIG did not issue any nonpublic audit or evaluation reports during the reporting period.
17
Table 1: Audit and Evaluation Reports Issued (October 1, 2024–March 31, 2025)
Questioned Funds Put to Unsupported Management
Report
Costs Better Use Costs Decision Made
Administration for Children and Families (ACF)
Maine Did Not Comply With Screening, Assessment, and Investigation Requirements for
- - - -
Responding to Reports of Child Abuse and Neglect (A-01-23-02500), November 2024
ACF Used Contractor Personnel To Perform Inherently Governmental Functions and Paid -
$4,968,857 $4,968,857 Yes
Millions in Potentially Unallowable Costs (A-12-22-10000), February 2025*
Little Overlap Exists Between ORR-Funded Foster Care and the U.S. Domestic Foster Care
- - - -
System (OEI-07-24-00320), March 2025
Administration for Community Living (ACL)
California Used CARES Act Funds for Unallowable Nutrition Services Program Expenditures
$3,572,090 - $2,484,631 Yes
(A-06-22-01004), October 2024
Administration for Strategic Preparedness and Response (ASPR)
ASPR Established Adequate Controls for Maintaining Physical Security and Inventory Records at
- - - -
Stockpile Site B (A-04-24-02046), October 2024
Response to OSC File #DI-20-000743: HHS Actions Related to FDA's March 2020 Emergency Use
- - - -
Authorization for Chloroquine and Hydroxychloroquine (OEI-09-20-00571), December 2024
ASPR Established Adequate Controls for Maintaining Physical Security and Inventory Records at
- - - -
Stockpile Site C (A-04-24-02047), January 2025
Agency for Healthcare Research and Quality (AHRQ)
Some HHS Requirements for Vetting Mobile Apps Were Not Followed Prior to the Release of
- - - -
the AHRQ Question Builder App (A-18-22-09008), December 2024
Centers for Disease Control and Prevention (CDC)
CDC’s and SAMHSA’s Processes for and Challenges With Compiling Data for the National Drug
- - - -
Control Assessment (A-03-24-00353), November 2024
ICAP at Columbia University Generally Managed Its PEPFAR Expenditures Appropriately but
$58,111 - - -
Lacked a Robust Financial Management System (A-04-20-01020), December 2024
Florida Generally Used CDC Public Health Crisis Response Cooperative Agreement Program
$218,504 - - -
Funds in Accordance With Federal Requirements (A-02-23-02008), February 2025
CDC Lacked Documentation for Its Redirections of PEPFAR Funds To Support the COVID-19
- - - -
Response (A-04-23-01028), February 2025
Centers for Medicare & Medicaid Services (CMS)
Massachusetts Could Better Ensure That Nursing Homes Comply With Federal Requirements
- - - -
for Life Safety, Emergency Preparedness, and Infection Control (A-01-23-00003), October 2024
Medicare Part D Paid Millions for Drugs for Which Payment Was Available Under the Medicare
$953,370 $465,077,908 - Yes
Part A Skilled Nursing Facility Benefit (A-09-21-03008), October 2024
18
Questioned Funds Put to Unsupported Management
Report
Costs Better Use Costs Decision Made
Massachusetts Could Better Ensure That Intermediate Care Facilities for Individuals With
Intellectual Disabilities Comply With Federal Requirements for Life Safety and Emergency - - - Yes
Preparedness (A-01-24-00001), October 2024
National Government Services, Inc., Reopened and Corrected Cost Report Final Settlements
With Obvious Errors To Collect Overpayments Made to Medicare Providers (A-06-24-05000), - - - Yes
October 2024
Medicare Advantage: Questionable Use of Health Risk Assessments Continues To Drive Up
- $4,194,145,137 - -
Payments to Plans by Billions (OEI-03-23-00380), October 2024
Not All Selected Hospitals Complied With the Hospital Price Transparency Rule
- - - Yes
(A-07-22-06108), November 2024
Report on the Financial Statement Audit of the Centers for Medicare & Medicaid Services for
- - - -
Fiscal Year 2024 (A-17-24-53000), November 2024
Utah Generally Operated Its Medicaid Estate Recovery Program in Accordance With
Requirements and in a Cost-Effective Manner, but Utah Did Not Have Formal Written - - - Yes
Procedures (A-07-23-03257), November 2024
Medicare Improperly Paid Acute-Care Hospitals an Estimated $190 Million Over 5 Years for
- $190,110,930 - Yes
Outpatient Services Provided to Hospice Enrollees (A-09-23-03024), November 2024
Washington State’s Oversight Could Better Ensure That Adult Family Homes Comply With
- - - Yes
Health and Safety and Administrative Requirements (A-09-23-02002), November 2024
Puerto Rico Did Not Designate a Medicaid Contracts Oversight Lead in a Timely Manner and
- - - Yes
Certified Contracts That Were Noncompliant (A-02-24-01002), November 2024
Texas Generally Claimed Medicaid Reimbursement for Fee-for-Service Inpatient Hospital
Claims With Malnutrition Diagnosis Codes in Accordance With Federal and State Requirements - - - -
(A-06-22-04002), November 2024
CGS Administrators, LLC, Did Not Reopen and Recalculate Most Selected Hospices’ Caps for
- - - Yes
Years Prior to 2020 (A-06-23-09003), November 2024
National Background Check Program for Long-Term Care Providers: A Final Assessment
- - - -
(OEI-07-24-00100), November 2024
Comparison of Average Sales Prices and Average Manufacturer Prices: Results for the Second
- - - -
Quarter of 2024 (OEI-03-25-00010), November 2024
Nonprofit and Government-Owned Nursing Homes Generally Complied With Federal
- - - Yes
Requirements Regarding the Infection Preventionist Position (A-01-24-00002), December 2024
Medicaid Gross Spending on 10 Selected Diabetes and 2 Selected Weight Loss Drugs Totaled
More Than $9 Billion in 2023, an Increase of 540 Percent From 2019 (A-05-24-00016), - - - -
December 2024
Twelve Selected States Did Not Accurately Calculate the Federal Share of Medicaid Collections
Subject to the Increased COVID-19 Federal Medical Assistance Percentages (A-06-23-09002), $61,792,714 - - -
December 2024
Indiana Made at Least $56 Million in Improper Fee-for-Service Medicaid Payments for Applied
Behavior Analysis Provided to Children Diagnosed With Autism (A-09-22-02002), December $39,432,556 $53,236,026 - Yes
2024
19
Questioned Funds Put to Unsupported Management
Report
Costs Better Use Costs Decision Made
Some Selected Skilled Nursing Facilities Did Not Comply With Medicare Requirements for
- - - -
Reporting Related-Party Costs (A-07-21-02836), December 2024
Medicare Advantage Compliance Audit of Specific Diagnosis Codes That Triple-S Advantage,
$296,758 - - Yes
Inc. (Contract H5774) Submitted to CMS (A-04-21-07095), December 2024
Providers Used Medicare Part D Eligibility Verification Transactions for Permissible Purposes
- - - -
(A-05-22-00022), December 2024
Medicare Home Health Agency Provider Compliance Audit: Bridge Home Health (A-05-23-
$6,046 - - -
00017), December 2024
Medicare Advantage Compliance Audit of Specific Diagnosis Codes Blue Care Network of
$3,412,369 - - Yes
Michigan (Contract H5883) Submitted to CMS (A-06-20-02000), December 2024
Medicare Advantage Compliance Audit of Specific Diagnosis Codes That UCare Minnesota
$4,761,271 - - Yes
(Contract H2459) Submitted to CMS (A-07-22-01209), December 2024
Florida Did Not Comply With Federal Waiver and State Requirements at 18 of 20 Adult Day
- - - -
Care Facilities Reviewed (A-04-23-00135), December 2024
Medicare Could Save Billions With Comparable Access for Enrollees if Critical Access Hospital
Payments for Swing-Bed Services Were Similar to Those of the Fee-for-Service Prospective - $7,710,443,385 - -
Payment System (A-05-21-00018), December 2024
Update: Xolair Prefilled Syringes Likely Meet Part B Coverage Criteria (OEI-BL-24-00440),
- - - -
December 2024
Total Medicare Part B Spending on Lab Tests Decreased in 2023, Driven in Part by Less
- - - -
Spending on COVID-19 Tests (OEI-09-24-00350), December 2024
Wisconsin Medicaid Fraud Control Unit: 2024 Inspection (OEI-07-24-00220), January 2025
Centers for Medicare & Medicaid Services Fiscal Year 2024 Detailed Accounting Submission
and Fiscal Year 2026 Budget Formulation Compliance Report for National Drug Control - - - -
Activities, and the Accompanying Required Assertions (OAS-25-03-018), January 2025
West Virginia Did Not Always Invoice Rebates to Manufacturers for Physician-Administered
$2,173,585 $488,185 - -
Drugs (A-07-23-06109), February 2025
Medicare Improperly Paid Suppliers for Intermittent Urinary Catheters (A-09-22-03019),
$11,399 $35,079,833 - -
February 2025
Colorado Made Capitation Payments to Managed Care Organizations After Enrollees’ Deaths
$13,332,364 - $7,320,166 -
(A-07-21-05132), February 2025
Mental Health Center of Florida Generally Met Medicare Billing Requirements for Some
- - - -
Psychotherapy Services (A-04-21-06251), February 2025
Massachusetts Generally Claimed Safety Net Care Pool Costs That Complied With Federal
$41,768,735 - - -
Requirements (A-04-22-04091), February 2025
Medicare Paid Claims That Were Not in Accordance With the Over-the-Counter COVID-19 Test
- - - -
Kits Demonstration Quantity Limitation (A-06-23-06000), February 2025
Office of Inspector General's Partnership With the Office of the Washington State Auditor:
State Auditor's Report Examining Washington's Concurrent Medicaid Enrollments - - - -
(A-09-23-02009), February 2025
20
Questioned Funds Put to Unsupported Management
Report
Costs Better Use Costs Decision Made
Medicare Part D Spending for 10 Selected Diabetes Drugs Totaled $35.8 Billion in 2023, an
- - - -
Increase of 364 Percent From 2019 (A-05-24-00015), February 2025
Office of Inspector General's Partnership With the Commonwealth of Massachusetts, Office of
the State Auditor: Office of Medicaid (MassHealth) — Review of Capitation Payments With - - - -
Multiple Identification Numbers (A-01-23-00004), February 2025
Not All Medicare Enrollees Are Continuing Treatment for Opioid Use Disorder
- - - -
(OEI-02-23-00360), February 2025
Comparison of Average Sales Prices and Average Manufacturer Prices: Results for the Third
- - - -
Quarter of 2024 (OEI-03-25-00020), February 2025
Medicare Contractors Did Not Use Complete and Timely Utilization Data When Making Part B
- - - -
Coverage Determinations for Stelara (OEI-BL-19-00501), February 2025
North Carolina’s Medicaid Control Environment, Risk Management Practices, and Governing
- - - -
Processes Were Assessed as Moderate Risk (A-04-21-00127), March 2025
Texas Did Not Fully Comply With Federal Waiver and State Health, Safety, and Administrative
Requirements at All 20 Adult Day Activity Health and Service Facilities Audited - - - -
(A-06-23-05000), March 2025
Medicare Administrative Contractors Did Not Consistently Meet Medicare Cost Report
- - - -
Oversight Requirements (A-04-22-06264), March 2025
Medicare and Medicaid Payments to Providers Are at Risk of Diversion Through Electronic
- - - -
Funds Transfer Fraud Schemes (OEI-07-23-00180), March 2025
State Survey Agencies Need Additional Guidance To Assess Nursing Home Emergency
- - - -
Preparedness Programs (OEI-04-23-00030), March 2025
Medicaid Fraud Control Units Annual Report: Fiscal Year 2024 (OEI-09-25-00090), March 2025 - - - -
Food and Drug Administration (FDA)
How FDA Used Its Accelerated Approval Pathway Raised Concerns in 3 of 24 Drugs Reviewed
- - - -
(OEI-01-21-00400), January 2025
Health Resources and Services Administration (HRSA)
Seven of Thirty Hospices Reviewed Did Not Comply or May Not Have Complied With Terms and
Conditions and Federal Requirements for Provider Relief Fund Payments $12,273,544 - $12,273,544 -
(A-02-22-01014), November 2024
Selected Home Health Agencies Complied With Terms and Conditions and Federal
- - - -
Requirements for Provider Relief Fund Payments (A-01-22-00503), November 2024
The Organ Procurement and Transplantation Network IT System’s Cybersecurity Controls Were
- - - -
Partially Effective and Improvements Are Needed (A-18-22-03400), December 2024
Health Resources and Services Administration Fiscal Year 2024 Detailed Accounting Submission
and Fiscal Year 2026 Budget Formulation Compliance Report for National Drug Control - - - -
Activities, and the Accompanying Required Assertions (OAS-25-03-016), January 2025
A Review of Pandemic Relief Funding and How It Was Used in Six U.S. Communities: Marion
- - - -
County, Georgia (OEI-06-22-00470), January 2025
21
Questioned Funds Put to Unsupported Management
Report
Costs Better Use Costs Decision Made
A Review of Pandemic Relief Funding and How It Was Used in Six U.S. Communities: White
- - - -
Earth Nation Reservation in Minnesota (OEI-06-22-00480), March 2025
Indian Health Service (IHS)
Staffing Shortages Limited IHS's Capacity To Effectively Administer Much-Needed Sanitation
Projects Funded by the Infrastructure Investment and Jobs Act (OEI-06-24-00010), December - - - -
2024
National Institutes of Health (NIH)
Most Institutions That Received NIH Funding Did Not Fully Understand When They Must Report
- - - -
Monetary Donations (OEI-03-22-00570), March 2025
Office of the Secretary (OS)
HHS Continues To Make Progress Toward Compliance With the Geospatial Data Act
- - - -
(A-18-24-03500), October 2024
Financial Statement Audit of the Department of Health and Human Services for Fiscal Year
- - - -
2024 (A-17-24-00001), November 2024
Review of the Department of Health and Human Services’ Compliance With the Federal
Information Security Modernization Act of 2014 for Fiscal Year 2024 (A-18-24-11200), - - - -
November 2024
The Office for Civil Rights Should Enhance Its HIPAA Audit Program To Enforce HIPAA
Requirements and Improve the Protection of Electronic Protected Health Information - - - -
(A-18-21-08014), November 2024
Summary Report of Prior Office of Inspector General Cyber Threat Hunt Audits of Eight HHS
- - - -
Operating Division Networks (A-18-22-07002), December 2024
Response to OSC File #DI-20-000743: HHS Actions Related to Medical Countermeasures and
Supplies to Respond to COVID-19 (OEI-09-20-00570), December 2024 - - - -
OMB Memo for Government Charge Card Abuse Prevention Act of 2012 (OAS-25-04-007),
January 2025 - - - -
Substance Abuse and Mental Health Services Administration (SAMHSA)
SAMHSA’s FindTreatment.gov Contained Some Inaccurate Information on Substance Use and
- - - -
Mental Health Treatment Facilities (A-09-23-01003), March 2025
Total Reports: 78 $189,032,273 $12,648,581,404 $27,047,198 16 2
*Contract audit per NDAA 2008, section 845.
2 This figure represents management decisions on reports issued during the reporting period only. OIG has not yet received management decisions for most reports listed above
because those decisions are not due to OIG until 6 months following the issuance of a report. For additional information on reports for which a management decision was made
during the reporting period, including reports that were issued prior to the reporting period, see Appendix B.
22
Appendix B: Report Details
Audit Reports With Questioned Costs
OIG identified $189 million in questioned costs during the reporting period. The table below summarizes
audit reports with questioned costs and HHS program officials’ decisions to take action on these and other
outstanding audit recommendations.
Table 2: Audit Reports With Questioned Costs (October 1, 2024–March 31, 2025)
Number Dollar Value Dollar Value
of Reports Questioned Unsupported
A. Reports for which no management decision has been made by
22 $691,436,000 $366,866,000
the commencement of the reporting period*
B. Reports issued during the reporting period† 16 $189,032,000 $27,047,000
Subtotal (A + B) 38 $880,468,000 $393,913,000
Less:
C. Reports for a which management decision was made during the
reporting period
i. Disallowed costs 12 $450,575,000** $371,834,000
ii. Costs not disallowed 13 $271,150,000 $2,485,000
Subtotal (i + ii) 25 $721,725,000 $374,319,000
D. Reports for which no management decision has been made by
13 $158,743,000 $19,594,000
the end of the reporting period [(A + B) – Subtotal C]
E. Reports for which no management decision was made within 6
3 $26,155,000 -
months of issuance‡
* The opening balance was adjusted upward by $366,851,000 because of re-evaluations of previously issued recommendations.
† Four issued reports containing recommendations for both questioned costs and funds put to better use are counted in both tables.
** Audit receivables (expected recoveries).
‡Because of administrative delays, some of which were beyond management control, resolution of three audits were not completed
within 6 months of issuance of the reports; however, agency management has informed us that the agency is working to resolve the
outstanding recommendations before the end of the next semiannual reporting period.
DEFINITIONS
As defined by the Inspector General Act, the term “questioned cost” means a cost that is questioned by OIG because of: (1) an
alleged violation of a provision of a law, regulation, contract, grant, cooperative agreement, or other agreement or document
governing the expenditure of funds; (2) a finding that, at the time of the audit, the cost is not supported by adequate
documentation; or (3) a finding that the expenditure of funds for the intended purpose is unnecessary or unreasonable.
Unsupported costs are a subset of questioned costs; these are costs that OIG found that, at the time of the audit, are not supported
by adequate documentation.
Questioned costs that HHS program officials have, in a management decision, sustained or agreed should not be charged to the
Government are known as disallowed costs.
23
Audit and Evaluation Reports With Recommendations That
Funds Be Put to Better Use
OIG identified $12.65 billion in funds put to better use during the reporting period. The table below
summarizes audit reports with recommendations that funds be put to better use and HHS program officials’
decisions to take action on these audit and evaluation recommendations.
Table 3: Audit and Evaluation Reports With Recommendations That Funds Be Put to Better Use (October 1,
2024–March 31, 2025)
Number of Reports Dollar Value
A. Reports for which no management decision has been made by the
3 $15,128,799,000
commencement of the reporting period*
B. Reports issued during the reporting period† 7 $12,648,581,000
Subtotal (A + B) 10 $27,777,380,000
Less:
C. Reports for which a management decision was made during the
reporting period
i. Value of recommendations agreed to by management
a. Based on proposed management action 1 $465,078,000
b. Based on proposed legislative action - -
ii. Value of recommendations not agreed to by management 3 $15,132,590,000
Subtotal (i + ii) 4 $15,597,668,000
D. Reports for which no management decision had been made by the end
6 $12,179,712,000
of the reporting period** [(A + B) – Subtotal C]
* The opening balance was adjusted downward by $366,851,000 because of re-evaluations of previously issued recommendations.
†Four issued reports containing recommendations for both questioned costs and funds put to better use are counted in both tables.
** Because of administrative delays, some of which were beyond management control, resolution of one of the five audits was not
completed within 6 months of issuance of the reports; however, agency management has informed us that the agency is working to
resolve the outstanding recommendation before the end of the next semiannual reporting period.
DEFINITIONS
The phrase “recommendations that funds be put to better use” means that funds could be used more efficiently if management
took action to implement an OIG recommendation through reductions in outlays, de-obligation of funds, and/or avoidance of
unnecessary expenditures.
24
Appendix C: Investigative Actions
During the reporting period, OIG’s investigative work led to $3.51 billion in investigative receivables and
349 criminal actions. OIG also took civil actions, such as assessing monetary penalties, against 395
individuals and entities, and excluded 1,503 individuals and entities from Federal health care programs. The
following table summarizes OIG’s investigative activities and results during the reporting period.3
Table 4: Investigative Activity and Results (October 1, 2024–March 31, 2025)
Investigative Receivables
Amount due to HHS $2,701,664,689
Amount due to non-HHS entities $804,677,717
Total Investigative Receivables $3,506,342,406
Investigative Results
Criminal actions resulting from investigations 349
Civil actions 395
Judgments/settlements 319
Civil monetary penalties 76
Total Criminal and Civil Actions 744
Investigations closed 946
Referrals
Referrals to the Department of Justice 1,099
Indictments and criminal informations resulting from referrals made prior to and during the reporting period 219
Referrals to State and local authorities 110
Indictments and criminal informations resulting from referrals made prior to and during the reporting period 79
Total Referrals 1,209
Exclusions
Individuals 1,476
Entities 27
Total Exclusions 1,503
TYPES OF ENFORCEMENT ACTIONS
Civil actions include civil settlements and civil judgments, including actions resulting from the use of OIG’s Civil Monetary Penalties
Law authority.
Criminal actions include actions, such as convictions, that occur once an individual or entity’s guilt is determined and a sentence is
imposed, as well as when a defendant enters a pretrial diversion program before or after indictment.
OIG excludes individuals and entities from federally funded health care programs pursuant to section 1128 of the Social Security Act
(42 U.S.C. § 1320a-7). Those that are excluded can receive no payment from Federal health care programs for any items or services
they furnish, order, or prescribe. OIG primarily receives exclusion referrals from its Office of Investigations, Medicaid Fraud Control
Units, and State licensing boards. OIG also identifies its own cases through online news media and other sources.
Referrals are presentations of OIG subjects to Federal, State, or local prosecuting jurisdictions for prosecutorial consideration.
3 OIG issued no investigative reports, which are reports that identify or bring renewed attention to systemic weaknesses or
vulnerabilities within HHS programs and recommend administrative, procedural, policy, regulatory, or legislative change to correct
or minimize the problem during the reporting period.
25
Table 5: Investigations of Senior Government Employees (October 1, 2024–March 31, 2025)
OIG conducted 11 investigations of 13 senior Government employees (as defined in the IG Act). Of these
investigations, 1 allegation was substantiated (investigation was reported publicly), and 10 allegations were
either unsubstantiated or no determination was made (investigations were not reported publicly).
Substantiated
OIG investigated a senior Government employee (GS-15) for allegedly retaliating against a former employee
for reporting a security violation. The complainant alleged that the complainant’s supervisors and responsible
management officials (RMOs) retaliated against the complainant for reporting a security violation. OIG
investigators found that the RMOs suspended and subsequently revoked complainant’s security clearance in
retaliation for making a protected disclosure (public report). The OIG investigative report was provided to the
Secretary of HHS and included a recommendation that the Secretary take appropriate action.
Unsubstantiated/No Determination Made and Not Reported Publicly
Description of Investigation
OIG investigated a senior Government employee (GS-15) for allegedly generating an anonymous letter of threats made against
the employee by a subordinate.
OIG investigated a senior Government employee (GS-15) for allegedly being a counterintelligence risk. The employee was
removed from Government employment.
OIG investigated a senior Government employee (GS-15) for allegedly engaging in contract fraud and accepting kickbacks.
OIG investigated a senior Government employee (GS-15) for alleged sexual harassment and false statements. The matter was
referred to the HHS Operating Division.
OIG investigated a Presidential Appointee employee and a Senior Executive Service (SES) employee for allegedly expressing
concerns about the treatment of a patient at a medical facility and, in their official capacity, threatening an investigation if that
patient was not transferred out of that medical facility.
OIG investigated a senior Government employee (GS-15) for allegedly retaliating against another employee by giving a poor
performance review after that employee reported mismanagement and an abuse of authority. The OIG referred this matter to
the Office of Special Counsel (OSC).
OIG investigated two senior Government employees (GS-15) and one SES employee for allegedly retaliating against another
employee after that employee reported multiple incidences where management used the contractor’s recommendations to
coerce employees to violate Federal regulations established for certain programs and program operations. OIG referred this
matter to OSC.
OIG investigated a senior Government employee (GS-15) for allegedly retaliating against an employee after the employee
reported their manager for abuse of authority and harassment. OIG referred this matter to OSC.
OIG investigated a senior Government employee (GS-15) for allegedly retaliating against another employee and creating a
hostile work environment after the employee previously reported to his supervisor that they were experiencing a hostile work
environment. The employee reached a settlement with the employer and the investigation was closed.
OIG investigated a senior Government employee (GS-15) for allegedly sexually assaulting someone several years prior. OIG
determined the alleged crime was not committed on Federal property or during work hours and therefore jurisdiction would lie
with local authorities.
26
Appendix D: Peer Reviews
Peer reviews are conducted by member organizations of the Council of the Inspectors General on Integrity and
Efficiency (CIGIE). The CIGIE peer review program provides OIGs and their stakeholders with an assessment of
the OIG’s compliance with relevant quality standards and its quality control systems (e.g., policies and
procedures).
Office of Audit Services
During the reporting period, OIG’s Office of Audit Services (OAS) did not receive a peer review. The most
recent peer review OAS received was conducted by the Department of Housing and Urban Development
(HUD) OIG, the final report of which was issued in March 2024. In that review, OAS received a “pass” rating
and HUD-OIG issued no recommendations. OAS has no outstanding peer review recommendations. OAS did
not conduct a peer review during the reporting period. The most recent peer review OAS conducted was of
the Department of Defense OIG, the final report of which was issued in September 2024.
Office of Evaluation and Inspections
During the reporting period, OIG’s Office of Evaluation and Inspections (OEI) did not receive a peer review.
The most recent peer review OEI received was conducted by the Department of Energy (DOE) OIG, the final
report of which was issued in February 2023. In that review, DOE-OIG determined that OEI’s policies and
procedures and the four reports reviewed generally were consistent and complied with the CIGIE Blue Book
standards. OEI has no outstanding peer review recommendations. OEI did not conduct a peer review during
the reporting period. The most recent per review OEI conducted was of the Special Inspector General for
Afghanistan Reconstruction OIG, the final report of which was issued in March 2023.
Office of Investigations
During the reporting period, OIG’s Office of Investigations (OI) did not receive a peer review; however, the
United States Postal Service (USPS) OIG issued its final report for the peer review it conducted of OI in
September 2024. In that review, USPS-OIG determined that OI’s system of internal safeguards and
management procedures for the investigative function was in full compliance with the quality standards
established by CIGIE and the Attorney General’s guidelines. OI has no outstanding peer review
recommendations. OI initiated a peer review of the U.S. Department of Agriculture OIG during the reporting
period. This review was still ongoing as of March 31, 2025.
27
Appendix E: Reporting
Requirements
The National Defense Authorization Act (NDAA) of Fiscal Year 2023, section 5273, amended the Inspector
General Act of 1978 and the Inspector General Empowerment Act of 2016 to streamline semiannual reporting
requirements for offices of inspectors general, which now appear in the note of 5 U.S.C. § 405. The following
table presents the new NDAA requirements and other remaining requirements, along with the location of the
information in this report.
Section Requirement Location
U.S.C. § 405 (note)
5(a)(1) Significant problems, abuses, and deficiencies Throughout this report
5(a)(2) Recommendations for which corrective action has not been OIG Impact from Recommendations
completed and OIG’s Recommendations Tracker
5(a)(3) Significant investigations closed during the reporting period Throughout this report
5(a)(4) Convictions during the reporting period Appendix C: Investigative Actions
5(a)(5) Information regarding reports issued during the reporting period Appendix A: Audits and Evaluations
5(a)(6) Information regarding any management decision made during At a Glance: OIG Accomplishments,
the reporting period with respect to any report issued during a OIG Impact from Recommendations,
previous reporting period and OIG’s Recommendations Tracker
5(a)(7) Information required by the Federal Financial Management None this reporting period
Improvement Act of 1996
5(a)(8) Results of peer reviews of HHS-OIG conducted by other OIGs Appendix D: Peer Reviews
5(a)(9) Outstanding recommendations from peer reviews of HHS-OIG Appendix D: Peer Reviews
conducted by other OIGs
5(a)(10) Peer reviews of other OIGs conducted by HHS-OIG Appendix D: Peer Reviews
5(a)(11) Investigative statistical tables Appendix C: Investigative Actions
5(a)(12) Metrics description for investigative statistical tables Appendix C: Investigative Actions
5(a)(13) Investigations of senior Government employees Appendix C: Investigative Actions
5(a)(14) Description of whistleblower retaliation instances Additional OIG Activities
5(a)(15) Description of attempts to interfere with OIG independence None this reporting period
5(a)(16) Descriptions of investigations of senior Government employees Appendix C: Investigative Actions
5(a)(16) Descriptions of nonpublic reports Appendix A: Audits and Evaluations
Other Requirements
NDAA 2008, § 845 Significant contract audits Appendix A: Audits and Evaluations
SSA § 1128D Health Public proposals for new and modified safe harbors Additional OIG Activities
Insurance Portability
and Accountability Act
28
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Report Fraud, Waste,
and Abuse
OIG Hotline Operations accepts tips and complaints from all sources about
potential fraud, waste, abuse, and mismanagement in HHS programs. Hotline
tips are incredibly valuable, and we appreciate your efforts to help us stamp
out fraud, waste, and abuse.
Phone: 1-800-447-8477
TTY: 1-800-377-4950
Who Can Report?
Anyone who suspects fraud, waste, and abuse should report their concerns
to the OIG Hotline. OIG addresses complaints about misconduct and
mismanagement in HHS programs, fraudulent claims submitted to Federal
health care programs such as Medicare, abuse or neglect in nursing homes,
and many more. Learn more about complaints OIG investigates.
How Does It Help?
Every complaint helps OIG carry out its mission of overseeing HHS programs
and protecting the individuals they serve. By reporting your concerns to the
OIG Hotline, you help us safeguard taxpayer dollars and ensure the success of
our oversight efforts.
Who Is Protected?
Anyone may request confidentiality. The Privacy Act, the Inspector General
Act of 1978, and other applicable laws protect complainants. The Inspector
General Act states that the Inspector General shall not disclose the identity of
an HHS employee who reports an allegation or provides information without
the employee’s consent, unless the Inspector General determines that
disclosure is unavoidable during the investigation. By law, Federal employees
may not take or threaten to take a personnel action because of
whistleblowing or the exercise of a lawful appeal, complaint, or grievance
right. Non-HHS employees who report allegations may also specifically
request confidentiality.
30
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