Semiannual Report to Congress, April 1, 2022, Through September 30, 2022 — HHS-OIG
Summary
Semiannual Report to Congress from the Department of Health and Human Services, Office of Inspector General, for April 1, 2022, through September 30, 2022, opening with a message from Inspector General Christi A. Grimm. For the period, OIG reports 68 audit reports and 29 evaluation reports, $62.9 million in expected audit recoveries, $612.6 million in questioned costs and $117 million in potential savings. Its investigative work led to $1.29 billion in expected investigative recoveries and 390 criminal actions, and OIG excluded 1,290 individuals and entities from Federal health care programs. For FY 2022 it lists $2.73 billion in expected investigative recoveries, 710 criminal actions and 2,332 exclusions. Its work covers COVID-19 oversight, nursing home safety, the Provider Relief Fund Program and anti-kickback safe harbors.
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“Semiannual Report to Congress, April 1, 2022, Through September 30, 2022 — HHS-OIG.”
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Department of Health and Human Services, Office of Inspector General
Semiannual Report to Congress—April 1, 2022, Through September 30, 2022
A Message From Christi A. Grimm, Inspector General
I am pleased to submit this Semiannual Report to Congress summarizing the
activities of the Department of Health and Human Services (HHS), Office of
Inspector General (OIG), for the 6-month period ending on September 30, 2022.
As HHS’s programs continue to expand, OIG maintains our sharp focus on
identifying key vulnerabilities. We use a risk-based approach to provide oversight
that supports better health, well-being, program integrity, and opportunities for
savings.
We hold accountable bad actors who hurt people and steal from taxpayer-funded programs. In
coordination with our law enforcement partners, we strategically bring to bear every criminal, civil, and
administrative tool that we have to safeguard the integrity of HHS programs and protect the people they
serve. During this reporting period, OIG aggressively pursued entities and individuals committing fraud
and abuse. We endeavor to send a strong signal that theft and abuse will not be tolerated in HHS
programs, including fraud schemes that exacerbate the opioid epidemic, cheat child care programs, and
endanger patients. OIG’s investigative work led to $1.29 billion in expected investigative recoveries during
this reporting period.
Findings from our audits and evaluations help to construct actionable strategies that will yield meaningful
improvements. Examples from this reporting period include how HHS can reduce patient harm in
hospitals, better protect children in foster care from sex trafficking, and strengthen its cybersecurity
posture. Our work identified suggested ways to better protect Federal funds from misuse, including
improvements in awarding and monitoring emergency response contracts and implementing the Provider
Relief Fund Program. We reported on issues that, if addressed, would better ensure that HHS programs
run efficiently and effectively, including programs related to confirmatory trials for drugs, prior
authorization requests for Medicare services, and caring for unaccompanied children served by the Office
of Refugee Resettlement.
OIG is steadfast in our commitment to drive positive change in HHS programs and in the lives of people
served by these programs. My top priority is propelling meaningful improvement in the quality and safety
of care in the more than 15,000 Medicare- and Medicaid-certified nursing homes nationwide. During this
reporting period, we identified deficiencies in compliance with life safety and emergency preparedness
requirements that put residents at increased risk of injury and death. We are continuing work on 21 audits
and evaluations that address a wide range of issues involving nursing homes. Looking forward, we will
delve deeply to understand the factors that contribute to poor nursing home performance, what should be
done to improve residents’ experience in nursing homes, and how frontline oversight of nursing homes
can be more effective.
The independent, objective oversight described in this Semiannual Report to Congress reflects the
excellence and innovation of the OIG workforce as well as the breadth and complexities of work in
overseeing the more than 100 programs at HHS. We deploy a multidisciplinary approach and leverage
data and cutting-edge technology to detect risks and strategically plan the most high-impact oversight
across HHS programs and services. The reach, range, and impact of our work are bound only by our
Department of Health and Human Services, Office of Inspector General
Semiannual Report to Congress—April 1, 2022, Through September 30, 2022
constrained resources. With an eye on problems on the horizon, a focus on equity, and a firm grounding
in our oversight mission, we will continue to pursue wrongdoers, recover misspent funds, and promote the
health and well-being of the Nation.
We greatly appreciate the support of Congress and HHS for this important work.
Christi A. Grimm
Inspector General
Department of Health and Human Services, Office of Inspector General
Semiannual Report to Congress—April 1, 2022, Through September 30, 2022
Table of Contents
A Message From Christi A. Grimm, Inspector General 2
OIG’s Approach to Driving Positive Change 4
Highlights of OIG Accomplishments 5
Selected Acronyms and Abbreviations 15
Medicare and Medicaid Reports and Reviews 16
Legal and Investigative Activities Related to Medicare and Medicaid 41
Public Health and Human Service Agency Reports and Reviews 62
Legal and Investigative Activities Related to Public Health and Human Service Agencies 76
Other HHS-Related Reviews and Investigative Activities 77
Appendix A: Questioned Costs and Funds To Be Put to Better Use 86
Appendix B: Savings Decisions Supported by OIG Recommendations 97
Appendix C: Peer Review Results 100
Appendix D: Summary of Sanction Authorities 103
Appendix E: Reporting Requirements in the Inspector General Act of 1978 106
Appendix F: Reporting Requirements in the Inspector General Empowerment Act of 2016 108
Appendix G: Anti-Kickback Statute—Safe Harbors 115
OIG’s Approach to Driving Positive Change
THE DEPARTMENT OF HEALTH AND HUMAN SERVICES (HHS), Office of Inspector General (OIG), provides
independent and objective oversight that promotes economy, efficiency, and effectiveness in HHS
programs and operations. OIG’s program integrity and oversight activities are shaped by legislative and
budgetary requirements and adhere to professional standards established by the
Government Accountability Office (GAO), Department of Justice (DOJ), and Inspector General community.
Through a nationwide network of audits, investigations, and evaluations, OIG carries out its mission to
protect the integrity of HHS programs and the health and welfare of the people served by those programs.
OIG’s work is conducted by the Office of Audit Services (OAS), Office of Evaluation and Inspections (OEI),
Office of Investigations (OI), Office of Counsel to the Inspector General (OCIG), and Mission Support and
Infrastructure (MSI).
Department of Health and Human Services, Office of Inspector General
Semiannual Report to Congress—April 1, 2022, Through September 30, 2022
OIG Organization
Office of Audit Services
OAS conducts audits of HHS programs and operations either through its own resources or by
overseeing audit work done by others. Audits examine the performance of HHS programs and/or
of HHS’s grantees and contractors in carrying out their respective responsibilities and provide
independent assessments of HHS programs and operations. These audits help reduce waste,
abuse, and mismanagement and promote the economy, efficiency, and effectiveness of programs
and operations throughout HHS.
Office of Evaluation and Inspections
OEI conducts national evaluations to provide HHS, Congress, and the public with timely, useful,
and reliable information on significant issues. These evaluations focus on preventing fraud, waste,
and abuse and promoting economy, efficiency, and effectiveness in HHS programs. OEI reports
also present practical recommendations for improving program operations.
Office of Investigations
OI conducts criminal, civil, and administrative investigations of fraud and misconduct related to
HHS programs, operations, and beneficiaries. With investigators working in almost every State, the
District of Columbia, and Puerto Rico, OI coordinates with DOJ and other Federal, State, and local
law enforcement authorities. OI also coordinates with OAS and OEI when audits and evaluations
uncover potential fraud. OI’s investigative efforts often lead to criminal convictions, administrative
sanctions, or civil monetary penalties (CMPs).
Office of Counsel to the Inspector General
OCIG provides legal services to OIG, rendering advice and opinions on HHS programs and
operations and providing all legal support for OIG’s internal operations. OCIG represents OIG in all
civil and administrative fraud and abuse cases involving HHS programs, including the False Claims
Act, program exclusion, self-disclosure, and CMP cases. In connection with these cases, OCIG also
negotiates and monitors corporate integrity agreements (CIAs). OCIG renders advisory opinions,
issues compliance program guidance, publishes fraud alerts, and provides other guidance to the
health care industry about the anti-kickback statute and other OIG enforcement authorities.
Mission Support and Infrastructure
MSI is composed of the Immediate Office of the Inspector General and the Office of Management
and Policy. MSI is responsible for coordinating OIG activities and providing mission support,
including setting vision and direction for OIG’s priorities and strategic planning; ensuring effective
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Semiannual Report to Congress—April 1, 2022, Through September 30, 2022
management of budget, finance, human resource management, and other operations; and serving
as a liaison with HHS, Congress, and other stakeholders. MSI plans, conducts, and participates in a
variety of cooperative projects within HHS and with other Government agencies. MSI provides
critical data analytics, data management, and information technology (IT) infrastructure that enable
OIG components to conduct their work efficiently and effectively.
OIG Strategic Publications
HHS-OIG Strategic Plan
OIG’s Strategic Plan outlines the approach to protecting the integrity of HHS programs. The plan
has three key goals: (1) to fight fraud, waste, and abuse; (2) to promote quality, safety, and value in
HHS programs and for HHS beneficiaries; and (3) to advance excellence and innovation. These
goals drive OIG’s work planning for audits and evaluations as well as OIG’s approach to
enforcement. These goals also serve as a starting point for OIG’s assessment of its own
effectiveness.
OIG Work Plan
OIG’s Work Plan sets forth projects that OIG plans to undertake during the fiscal year (FY) and
beyond. Projects listed in the Work Plan span HHS’s Operating Divisions (OpDivs), which include
the Centers for Medicare & Medicaid Services (CMS), public health agencies such as the Centers for
Disease Control and Prevention (CDC) and the National Institutes of Health (NIH), and human
services agencies such as the Administration for Children and Families (ACF) and the
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Department of Health and Human Services, Office of Inspector General
Semiannual Report to Congress—April 1, 2022, Through September 30, 2022
Administration for Community Living (ACL). The Work Plan also includes oversight of State and
local governments’ use of Federal funds as well as the administration of HHS. Some of the projects
described in the Work Plan are statutorily required.
OIG’s Top Recommendations
OIG drives positive change by not only identifying risks, problems, abuses, and deficiencies, but
also recommending solutions to address them. OIG maintains a list of recommendations it has
made to address vulnerabilities detected in its reviews, and it keeps track of whether these
recommendations have been implemented. OIG systematically follows up on its recommendations
with the relevant HHS programs. From among the recommendations that have not been
implemented, OIG identifies the top recommendations that, if implemented, are likely to garner
significant savings and improvements in quality, efficiency, and effectiveness. OIG compiles these
recommendations in OIG’s Top Unimplemented Recommendations: Solutions To Reduce Fraud,
Waste, and Abuse in HHS Programs (previously known as the Compendium of Unimplemented
Recommendations).
Top Management and Performance Challenges Facing HHS
To focus HHS’s attention on the most pressing issues, each year OIG identifies the Top
Management and Performance Challenges facing HHS. These top challenges arise across HHS
programs and cover critical HHS responsibilities, including delivering quality services and benefits,
exercising sound fiscal management, safeguarding public health and safety, and enhancing
cybersecurity.
OIG’s Semiannual Report to Congress
OIG’s Semiannual Report to Congress (Semiannual Report) describes OIG’s work on identifying
significant problems, abuses, deficiencies, remedies, and investigative outcomes relating to the
administration of HHS programs and operations that were disclosed during the reporting period.
In the report below, we present OIG expected recoveries, criminal and civil actions, and other
statistics as a result of our work for the semiannual reporting period of April 1, 2022, through
September 30, 2022. We also provide data for accomplishments for FY 2022. We also highlight
some of our work completed during this semiannual reporting period.
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Department of Health and Human Services, Office of Inspector General
Semiannual Report to Congress—April 1, 2022, Through September 30, 2022
Highlights of OIG Accomplishments
HHS-OIG’s Semiannual Report describes OIG’s work identifying significant risks, problems, abuses,
deficiencies, remedies, and investigative outcomes relating to the administration of HHS programs and
operations that were disclosed during the semiannual reporting period of April 1, 2022, through
September 30, 2022. In this highlights section, we present data on OIG reports issued, expected
recoveries, criminal and civil actions, and other statistics resulting from our work for both the semiannual
reporting period and the entirety of FY 2022. We then highlight significant results from selected audits,
evaluations, and enforcement activities completed during the reporting period.
At-a-Glance Highlights
Statistic FY 2022
(10/1/2021–9/30/2022)
Audit Reports Issued 114
Evaluations Issued 43
Expected Audit Recoveries $1,199,088,845
Questioned Costs $2,173,082,045
Potential Savings $279,087,234
New Audit and Evaluation 445
Recommendations
Recommendations Implemented by 424
HHS OpDivs
Expected Investigative Recoveries $2.73 billion
Criminal Actions 710
Civil Actions 736
Exclusions 2,332
Results for the Semiannual Reporting Period
During this semiannual reporting period (April 1, 2022, through September 30, 2022), we issued 68 audit
reports and 29 evaluation reports. Our audit work identified $62.9 million in expected recoveries as well as
$612.6 million in questioned costs (costs questioned by OIG because of an alleged violation, costs not
supported by adequate documentation, or expenditures of funds for which intended purposes were
unnecessary or unreasonable). Our audit work also identified $117 million in potential savings for HHS—
funds that could be saved if HHS implemented all of OIG’s audit recommendations. During this reporting
period, OIG made 309 new audit and evaluation recommendations crucial to encouraging positive change
in HHS programs. Meanwhile, HHS OpDivs implemented 130 prior recommendations, resulting in positive
impacts for HHS programs and enrollees.
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Department of Health and Human Services, Office of Inspector General
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OIG also remains at the forefront of the Nation’s effort to fight fraud in HHS programs and hold
wrongdoers accountable. Along with our partners, including DOJ, Medicaid Fraud Control Units (MFCUs
or Units), and various Federal, State, and local law enforcement agencies, we detect, investigate, and
prosecute fraud through a coordinated, data-driven approach. OIG’s investigative work led to $1.29 billion
in expected investigative recoveries and 390 criminal actions during this reporting period. OIG also took
civil actions, such as assessing monetary penalties against 416 individuals and entities, and excluded 1,290
individuals and entities from Federal health care programs.
OIG continues to focus on the most significant and high-risk issues in health care and human services. Our
mission is to provide objective oversight to promote the economy, efficiency, effectiveness, and integrity of
HHS programs, as well as the health and welfare of the people they serve. Below, we highlight results from
selected OIG oversight and enforcement activities from this reporting period, organized by subject area. A
comprehensive list of OIG work during this reporting period follows, and appendices A through G provide
data to meet the reporting requirements of the Inspector General Act of 1978.
Responding to the COVID-19 Pandemic and Other Emergencies
OIG continues to advance the four goals that drive OIG’s strategic planning and mission execution with
respect to HHS’s COVID-19 response and recovery. These goals are: (1) protect people; (2) protect funds;
(3) protect infrastructure; and (4) promote the effectiveness of HHS programs, now and into the future.
Additional information about the OIG COVID-19 strategic plan, emerging fraud schemes, and work related
to COVID-19 is available on our website COVID-19 Portal.
Significant OIG oversight work completed during this reporting period related to the COVID-19 pandemic
includes the following reports:
• FDA Repeatedly Adapted Emergency Use Authorization Policies To Address the Need for COVID-19
Testing (OEI-01-20-00380), September 2022;
• FDA’s Work With the Tri-Agency Task Force for Emergency Diagnostics Helped Labs Implement
COVID-19 Tests (OEI-01-20-00381), September 2022;
• HHS Did Not Fully Comply With Federal Requirements and HHS Policies and Procedures When
Awarding and Monitoring Contracts for Ventilators (A-02-20-02002), September 2022; and
• HHS’s and HRSA’s Controls Related to Selected Provider Relief Fund Program Requirements Could Be
Improved (A-09-21-06001), September 2022.
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Department of Health and Human Services, Office of Inspector General
Semiannual Report to Congress—April 1, 2022, Through September 30, 2022
OIG also conducted enforcement activities during this reporting period. Following are two examples of
successful outcomes from these cases:
• An individual was sentenced to 37 months in prison, followed by 3 years of supervised release,
after making threats against Dr. Anthony Fauci. The individual further admitted to threatening
other individuals within and outside HHS with the intent of intimidating or interfering with
performance of their official duties regarding COVID-19 and its testing and prevention.
• A health system agreed to pay $1.75 million in restitution for facilitating COVID-19 vaccinations for
individuals who were falsely characterized as “staff” and “volunteers” and ineligible to participate in
the CDC’s vaccine program specifically designed to vaccinate long-term care facility residents and
staff during the vaccine rollout, when vaccines were in short supply.
Leveraging Oversight To Better Protect Nursing Home Residents
Improving nursing home care is a top priority for OIG. Decades of OIG oversight of nursing homes
revealed significant challenges and vulnerabilities, and the COVID-19 pandemic brought challenges at
nursing homes to the forefront. To better understand contributing factors; identify fraud, inefficiency, and
substandard care; and aid policymakers, our oversight work is guided by a a three-part strategy:
• Performance. Understanding what drives nursing home performance, and in particular what
contributes to poorly performing nursing homes.
• Residents First. Ensuring that nursing homes prioritize quality of care and quality of life for
residents.
• Oversight. Ensuring that entities responsible for nursing home oversight—CMS and States—detect
problems quickly and insist on rapid remediation.
Currently, OIG has 21 ongoing audits and evaluations of nursing home issues. We are continuing to
monitor identified areas of concern, push for implementation of unimplemented recommendations, and
issue new recommendations as problems and solutions are identified. Information about ongoing nursing
home work can be found on OIG’s Nursing Homes web page. Significant OIG work completed during this
reporting period related to protecting residents in nursing homes includes the following:
• An Estimated 91 Percent of Nursing Home Staff Nationwide Received the Required COVID-19 Vaccine
Doses, and an Estimated 56 Percent of Staff Nationwide Received a Booster Dose (A-09-22-02003),
June 2022; and
• Audits of Nursing Home Life Safety and Emergency Preparedness in Eight States Identified
Noncompliance With Federal Requirements and Opportunities for the Centers for Medicare &
Medicaid Services To Improve Resident, Visitor, and Staff Safety (A-02-21-01010), July 2022.
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Department of Health and Human Services, Office of Inspector General
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OIG uses its authorities to exclude entities and individuals engaging in fraud and abuse. For example, OIG
excluded an individual who owned seven nursing homes during this reporting period. OIG had previously
excluded the individual’s seven nursing homes that had been excluded for housing residents during
Hurricane Ida in an unsanitary warehouse without proper food, water, or waste facilities.
Ensuring Health and Safety of Vulnerable People Served by HHS
OIG has devoted substantial oversight effort to protect vulnerable people—including the elderly, children,
and adults with developmental disabilities—who are served by HHS programs such as Medicare, Medicaid,
the Unaccompanied Children (UC) Program, and the Child Care and Development Fund (CCDF).
Significant OIG work completed during this reporting period related to ensuring the health and safety of
vulnerable people served by HHS programs includes the following:
• Adverse Events in Hospitals: A Quarter of Medicare Patients Experienced Harm in October 2018 (OEI-
06-18-00400), May 2022;
• Office of Refugee Resettlement’s Influx Care Facility and Emergency Intake Sites Did Not Adequately
Safeguard Unaccompanied Children From COVID-19 (A-06-21-07002), June 2022;
• HHS Should Improve Internal Coordination Regarding Unaccompanied Children, (OEI-BL-20-00670),
May 2022;
• Operational Challenges Within ORR and the ORR EIS at Fort Bliss Hindered Case Management for
Children (OEI-07-21-00251), September 2022;
• National Snapshot of State Agency Approaches To Reporting and Locating Children Missing From
Foster Care (A-07-20-06095), May 2022;
• In Five States, There Was No Evidence That Many Children in Foster Care Had a Screening for Sex
Trafficking When They Returned After Going Missing (OEI-07-19-00371), July 2022; and
• ACF Should Improve Oversight of Head Start To Better Protect Children's Safety (OEI-BL-19-00560),
September 2022.
OIG uses its authorities to suspend or debar individuals or entities engaged in grant or contract fraud. For
example, OIG debarred individuals and entities due to criminal convictions during this reporting period.
Multiple individuals and entities were debarred after being criminally convicted for their role in a scheme
to defraud child care programs, partially funded by the CCDF, by submitting claims for children who did
not attend day care programs.
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Department of Health and Human Services, Office of Inspector General
Semiannual Report to Congress—April 1, 2022, Through September 30, 2022
Preventing and Treating Opioid Misuse
OIG continued to prioritize oversight and enforcement activities to protect enrollees from prescription
drug abuse and improve access to medications for opioid use disorder.
Significant OIG work completed during this reporting period related to preventing and treating opioid use
disorder includes the report Opioid Overdoses and the Limited Treatment of Opioid Use Disorder Continue
To Be Concerns for Medicare Beneficiaries (OEI-02-22-00390), September 2022.
OIG works with and supports DOJ’s efforts to identify and criminally prosecute bad actors in Federal health
care programs. Following are two examples of successful criminal prosecutions related to improper opioid
prescriptions and distributions during this reporting period:
• An individual was sentenced to 20 years in prison, followed by 5 years of supervised release, and
was ordered to pay a $40,000 fine and almost $4 million in restitution for running a prescription
“pill mill” and providing unwarranted medications.
• An individual was sentenced to 48 months in Federal prison for conspiring to distribute and
possess with intent to inappropriately distribute opioid pain medications and other controlled
substances.
Ensuring Equitable Access to High-Quality Care in Departmental Programs
OIG works to ensure that people served by HHS programs have equitable access to quality care. OIG is
also focused on identifying disparities in access to high-quality care by ensuring that HHS program data
capture demographic data accurately and through analysis of that program data identify, assess, or
remediate health disparities when relevant.
Significant OIG work completed during this reporting period related to promoting equitable access to
high-quality care includes the following:
• Certain Medicare Beneficiaries, Such as Urban and Hispanic Beneficiaries, Were More Likely Than
Others To Use Telehealth During the First Year of the COVID-19 Pandemic (OEI-02-20-00522),
September 2022;
• CDC Found Ways To Use Data To Understand and Address COVID-19 Health Disparities, Despite
Challenges With Existing Data (OEI-05-20-00540), July 2022; and
• Inaccuracies in Medicare’s Race and Ethnicity Data Hinder the Ability To Assess Health Disparities
(OEI-02-21-00100), June 2022.
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Department of Health and Human Services, Office of Inspector General
Semiannual Report to Congress—April 1, 2022, Through September 30, 2022
Reducing Prescription Drug Spending for HHS Programs and Enrollees
OIG performs work to assess areas in which HHS programs or people enrolled in them may be paying
more than necessary for vital drugs.
Significant OIG work completed during this reporting period related to prescription drug spending
includes the following:
• Tennessee Did Not Always Invoice Rebates to Manufacturers for Physician-Administered Drugs
Dispensed to Enrollees of Medicaid Managed-Care Organizations (A-07-21-06096), September 2022;
and
• Part D Plan Preference for Higher-Cost Hepatitis C Drugs Led to Higher Medicare and Beneficiary
Spending (OEI-BL-21-00200), August 2022.
Promoting Program Integrity and Good Financial Stewardship in Traditional Medicare
The 2022 Medicare Trustees’ report projected that assets in the Part A trust fund will be depleted by 2028,
adding urgency to efforts to ensure good stewardship and appropriate use of scarce Medicare funds. OIG
recognizes the importance of identifying and mitigating fraud risks in the Medicare program and holding
accountable those who defraud Medicare, beneficiaries, and taxpayers.
Significant OIG work completed during this reporting period related to Medicare program integrity and
financial stewardship includes the following:
• Medicare Telehealth Services During the First Year of the Pandemic: Program Integrity Risks (OEI-02-
20-00720), September 2022; and
• Reducing Medicare’s Payment Rates for Intermittent Urinary Catheters Can Save the Program and
Beneficiaries Millions of Dollars Each Year (OEI-04-20-00620), September 2022.
OIG uses its authorities to pursue affirmative administrative action against entities and individuals
engaging in conduct that violates the Civil Monetary Penalties Law (CMPL). Following are four examples of
affirmative administrative litigation in the Medicare program during this reporting period:
• A physician entered into a $1,905,070.74 settlement agreement with OIG to resolve allegations of
submitting false claims to Medicare for the application, monitoring, and removal of medical devices
as well as improper claims for reimbursement of devices not covered by the Medicare program.
• An ambulance company entered into a $1,578,412 settlement agreement to resolve allegations that
claims submitted to Medicare Part B for ambulance transportation to and from skilled nursing
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Department of Health and Human Services, Office of Inspector General
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facilities were already covered under Part A.
• A physician entered into a $919,644.34 settlement agreement with OIG to resolve allegations of
presenting to Medicare claims for items or services that were not provided as claimed and were
false or fraudulent.
• An individual and associated clinics entered into a $409,809.88 settlement agreement with OIG to
resolve allegations that procedure claims submitted to Medicare for facet joint injections and
denervations exceeded the coverage limitation of sessions in a rolling, 12-month period.
Promoting Integrity and Effectiveness in Medicare Advantage and Medicaid Managed Care
Almost half of people with Medicare are currently enrolled in Medicare Advantage Organizations.
Enrollment is expected to continue to grow to cover 53 percent—a majority of Medicare enrollees—by
2031.
Managed care is now the predominant payment model in Medicaid. State and Federal expenditures on
Medicaid managed care are growing. These expenditures totaled $421 billion and represented 59 percent
of all Medicaid expenditures in 2021.
Significant OIG work completed during this reporting period related to Medicare Advantage and Medicaid
managed care includes the following:
• Some Medicare Advantage Organization Denials of Prior Authorization Requests Raise Concerns
About Beneficiary Access to Medically Necessary Care (OEI-09-18-00260), April 2022;
• Medicare Advantage Compliance Audit of Specific Diagnosis Codes That Cariten Health Plan, Inc.,
(Contract H4461) Submitted to CMS (A-02-20-01009), July 2022;
• CMS Has Opportunities To Strengthen States’ Oversight of Medicaid Managed Care Medical Loss
Ratios (OEI-03-20-00231), September 2022; and
• Nearly All States Made Capitation Payments for Beneficiaries Who Were Concurrently Enrolled in a
Medicaid Managed Care Program in Two States (A-05-20-00025), September 2022.
Ensuring Medicaid Program Integrity
Medicaid is the largest Federal health care program, with nearly 89 million enrollees as of May 2022.
Medicaid is administered by States per Federal requirements. The program is funded jointly by the Federal
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Department of Health and Human Services, Office of Inspector General
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Government and States. CMS estimated Federal and State Medicaid expenditures of $671.2 billion in 2020.
Significant OIG work completed during this reporting period related to Medicaid program integrity
includes the following:
• New York Claimed $196 Million, Over 72 Percent of the Audited Amount, in Federal Reimbursement
for NEMT Payments to New York City Transportation Providers That Did Not Meet or May Not Have
Met Medicaid Requirements (A-02-21-01001), September 2022; and
• UPICs Hold Promise To Enhance Program Integrity Across Medicare and Medicaid, But Challenges
Remain (OEI-03-20-00330), September 2022.
OIG uses its authorities to exclude entities and individuals engaging in fraud and abuse. For example,
during this reporting period, OIG excluded an individual for 30 years who was an owner and operator of a
billing agency and who was convicted of conspiracy to commit Medicaid fraud.
Promoting Proper Departmental Management and Operations
OIG reviews programs across the Department to ensure that programs are being administered effectively,
efficiently, and without waste.
Significant OIG work completed during this reporting period related to proper departmental management
includes the following:
• FDA: The Food and Drug Administration’s Foreign For-Cause Drug Inspection Program Can Be
Improved To Protect the Nation’s Drug Supply (A-01-19-01500), June 2022;
• Delays in Confirmatory Trials for Drugs Granted FDA’s Accelerated Approval Raise Concerns (OEI-01-
21-00401), September 2022;
• Indian Health Service Capacity To Manage Supplemental $3.5 Billion Allocated to Its Sanitation
Facilities Construction Program (OEI-06-22-00320), September 2022; and
• Opportunities Exist To Strengthen NIH Grantees’ Oversight of Investigators’ Foreign Significant
Financial Interests and Other Support (OEI-03-20-00210), May 2022.
Cybersecurity Protection
OIG continues to recognize cybersecurity vulnerabilities as major risks to effectively managing and
safeguarding the Department’s programs. Oversight of the Department’s cybersecurity is being
prioritized. Repeated cyberattacks focused on accessing critical information in HHS systems added
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Department of Health and Human Services, Office of Inspector General
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urgency to the task of developing departmental cybersafeguards—in addition to conducting normal
operations—over the course of the COVID-19 pandemic.
During this reporting period, OIG conducted work examining HHS’s cybersecurity controls to strengthen
HHS’s cybersecurity posture including:
• The Centers for Medicare & Medicaid Services Had Policies and Procedures in Place To Mitigate
Vulnerabilities in a Timely Manner, but Improvements Are Needed (A-18-20-06500), July 2022;
• IHS Telehealth System Was Deployed Without Some Required Cybersecurity Controls (A-18-21-
03100), September 2022; and
• National Institutes of Health Grant Program Cybersecurity Requirements Need Improvement (A-18-
20-06300), September 2022.
13
Department of Health and Human Services, Office of Inspector General
Semiannual Report to Congress—April 1, 2022, Through September 30, 2022
OIG Participation in Congressional Hearings
6/28/2022 Erin Bliss, Assistant Inspector “Protecting America’s Seniors: Oversight of Private
General, Office of Evaluation and Sector Medicare Advantage Plans,” U.S. House
Inspections Committee on Energy and Commerce.
14
Department of Health and Human Services, Office of Inspector General
Semiannual Report to Congress—April 1, 2022, Through September 30, 2022
Selected Acronyms and Abbreviations
ACA Patient Protection and Affordable Care Act
ACF Administration for Children and Families
ACL Administration for Community Living
CDC Centers for Disease Control and Prevention
CIA corporate integrity agreement
CMP civil monetary penalty
CMPL Civil Monetary Penalties Law
CMS Centers for Medicare & Medicaid Services
DEA Drug Enforcement Administration
DOJ Department of Justice
DME durable medical equipment
EMTALA Emergency Medical Treatment and Labor Act
FBI Federal Bureau of Investigation
FDA Food and Drug Administration
GAO Government Accountability Office
HHS Department of Health and Human Services
HIPAA Health Insurance Portability and Accountability Act of 1996
HRSA Health Resources and Services Administration
IHS Indian Health Service
MAC Medicare administrative contractor
MCO managed care organization
MFCU Medicaid Fraud Control Unit
NIH National Institutes of Health
OAS Office of Audit Services
OASH Office of Safety and Health
OCIG Office of Counsel to the Inspector General
OEI Office of Evaluation and Inspections
OI Office of Investigations
OIG Office of Inspector General
OMB Office of Management and Budget
OS Office of the Secretary
15
Department of Health and Human Services, Office of Inspector General
Semiannual Report to Congress—April 1, 2022, Through September 30, 2022
Medicare and Medicaid Reports and Reviews
Medicare Program Reports and Reviews
Financial Management and Improper Payments
Medicare Improperly Paid Durable Medical Equipment Suppliers an Estimated $8 Million of the
$40 Million Paid for Power Mobility Device Repairs (A-09-20-03016), May 2022
We found that not all suppliers complied with Medicare requirements when billing for power
mobility device (PMD) repairs. For the 922 PMD repairs associated with 100 sampled beneficiaries,
261 PMD repairs associated with 76 beneficiaries did not comply with those requirements.
Specifically, documentation did not adequately support the charges for PMD repairs, the labor time
associated with PMD repairs was not documented, or PMD repair charges were not reasonable and
necessary. We also identified questionable charges for 183 PMD repairs associated with 19
sampled beneficiaries. Although the billing of these PMD repairs did not reflect noncompliance
with Medicare requirements, suppliers did not meet documentation standards established by
guidance or submitted charges that may not have been reasonable and necessary.
On the basis of our sample results, we estimated that $7.9 million of the $40.1 million paid for PMD
repairs was improperly paid. We also estimated that Medicare could have saved as much as an
additional $3.7 million for questionably paid PMD repairs. In addition, we estimated that Medicare
beneficiaries could have saved as much as $3 million in coinsurance for the improperly and
questionably paid PMD repairs.
CMS generally concurred with our recommendations that it instruct the durable medical
equipment (DME) Medicare contractors to: (1) recover $41,137 in overpayments for PMD repairs; (2)
notify suppliers to refund $10,494 in coinsurance; and (3) based on the results of this audit, notify
appropriate suppliers so that they can exercise reasonable diligence to identify, report, and return
any overpayments. We also made four procedural recommendations.
Vanderbilt University Medical Center: Audit of Outpatient Outlier Payments (A-06-20-04003), May
2022
Vanderbilt University Medical Center (VUMC) did not properly bill the claims related to 81 outlier
payments of 117 sampled claims, resulting in improper outlier payments during our audit period.
These 81 claims, which had outlier payments totaling $427,644, contained 110 billing errors. The
billing errors primarily occurred because VUMC did not have adequately designed controls or
billing system capabilities to prevent coding errors, charge errors, and billing for services not
covered by Medicare Part B.
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Department of Health and Human Services, Office of Inspector General
Semiannual Report to Congress—April 1, 2022, Through September 30, 2022
VUMC concurred with our recommendations that it: (1) refund to the Medicare contractor the
portion of the $686,500 in estimated outpatient outlier net overpayments for incorrectly billed
claims that are within the 4-year reopening period and (2) improve procedures, provide education,
and implement changes to its billing system to ensure that claims billed to Medicare are accurate.
Accuracy of Risk Adjustment and Capitated Payments in Medicare Advantage
To determine the health status of enrollees, CMS relies on MA organizations to collect diagnosis
codes from their providers and submit these codes to CMS. Some diagnoses are at higher risk for
being miscoded, which may result in overpayments from CMS. During this reporting period, OIG
conducted seven audits that were designed to assess whether selected diagnosis codes that MA
organizations submitted to CMS for use in CMS’s risk adjustment program complied with Federal
requirements. In some cases, we identified underpayments and netted them against
overpayments. We conducted two audits that examined all diagnosis codes. Complete
recommendations and providers’ responses can be found in the final reports, which are
summarized below.
Medicare Advantage Compliance Audit of Specific Diagnosis Codes That Peoples Health Network
(Contract H1961) Submitted to CMS (A-06-18-05002), May 2022
With respect to the seven high-risk groups covered by our audit, most of the selected diagnosis
codes that Peoples Health Network (Peoples Health) submitted to CMS for use in CMS’s risk
adjustment program did not comply with Federal requirements. These errors occurred because
the policies and procedures that Peoples Health had to detect and correct noncompliance with
CMS’s program requirements, as mandated by Federal regulations, were not always effective. On
the basis of our sample results, we estimated that Peoples Health received at least
$3.3 million in overpayments for these high-risk diagnosis codes for 2015 and 2016.
Medicare Advantage Compliance Audit of Specific Diagnosis Codes That Cariten Health Plan, Inc.,
(Contract H4461) Submitted to CMS (A-02-20-01009), July 2022
With respect to the nine high-risk groups covered by our audit, most of the selected diagnosis
codes that Cariten Health Plan, Inc. (Cariten) submitted to CMS for use in CMS’s risk adjustment
program did not comply with Federal requirements. These errors occurred because the policies
and procedures that Cariten had to detect and correct noncompliance with CMS’s program
requirements, as mandated by Federal regulations, were not always effective. On the basis of our
sample results, we estimated that Cariten received at least $9.2 million in net overpayments for
these high-risk diagnosis codes for 2016 and 2017.
17
Department of Health and Human Services, Office of Inspector General
Semiannual Report to Congress—April 1, 2022, Through September 30, 2022
Medicare Advantage Compliance Audit of Specific Diagnosis Codes That WellCare of Florida, Inc.,
(Contract H1032) Submitted to CMS (A-04-19-07084), August 2022
With respect to the seven high-risk groups covered by our audit, most of the selected diagnosis
codes that WellCare of Florida, Inc. (WellCare) submitted to CMS for use in CMS’s risk adjustment
program did not comply with Federal requirements. These errors occurred because the policies
and procedures that WellCare had to prevent, detect, and correct noncompliance with CMS’s
program requirements, as mandated by Federal regulations, were not always effective. On the
basis of our sample results, we estimated that WellCare received at least
$3.5 million of net overpayments for these high-risk diagnosis codes for 2015 and 2016.
Medicare Advantage Compliance Audit of Diagnosis Codes That Cigna HealthSpring of Florida, Inc.
(Contract H5410) Submitted to CMS (A-03-18-00002), August 2022
Cigna HealthSpring did not submit some diagnosis codes to CMS for use in the risk adjustment
program in accordance with Federal requirements. First, although most of the diagnosis codes
that Cigna HealthSpring submitted were supported in the medical records and therefore validated
1,401 of the 1,470 sampled enrollees’ Hierarchical Condition Categories (HCCs), the remaining 69
HCCs were not validated and resulted in overpayments. Second, there were an additional 18 HCCs
for which the medical records supported diagnosis codes that Cigna HealthSpring should have
submitted to CMS but did not.
As a result, Cigna HealthSpring received $39,612 of net overpayments for 2015 for the sampled
enrollees. As demonstrated by the errors found in our sample, Cigna HealthSpring’s policies to
prevent, detect, and correct noncompliance with CMS’s program requirements, as mandated by
Federal regulations, could be improved.
Medicare Advantage Compliance Audit of Specific Diagnosis Codes That Regence BlueCross
BlueShield of Oregon (Contract H3817) Submitted to CMS (A-09-20-03009), September 2022
With respect to the seven high-risk groups covered by our audit, most of the selected diagnosis
codes that Regence BlueCross BlueShield of Oregon (Regence) submitted to CMS for use in CMS’s
risk adjustment program did not comply with Federal requirements. Specifically, for 111 of the 179
sampled enrollee-years, the diagnosis codes were not supported in the medical records and
resulted in net overpayments of $248,885. As demonstrated by the errors in our sample, the
policies and procedures that Regence had to prevent, detect, and correct noncompliance with
CMS’s program requirements, as mandated by Federal regulations, could be improved. On the
basis of our sample results, we estimated that Regence received at least $1.8 million of net
overpayments for these high-risk diagnosis codes for 2015 and 2016.
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Department of Health and Human Services, Office of Inspector General
Semiannual Report to Congress—April 1, 2022, Through September 30, 2022
Medicare Advantage Compliance Audit of Diagnosis Codes That Inter Valley Health Plan, Inc.
(Contract H0545), Submitted to CMS (A-05-18-00020), September 2022
Inter Valley Health Plan, Inc. (Inter Valley) did not submit some diagnosis codes to CMS for use in
the risk adjustment program in accordance with Federal requirements. First, although most of the
diagnosis codes that Inter Valley submitted were supported in the medical records and therefore
validated 1,411 of the 1,553 sampled enrollees’ HCCs, the remaining 142 HCCs were not validated
and resulted in overpayments. These 142 unvalidated HCCs included 23 HCCs for which we
identified 23 other, replacement HCCs for more and less severe manifestations of the diseases.
Second, there were an additional 12 HCCs for which the medical records supported diagnosis
codes that Inter Valley should have submitted to CMS but did not.
Thus, the risk scores for the 200 sampled enrollees should not have been based on the 1,553 HCCs.
Rather, the risk scores should have been based on 1,446 HCCs (1,411 validated HCCs + 23 other
HCCs + 12 additional HCCs). As a result, we estimated that Inter Valley received at least $5.3 million
in net overpayments for 2015. These errors occurred because Inter Valley’s policies and procedures
to prevent, detect, and correct noncompliance with CMS’s program requirements, as mandated by
Federal regulations, could be improved.
Medicare Advantage Compliance Audit of Specific Diagnosis Codes That BlueCross BlueShield of
Tennessee, Inc. (Contract H7917) Submitted to CMS (A-07-19-01195), September 2022
With respect to the nine high-risk groups covered by our audit, most of the selected diagnosis
codes that BlueCross BlueShield of Tennessee, Inc. (BCBST), submitted to CMS for use in CMS’s risk
adjustment program did not comply with Federal requirements. For 210 of the 270 sampled
enrollee-years, the medical records that BCBST provided did not support the diagnosis codes and
resulted in $491,269 in overpayments.
As demonstrated by the errors found in our sample, BCBST’s policies and procedures to prevent,
detect, and correct noncompliance with CMS’s program requirements, as mandated by Federal
regulations, could be improved. On the basis of our sample results, we estimated that BCBST
received approximately $7.8 million in overpayments for 2016 and 2017.
Medicare Advantage Compliance Audit of Specific Diagnosis Codes That Highmark Senior Health
Company (Contact H3916) Submitted to CMS (A-03-19-00001), September 2022
With respect to the six high-risk groups covered by our audit, most of the selected diagnosis codes
that Highmark Senior Health Company (Highmark) submitted to CMS for use in CMS’s risk
adjustment program did not comply with Federal requirements. For 160 of the 226 sampled
enrollee-years, the diagnosis codes were not supported in the medical records.
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Department of Health and Human Services, Office of Inspector General
Semiannual Report to Congress—April 1, 2022, Through September 30, 2022
The errors occurred because the policies and procedures that Highmark had to prevent, detect,
and correct noncompliance with CMS’s program requirements, as mandated by Federal
regulations, could be improved. As a result, the HCCs (diagnosis code groupings based on
similarity of clinical characteristics, severity, and cost implications) for these high-risk diagnosis
codes were not validated. On the basis of our sample results, we estimated that Highmark received
at least $6.2 million of net overpayments for 2015 and 2016.
Medicare Advantage Compliance Audit of Specific Diagnosis Codes That HumanaChoice (Contract
R5826) Submitted to CMS (A-05-19-00039), September 2022
With respect to the nine high-risk groups covered by our audit, most of the selected diagnosis
codes that HumanaChoice submitted to CMS for use in CMS’s risk adjustment program did not
comply with Federal requirements. For 207 of the 270 sampled enrollee-years, the diagnosis codes
that HumanaChoice submitted to CMS were not supported in the medical records and resulted in
$574,430 of overpayments for the 270 enrollee-years.
These errors occurred because the policies and procedures that HumanaChoice had to prevent,
detect, and correct noncompliance with CMS’s program requirements as mandated by Federal
regulations could be improved. On the basis of our sample results, we estimated that
HumanaChoice received at least $34.4 million of overpayments for these high-risk diagnosis codes
in 2016 and 2017.
Medicare and Beneficiaries Paid Substantially More to Provider-Based Facilities in Eight Selected
States in Calendar Years 2010 Through 2017 Than They Paid to Freestanding Facilities in the Same
States for the Same Type of Services (A-07-18-02815), June 2022
Both the Medicare program and its beneficiaries could have realized significant savings for
evaluation and management (E&M) services if those services had been paid as if provided at
freestanding facilities. If the physicians in the selected States had been paid at the freestanding
Physician Fee Schedule (PFS) nonfacility rate and hospitals paid nothing under the Outpatient
Prospective Payment System for our audit period, the Medicare program and its beneficiaries could
have realized cost savings of more than $1.6 billion. In addition, beneficiaries would have been
required to make only one coinsurance payment rather than two (as they are currently required to
do), and the cost-sharing would generally be lower because it would be based only on the
freestanding facility rate.
CMS has taken some steps intended to equalize payments. If these changes had been in effect
during the period covered by our audit, the potential cost savings of these changes for E&M
services in the selected States for our audit period could have been a combined $1.4 billion for the
Medicare program and its beneficiaries. However, the combined $1.4 billion in potential cost
savings would still have been less than the $1.6 billion in potential cost savings if E&M services had
been paid at the freestanding PFS nonfacility rate.
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Department of Health and Human Services, Office of Inspector General
Semiannual Report to Congress—April 1, 2022, Through September 30, 2022
CMS did not directly agree or disagree with our recommendation that it pursue legislative or
regulatory changes to lower costs for both the Medicare program and beneficiaries, by equalizing
payments as appropriate between provider-based facilities and freestanding facilities for E&M
services.
The Reduced Outlier Threshold Applied to Transfer Claims Did Not Significantly Increase Medicare
Payments to Hospitals (A-05-19-00019), July 2022
Medicare’s reduced outlier threshold for transfer claims did not have a significant impact on the
total Medicare payments to the 30 hospitals we audited. Of the 5,303 transfer claims, the total
Medicare payments for 3,668 transfer claims were less than what Medicare would have paid the
hospitals if they had discharged the beneficiaries. However, the total Medicare payments for the
remaining 1,635 transfer claims were $2.9 million more than what Medicare would have paid the
hospitals if they had discharged the beneficiaries. Specifically, under the transfer policy, Medicare
decreased DRG rate payments by $10.8 million, but because of the reduced outlier threshold,
Medicare increased outlier payments by $13.7 million, resulting in a net increase of $2.9 million in
total Medicare payments compared to what hospitals would have been paid if they had discharged
the beneficiaries.
The $2.9 million net increase in total Medicare payments for these 1,635 transfer claims occurred
because the outlier payment increase using the reduced outlier threshold was greater than the
DRG payment decrease under the transfer policy.
Medicare’s reduced outlier threshold for transfer claims does not have a significant enough impact
for us to recommend a policy change. Therefore, we do not have any recommendations.
CMS Reported Collecting Just Over Half of the $498 Million in Medicare Overpayments
Identified by OIG Audits (A-04-18-03085), July 2022
We verified that CMS collected $120 million of the $498 million in sustained Medicare
overpayments identified in HHS-OIG audit reports issued during our audit period. Of this
sustained amount, CMS reported that it had collected $272 million (55 percent) and that it had not
collected $226 million (45 percent). CMS provided documentation to support that it had collected
$120 million of the $272 million. However, CMS did not provide adequate documentation to
support that it had collected the remaining $152 million. In addition, CMS did not take corrective
action in response to all of the recommendations made in our prior audit report, Obstacles to
Collection of Millions in Medicare Overpayments. In that audit report, issued on May 18, 2012, we
made six recommendations, and CMS agreed to implement four of them. Of those four
recommendations, CMS implemented two, partially implemented one, and did not implement one.
21
Department of Health and Human Services, Office of Inspector General
Semiannual Report to Congress—April 1, 2022, Through September 30, 2022
We recommended that CMS: (1) continue its efforts to recover any collectible portion of the
$226 million in uncollected overpayments, (2) determine what portion of the $152 million was
collected and recorded in its accounting system, (3) revise 42 CFR section 405.980 and
corresponding manual instructions related to the reopening period for claims to be consistent with
statutory provisions contained in section 1870 of the Social Security Act, and (4) develop a plan for
resolving cost reports applicable to the nine audit reports discussed in this report. We also made
other procedural recommendations. CMS generally did not concur with our findings or
recommendations.
Medicare Critical Care Services Provider Compliance Audit: Lahey Clinic, Inc. (A-03-20-00002), July
2022
Lahey Clinic, Inc. (Lahey) complied with Medicare billing requirements for 36 of the 92 critical care
services that we reviewed. However, Lahey did not comply with Medicare billing requirements for
the remaining 56 critical care services. All 10 of the inpatient admissions reviewed included at least
1 critical care service that did not comply with Medicare billing requirements. Specifically, Lahey
billed for 54 critical care services for patients whose conditions did not indicate that the critical care
services were medically necessary or for which the physician did not directly provide services that
were at the level of care required for critical care services. In addition, Lahey billed for two critical
care services that were billed using an incorrect Current Procedural Terminology (CPT) code for the
critical care service provided.
These billing errors resulted in Lahey receiving $6,015 in unallowable Medicare payments. These
errors occurred because Lahey did not have adequate policies and procedures to ensure that: (1)
physicians correctly documented in the patient’s medical record and identified critical care services
that met Medicare requirements and (2) coders made correct determinations for critical care
services that met Medicare requirements.
We recommended that Lahey refund to the MAC $6,015 in overpayments for critical care services,
and we also made procedural recommendations for Lahey to strengthen its policies and
procedures. Lahey partially agreed with our recommendations.
Medicare Hospice Provider Compliance
The Medicare hospice benefit allows providers to claim Medicare reimbursement for hospice
services provided to individuals with a life expectancy of 6 months or less and who have elected
hospice care. Previous OIG reviews found that Medicare inappropriately paid for hospice services
that did not meet certain Medicare requirements. Complete recommendations and providers’
responses can be found in the final reports, which are summarized below.
22
Department of Health and Human Services, Office of Inspector General
Semiannual Report to Congress—April 1, 2022, Through September 30, 2022
Medicare Hospice Provider Compliance Audit: Vitas Healthcare Corporation of Florida (A-02-19-
01018), July 2022
Vitas Healthcare Corporation of Florida (Vitas) did not comply with Medicare requirements for 89
of the 100 claims in our sample. These improper payments occurred because Vitas’ policies and
procedures were not effective to ensure that it maintained documentation to support the level of
care and hospice services claimed for Medicare reimbursement. On the basis of our sample
results, we estimated that Vitas received at least $140 million in improper Medicare reimbursement
for hospice services that did not comply with Medicare requirements.
Medicare Hospice Provider Compliance Audit: Hospice of Palm Beach County, Inc. (A-02-20-01001),
September 2022
Hospice of Palm Beach County, Inc. (HPBC) received Medicare reimbursement for hospice services
that did not comply with Medicare requirements. Improper payment of these claims occurred
because HPBC’s policies and procedures were not effective in ensuring that the clinical
documentation it maintained supported the terminal illness prognosis, that the appropriate level of
care was provided, and that services were supported. On the basis of our sample results, we
estimated that HPBC received at least $42.3 million in improper Medicare reimbursement for
hospice services.
We made a series of recommendations to Vitas, including that it refund to the Federal Government
the portion of the estimated $140 million in Medicare overpayments that are within the 4-year
claims reopening period; identify, report, and return any overpayments in accordance with the 60-
day rule; and strengthen its policies and procedures to ensure that hospice services comply with
Medicare requirements. Vitas disagreed with some of our recommendations and partially agreed
with our findings.
Reducing Medicare’s Payment Rates for Intermittent Urinary Catheters Can Save the Program and
Beneficiaries Millions of Dollars Each Year (OEI-04-20-00620), September 2022
In Medicare Part B, suppliers of intermittent urinary catheters received $407 million in FY 2020,
more than three times the suppliers’ estimated acquisition costs of $121 million. Our findings
demonstrate that Medicare and its beneficiaries have the opportunity to achieve substantial
savings while allowing suppliers adequate payments for the items and services they provide. CMS
did not explicitly indicate whether it concurred with our recommendation; instead, CMS stated that
it will take our recommendation under consideration as it determines appropriate next steps. Our
recommendation was for CMS to lower Medicare’s payment rates for intermittent urinary catheters.
CMS’s System Edits Significantly Reduced Improper Payments to Acute-Care Hospitals After May
2019 for Outpatient Services Provided to Beneficiaries Who Were Inpatients of Other Facilities (A-09-
22-03007), September 2022
23
Department of Health and Human Services, Office of Inspector General
Semiannual Report to Congress—April 1, 2022, Through September 30, 2022
During our audit period, Medicare inappropriately paid acute-care hospitals $39.3 million for
outpatient services they provided to beneficiaries who were inpatients of other facilities (i.e., long-
term care hospitals, inpatient rehabilitation facilities, inpatient psychiatric facilities, and critical
access hospitals). None of the $39.3 million should have been paid because the inpatient facilities
were responsible for payment. Each type of inpatient facility covered by our audit must: (1) provide
directly all services furnished during an inpatient stay or (2) arrange for services to be provided on
an outpatient basis by an acute-care hospital and include those outpatient services on its inpatient
claims submitted to Medicare.
CMS generally concurred with our recommendations that it: (1) direct the Medicare contractors to
recover the portion of the $39.3 million in improper payments for our audit period that are within
the 4-year reopening period, (2) instruct acute-care hospitals to refund beneficiaries up to
$9.8 million in deductible and coinsurance amounts that may have been incorrectly collected from
them or from someone on their behalf, (3) direct the Medicare contractors to recover any improper
payments after our audit period, and (4) continue to review the system edits to determine whether
any refinements are necessary to prevent overpayments to acute-care hospitals for outpatient
services provided to beneficiaries who are inpatients of other facilities. The report includes one
other recommendation.
Medicare Part B Overpaid and Beneficiaries Incurred Cost-Share Overcharges of Over
$1 Million for the Same Professional Services (A-06-21-05003), September 2022
Not all Medicare Part B payments made to Critical Access Hospitals (CAHs) for professional services
and payments made to health care practitioners complied with Federal requirements. For the
40,026 claims we audited, CAHs and health care practitioners each submitted an equal number of
claims. However, for each date of service, only one of the claims complied with Federal
requirements. As a result, Medicare administrative contractors (MACs) paid providers $907,438
more than they should have been paid, and beneficiaries were held responsible for $281,321 more
than they should have been.
These overpayments occurred because CMS did not have claim system edits to prevent and detect
duplicate professional services claims for the same date of service, beneficiary, and procedure.
CMS generally concurred with our recommendations that it: (1) direct the MACs to recover the
$331,448 from the CAHs for 12,156 claims for which the health care practitioners had not
reassigned their billing rights to the CAHs and $83,412 in cost-sharing overcharges to Medicare
beneficiaries that are within the 4-year reopening period and (2) direct the MACs to recover the
$575,990 from health care practitioners for 7,857 claims for which the health care practitioners had
reassigned their billing rights to the CAHs and $197,909 in cost-sharing overcharges to beneficiaries
that are within the 4-year reopening period.
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Department of Health and Human Services, Office of Inspector General
Semiannual Report to Congress—April 1, 2022, Through September 30, 2022
CMS’s System Edits Significantly Reduced Improper Payments to Acute-Care Hospitals After May
2019 for Outpatient Services Provided to Beneficiaries Who Were Inpatients of Other Facilities (A-09-
22-03007), September 2022
During our audit period, Medicare inappropriately paid acute-care hospitals $39.3 million for
outpatient services they provided to beneficiaries who were inpatients of other facilities. None of
the $39.3 million should have been paid because the inpatient facilities were responsible for
payment. Each type of inpatient facility covered by our audit must: (1) provide directly all services
furnished during an inpatient stay or (2) arrange for services to be provided on an outpatient basis
by an acute-care hospital and include those outpatient services on its inpatient claims submitted to
Medicare.
Before May 2019, the system edits were not working properly. However, after CMS modified the
edits in May 2019, only $3.4 million (less than 9 percent of the $39.3 million in improper payments
for the entire audit period) was inappropriately paid to acute-care hospitals from
June 2019 through December 2021.
CMS generally concurred with our recommendations that it: (1) direct the Medicare contractors to
recover the portion of the $39.3 million in improper payments for our audit period that are within
the reopening period, (2) instruct acute-care hospitals to refund beneficiaries up to
$9.8 million in deductible and coinsurance amounts that may have been incorrectly collected from
them or from someone on their behalf, (3) direct the Medicare contractors to recover any improper
payments after our audit period, and (4) continue to review the system edits to determine whether
any refinements are necessary to prevent overpayments to acute-care hospitals for outpatient
services provided to beneficiaries who are inpatients of other facilities.
Medicare Dialysis Services Provider Compliance Audit—Dialysis Clinic, Inc. (A-05-20-00010),
September 2022
Dialysis Clinic, Inc. (DCI) claimed reimbursement for dialysis services that did not comply with
Medicare requirements for 70 of the 100 sampled claims. Specifically, DCI submitted claims for
which: (1) comprehensive assessments or plans of care did not meet Medicare requirements, (2)
dialysis treatments were not completed, (3) dialysis services were not documented, (4)
beneficiaries’ height or weight measurements did not comply with Medicare requirements, and (5)
the medical record did not have a monthly progress note by a physician or other qualified
professional.
Although DCI had established corporatewide internal controls to monitor and maintain complete,
accurate, and accessible medical records at all its facilities, these controls were not always effective
in ensuring that DCI’s claims for dialysis services complied with Medicare requirements.
We estimated that DCI received unallowable Medicare payments of at least $14,193,677 for dialysis
services that did not comply with Medicare requirements. Many of the errors we identified did not
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Department of Health and Human Services, Office of Inspector General
Semiannual Report to Congress—April 1, 2022, Through September 30, 2022
affect DCI’s Medicare reimbursement for the services because they were reimbursed on a bundled,
per-treatment basis or related to Medicare conditions for coverage. However, the deficiencies
could have a significant impact on the quality of care provided to Medicare beneficiaries and could
result in the provision of inappropriate or unnecessary dialysis services.
DCI did not concur with our recommendations that it refund an estimated $14,193,677 to the
Medicare program. We also made a series of recommendations to strengthen DCI’s internal
controls to ensure that dialysis services comply with Medicare requirements.
Quality of Care, Safety, and Access
Some Medicare Advantage Organization Denials of Prior Authorization Requests Raise Concerns
About Beneficiary Access to Medically Necessary Care (OEI-09-18-00260), April 2022
Medicare Advantage Organizations (MAOs) sometimes denied prior authorization and payment
requests that met Medicare coverage rules; we found that 13 percent of prior authorization
requests that MAOs denied, and 18 percent of payment requests that MAOs denied, met Medicare
coverage rules and/or MAO billing rules. When MAOs deny requests for Medicare-covered
services, they may prevent or delay beneficiaries from accessing needed care and create
administrative burden for both beneficiaries and providers.
CMS concurred with our recommendations that: (1) CMS should issue new guidance on the
appropriate use of MAO clinical criteria in medical necessity reviews; (2) CMS should update its
audit protocols to address the issues identified in this report, such as MAO use of clinical criteria
and/or examining particular service types; and (3) CMS should direct MAOs to take additional steps
to identify and address vulnerabilities that can lead to manual review errors and system errors.
Posthospital Skilled Nursing Facility Care Provided to Dually Eligible Beneficiaries in Indiana
Generally Met Medicare Level-of-Care Requirements (A-05-20-00005), April 2022
Posthospital skilled nursing facility (SNF) care provided to 98 of the 100 dually eligible beneficiaries
in Indiana was not associated with potentially avoidable hospitalizations. For the remaining two
beneficiaries, our independent medical review contractor found that because the nursing facilities
did not have effective prevention strategies, the beneficiaries were hospitalized and later
discharged to SNF care at the same facility.
Posthospital SNF care provided to 98 of the 100 beneficiaries met the Medicare SNF level-of-care
requirements. The remaining two beneficiaries did not meet the Medicare SNF level-of-care
requirements because the SNF physicians incorrectly determined that the beneficiaries required
either skilled nursing or skilled rehabilitation services, or both, on a daily basis.
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For all 100 beneficiaries, physicians ordered SNF services. We noted that records from the hospitals
where 33 beneficiaries had a qualifying inpatient stay did not contain a clear and definitive hospital
physician discharge order for SNF care. Hospital physicians mainly discharged beneficiaries "back
to nursing facility" without specifying the level of care. In these cases, SNF physicians certified the
SNF level of care. The physician order not only affects level-of-care determination but also has a
financial impact on the nursing facilities.
Our independent medical review contractor found that SNF care provided to dually eligible
beneficiaries in Indiana during our audit period generally: (1) was not associated with potentially
avoidable hospitalizations and (2) met the Medicare level-of-care requirements. As a result, we do
not have any recommendations. However, the quality of care in nursing facilities remains a
concern for OIG.
Adverse Events in Hospitals: A Quarter of Medicare Patients Experienced Harm in October 2018 (OEI-
06-18-00400), May 2022
One in four Medicare patients experienced patient harm events during their hospital stays in
October 2018. Patient harm events indicate that a patient’s care resulted in an undesirable clinical
outcome not caused by underlying disease. Forty-three percent of these harm events could have
been prevented. Our findings will help CMS and the Agency for Healthcare Research and Quality
(AHRQ) track and reduce patient harm in hospitals and improve patient safety.
CMS and AHRQ concurred with all seven of our recommendations. We recommended to CMS
that: (1) CMS should update and broaden its lists of hospital-acquired conditions to capture
common, preventable, and high-cost harm events; (2) CMS should explore expanding the use of
patient safety metrics in pilots and demonstrations for health care payment and service delivery, as
appropriate; and (3) CMS, as OIG previously recommended, should develop and release
interpretive guidance to surveyors for assessing hospital compliance with requirements to track
and monitor patient harm. We recommended to AHRQ that: (4) AHRQ should with support from
HHS leadership coordinate agency efforts to update agency-specific Quality Strategic Plans; (5)
AHRQ should optimize use of the Quality and Safety Review System (QSRS), including assessing
the feasibility of automating data capture for national measurement and to facilitate local use; (6)
AHRQ should develop an effective model to disseminate information on national clinical practice
guidelines or best practices to improve patient safety; and (7) AHRQ should continue efforts to
identify and develop new strategies to prevent common patient harm events in hospitals.
Certain Medicare Beneficiaries, Such as Urban and Hispanic Beneficiaries, Were More Likely Than
Others To Use Telehealth During the First Year of the COVID-19 Pandemic (OEI-02-20-00522),
September 2022
Beneficiaries in urban areas were more likely than those in rural areas to use telehealth during the
first year of the pandemic. Beneficiaries in Massachusetts, Delaware, and California were more
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likely than beneficiaries in some other States to use telehealth. Dually eligible beneficiaries (i.e.,
those eligible for both Medicare and Medicaid), Hispanic beneficiaries, younger beneficiaries, and
female beneficiaries were also more likely than others to use telehealth. In addition, beneficiaries
almost always used telehealth from home or other non-health-care settings. Furthermore, almost
one-fifth of beneficiaries used certain audio-only telehealth services, with the vast majority of these
beneficiaries using these audio-only services exclusively. Older beneficiaries were more likely to
use these audio-only services, as were dually eligible and Hispanic beneficiaries. As CMS, HHS,
Congress, and other stakeholders consider permanent changes to Medicare telehealth services, it is
important that they balance concerns about issues such as access, quality of care, health equity,
and program integrity.
CMS did not explicitly indicate whether it concurred with our four recommendations. Our
recommendations were that: (1) CMS should take appropriate steps to enable a successful
transition from current pandemic-related flexibilities to well-considered long-term policies for the
use of telehealth for beneficiaries in urban areas and from the beneficiary’s home, (2) CMS should
temporarily extend the use of audio-only telehealth services and evaluate their impact, (3) CMS
should require a modifier to identify all audio-only telehealth services provided in Medicare, and
(4) CMS should use telehealth to advance health care equity.
Opioid Overdoses and the Limited Treatment of Opioid Use Disorder Continue To Be Concerns for
Medicare Beneficiaries (OEI-02-22-00390), September 2022
In 2021, almost a quarter of Part D beneficiaries received opioids, about 50,400 Medicare Part D
beneficiaries experienced an opioid overdose, and more than 1 million Medicare beneficiaries had
a diagnosis of opioid use disorder during 2021. However, fewer than one in five Medicare
beneficiaries with opioid use disorder received medication to treat their opioid use disorder. At the
same time, the number of beneficiaries receiving prescriptions for naloxone—a drug that reverses
opioid overdoses—through Part D grew. Monitoring opioid use and access to medications for the
treatment of opioid use disorder as well as to naloxone are critical to addressing the opioid crisis.
We did not make any recommendations in this report, however, a December 2021 OIG report
recommended that CMS take steps to improve access to medications for the treatment of opioid
use disorder and other support services. We continue to call attention to the importance of
implementing these recommendations and to ensuring access to treatment for opioid use
disorder.
Certain Life Care Nursing Homes May Not Have Complied With Federal Requirements for Infection
Prevention and Control and Emergency Preparedness (A-01-20-00004), September 2022
Selected Life Care nursing homes may not have complied with Federal requirements for infection
prevention and control and emergency preparedness. Life Care officials attributed the possible
noncompliance to: (1) leadership turnover, (2) staff turnover, (3) documentation issues (i.e.,
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information was not documented or documentation was either lost or misplaced), (4) staff
members who were unfamiliar with requirements (i.e., requirements stipulating that there is no
grace period for infection preventionists to complete specialized training and that emergency
preparedness plans needed to be reviewed annually), (5) qualified personnel shortage, and (6)
challenges related to the COVID-19 public health emergency. We also believe that many of the
conditions noted in our report occurred because CMS did not provide nursing homes with
communication and training related to complying with the new, phase 3 infection control
requirements, or clarification about the essential components to be integrated in the nursing
homes’ emergency plans.
CMS concurred with our recommendation that it instruct State survey agencies SSAs to follow up
with the 23 nursing homes that we have identified with possible infection prevention and control
and emergency preparedness deficiencies to verify that they have taken corrective actions.
End-Stage Renal Disease Network Organizations’ Reported Actions Taken in Response to the COVID-
19 Pandemic (A-05-20-00051), September 2022
The 18 end-stage renal disease (ESRD) Network Organizations that we surveyed provided
information about the actions they took to aid dialysis clinics and patients and keep CMS informed
about quality-of-care issues that arose during the COVID-19 pandemic. Network Organizations
also reported to us challenges they encountered in taking those actions during the pandemic.
Despite the unprecedented challenges faced by the Network Organizations during the pandemic,
they took actions to ensure continuity of services in a safe manner for high-risk ESRD beneficiaries.
Network Organizations served a key role in addressing the additional demands on dialysis clinics
during the pandemic through actions such as: (1) disseminating changing guidance, (2) aiding
dialysis clinics to address the increased concerns and grievances related to the pandemic, and (3)
promoting safe alternative treatment options. Network Organizations also kept CMS informed of
quality-of-care issues by communicating through established communication processes and
processes modified for better use during the pandemic. This report does not contain any
recommendations.
Program Integrity
2021 Performance Data for the Senior Medicare Patrol Projects (OEI-02-22-00310), June 2022
The Senior Medicare Patrol (SMP) projects receive grants from the Administration for Community
Living to recruit and train retired professionals and other older adults and community members to
prevent, detect, and report health care fraud, errors, and abuse. In 2021, the 54 SMP projects had
a total of 5,346 active team members who conducted a total of 12,660 group outreach and
education events, reaching an estimated 556,980 people. In addition, the projects had 239,625
individual interactions with, or on behalf of, a Medicare beneficiary. The projects reported
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$2.5 million in expected Medicare recoveries. Cost avoidance totaled $41,498, while savings to
beneficiaries totaled $40,798.
Inaccuracies in Medicare’s Race and Ethnicity Data Hinder the Ability To Assess Health Disparities
(OEI-02-21-00100), June 2022
We found that Medicare’s enrollment race and ethnicity data are less accurate for some groups,
particularly for beneficiaries identified as American Indian/Alaska Native, Asian/Pacific Islander, and
Hispanic. Data that are not accurate limit the ability to assess health disparities. Limited race and
ethnicity categories and missing information contribute to inaccuracies in the enrollment data.
Although the use of an algorithm improves the existing data to some extent, it falls short of self-
reported data. Finally, Medicare’s enrollment data on race and ethnicity are inconsistent with
Federal data collection standards, which inhibits the work of identifying and improving health
disparities within the Medicare population. Advancing health equity is a priority for CMS and the
Department. Race and ethnicity data are foundational to identifying and understanding health
disparities among Medicare beneficiaries and to assessing the effectiveness of efforts to reduce
such disparities. It is critical that these data are accurate, complete, and comprehensive.
Therefore, CMS must improve its race and ethnicity data; though a significant undertaking, the
need for better data is pressing.
Accordingly, we recommended that: (1) CMS should develop its own source of race and ethnicity
data, (2) CMS should use self-reported race and ethnicity information to improve data for current
beneficiaries, (3) CMS should develop a process to ensure that the data are as standardized as
possible, and (4) CMS should educate beneficiaries about CMS’s efforts to improve the race and
ethnicity information. CMS did not explicitly concur with the first recommendation and concurred
with the other three recommendations.
Review of Medicare Administrative Contractor Information Security Program Evaluations for Fiscal
Year 2021 (A-18-22-11300), July 2022
The Social Security Act requires that each MAC have its information security program evaluated
annually by an independent entity. CMS contracted with Guidehouse, LLP (Guidehouse), to
evaluate information security programs at the MACs.
Guidehouse’s evaluations of the contractor information security programs were adequate in scope
and sufficiency. Guidehouse identified a total of 95 gaps at the 7 MACs in FY 2021, which was 4
percent less than the number of gaps for the same 7 MACs in FY 2020. The number of high- and
moderate-risk gaps decreased by 39 percent from FY 2020. Deficiencies remained in eight of the
nine Federal Information Security Modernization Act of 2014 (FISMA) control areas that were
tested. The results warrant CMS continuing its oversight visits to ensure that the MACs remediate
all gaps to improve the MACs’ IT security, especially those with increased gaps from the previous
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year. Gaps that were similar to those from prior years should be considered repeat findings to
highlight systemic problems and the existence of continued exposure to known weaknesses. This
report contains no recommendations.
Medicare Telehealth Services During the First Year of the Pandemic: Program Integrity Risks (OEI-02-
20-00720), September 2022
We identified 1,714 providers out of approximately 742,000 whose billing for telehealth services
during the first year of the pandemic poses a high risk to Medicare. Each of these 1,714 providers
had concerning billing on at least 1 of 7 measures we developed that may indicate fraud, waste, or
abuse of telehealth services. In addition, more than half of the high-risk providers we identified are
a part of a medical practice with at least one other provider whose billing poses a high risk to
Medicare. Further, 41 providers whose billing poses a high risk appear to be associated with
telehealth companies. Although these high-risk providers represent a small proportion of all
providers who billed for a telehealth service, these findings demonstrate the importance of strong,
targeted oversight of telehealth services.
CMS concurred with our recommendation to follow up on the providers identified in this report,
but CMS did not explicitly indicate whether it concurred with the other four recommendations.
Our recommendations were that: (1) CMS should strengthen monitoring and targeted oversight of
telehealth services, (2) CMS should provide additional education to providers on appropriate billing
for telehealth services, (3) CMS should improve the transparency of “incident to” services when
clinical staff primarily delivered the telehealth service, (4) CMS should identify telehealth companies
that bill Medicare, and (5) CMS should follow up on the providers identified in this report.
Drug Spending and Reimbursement
Comparison of Average Sales Prices and Average Manufacturer Prices: Results for the Fourth Quarter
of 2021 (OEI-03-22-00200), May 2022, and Comparison of Average Sales Prices and Average
Manufacturer Prices: Results for the First Quarter of 2022 (OEI-03-22-00210), August 2022
OIG identified eight drug codes in the fourth quarter of 2021 and eight drug codes in the first
quarter of 2022 that met CMS’s criteria for price substitution. OIG compares average sales prices
(ASPs) to average manufacturer prices (AMPs) every quarter and identifies Part B-covered drug
codes eligible for price substitutions. If OIG finds that the ASP for a drug exceeds the AMP by a
certain percentage—currently, 5 percent—the ASP-based payment amount is substituted with a
lower calculated rate. This substituted rate serves as a mechanism for monitoring market prices
and limiting potentially excessive payment amounts. OIG provides these drug codes to CMS for its
review. CMS reviews this information and determines whether to implement price substitutions
that would limit excessive payments for Part B drugs.
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Part D Plans Generally Include Drugs Commonly Used by Dual Eligibles: 2022 (OEI-05-22-00230),
June 2022
We found that dual eligibles—that is, beneficiaries who are covered by both Medicare and
Medicaid—have access to the majority of commonly used prescription drugs in 2022 via Part D
plans, as we also found in previous years. A majority of the 449 Part D plan formularies covered
almost all (at least 97 percent) of the 200 drugs most commonly used by dual eligibles. Similarly,
among Part D plans with premiums below the regional benchmark, a majority of formularies (95 of
132) covered at least 97 percent of the drugs commonly used by dual eligibles. This is important
because when dual eligibles do not select their own Part D plans, CMS randomly assigns them to
plans with premiums below the regional benchmark without considering their specific prescription
drug needs. If dual eligibles’ plans do not cover specific drugs, they have several options
(switching plans, using an exceptions and appeals process, finding an alternative drug, or paying
out of pocket), but these options require beneficiaries to take administrative actions and do not
guarantee access to the drugs.
This report did not make recommendations.
Part D Plan Preference for Higher-Cost Hepatitis C Drugs Led to Higher Medicare and Beneficiary
Spending (OEI-BL-21-00200), August 2022
Medicare Part D beneficiaries are much less likely than Medicaid beneficiaries to receive lower-cost
versions of the same drugs (i.e., authorized generics)—as well as other widely used lower-cost
brand name drugs—to treat hepatitis C. Part D’s programmatic structure may lead plan sponsors
to prefer higher-cost versions of hepatitis C drugs, which resulted in beneficiaries paying thousands
more out-of-pocket and nearly double Medicare reinsurance in 2020. Increasing the use of lower-
cost hepatitis C drugs could generate significant savings for Medicare and its beneficiaries. CMS
concurred with OIG’s recommendations that CMS: (1) encourage Part D plans to increase access to
and use of the authorized generic versions of Epclusa and Harvoni, within the authorities granted
under statute and (2) pursue additional strategies—such as educating providers and pharmacies—
to increase access to and use of lower-cost hepatitis C drugs in Part D.
Medicare Part B Drug Payments: Impact of Price Substitutions Based on 2020 Average Sales Prices
(OEI-03-22-00170), September 2022
Because CMS did not implement all eligible drug price reductions based on 2020 ASPs for Part B
drugs, savings that could have totaled $2.8 million over 1 year amounted to only $8,158.
(Generally, Part B-covered drugs are those that are injected or infused in physicians’ offices or
outpatient settings. ASPs generally serve as the basis for reimbursement for Part B drugs. CMS
has a price-substitution policy under which OIG’s comparisons of ASPs with AMPs can—depending
on the difference—result in the substitution of a lower calculated rate. The use of this policy serves
as a mechanism for monitoring market prices and limiting potentially excessive payment amounts.)
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Although the $8,158 amount is small, Medicare and its beneficiaries have saved $73.1 million for
Part B-covered drugs since the price-substitution policy went into effect in 2013. These total
savings highlight the impact of OIG’s mandated quarterly ASP-AMP comparisons and the
implementation of CMS’s current price-substitution policy. This data snapshot contains no
recommendations. However, OIG continues to support a previous recommendation that CMS
expand the price-substitution criteria.
Medicaid Program Reports and Reviews
Financial Management and Improper Payments
California Improperly Claimed at Least $23 Million of $260 Million in Total Medicaid Reimbursement
for Opioid Treatment Program Services (A-09-20-02009), April 2022
California claimed Medicaid reimbursement for some opioid treatment program (OTP) services that
did not meet Federal and State requirements. Of the 130 sample items, 88 had services that were
all allowable, but 42 had services that were unallowable.
On the basis of our sample results, we estimated that California claimed at least $23.1 million in
unallowable Federal Medicaid reimbursement for OTP services during our audit period. In
addition, we identified deficiencies in three areas that that did not result in unallowable services but
could impact the quality of care provided to beneficiaries receiving OTP services.
California agreed with our recommendations that it refund $23.1 million to the Federal Government
and take specific actions to address the deficiencies that we identified. In addition, we recommend
that California take actions to ensure that OTPs comply with Federal and State requirements for
providing and claiming reimbursement for OTP services.
Washington State Did Not Comply With Federal and State Requirements for Claiming Enhanced
Federal Reimbursement for Medicaid Managed-Care Health Home Service Expenditures (A-09-20-
02008), May 2022
Washington State did not comply with Federal and State requirements for claiming health home
service expenditures under Medicaid managed care at the enhanced Federal medical assistance
percentage. Specifically, Washington State improperly calculated and claimed enhanced Federal
reimbursement for its managed-care health home expenditures, totaling $1,770,860. In addition, of
the $1,770,860 that Washington State claimed, $374,579 was not supported by encounter data, and
$29,161 was claimed for unallowable encounters. These issues occurred because Washington State
did not follow its State plan or Federal guidance and lacked adequate procedures and Medicaid
Management Information System (MMIS) edits.
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Washington concurred with our recommendations that it: (1) refund to the Federal Government
$374,579 for the encounters that were no longer supported and the $29,161 that exceeded the
number of allowable encounters; (2) determine the portion of the remaining $1,367,120 that should
have been claimed based on the portion of the managed-care capitation rate attributable to health
home services and refund any unallowable amounts; (3) review all managed-care health home
encounters from July 1, 2013, through March 31, 2017, to determine the amount that should have
been claimed based on the portion of the managed-care capitation rate attributable to health
home services; (4) implement a procedure to identify whether encounters used to support journal
vouchers have been removed from the encounter data; and (5) strengthen its MMIS edits to ensure
that encounters comply with State reporting requirements.
Texas Did Not Report and Return All Medicaid Overpayments for the State’s Medicaid Fraud Control
Unit’s Cases (A-06-20-04004), May 2022
Texas did not correctly report and return the Federal share of all MFCU-determined Medicaid
overpayments identified for the period October 1, 2016, through September 30, 2018. We
determined that Texas should have reported MFCU-determined Medicaid overpayments totaling
$24.3 million (at least $13.9 million Federal share) for the 65 cases with Medicaid restitution during
the period that we reviewed. In addition, Texas did not report $5.2 million (at least $2.7 million
Federal share) for 37 cases within the required timeframe. These issues occurred because Texas did
not have adequate internal controls to ensure that it always reported MFCU-determined Medicaid
overpayments in accordance with Federal requirements.
Texas agreed with our recommendations that it: (1) report and return the Federal share for the 26
cases, totaling $19 million ($11.1 million Federal share); (2) strengthen internal controls by
developing written policies and procedures, including procedures for recording MFCU-determined
Medicaid overpayments, and reconciling case files received from the MFCU with the overpayments
recorded in the State agency’s accounting system; (3) ensure that it reports all MFCU-determined
Medicaid overpayments in accordance with Federal regulations and within regulatory timeframes;
and (4) review the MFCU-determined Medicaid overpayments for cases after our audit period to
ensure that all overpayments were reported on the Form CMS-64.
More Than 90 Percent of the New Hampshire Managed Care Organization and Fee-for-Service
Claims for Opioid Treatment Program Services Did Not Comply With Medicaid Requirements (A-01-
20-00006), June 2022
New Hampshire claimed Medicaid reimbursement for OTP services that did not comply with
Federal and State requirements. Of the 100 OTP services we sampled, 6 complied with Federal and
State requirements, but 94 did not meet applicable Federal and State requirements. These
deficiencies occurred because New Hampshire did not have the resources to oversee providers and
enforce the OTP requirements. Providers said high personnel turnover, difficulty attracting and
retaining personnel, and difficulty keeping patients engaged in counseling services contributed to
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the lack of adherence to State requirements. Furthermore, New Hampshire did not always provide
guidance regarding State OTP requirements.
On the basis of our sample results, we estimated that New Hampshire improperly claimed at least
$7.9 million in Federal Medicaid reimbursement for OTP services during our audit period.
New Hampshire agreed with our recommendations that it: (1) refund $7.9 million to the Federal
Government, (2) take steps to ensure that providers comply with Federal and State requirements
for providing and claiming Medicaid reimbursement for OTP services, and (3) improve
communication with providers regarding the State requirements for opioid use disorder treatment
and provide written confirmation about whether offsite counseling may be included as a required
counseling service.
Montana Claimed Federal Medicaid Reimbursement for More Than $5 Million in Targeted Case
Management Services That Did Not Comply With Federal and State Requirements (A-07-21-03246),
August 2022
Montana did not always claim Federal Medicaid reimbursement for targeted case management
(TCM) services during FYs 2018 through 2020 in accordance with Federal and State requirements.
Of the 150 randomly sampled grouped line items, 43 sample items were at least partially
unallowable because they had at least 1 error related to case managers lacking required experience
or qualifications, unsupported services, unallowable services, or an ineligible recipient.
Montana had policies and procedures in place for the administration of TCM services that, if
followed, would have ensured compliance with Federal and State requirements. Based on our
sample results, we estimated that Montana claimed at least $7.7 million (more than $5 million
Federal share) in unallowable Medicaid reimbursement for these services.
We recommended that Montana refund to the Federal Government the more than $5 million
(Federal share) in overpayments. We also made procedural recommendations that Montana
always follow its established policies and procedures regarding: (1) TCM providers’ case manager
hiring practices, (2) verification that billed services were allowable and properly documented, and
(3) verification that all individuals receiving services were eligible. Furthermore, we made
procedural recommendations that Montana require TCM providers to comply with established
policies and procedures. Montana neither concurred nor nonconcurred with our
recommendations.
New York Claimed $196 Million, Over 72 Percent of the Audited Amount, in Federal Reimbursement
for NEMT Payments to New York City Transportation Providers That Did Not Meet or May Not Have
Met Medicaid Requirements (A-02-21-01001), September 2022
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Of the 100 sampled non-emergency medical transportation (NEMT) payments, 17 complied with
Federal and State requirements. However, for 41 sampled payments, NEMT payments did not
comply with Federal and State requirements and were therefore unallowable. For the remaining 42
sampled payments, we could not determine whether the services complied with Federal and State
requirements. We estimated that New York improperly claimed at least $84,329,893 in Federal
Medicaid reimbursement for payments to NEMT providers that did not comply with certain Federal
and State requirements. In addition, we estimated that New York claimed $112,028,279 in Federal
Medicaid reimbursement for payments to NEMT providers that may not have complied with certain
Federal and State requirements.
New York did not indicate concurrence or nonconcurrence with our recommendations that it
refund $84,329,893 to the Federal Government for the payments that did not comply with certain
Federal and State requirements and work with the transportation manager to review the
$112,028,279 in Federal Medicaid reimbursement for payments to NEMT providers that may not
have complied with certain Federal and State requirements and refund to the Federal Government
any unallowable amounts. We also made recommendations for New York to improve its
monitoring of its NEMT program.
Nearly All States Made Capitation Payments for Beneficiaries Who Were Concurrently Enrolled in a
Medicaid Managed Care Program in Two States (A-05-20-00025), September 2022
All 47 States reviewed made capitation payments on behalf of Medicaid beneficiaries who were
concurrently enrolled in two States. The significant increase in these payments from August 2019
to August 2020 coincided with an overall increase in Medicaid enrollment during that time, and
new Federal requirements and flexibilities that were available to States during the COVID-19 public
health emergency.
CMS does not actively monitor beneficiaries’ concurrent Medicaid managed care enrollment;
instead, it relies on the individual States to identify concurrent enrollments and potential erroneous
payments. CMS does not provide States with Transformed Medicaid Statistical Information System
(T-MSIS) national enrollment data that would assist them in identifying beneficiaries who were
concurrently enrolled in a Medicaid managed care program in two States. Two States often made
capitation payments for the same Medicaid beneficiary in part because States did not have full
access to data they needed to identify beneficiaries who were concurrently enrolled in another
State. Therefore, CMS does not take all available steps, either directly or through the States, to
identify and prevent State capitation payments for non-resident beneficiaries.
CMS did not concur with our recommendations that it provide States with matched T-MSIS
enrollment data that identify Medicaid beneficiaries who were concurrently enrolled in a Medicaid
managed care program in two States, and assist States with utilizing the data as needed to reduce
future capitation payments made on behalf of beneficiaries concurrently enrolled in two States.
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CMS Has Opportunities To Strengthen States’ Oversight of Medicaid Managed Care Medical Loss
Ratios (OEI-03-20-00231), September 2022
States’ oversight of Medicaid managed care plans’ annual reporting of medical loss ratios (MLRs) is
critical to improve fiscal transparency, monitor costs, and promote high-quality care in Medicaid
managed care. (The Federal MLR is the percentage of premium revenue that a managed care plan
spent on covered health care services and quality-improvement activities in a 12-month period.)
Although States reported that most of their plans submitted MLR reports, we found that nearly half
of plans’ MLR reports were incomplete. The data element for non-claims costs, generally defined
as plans’ expenses for administrative services, accounted for the majority of incomplete MLR
reports. In addition, some States did not review selected MLR data elements for accuracy. We
made four recommendations to strengthen States’ oversight of MLR reporting and better ensure
that plans are using Federal dollars for patient care.
CMS concurred with all four recommendations, which were that: (1) CMS should design an annual
MLR reporting template for States to provide to their Medicaid managed care plans, (2) CMS
should clarify that States should verify the completeness of their plans’ MLR reports, (3) CMS
should clarify that States should review their plans’ MLR reports to verify the accuracy of reported
data elements, and (4) CMS should provide additional guidance to States regarding plans’
reporting of non-claims costs in MLR reports.
Tennessee Did Not Always Invoice Rebates to Manufacturers for Physician-Administered Drugs
Dispensed to Enrollees of Medicaid Managed-Care Organizations (A-07-21-06096), September 2022
Tennessee did not always comply with Federal Medicaid requirements for invoicing manufacturers
for rebates for physician-administered drugs dispensed to managed care organization (MCO)
enrollees. Tennessee did not invoice for, and collect from manufacturers, rebates totaling $18.4
million ($12 million Federal share) for physician-administered drugs dispensed to MCO
enrollees. In addition, Tennessee did not invoice for, and collect from manufacturers, $43.3 million
($28.4 million Federal share) in rebates for physician-administered drugs invoiced on crossover
claims, for which beneficiaries are eligible for both Medicare and Medicaid services.
Although its policies required the collection of drug utilization data necessary to invoice for rebates
on all claims, Tennessee’s internal controls did not always ensure that the data were used to invoice
manufacturers and collect rebates for physician-administered drugs dispensed to enrollees of
MCOs.
Tennessee generally concurred with our recommendations that it: (1) invoice for and collect
manufacturers’ rebates and refund to the Federal Government $11 million (Federal share) for single-
source and top-20 multiple-source drugs; (2) work with the CMS to determine the portion of the $1
million (Federal share) for other multiple-source drugs that were eligible for rebate, invoice
manufacturers, and refund the Federal share; and (3) strengthen internal controls for non-crossover
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claims to ensure that all eligible physician-administered drugs are invoiced for rebate. Tennessee
did not concur with our recommendation that it consider revising its methodology going forward
regarding payments for crossover claims.
New York Generally Determined Eligibility for Its Basic Health Program Enrollees in Accordance With
Program Requirements (A-02-20-01028), September 2022
New York generally determined eligibility for its Basic Health Program (BHP) enrollees in
accordance with Federal and State requirements. For five sampled policies, New York enrolled
individuals who were ineligible or potentially ineligible for the program and received improper
monthly payments totaling $8,615. According to New York, system defects prevented controls that
were in place from working as intended.
On the basis of our sample results, we estimated that the financial impact of the incorrect or
potentially incorrect eligibility determinations made by New York for its BHP during the audit
period totaled $69.9 million.
New York did not indicate concurrence or nonconcurrence with our recommendations that it:
(1) reimburse its BHP Trust Fund $8,615 associated with the improper monthly payments identified
in our sample and (2) identify and reimburse the BHP Trust Fund all improper payments, which we
estimate to total $69.9 million, resulting from system defects identified in our report. We also
made recommendations for New York to improve its system for enrolling individuals in its BHP.
Texas Claimed or May Have Claimed More Than $30 Million of $9.89 Billion in Federal Funds for
Medicaid Uncompensated Care Payments That Did Not Meet Federal and State Requirements (A-06-
19-09002), September 2022
Texas claimed $16.90 billion ($9.86 billion Federal share) in uncompensated care payments in
accordance with applicable Federal and State requirements. However, Texas incorrectly claimed
$18.90 million ($11.05 million Federal share). Specifically, Texas claimed: (1) $12.91 million ($7.51
million Federal share) because it did not refund the full Federal share of overpayments and (2)
$5.99 million ($3.54 million Federal share) because it did not collect overpayments it identified.
Additionally, the State agency may have incorrectly claimed $33.78 million ($19.66 million Federal
share) because it did not reduce hospitals’ actual uncompensated care costs by Medicare
payments the hospitals received.
Texas did not concur with our recommendation that it work with CMS to determine whether the
$33.78 million in uncompensated care payments hospitals retained should be recouped and refund
the related Federal share or redistribute the recouped funds to hospitals that had unmet
uncompensated care costs. Texas concurred with our recommendations that it: (1) refund
$11.05 million to the Federal Government for the underreported uncompensated care
overpayments; (2) follow the CMS-approved methodology for calculating actual uncompensated
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care costs when reconciling initial uncompensated care payments with providers’ actual
uncompensated care costs, including reducing uncompensated care costs by Medicare payments
providers receive; and (3) establish review procedures for overpayments to ensure that they are
accurately entered into the State agency’s accounting system and returned to the Federal
Government.
Quality of Care, Safety, and Access
South Carolina Did Not Fully Comply With Requirements for Reporting and Monitoring Critical
Events Involving Medicaid Beneficiaries With Developmental Disabilities (A-04-18-07078), April 2022
South Carolina did not fully comply with requirements for reporting and monitoring critical events
involving Medicaid beneficiaries with developmental disabilities residing in community-based
settings. Specifically, South Carolina did not ensure that providers: (1) reported all critical incidents,
(2) reported within 24 hours or the next business day all critical events, or (3) always submitted the
results of their internal reviews within 10 working days.
South Carolina concurred with our recommendations that it work with the Department of
Disabilities and Special Needs (DDSN) to: (1) ensure that providers follow the reporting
requirements for critical events, (2) provide training to providers on recognizing and reporting
critical incidents according to reporting requirements, (3) perform analytical procedures such as
data matches on Medicaid claims data to identify any unreported critical incidents and investigate
as needed, and (4) ensure that providers submit all incident reports to DDSN through the Incident
Management System within 24 hours of an incident or the next business day.
Massachusetts Implemented Our Prior Audit Recommendations and Generally Complied With
Federal and State Requirements for Reporting and Monitoring Critical Incidents (A-01-20-00003),
April 2022; and Maine Implemented Our Prior Audit Recommendations and Generally Complied
With Federal and State Requirements for Reporting and Monitoring Critical Incidents (A-01-20-
00007), June 2022
Massachusetts implemented the five recommendations from our prior audit and generally
complied with Federal and State requirements for reporting and monitoring critical incidents
involving Medicaid beneficiaries with developmental disabilities residing in group homes.
However, the corrective actions for one recommendation in our prior audit were not effective in
addressing one of our previous findings.
Maine implemented the seven recommendations from our prior audit and generally complied with
Federal and State requirements for reporting and monitoring critical incidents involving Medicaid
beneficiaries with developmental disabilities. However, Maine’s corrective actions for two
recommendations were not fully implemented by the conclusion of our current audit period and,
therefore, were only partially effective in addressing two of our previous findings.
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Massachusetts agreed with our recommendations that it: (1) continue to coordinate with
Department of Developmental Services and the Disabled Persons Protection Commission to ensure
that all reasonable suspicions of abuse and neglect are properly identified, reported, and
investigated as needed; and (2) require periodic training for DDS and group home staff on
reporting reasonable suspicions of abuse and neglect.
Maine concurred with our recommendations that it: (1) continue to work with CMS to fully
implement the prior recommendation to ensure that followup reports are submitted by
community-based providers appropriately and (2) ensure that the Mortality Review Committee
reviews Mortality Review Form aggregate data to identify patterns and trends and to make
recommendations to improve care.
National Background Check Program for Long-Term Care Providers: An Interim Assessment (OEI-07-
20-00181), May 2022
The National Background Check Program (Program) provides grants to States to develop
programs for conducting background checks of prospective long-term care employees via State
and Federal criminal history records. In our interim assessment of Idaho and Mississippi, OIG
found that during the first years of Program participation, both States were unable to implement
some requirements and did not consistently report Federal and State funds. Additionally, one
State did not report data to accurately assess Program outcomes. We recommended that CMS
continue to implement OIG’s prior recommendations for it to take appropriate actions to:
(1) encourage States to obtain the necessary legislative authority from the State to fully implement
Program requirements and (2) require participating States to consistently submit data that allow
CMS and each State to calculate determinations of ineligibility. CMS concurred with our new
recommendation to ensure that participating States submit accurate quarterly reports.
Drug Spending and Reimbursement
South Carolina Did Not Always Invoice Rebates to Manufacturers for Physician-Administered Drugs
(A-07-21-07003), August 2022
South Carolina did not always comply with Federal Medicaid requirements for invoicing
manufacturers for rebates for physician-administered drugs. South Carolina did not invoice for,
and collect from manufacturers, rebates associated with $14.5 million (Federal share) in physician-
administered drugs. Of this amount, $14.3 million (Federal share) was for single-source drugs and
$242,000 (Federal share) was for top-20 multiple-source drugs. Further, we were unable to
determine whether, in some cases, South Carolina was required to invoice for rebates for other
multiple-source physician-administered drug claims. South Carolina did not invoice the
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manufacturers for rebates associated with claims totaling $1.3 million (Federal share) for these
multiple-source drugs.
We recommended that South Carolina refund to the Federal Government $14.3 million (Federal
share) for claims for single-source physician-administered drugs and $242,000 (Federal share) for
claims for top-20 multiple-source physician-administered drugs. We also recommended that
South Carolina work with CMS to determine the unallowable portion of $1.3 million (Federal share)
for other claims for multiple-source, physician-administered drugs that may have been ineligible
for Federal reimbursement, refund that amount, and consider invoicing drug manufacturers for
rebates for these drugs if CMS determines that the drug claims are allowable. In addition, we
recommend that South Carolina work with CMS to determine and refund the unallowable portion
of Federal reimbursement for physician-administered drugs that were not invoiced for rebates after
December 31, 2019, and continue to review and strengthen its internal controls to ensure that all
physician-administered drugs eligible for rebates are invoiced. South Carolina generally concurred
with our recommendations.
Legal and Investigative Activities Related to
Medicare and Medicaid
OIG investigates allegations of fraud, waste, and abuse in all HHS programs. Our largest body of work
involves investigating matters related to the Medicare and Medicaid programs, such as patient harm;
billing for services not rendered, medically unnecessary services, or upcoded services (i.e., services billed
for at a level higher than warranted); illegal billing, sale, and diversion of prescription drugs; the marketing
of off-label uses for prescription drugs; and solicitation and receipt of kickbacks, including illegal payments
to patients for involvement in fraud schemes and illegal referral arrangements between physicians and
medical companies.
OIG also conducts investigations regarding organized criminal activity, including medical identity theft and
fraudulent medical schemes established for the sole purpose of stealing Medicare dollars. Investigators
are opening an increasing number of cases against health care providers who engage in these health care
fraud schemes. Those who participate in the schemes may face heavy fines, jail time, and exclusion from
participation in Federal health care programs.
One of the most common types of fraud perpetrated against Medicare, Medicaid, and other Federal health
care programs involves filing false claims for reimbursement. False claims may be pursued under Federal
and State criminal statutes and, when appropriate, under the False Claims Act. Depending on the types of
fraud or other violations involved, OIG investigations may culminate in criminal or civil court judgments
and decisions, administrative sanctions and decisions, and/or negotiated settlement agreements.
Investigative outcomes take many forms, including incarceration, restitution, fines, penalties, forfeitures,
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assessments, and exclusion of individuals or entities from participation in all Federal health care programs.
Frequently used exclusion and penalty authorities are described on our website at
http://oig.hhs.gov/fraud/enforcement/cmp/.
During this semiannual reporting period, we reported 354 criminal and 413 civil actions against individuals
or entities that engaged in offenses related to health care. We also reported more than $929.1 million in
investigative receivables due to HHS and more than $357.5 million in non-HHS investigative receivables,
including civil and administrative settlements or civil judgments related to Medicare, Medicaid, and other
Federal, State, and private health care programs.
Criminal and Civil Enforcement Activities Related to Medicare and Medicaid
The following recently completed actions and settlements are organized by the type of provider or entity
involved. Additional cases appear in the Medicare Fraud Strike Force Activities section below.
COVID-19 Enforcement Activities
The following case examples involve COVID-19 Enforcement activities:
Maryland—On August 4, 2022, Thomas Connally was sentenced to 37 months in Federal
prison, followed by 3 years of supervised release, for making threats against a Federal
official, specifically for sending emails threatening harm to Dr. Anthony Fauci, the Director
of the National Institute of Allergy and Infectious Diseases (NIAID) at NIH. Connally further
admitted to threatening Dr. Francis Collins, the former Director of the NIH; Dr. Rachel
Levine, currently the Assistant Secretary for Health at HHS; a Massachusetts public health
official; and a religious leader. According to Connally’s plea agreement, from December 28,
2020, to July 25, 2021, Connally used an anonymous email account from a provider of
secure, encrypted email services based in Switzerland to send a series of emails to Dr.
Anthony Fauci threatening to harm and/or kill Dr. Fauci and members of his family. One
email threatened that Dr. Fauci and his family would be “dragged into the street, beaten to
death, and set on fire.” On April 24, 2021, Connally sent Dr. Collins a series of four emails
threatening Dr. Collins and his family with physical assault and death if Dr. Collins did not
stop speaking about the need for “mandatory” COVID-19 vaccinations. Connally admitted
that he sent the threats to Dr. Fauci and Dr. Collins with the intent of intimidating or
interfering with the performance of their official duties and with the intent to retaliate
against Dr. Fauci and Dr. Collins for performing their official duties, including discussing
COVID-19 and its testing and prevention.
Connally also admitted sending emails threatening harm to three other individuals.
Specifically, on November 24, 2020, Connally sent a series of six threatening emails to Dr.
Rachel Levine, then Secretary of Health for the State of Pennsylvania, at Dr. Levine’s email
account at the Pennsylvania Department of Health. The subject lines and body of the
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emails threatened Dr. Levine with physical violence and death. Similarly, on August 31,
2020, Connally sent an email threatening physical violence and death to a Massachusetts
public health official. Finally, on April 21, 2021, Connally sent a series of four threatening
emails to four individuals who work for a religious institution in Newark, New Jersey. The
four emails threatened physical violence and death to a religious leader at the institution.
Florida—On June 30, 2022, MorseLife Health System Inc. (MorseLife) agreed to pay the
United States $1.75 million to resolve its potential liability under the False Claims Act for
facilitating COVID-19 vaccinations for hundreds of individuals ineligible to participate in the
CDC Pharmacy Partnership for Long-Term Care Program (LTC PPP), a program specifically
designed to vaccinate long-term care facility (LTCF) residents and staff when doses of
COVID-19 vaccine were in limited supply at the beginning of the CDC COVID-19
Vaccination Program. MorseLife is a not-for-profit corporation located in West Palm
Beach, Florida, that oversees health care facilities on its campus, including a nursing home
and an assisted living facility.
The CDC announced the launch of the LTC PPP in October 2020. Because the LTCF
population was at the highest risk of COVID-19 infections, the CDC created the LTC PPP to
prioritize vaccinations for that population as quickly as possible and while vaccine
availability was limited. Under this program, the CDC engaged with pharmacy partners to
provide “end to end” management of the COVID-19 vaccination process, including
conducting on-site vaccination clinics at the nursing homes and other LTCFs. More than 8
million vaccine doses were administered to LTCF residents and staff through this program.
MorseLife enrolled in the LTC PPP and scheduled its first vaccination clinic at MorseLife on
Dec. 31, 2020 (the vaccination clinic) for residents and staff of the Joseph L. Morse Health
Center, a skilled nursing facility on MorseLife’s campus. The settlement resolves allegations
that MorseLife knew that the LTC PPP covered only LTCF residents and staff but
nevertheless invited and facilitated the vaccination of hundreds of ineligible persons at the
clinic by characterizing them as “staff” and “volunteers,” many of whom MorseLife targeted
for donations. Specifically, the United States alleged that MorseLife: (1) characterized board
members as “staff,” (2) directed the organization’s fundraising arm to invite donors and
potential donors to the vaccination clinic, and (3) allowed the Vice Chairman of the
MorseLife Health Systems Inc. Board and his brother to invite close to 300 ineligible
individuals to receive the vaccine at MorseLife.
MorseLife’s chief executive officer (CEO) allegedly directed the MorseLife Foundation, the
organization’s fundraising arm, to invite donors and potential donors to the vaccination
clinic, encouraging Foundation employees to take advantage of the vaccination
opportunity to target billionaires and millionaires for donations. For example, in one text
message MorseLife’s CEO stated: “I’m a little disappointed in the foundations mentality; I
have delivered you 350 of the richest people in the country and you’re still thinking $25,000
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gift…”. MorseLife’s CEO added: “Do not be weak be strong you have the opportunity to
take advantage of everyone who needs the shot…” Ultimately, the United States alleged
that, of 976 persons vaccinated at the December 31, 2020, clinic, 567—or more than half—
were ineligible to participate in the LTC PPP.
Utah—On July 6, 2022, Dino Rende and Francis Rende II were both sentenced to 36
months of probation and ordered to pay $500 in restitution after pleading guilty to
misdemeanor conspiracy to steal or convert Government property charges stemming from
the theft of CDC COVID-19 Vaccination Record Cards. In the plea agreement, both
defendants admitted that between March 2021 and August 2021, they conspired to defraud
CDC by agreeing to sell stolen CDC COVID-19 Vaccination Record Cards to others for $50
each. Both defendants also admitted that defendant Francis Rende II stole at least 20 CDC
Vaccination Record Cards in March 2021; that he sent his brother, Dino Rende, some of the
stolen vaccination record cards; and that they agreed to use them and sell them to others
for $50 each.
Home Health
The following case examples involve home health fraud:
Kentucky—On May 5, 2022, SHC Home Health Services of Florida, LLC and its related
entities (collectively, “Signature HomeNow”) paid $2.1 million to the United States
Government to settle claims of improperly billing the Medicare Program for home health
services provided to beneficiaries living in Florida. Signature HomeNow, whose corporate
headquarters is located in Louisville, Kentucky, operated home health care services in
Florida. According to a complaint filed in the U.S. District Court for the Southern District of
Florida against Signature HomeNow and the subsequent settlement agreement, it was
alleged that between 2013 and 2017 Signature HomeNow knowingly submitted false or
fraudulent claims seeking payment from the Medicare Program for home health services to
Medicare beneficiaries who: (1) were not homebound, (2) did not require certain skilled
care, (3) did not have a valid or otherwise appropriate plans of care in place, and/or (4) did
not have appropriate face-to-face encounters needed to be appropriately certified to
receive home health services.
Oklahoma and Florida—On September 27, 2022, the United States entered into two
settlements with Carter Healthcare, LLC, an Oklahoma-based for-profit home health
provider, and its affiliates. Carter Healthcare agreed to pay $7,175,000 to resolve
allegations that it violated the False Claims Act by submitting claims to Medicare for
medically unnecessary home health therapy services to Medicare beneficiaries in Florida,
and it also agreed to pay $22,948,004 to resolve allegations that it submitted claims to
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Medicare in violation of the anti-kickback statute by paying physicians remuneration under
the guise of medical directorships in order to induce referrals of home health patients in
Oklahoma. Carter Healthcare and its affiliates (CHC Holdings and CHC-FLA) entered into a
5-year CIA with OIG as part of the resolution of the matter. OIG excluded CEO Stanley
Carter and Chief Operating Officer Brad Carter from participation in Federal health care
programs for 5 years.
Hospital
The following case example involves a hospital:
Washington—On April 12, 2022, Providence Health & Services Washington (Providence)
agreed to pay $22,690,458 to resolve allegations that it fraudulently billed Medicare,
Medicaid, and other Federal health care programs for medically unnecessary neurosurgery
procedures. Providence is a large health care and hospital system that operates 51
hospitals in 7 western U.S. States, including Providence St. Mary’s Medical Center
(Providence St. Mary’s) in Walla Walla, Washington. Between 2013 and 2018, Providence St.
Mary’s employed neurosurgeons identified in the Settlement Agreement as Dr. A and Dr. B.
Providence St. Mary’s paid neurosurgeons based on a productivity metric that provided
them a financial incentive to perform more surgical procedures of greater complexity.
Between 2014 and 2018, Dr. A was one of the highest producing neurosurgeons in the
entire Providence system. Between 2014 and 2017, based on the productivity metric,
Providence paid Dr. A between $2.5 million and $2.9 million per year. This settlement
resolves allegations that Providence falsely billed Medicare, Washington State Medicaid,
and other Federal health care programs for deficient and medically unnecessary
neurosurgery procedures performed by Dr. A and Dr. B.
As part of the Settlement Agreement, Providence admitted that during the time period in
which Dr. A and Dr. B were employed at Providence St. Mary’s as neurosurgeons,
Providence medical personnel articulated concerns that Dr. A and Dr. B: (1) were
endangering the safety of patients, (2) created through their surgeries an excessive level of
complications and negative outcomes, (3) performed surgery on candidates who were not
appropriate for surgery, and (4) failed to properly document their procedures and
outcomes. Providence further admitted that Providence medical personnel articulated
additional concerns that Dr. A: (1) completed medical documentation with falsified and
exaggerated diagnoses to obtain reimbursement from insurance providers, (2) performed
surgical procedures that did not meet the medical necessity requirements set by Medicare
and other insurance programs, (3) “over-operated” (i.e., performed surgeries of greater
complexity and scope than were medically appropriate), and (4) jeopardized patient safety
by attempting to perform an excessive number of overly complex surgeries. Finally,
Providence admitted that, while it eventually placed both Dr. B and Dr. A on administrative
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leave in February 2017 and May 2018, respectively, it allowed both doctors to resign while
on leave, and did not take any action to report Dr. A or Dr. B to the National Practitioner
Data Bank or the Washington State Department of Health.
Pharmacies
The following case example involves a pharmacy:
New York—On April 13, 2022, Aleah Mohammed was sentenced to 6.5 years in prison for
carrying out multiple schemes to defraud health care programs, including obtaining more
than $6.5 million from Medicare Part D plans and Medicaid drug plans. According to court
documents, Mohammed was the owner and operator of five pharmacies: Superdrugs Inc.,
Superdrugs I Inc., Superdrugs II Inc., S&A Superdrugs II Inc., and Village Stardrugs Inc.
Between 2015 and2020, Mohammed utilized these pharmacies to engage in schemes that
defrauded health care programs, including Medicare and Medicaid, by submitting claims
for prescription drugs that were not dispensed, not prescribed as claimed, not medically
necessary, or dispensed during a time when the pharmacy was no longer registered with
the State of New York. The fraudulent claims included claims for expensive prescription
drugs for the treatment of human immunodeficiency virus (HIV). Mohammed and her
family used proceeds of the scheme to purchase luxury items such as a Cadillac Escalade
SUV, a Mercedes Benz sedan, a Porsche Turbo coupe, as well as jewelry and real property
in Queens, New York, and Pocono Pines, Pennsylvania.
Prescription Drugs
The following case examples involve prescription drugs:
Pennsylvania—On May 10, 2022, Andrew Berkowitz was sentenced to 20 years in prison,
followed by 5 years of supervised release, and was ordered to pay a $40,000 fine and
almost $4 million in restitution for running a prescription “pill mill” from his medical
practice, which he operated in Philadelphia under the name ”A+ Pain Management.” In
January 2020, Berkowitz pleaded guilty to 19 counts of health care fraud and 23 counts of
distributing oxycodone outside the course of professional practice and without a legitimate
medical purpose. The defendant fraudulently billed insurers for medically unnecessary
physical therapy, acupuncture, chiropractic adjustments, and prescription drugs. In
addition, the defendant fraudulently billed for treatments that were not provided at all.
Regardless of their medical complaint, at every visit patients received a “goodie bag,” which
was a tote bag filled with prescription drugs for which Berkowitz submitted pharmacy
claims through his company, Bucks Philadelphia Medical Care Group. The “goodie bags”
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typically included a combination of drugs, including topical analgesics such as Relyyt
and/or lidocaine, muscle relaxers such as chloroxazon and/or cyclobenzaprine, anti-
inflammatories such as celecoxib and/or nalfon, Schedule IV controlled substances such as
tramadol for pain, and/or eszopiclone and quazepam for insomnia and anxiety. The
defendant obtained payments from insurers of more than $4,000 for each bag by falsely
asserting that the drugs were for the benefit of the patient.
As part of the fraud scheme, Berkowitz also prescribed oxycodone to “pill-seeking” patients
in exchange for their tacit approval that he would submit excessive claims to the patient’s
insurer for the “goodie bag” and other medically unnecessary services. From 2015 through
2018, Berkowitz obtained more than $4 million in fraudulent proceeds from his scheme.
The defendant is also subject to a civil judgement under which he is obligated to pay
approximately $1.8 million as a result of civil False Claims Act liability for false claims
submitted to Medicare, and is subject to a permanent prohibition on prescribing,
distributing, or dispensing controlled substances.
Washington State—On April 27, 2022, Janet Sue Arnold was sentenced to 48 months in
Federal prison for conspiring to distribute and possess with intent to distribute opioid pain
medications and other controlled substances without a legitimate medical purpose and
outside the usual course of professional practice. According to court documents, Arnold
abused her position of trust as a medical doctor by participating in a prescription drug
conspiracy with Danielle Corine Mata, David Barnes Nay, Lisa Marie Cooper, and Jennifer
Cheri Prichard. As part of their conspiracy, Dr. Arnold and her conspirators pushed
thousands of pills on the street that were abused by addicts, and potentially caused others
to become addicted to controlled substances. Mata and Prichard, who were both addicts,
started out as patients but eventually started working at Dr. Arnold’s clinic, Desert Wind
Family Practice, in Richland, Washington. In approximately March 2016, Mata became the
practice’s office manager and one of Arnold’s most trusted associates. During the
conspiracy, Nay and Cooper also provided Mata with the names of fictitious patients for
her to use on several of the blank, pre-signed prescriptions to obtain opioids.
The conspiracy operated primarily out of Dr. Arnold’s clinic in Richland, Washington. On a
regular basis, the conspirators distributed highly addictive and dangerous controlled
substances, including fentanyl, oxycodone, methadone, hydromorphone, methylphenidate,
an amphetamine mixture, as well as carisoprodol and alprazolam. Dr. Arnold had a pattern
and practice of providing office staff and patients with hundreds of blank, pre-signed
prescriptions that, after logging into the clinic computer, allowed the conspirators to
complete and print prescriptions for opioids and other controlled substances. Text
messages recovered by investigators from Arnold’s and Mata’s phones showed that Dr.
Arnold had texted Mata asking whether she needed more “signed paper.”
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South Dakota—On July 12, 2022, Donna Garnette was convicted of conspiracy to distribute
a controlled substance. Garnette, age 29, was sentenced to 9 years in Federal prison,
followed by 3 years of supervised release, and was ordered to pay a $100 special
assessment to the Federal Crime Victims Fund. Garnette was indicted for the charge by a
Federal grand jury in May 2021 and pleaded guilty in December 2021. The conviction
stemmed from Garnette obtaining and distributing fentanyl (4-ANPP) and hydrocodone
pills with her conspirators on the Pine Ridge Reservation.
The case was investigated by the Badlands Safe Trails Task Force, which includes the
Federal Bureau of Investigation (FBI), Bureau of Indian Affairs, Oglala Sioux Tribe
Department of Public Safety, South Dakota Department of Criminal Investigation, and HHS-
OIG.
Kickbacks
The following case example involves kickbacks:
Washington State—On May 27, 2022, Jae Lee, the CEO of Northwest Physicians Laboratory
(NWPL), was sentenced to serve 24 months in prison and ordered to pay $7.6 million in
restitution for conspiracy to solicit kickbacks from medical testing laboratories in exchange
for referring Government testing business to the laboratories. CEO Lee helped NWPL
obtain more than $3.7 million in kickback payments by steering urine drug test specimens
to two laboratories that billed the Government for testing, resulting in Government
payments to those two laboratories of more than $6.5 million.
According to records filed in the case between January 2013 and July 2015, those two
laboratories, which were not physician owned, made payments to NWPL in exchange for
referrals of Medicare and TRICARE program business, in violation of the anti-kickback
statute. Paying remuneration to medical providers or provider-owned laboratories in
exchange for referrals encourages providers to order medically unnecessary services. The
anti-kickback statute functions, in part, to discourage such behavior. NWPL was physician-
owned, and for that reason could not test urine samples for patients covered by
Government health programs such as Medicare, Medicaid, and TRICARE. To conceal the
payment of the kickbacks, Lee and other co-conspirators described the fees as being for
marketing services; however, no marketing services were performed.
NWPL pleaded guilty in February 2021 and was sentenced to pay $8,114,417 in restitution
joint and several with the other criminal defendants. NWPL has been dissolved. To date,
the laboratories and individuals involved in this investigation have agreed to pay more than
$14 million to settle related civil allegations.
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Nursing Homes
The following case example involves a nursing home:
New York—On June 29, 2022, the United States settled a civil False Claims Act lawsuit
against TCPRNC, LLC d/b/a Plaza Rehab and Nursing Center (Plaza Rehab Center) and
Citadel Consulting Group LLC d/b/a Citadel Care Centers (Citadel). The settlement resolved
allegations that Plaza Rehab Center, acting at the direction of Citadel, fraudulently switched
the type of Medicare coverage in which elderly residents were enrolled to maximize the
Medicare payments that Plaza Rehab Center would receive.
Under the settlement, Plaza Rehab Center and Citadel agreed to pay a total of $7.85 million
and made extensive factual admissions regarding their conduct. Specifically, Plaza Rehab
Center and Citadel admitted that their staff often did not obtain the consent of residents or
authorized representatives before disenrolling the residents from their Medicare Advantage
Plan. From September 2016 to February 2019, Citadel exerted pressure on Plaza Rehab
Center staff to increase the number of residents enrolled in fee-for-service Medicare to
increase Medicare reimbursements. Plaza Rehab Center and Citadel also entered into a
CIA with HHS-OIG, which requires that they maintain a compliance program designed to
foster adherence to Federal health care program requirements.
Telemarketing
The following case example involves telemarketing
Florida—On June 16, 2022, Marc Sporn was sentenced to 14 years in prison for health care
and wire fraud resulting in a loss of more than $20 million to Medicare, and for evading
taxes. According to court documents, Marc Sporn owned and operated several
telemarketing and telemedicine companies, including CPL Media Group Inc. Medipak, LLC;
Real Time Physicians LLC; 24 HR Virtual MD LLC; Medtech Worldwide Inc.; New World
Holdings Inc.; and Ins Cov LLC. Sporn used these companies to market medically
unnecessary genetic tests to Medicare beneficiaries, and to sell prescriptions (i.e., doctors’
orders) for medically unnecessary genetic tests to laboratories in exchange for kickbacks
and bribes. Sporn knew these laboratories would use these doctors’ orders to bill Medicare
for medically unnecessary goods and services.
Through nominee owners, Sporn also operated and controlled Palm Beach companies
Medi Biotech LLC and Walmol Holdings LLC. Sporn used Medi Biotech to market
compounded prescription creams to customers with certain health conditions. Pharmacies
and laboratories associated with Medi Biotech filled the prescriptions, billed the customers’
insurance companies, and paid Sporn kickbacks. In addition to opening bank accounts for
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Medi Biotech in nominee names, Sporn opened accounts in the name of Walmol Holdings,
a shell corporation, and in 2014 and 2015, avoided paying more than $1.6 million in
personal income taxes by diverting millions through the company’s accounts. Sporn used
these company accounts to purchase luxury items such as high-end watches and diamond
jewelry, classic and exotic cars, two yachts, and other items. Sporn also evaded paying
more than $2.5 million in personal income taxes for other years dating back to 2000. When
the IRS attempted to collect back taxes from Sporn, he tried to conceal assets by
transferring property to trusts and individuals and by repeatedly opening and closing
companies, among other things. In addition to the prison term and Medicare restitution,
Sporn was ordered to pay more than $4 million in restitution to the IRS.
Affordable Care Act
The following case example involves the Affordable Care Act (ACA):
California—On August 18, 2022, Ventura County’s organized health system and three
medical care providers agreed to pay a total of $70.7 million to settle allegations that they
broke Federal and State laws by submitting or causing the submission of false claims to
California’s Medicaid program (Medi-Cal) related to Medicaid Adult Expansion under the
ACA. The parties that entered into the three separate settlement agreements are:
• Ventura County Medi-Cal Managed Care Commission, which does business as Gold
Coast HealthPlan, a county-organized health system (COHS) that contracts to
arrange for the provision of health care services under Medi-Cal in Ventura County;
• Ventura County, which owns and operates Ventura County Medical Center, an
integrated health care system that provides hospital, clinic, and specialty services;
• Dignity Health, a San Francisco-based not-for-profit hospital system that operates
two acute-care hospitals in Ventura County; and
• Clinicas del Camino Real, Inc. (Clinicas), a non-profit health care organization
headquartered in Camarillo.
Pursuant to the ACA, beginning in January 2014, Medi-Cal was expanded to cover the
previously uninsured “Adult Expansion” population—adults between the ages of 19 and 64,
without dependent children, and with annual incomes up to 133 percent of the Federal
poverty level. The Federal Government fully funded the expansion coverage for the first
three years of the program.
Pursuant to contracts with California’s Department of Health Care Services (DHCS), if a
California COHS did not spend at least 85 percent of the funds it received for the Adult
Expansion population on “allowed medical expenses,” the COHS was required to pay back
to the State the difference between 85 percent and what it actually spent. California, in
turn, was required to return that amount to the Federal Government.
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The three settlements resolve allegations that Gold Coast, Ventura County, Dignity, and
Clinicas knowingly submitted or caused the submission of false claims to Medi-Cal for
“Additional Services” provided to Adult Expansion Medi-Cal members between January 1,
2014, and May 31, 2015. The United States and California alleged that the payments were
not “allowed medical expenses” under Gold Coast’s contract with DHCS, were pre-
determined amounts that did not reflect the fair market value of any Additional Services
provided, and/or the additional services were duplicative of services already required to be
rendered. The United States and California further alleged that the payments were
unlawful gifts of public funds in violation of Article IV, Section 17, of the Constitution of
California.
As a result of the settlements, Gold Coast agreed to pay $17.2 million to the United States;
Ventura County agreed to pay $29 million to the United States; Dignity agreed to pay
$10.8 million to the United States and $1.2 million to the State of California; and Clinicas
agreed to pay $11.25 million to the United States and $1.25 million to the State of California.
Contemporaneous with the False Claims Act settlement, HHS agreed to release its right to
exclude Gold Coast and Ventura County from federally funded health care programs in
exchange for their agreements to enter into 5-year CIAs. The CIAs require, among other
things, that Gold Coast and Ventura County each implement centralized risk assessment
programs as part of their compliance programs, and that each hire an independent review
organization to complete annual reviews. Gold Coast’s annual reviews will focus on its
calculation and reporting of MLR data under Medi-Cal, while Ventura County’s annual
reviews will target hospital claims submitted to Medicare and Medicaid, including claims
submitted to Medicaid managed care organizations.
Medicare Fraud Strike Force Activities
In 2007, Medicare Fraud Strike Force teams began an effort to combine resources of Federal, State, and
local law enforcement entities to prevent and combat health care fraud, waste, and abuse. These
partnerships among OIG and HHS, DOJ, U.S. Attorneys’ Offices, FBI, and State and local law enforcement
have a common goal: to analyze health care fraud data and investigative intelligence to quickly identify
fraud and bring prosecutions. Strike Force teams operate in 11 areas: Miami and Tampa/Orlando, Florida;
Dallas and Houston, Texas; Los Angeles, California; Detroit, Michigan; Brooklyn, New York; Baton Rouge
and New Orleans, Louisiana; Chicago, Illinois; and Newark, New Jersey/Philadelphia, Pennsylvania; along
with a Corporate Strike Force located in Washington, DC. During this semiannual reporting period, Strike
Force efforts resulted in the filing of charges against 100 individuals or entities, 98 criminal actions, and
more than $248.2 million in investigative receivables.
In October 2018, DOJ announced the creation of a new initiative to combat the Nation’s opioid
epidemic. The Appalachian Regional Prescription Opioid Strike Force covers 10 Federal judicial districts
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in Alabama, Kentucky, Ohio, Tennessee, Virginia, and West Virginia. OIG’s Office of Investigations is
working closely with its law enforcement partners at the Drug Enforcement Administration (DEA), FBI,
and the MFCUs to provide investigative support. Cases involve physicians and pharmacies that are
responsible for medically unnecessary opioid prescriptions and dangerous drug combinations that are
being paid for by Medicare and Medicaid. In many instances, there are other allegations of
wrongdoing relating to kickbacks, health care fraud, and quality of care, including patient overdoses
and deaths.
The following case example involves a Strike Force case:
Florida—On July 7, 2022, Jose Santeiro was sentenced to 54 months in prison for engaging in a
scheme that fraudulently billed approximately $112 million for substance use disorder services that
were never provided or were medically unnecessary. According to court documents, Jose Santeiro
worked with others to unlawfully bill for approximately $112 million of addiction treatment services
that were never rendered and/or were medically unnecessary at two addiction treatment facilities
where Santeiro was the medical director. The facilities were Second Chance Detox LLC, d/b/a
Compass Detox (Compass Detox), an inpatient detox and residential facility, and WAR Network LLC
(WAR), a related outpatient treatment program.
According to court documents and evidence presented at trial, Santeiro and others admitted
patients for medically unnecessary detox services, the most expensive kind of treatment the
facilities offered. Patient recruiters offered kickbacks to induce patients to attend the programs
and then gave them illegal drugs to ensure admittance for detox at Compass Detox. Evidence at
trial also showed that Santeiro submitted false and fraudulent claims for excessive, medically
unnecessary urinalysis drug tests that were never used in treatment. Santeiro and others then
authorized the re-admission of a core group of patients who were shuffled between Compass
Detox and WAR to fraudulently bill for as much as possible, even though the patients did not need
the expensive treatments for which they were repeatedly admitted. Santeiro also prescribed
Compass Detox patients a so-called “comfort drink” to sedate them, ensure they stayed at the
facility, and keep them coming back. The evidence further showed that Santeiro’s log-in
information was used by others, with his knowledge, to sign electronic medical files to make it
appear as if Santeiro had provided treatment himself when he had not.
Compliance Trainings
Health Care Provider Compliance Training
OIG provides free training on our website for health care providers, compliance professionals, and
attorneys. OIG’s Provider Compliance Training was an initiative developed in 2011 that continues to
reach the health care community with OIG’s message of compliance and prevention via free
downloadable comprehensive training materials and podcasts. OIG’s provider compliance training
resources are available at https://oig.hhs.gov/compliance/compliance-guidance/index.asp.
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American Indian/Alaska Native Compliance Trainings
OIG provides a free online training series, Improving Health and Well-Being in American Indian and
Alaska Native Communities Through Compliance, for grantees and health care providers who serve
American Indian/Alaska Native (AI/AN) communities. The training series covers topics such as
compliance; fraud, waste, and abuse; and health care quality, including how OIG works with the
AI/AN community to combat the opioid epidemic and to protect patients from sexual abuse. The
training series includes web-based trainings, job aids, and videos which are available at
https://oig.hhs.gov/reports-and-publications/featured-topics/ihs/training.asp.
Whistleblower Protection Training
In addition to training for health care providers, OIG provides training to HHS employees,
contractors, and award recipients on Federal whistleblower protections and prohibitions against
retaliation. This training is provided by the HHS Whistleblower Protection Coordinator within the
OIG Office of Counsel to the Inspector General and is conducted in coordination with HHS OpDivs
and Staff Divisions (StaffDivs). OIG also provides training videos, materials, and FAQs about
whistleblower protections on its website at https://oig.hhs.gov/fraud/whistleblower/.
Most Wanted Fugitives List
OIG’s Most Wanted Fugitives website continues to garner national and international attention and has
greatly assisted in helping to capture fugitives charged with defrauding Federal health care programs and
stealing millions of taxpayer dollars. The Most Wanted Fugitives website is continually updated and
features a profile for each fugitive as well as an online tip form and a hotline number for individuals to
report fugitive-related information to OIG, in English or Spanish, 24 hours a day, 365 days a year. The
Most Wanted Fugitives list is available at https://oig.hhs.gov/fraud/fugitives/. During this semiannual
reporting period, no fugitives were captured.
HHS-OIG Hotline
As part of OIG’s Office of Investigations, the Hotline is the public-facing division for OIG’s intake and
evaluation of fraud tips. The mission of the OIG Hotline is to support OIG’s oversight responsibilities in
safeguarding the integrity of all programs and personnel under HHS’s purview and protecting them from
fraud, waste, and abuse. The OIG Hotline achieves its mission through its staff’s dedication to timely intake
and analysis of information received from various sources, such as the “Submit a Complaint” link on the
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HHS-OIG website. During this semiannual reporting period, the OIG Hotline reported expected recoveries
of $40,229,634 as a direct result of cases originating from hotline complaints.
OIG Hotline Activity (4/1/2022–9/30/2022)
Contacts to 1-800-HHS-TIPS phone line, including 60,880
callers seeking information
Total tips evaluated 19,450
Tips referred for action 10,547
Closed; no basis provided for further action 1,343
1
Closed; no HHS violation 770
Closed; other administrative reason 6,790
Sources of tips referred for action
Phone 2,930
OIG website 6,112
Letters or faxes 515
Other 990
Medicaid Fraud Control Units
OIG Oversight of Medicaid Fraud Control Units
MFCUs are key partners with OIG in the fight against fraud, waste, and abuse in State Medicaid
programs. OIG has oversight responsibility for MFCUs and administers grants that provide Federal
funding for their operations. Currently, all 50 States, the District of Columbia, Puerto Rico, and the
U.S. Virgin Islands operate MFCUs. The Federal Government reimburses 90 percent of a MFCU’s
total expenditures during the first 3 years of operation and 75 percent thereafter. MFCUs
investigate and prosecute Medicaid provider fraud as well as abuse or neglect of residents in
health care facilities and board and care facilities and of Medicaid beneficiaries in noninstitutional
or other settings.
In addition to an annual recertification review of each MFCU, OIG conducts reviews of a sample of
MFCUs. OIG evaluates MFCU operations based on 12 performance standards and assesses
compliance with laws, regulations, and OIG policy guidance. During the reporting period, OIG
issued reports of onsite reviews of the following MFCUs:
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• Iowa Medicaid Fraud Control Unit: 2021 Inspection (OEI-07-21-00340), June 2022;
• Connecticut Medicaid Fraud Control Unit: 2021 Inspection (OEI-06-21-00360), September
2022; and
• Michigan Medicaid Fraud Control Unit: 2021 Review (OEI-06-21-00270), September 2022.
OIG Joint Casework With MFCUs
The following case example involves OIG’s joint efforts with MFCUs:
Louisiana—On April 19, 2022, Marty Johnson was sentenced to 60 months in prison,
followed by 1 year of supervised release, and Keesha Dinkins was sentenced to 24 months
in prison, followed by 1 year of supervised release, in connection with a health care fraud
and wire fraud scheme. In addition, Marty Johnson and Keesha Dinkins were ordered to
jointly pay restitution in the amount of $3.5 million. According to information presented to
the court, Marty Johnson owned and operated Positive Change Counseling Agency
(Positive Change) located in Shreveport, Louisiana, from January 2013 to January 2018.
Keesha Dinkins was a manager and supervisor at Positive Change, which provided mental
health rehabilitation and related services to Medicaid beneficiaries in the Caddo and
Bossier Parish areas. From 2014 to January 2018, Johnson submitted and caused to be
submitted fraudulent claims for mental health rehabilitation and non-emergency
transportation services on behalf of Positive Change. Keesha Dinkins knew that Marty
Johnson submitted these fraudulent claims that she and Johnson both knew were not
performed or rendered. These fraudulent claims resulted in Positive Change receiving
payments from Medicaid to which it was not entitled. Johnson admitted to paying
individuals money to enroll with Positive Change, increasing the capacity for Positive
Change to bill Medicaid for services that were not rendered. Johnson instructed employees
at Positive Change, and Dinkins advised those employees, to create false client files to
conceal from Medicaid and insurance company auditors and inspectors that it had not
performed the services related to its previously submitted claims which had already been
reimbursed by Medicaid. To create these false client files, sections from different client
documents were physically cut to form inserts that were glued into blank client log
templates. These templates with the glued inserts were then photocopied to create the
appearance of legitimate documents. Johnson and Dinkins supervised and knowingly and
willfully instructed the employees creating these false client files to place the false and
fictitious photocopied, cut-and-pasted documents into the client files. Johnson and Dinkins
knew that these false client files were used to conceal from Medicaid officials that Positive
Change did not render the services in the claims submitted by it and paid by Medicaid.
The case was investigated by HHS-OIG, the Louisiana State Attorney General’s Office MFCU,
and the FBI.
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Advisory Opinions and Other Industry Guidance
Advisory opinions, which are developed in consultation with DOJ, are issued to requesting parties
regarding the interpretation and applicability of certain statutes relating to Federal health care programs.
The Health Insurance Portability and Accountability Act of 1996 (HIPAA), § 205, allows OIG to provide case-
specific formal opinions on the application of the anti-kickback statute and safe harbor provisions and
other OIG health care fraud and abuse sanctions. During this semiannual reporting period, OIG received
14 requests for advisory opinions, issued 11 advisory opinions, and modified 2 advisory opinions.
Sanction Authorities and Other Administrative Actions
Various Federal laws provide authorities the ability to impose administrative sanctions for fraud and abuse
as well as other activities that pose a risk to Federal health care programs and their beneficiaries.
Sanctions include the exclusion of individuals and entities from Federal health care programs and the
imposition of CMPs for submitting false and fraudulent claims to a Federal health care program or for
violating the anti-kickback statute, the physician self-referral law (also known as the Stark Law), or the
Emergency Medical Treatment and Labor Act (EMTALA), also known as the “patient dumping statute.”
Sanctions also include referrals for suspension and debarment in cases of grant and contract fraud.
During this semiannual reporting period, OIG imposed 1,290 administrative sanctions in the form of
program exclusions or administrative actions for alleged fraud or abuse or other activities that posed a risk
to Federal health care programs and their beneficiaries.
Exclusion and penalty authorities are described in Appendix C and on our website at
http://oig.hhs.gov/fraud/enforcement/cmp/index.asp.
Program Exclusions
During this semiannual reporting period, OIG excluded 1,290 individuals and entities from
Medicare, Medicaid, and other Federal health care programs. Most of the exclusions resulted from
convictions for crimes relating to Medicare or Medicaid, patient abuse or neglect, financial
misconduct, controlled substances, or as a result of license revocation. OIG completed the
deployment of a new service for MFCUs to report convictions through a central web-based portal
for exclusions. OIG is also responsible for reinstating providers who apply and have met the
requirements of their exclusions. For a list of excluded individuals and entities, see
https://exclusions.oig.hhs.gov/.
The following are case examples of program exclusions:
North Carolina—On May 19, 2022, OIG excluded the owner and operator of a billing
agency for a minimum period of 30 years based on her conviction for health care fraud
conspiracy. Specifically, the individual engaged in a scheme to defraud Medicaid by
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submitting claims for fictitious services or services that were never provided. The court
ordered her to pay approximately $6,121,600 in restitution, and she was sentenced to 84
months of incarceration.
Georgia—On May 19, 2022, a dietary supplements company and its owner were excluded
for a minimum period of 3 years based on their convictions for introducing a misbranded
drug into interstate commerce in violation of the Federal Food, Drug, and Cosmetic Act.
Specifically, the individual and company pled guilty to selling and distributing a vitamin D
product with false and misleading marketing claims that their product would lower
consumers’ risks of contracting COVID-19.
Louisiana—On May 22, 2022, OIG excluded the owner of seven nursing homes in the State
of Louisiana for an indefinite period of time based on his ownership of excluded entities.
As background, OIG had previously excluded the seven nursing homes owned by this
individual after the State of Louisiana revoked their licenses to operate as nursing homes
following a series of documented violations identified in the aftermath of Hurricane Ida.
Specifically, the nursing homes evacuated more than 800 residents of the facilities to a
single warehouse where subsequent State inspectors observed residents living in inhumane
conditions (e.g., some residents were sleeping on mattresses near standing water, some
residents were undressed or naked, other residents were calling for help but being left
alone with full diapers). During these onsite visits, the owner attempted to threaten,
intimidate, and interfere with the assessment of the site, where seven residents eventually
died.
Washington—On July 20, 2022, a physician in Seattle was excluded for a minimum period
of 18 years based on his conviction by jury verdict of multiple counts of wire fraud, bank
fraud, and money laundering. Specifically, the physician submitted false and misleading
loan applications as part of a fraud scheme to obtain funding from the Paycheck Protection
Program and Economic Injury Disaster Loan Program, authorized by the Coronavirus Aid,
Relief, and Economic Security (CARES) Act designed to offset economic hardships caused
by the COVID-19 pandemic. In addition, the court ordered him to pay $1,438,000 in
restitution and sentenced him to 48 months of incarceration. The Washington Department
of Health Medical Commission also suspended his license to practice.
Texas—On August 18, 2022, OIG excluded a physician for a minimum period of 25 years
based on his convictions for conspiracy to distribute a controlled substance and commit
mail fraud. In addition to illegally dispensing controlled substances (e.g., hydrocodone),
this physician conspired with others to unlawfully enrich themselves by submitting
fraudulent claims to workers’ compensation programs as well as other health insurers for
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medical services that were not rendered. The court ordered the physician to pay
approximately $376,300 in restitution and serve 144 months of incarceration.
Maine—On September 20, 2022, OIG excluded a physician’s assistant for a minimum
period of 23 years based on his conviction of unlawful sexual contact with a minor patient.
The court also sentenced the physician’s assistant to 7 years of incarceration, and the Maine
State Board of Medical Licensure revoked his license.
Suspensions and Debarments
Suspensions and debarments are administrative tools used by HHS and other Federal agencies to
protect the Government from individuals and entities that have engaged in contract fraud, have
misused grant funds, or are otherwise not presently responsible. Because these are
Governmentwide sanctions, an individual or entity that has been suspended or debarred by HHS or
any other agency is ineligible to participate in any future funding opportunities across the Federal
Government for a specified period of time.
OIG refers individuals and entities that have potentially engaged in grant or contract fraud or
misconduct to the HHS suspension and debarment official, who is responsible for determining
whether to impose a suspension or debarment. OIG continues to develop a robust suspension and
debarment program and uses this tool to protect Government programs against fraud, waste, poor
performance, and noncompliance with contract provisions or applicable law.
The following case examples involve debarment:
Nebraska—Mubanga Chongo-Ofafa, Little Blessings Learning Center, Seth Mock, Mock’s
Loving Life Learning Center, and Aileen Kogera Njoroge were each debarred for a period of
3 years. The debarment was imposed by the HHS Suspension and Debarment Official
based on a referral from OIG. Chongo-Ofafa, Little Blessings, Mock, Mock’s Loving Life
Learning Center, and Njoroge were criminally convicted for their role in a scheme to
defraud child care programs by submitting claims for children who did not attend the child
care program. The child care program is funded in part by HHS's Administration for
Children and Families' Child Care Development Fund (CCDF). The CCDF provides child care
subsidies to low-income families where the parents are employed or engaged in approved
job training. A review of timesheets reflected that the State was falsely billed for families
whose children did not attend day care on the days and times claimed.
Washington—Sami Anwar and his companies Mid Columbia Research LLC and Zain
Research LLC were each debarred for a period of 3 years. The debarment was imposed by
the HHS Suspension and Debarment Official based on a referral from OIG. Sami Anwar,
through his clinical research companies Mid Columbia and Zain Research, was paid by drug
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sponsors and clinical research organizations to conduct clinical research and drug trials.
Between 2013 and 2018 Sami Anwar directed a scheme to have his companies pose as
legitimate human clinical research sites and provide false clinical research trial data
regarding drug safety and efficacy to dozens of drug companies, and through them, to the
Food and Drug Administration (FDA). By engaging in this fraud, Sami Anwar bilked millions
from drug sponsors, endangered study participants, and provided false data to the FDA
and DEA regulators.
Civil Monetary Penalties Law
The CMPL authorizes OIG to impose administrative penalties, assessments, and exclusions against
a person who, among other things, submits, or causes to be submitted, claims to a Federal health
care program that the person knows, or should know, are false or fraudulent. The exclusions
statute also authorizes OIG to exclude a person who violates the CMPL. During this semiannual
reporting period, OIG concluded cases involving more than $27.7 million in CMPs and assessments.
Affirmative Litigation
The CMPL authorizes OIG to use its administrative remedies to affirmatively pursue cases. OIG
may also exclude under the exclusions statute for engaging in conduct that violates the CMPL.
When OIG excludes under the exclusions statute for engaging in conduct that violates the CMPL, it
is known as an affirmative exclusion.
The following case examples involve affirmative litigation under the CMPL:
Georgia—Michael Dalton Hanowell, M.D.; Hanowell Spine Clinic, LLC; and Hanowell Pain
Management, LLC (collectively, “Dr. Hanowell”) entered into a $409,809.88 settlement
agreement with OIG. The settlement agreement resolves allegations that Dr. Hanowell
submitted claims to Medicare for facet joint injections and denervations that exceeded the
allowable number of sessions in a rolling 12-month period.
New York—Richmond County Ambulance, Inc. (RCA) entered into a $1,578,412 settlement
agreement with OIG. The settlement agreement resolves allegations that RCA presented
claims to Medicare Part B for ambulance transportation to and from skilled nursing facilities
(SNFs) where such transportation was already covered by the SNF consolidated billing
payment under Medicare Part A.
Minnesota—Dr. Kenneth P. Martinez and his professional corporation (Kenneth P. Martinez,
M.D., a Medical Corporation d/b/a Neurology and Pain Specialty Center) (collectively, “Dr.
Martinez”), entered into a $919,644.34 settlement agreement with OIG. The settlement
agreement resolves allegations that Dr. Martinez knowingly presented to Medicare claims
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for items or services that Dr. Martinez knew or should have known were not provided as
claimed and were false or fraudulent. Specifically, Dr. Martinez submitted claims: (1) using
CPT code 95937 (neuromuscular junction testing) under the National Provider Identifier
(NPI) number of Kenneth P. Martinez, M.D., when the neuromuscular junction testing was
either not medically necessary or was not performed at the applicable standard of care;
and (2) using CPT Code 95913 (for 13 or more nerve conduction studies) under Kenneth P.
Martinez, M.D.’s NPI number when Kenneth P. Martinez, M.D., performed only 12 or fewer
nerve conduction studies.
Arizona—Justin Thompson, DC; Physical Medicine of Scottsdale, LLC d/b/a Arizona Pain
Relief; Anthem Physical Medicine; and Biltmore Physical Medicine (collectively, “Arizona
Pain Relief") entered into a $1,905,070.74 settlement agreement with OIG. The settlement
agreement resolves allegations that Arizona Pain Relief submitted false claims to Medicare
for: (1) implantable neurostimulator devices using HCPCS Code L8679 when they instead
provided auricular peripheral nerve stimulation devices that are not covered by Medicare;
(2) CPT Codes 95970, 64555, and 64999 that were associated with the application,
monitoring, and removal of the device; and (3) CPT Codes 99211, 99212, and 99213 for
evaluation and management (E&M) services billed on the same date of service as HCPCS
Code L8679 that were billed for time spent providing and removing the device when no
separate and identifiable E&M service was provided.
Self-Disclosure Programs
Health care providers, suppliers, or other individuals or entities subject to CMPs can apply for
acceptance into the Health Care Fraud Self-Disclosure Protocol, a program created in 1998 for
voluntary disclosure of self-discovered evidence of potential fraud. The Health Care Fraud Self-
Disclosure Protocol may give individuals and entities the opportunity to avoid costs or disruptions
associated with Government-directed investigations and civil or administrative litigation.
Application processes for two additional self-disclosure programs were recently added to the OIG
website for HHS contractors and grantees. The OIG contractor self-disclosure program provides
contractors the opportunity to self-disclose when they have potentially violated the False Claims
Act or other Federal criminal laws prohibiting fraud, conflict of interest, bribery, or gratuity. This
self-disclosure process is only available to those with a FAR-based contract with HHS. The OIG
Grant Self-Disclosure Program is available for application by HHS grantees or HHS grant
subrecipients and provides the opportunity for voluntary disclosure to OIG of potential fraud. OIG
evaluates the reported results of each internal investigation under the provider self-disclosure
protocol to determine the appropriate course of action. The self-disclosure guidelines are available
on the OIG website at https://oig.hhs.gov/compliance/self-disclosure-info/index.asp. During this
semiannual reporting period, provider self-disclosure cases resulted in more than $18.8 million in
HHS receivables.
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The following case examples pertain to provider self-disclosure settlements:
Illinois—After they self-disclosed conduct to OIG, Presence Central and Suburban Hospitals
Network d/b/a AMITA Health Mercy Medical Center and Presence Chicago Hospitals
Network d/b/a AMITA Health Saints Mary and Elizabeth Medical Center (collectively,
“AMITA”) agreed to pay $6,232,195.50 for allegedly violating the CMPL. OIG alleged that
AMITA submitted claims to Medicare Part A for inpatient psychiatric admissions that were
not medically necessary.
Maryland—After it self-disclosed conduct to OIG, Corridor Anesthesia, LLC (Corridor)
agreed to pay $1,117,684.50 for allegedly violating the CMPL. OIG alleged that Corridor
submitted claims to Federal health care programs for services provided by certified
registered nurse anesthetists (CRNAs) who were not authorized to bill for their services on
behalf of Corridor. Therefore, Corridor billed for these services under the name of another
CRNA who was authorized to bill on behalf of Corridor.
Corporate Integrity Agreements
Many health care providers elect to settle their cases before litigation. As part of the settlements,
providers often agree to enter into CIAs with OIG to avoid exclusions from Medicare, Medicaid,
and other Federal health care programs. Under a CIA, a provider commits to establishing a
compliance program and taking other specified steps to ensure future compliance with Medicare
and Medicaid rules. The compliance programs are designed, in part, to prevent future fraud. OIG
monitors providers’ compliance with these agreements and may impose penalties on parties that
fail to comply with the requirements of their CIAs.
The following case examples involve CIA enforcement:
Oklahoma—After it disclosed conduct to OIG pursuant to its CIA, Oklahoma Heart Hospital
South, LLC entered into a $1,151,770.50 False Claims Act settlement agreement with DOJ
and OIG. The United States alleged that the hospital billed Medicare for intensive cardiac
rehabilitation that was not provided under a plan established, reviewed, and signed by a
physician, or not updated, reviewed, and signed by a physician every 30 days.
Michigan—After it disclosed conduct to OIG pursuant to its CIA, William Beaumont
Hospital (WBH) agreed to pay $1,732,548 for allegedly violating the CMPL by paying
kickbacks. OIG alleged that WBH: (1) paid remuneration to cardiologists in the form of
excess compensation and (2) paid remuneration to a medical practice in the form of free
use of medical equipment and personnel.
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Public Health and Human Service Agency
Reports and Reviews
Public Health Agency Reports and Reviews
Office of the Assistant Secretary for Preparedness and Response
HHS Did Not Fully Comply With Federal Requirements and HHS Policies and Procedures When
Awarding and Monitoring Contracts for Ventilators (A-02-20-02002), September 2022
HHS’s Administration for Strategic Preparedness and Response (ASPR) did not consistently award
and monitor contracts for ventilators for use in responding to the COVID-19 pandemic in
accordance with Federal requirements and HHS policies and procedures. Specifically, ASPR did not
establish roles and responsibilities for communication with other emergency response teams, did
not always accurately report contract data, and did not always properly monitor contractor
performance.
As a result, ASPR could not ensure compliance with applicable Federal requirements or that each
contract’s terms were economically and efficiently achieved; therefore, ASPR could not determine
whether the use of taxpayer funds was reasonable. In addition, the Federal Government may have
used inaccurate contract data supplied by ASPR to measure and assess the impact of Federal
procurements on Coronavirus Aid, Relief, and Economic Security (CARES) Act spending. Finally,
ASPR potentially hindered the Strategic National Stockpile’s ability to meet anticipated ventilator
demand in support of the Federal Government’s COVID-19 pandemic response.
ASPR did not indicate concurrence or nonconcurrence with our recommendations, including that it
establish written policies and procedures for communicating with federally established emergency
response team lead agencies, accurately report contract data, and strengthen its policies and
procedures to ensure proper monitoring of contractor performance.
Food and Drug Administration
The Food and Drug Administration’s Foreign For-Cause Drug Inspection Program Can Be Improved
To Protect the Nation’s Drug Supply (A-01-19-01500), June 2022
FDA’s timeframes for completing the steps in the foreign for-cause drug inspection process
generally improved after it implemented programmatic changes in 2017. However, we found that:
(1) FDA did not always follow its policies and procedures for foreign for-cause drug inspections and
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(2) FDA could not provide documentation to support that all lead investigators completed the
required training before they conducted inspections.
According to FDA, it had limited resources and faced unexpected events and complex
circumstances. FDA did not ensure that it recorded certain information in the Establishment
Inspection Report (EIR), such as whether an inspection was announced. If FDA does not follow its
policies and procedures related to timeliness, regulatory deficiencies may not be corrected in an
efficient manner. FDA did not ensure that lead investigators completed required training before
they conducted inspections because FDA did not have policies and procedures that required
investigators’ supervisors to verify that lead investigators completed the required training prior to
being assigned to an inspection. FDA officials told us that because of multiple location moves, FDA
misplaced records indicating that lead investigators completed training requirements. It is a
vulnerability to have lead investigators conduct inspections before ensuring that they are qualified.
FDA concurred with our recommendations that it identify and implement additional ways to
improve the timeliness of its foreign for-cause drug inspection process. We also made other
procedural recommendations that are listed in the report.
Delays in Confirmatory Trials for Drugs Granted FDA’s Accelerated Approval Raise Concerns (OEI-01-
21-00401), September 2022
More than one-third of accelerated approval drug applications with incomplete confirmatory trials
are past their trials’ original planned completion dates, including four drug applications that are
more than 5 years past those dates. Additionally, we found that Medicare and Medicaid spent
more than $18 billion from 2018 to 2021 for accelerated approval drugs with incomplete
confirmatory trials past their trials’ original planned completion dates.
FDA Repeatedly Adapted Emergency Use Authorization Policies to Address the Need for COVID-19
Testing (OEI-01-20-00380), September 2022
From January through May 2020, FDA repeatedly adapted its approach to how it used Emergency
Use Authorizations (EUAs) to address COVID-19 testing challenges; however, efforts to increase test
availability sometimes came at a cost to test quality. Our findings underscore the need to apply
insights from FDA’s early experiences with the COVID-19 pandemic toward current and future
infectious disease emergencies to better balance test availability and quality.
FDA concurred with all six of our recommendations, which were that: (1) FDA should assess and, as
appropriate, revise guidance for test EUA submissions; (2) FDA should develop a suite of EUA
templates for future emergencies involving novel pathogens; (3) FDA should expand the FDA
Center for Devices and Radiological Health’s existing device-tracking platform to facilitate EUA
submission and monitoring; (4) FDA should expand and improve resources for test developers on
the EUA process; (5) FDA should establish formal communication channels between FDA and the
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lab community, to be used in emergency testing; and (6) FDA should work with Federal partners to
implement lessons learned about a national testing strategy that go beyond the EUA process
FDA’s Work With the Tri-Agency Task Force for Emergency Diagnostics Helped Labs Implement
COVID-19 Tests (OEI-01-20-00381), September 2022
FDA’s engagement with the Tri-Agency Task Force for Emergency Diagnostics demonstrates the
value of interagency coordination and collaboration to facilitate emergency test implementation in
laboratories. This task force—a joint effort of FDA, CDC, and CMS—was established in 2019 to
enhance the effectiveness of the Federal response to emergencies that require laboratories to
implement tests. Prior to the COVID-19 pandemic, the task force identified gaps to prepare for
future emergencies. During the pandemic, it provided a venue for member agencies to coordinate
their responses to pandemic-related challenges. FDA’s continued coordination with the task force
holds potential for further improvements in emergency test implementation in laboratories.
Indian Health Service
Indian Health Service Capacity To Manage Supplemental $3.5 Billion Allocated to Its Sanitation
Facilities Construction Program (OEI-06-22-00320), September 2022
Congress appropriated $3.5 billion to the Indian Health Service (IHS) for Sanitation Facilities
Construction projects under the Infrastructure Investment and Jobs Act (IIJA), and allocated 0.5
percent of the supplemental funding to OIG for oversight. As part of a more comprehensive
evaluation, OIG conducted preliminary research of IHS’s capacity to administer and oversee the
$3.5 billion. Through this research, we identified three initial observations about IHS capacity,
which we shared with IHS to assist the agency as it continues its planning for how to use and
oversee the funds. These observations were that: (1) IHS quickly began preparations to increase
capacity and administer the funds using existing, generally supported methods; (2) to administer
the IIJA-funded projects and meet sanitation needs, IHS faces financial, capacity, and other
challenges that warrant continued attention; and (3) plans are still unclear for IHS assessment of
the use of IIJA funds, strategies for future spending, and assisting Tribes with long-term operation
of IIJA-funded facilities.
IHS’s National Supply Service Center Was Generally Effective in Providing Supplies to Facilities During
the COVID-19 Pandemic, but Its Internal Controls Could Be Improved (A-07-20-04124), September
2022
IHS’s National Supply Service Center (NSSC) was generally effective in facilitating the distribution of
medical supplies and equipment during the COVID-19 pandemic. However, we noted that NSSC’s
internal controls could be improved. In lieu of written policies and procedures, NSSC relied on the
institutional knowledge of key employees in implementing a new medical supply distribution
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method as the pandemic developed. NSSC also did not have sufficient warehouse facilities.
Finally, NSSC’s inventory management system was outdated and could not track the routing of a
product that had been shipped or provide necessary information about the shipment to the
customer.
Because NSSC did not have written policies and procedures in place that would provide a
framework to guide decision making for emergency situations, its current process is not optimal or
sustainable, particularly when institutional knowledge is subsequently lost or diminished. As a
result, there is an increased risk that NSSC will not be able to respond effectively to future
emergencies. NSSC’s outdated inventory management system also poses an increased risk to the
effectiveness and efficiency of NSSC operations in the future.
IHS concurred with our recommendations that NSSC strengthen internal controls by developing
and implementing written policies and procedures for emergency situations; identify feasibly viable
options, including seeking additional funding, to prepare for future emergency situations that
address additional storage capacity and inventory distribution; and upgrade its inventory
management system software to improve its ability to interface with customers and vendors.
IHS Telehealth System Was Deployed Without Some Required Cybersecurity Controls (A-18-21-
03100), September 2022
IHS deployed a national telehealth system, which increased the availability of health care services
during the pandemic, but it did not complete select IT controls as required prior to deploying its
telehealth system nationally. Specifically, IHS did not complete the contingency plan, risk
assessment, finalized authorization to operate, and system security plan. Additionally, after
deployment of the telehealth system, IHS did not remediate known vulnerabilities on some
telehealth system devices in a timely manner. IHS has since completed the controls covered by this
audit, and no major incidents or breaches have been reported to HHS.
IHS concurred with our recommendations that it develop a strategy for identifying, implementing,
and testing cybersecurity controls for new information systems that are deployed in an expedited
fashion to meet an urgent, mission-critical need.
Centers for Disease Control and Prevention
CDC Found Ways To Use Data To Understand and Address COVID-19 Health Disparities, Despite
Challenges With Existing Data (OEI-05-20-00540), July 2022
Although CDC’s racial, ethnic, and socioeconomic data associated with COVID-19 testing, cases,
hospitalizations, and deaths have limitations, CDC found ways to use these and other data to
understand and address COVID-19 health disparities. These findings illuminate challenges that
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jurisdictions and CDC face in collecting and using public health data and help CDC prioritize efforts
to improve the data collected.
CDC concurred with both of our recommendations, which were that: (1) CDC should expand efforts
both to improve racial and ethnic data associated with COVID-19 and to supplement them with
additional data sources and (2) CDC should ensure that Tribal Epidemiology Centers have timely
access to all public health data to which they are entitled.
HHS Should Improve Internal Coordination Regarding Unaccompanied Children, (OEI-BL-20-00670)
May 2022
OIG identified a lack of internal coordination during the development and early implementation of
a CDC public health order (“Title 42 order”) that significantly affected Office of Refugee
Resettlement (ORR) programs to serve unaccompanied children. (ORR is a program office within
the HHS’s Administration for Children and Families.) Effective coordination is critical, because in
order to effectively predict programmatic and capacity needs, ORR must have timely access to all
relevant information about HHS decision making that affects unaccompanied children.
CDC and ACF concurred with both of our recommendations, which were that: (1) HHS should take
steps to improve internal coordination and communication about unaccompanied children; and (2)
HHS should ensure that CDC coordinates with ORR when making future decisions that could affect
the number of unaccompanied children placed in ORR’s care, including any Title 42 order.
CDC’s Corrective Actions Improved Program Operations at the National Institute of Health in
Mozambique and Facilitated the Institute’s Implementation of Prior OIG Audit Recommendations (A-
04-20-01019), September 2022
CDC’s corrective actions, in response to our November 2016 memorandum, improved program
operations at the National Institute of Health in Mozambique (the Institute). Specifically, CDC took
the following eight corrective actions, which we confirmed through our current audit:
(1) designated the Institute a high-risk organization, (2) added special award conditions,
(3) conducted a site visit in December 2016, (4) delayed new funding to the Institute,
(5) conducted a risk and business system assessment in March 2018, (6) hired a project officer to
manage the Government-to-Government portfolio in Mozambique, (7) worked with the Institute to
ensure proper systems and practices are in place, and (8) employed a fiscal agent.
Of our 10 prior audit recommendations, 2 remained unimplemented when the current audit began:
(1) refund to CDC $431,458 of unallowable expenditures and (2) work with CDC to obtain value-
added tax (VAT) reimbursement from the Government of Mozambique.
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The Institute implemented the first recommendation by refunding $5,287 per CDC’s instruction. To
implement the second, the Institute is seeking a refund from the Government of Mozambique of
$546,543 for the VAT it paid with U.S. President’s Emergency Plan for AIDS Relief (PEPFAR) funds
from September 2012 through December 2015, when a new agreement was reached providing a
framework for VAT reimbursement. During our audit period, the Institute tracked VAT payments
and reported them to CDC quarterly for reimbursement requests. This report includes no
recommendations.
National Institutes of Health
Opportunities Exist To Strengthen NIH Grantees’ Oversight of Investigators’ Foreign Significant
Financial Interests and Other Support (OEI-03-20-00210), May 2022
The integrity and security of research funded by NIH relies, in part, on grantee institutions’
(hereafter grantees’) oversight of their investigators’ significant financial interests and other
support. We found that most grantees failed to meet at least one Federal requirement related to
investigators’ foreign significant financial interests and other support. In addition, many grantees
lacked oversight practices that would help ensure that all materials submitted to NIH are complete
and accurate. At the same time, grantees reported promising practices that, if more widely
adopted, present additional opportunities to strengthen oversight of investigators’ foreign
significant financial interests and other support.
NIH concurred with all seven of our recommendations, which were that: (1) NIH should ensure that
grantees comply with Federal requirements to train investigators regarding disclosure of significant
financial interests, (2) NIH should ensure that grantees conduct the required review of
investigators’ significant financial interests to determine whether conflicts exist, (3) NIH should
specifically require grantees to provide trainings and maintain a written policy regarding
investigators’ disclosure of other support, (4) NIH should modify reporting mechanisms to require
grantees to report whether investigators’ significant financial interests and other support involve
foreign entities, (5) NIH should conduct outreach to grantees with R13 conference grants to clarify
requirements regarding the disclosure and review of investigators’ significant financial interests and
other support, (6) NIH should clarify whether and how grantees should verify investigators’
significant financial interests and other support prior to submitting information to NIH, and (7) NIH
should establish a method for grantees to share their best practices for identifying and reviewing
investigators’ foreign significant financial interests and other support.
The National Institutes of Health Administered Superfund Appropriations During Fiscal Year 2021 in
Accordance With Federal Requirements (A-04-22-04088), August 2022
During FY 2021, NIH administered Superfund appropriations in accordance with applicable Federal
requirements. Specifically, NIH obligated and disbursed Superfund appropriations in accordance
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with Federal laws and in similar proportions to prior years. In addition, NIH’s monitoring of
Superfund grants generally ensured that grantees met requirements for financial, performance,
and audit reporting. This report contains no recommendations.
The National Institutes of Health Did Not Ensure That All Clinical Trial Results Were Reported in
Accordance With Federal Requirements (A-06-21-07000), August 2022
NIH did not ensure that all NIH-funded intramural and extramural clinical trials complied with
Federal reporting requirements for responsible parties to submit the results of clinical trials to
ClinicalTrials.gov. The noncompliance with Federal reporting requirements occurred because NIH
did not have adequate procedures for ensuring that responsible parties submitted the results of
clinical trials, took limited enforcement action when there was noncompliance, and continued to
fund new research of responsible parties that had not submitted the results of their completed
clinical trials. For the 47 NIH-funded clinical trials in which the responsible party submitted their
results (35 submitted on time and 12 submitted late), NIH complied with the Federal reporting
requirements to post the results to ClinicalTrials.gov.
NIH concurred with our recommendations that it: (1) improve its procedures to ensure that
responsible parties of NIH-funded clinical trials comply with requirements to submit results to
ClinicalTrials.gov in a timely manner, (2) take enforcement actions against responsible parties that
are late in submitting trial results or do not submit results, and (3) work with the responsible parties
to understand their challenges related to ClinicalTrials.gov and implement procedures to address
these challenges.
National Institutes of Health Grant Program Cybersecurity Requirements Need Improvement (A-18-
20-06300), September 2022
CliftonLarsonAllen (CLA) completed this audit on behalf of OIG and found that NIH did not have:
(1) an adequate pre-award risk assessment process because it does not consider cybersecurity and
does not include a special term and condition addressing cybersecurity risk in the Notice of Award;
(2) adequate policies because the NIH Grants Policy Statement (NIHGPS) does not include specific,
risk-based provisions on cybersecurity; and (3) adequate post-award monitoring to ensure that
grantees maintain effective cybersecurity to protect sensitive and confidential data and NIH’s
intellectual property.
NIH did not concur with CLA’s recommendations that NIH: (1) assess its grant award programs to
determine which grants should require additional cybersecurity protections; (2) based on results of
NIH’s risk assessment of grant awards, include cybersecurity controls that should be implemented;
(3) strengthen the NIHGPS to establish clear and measurable standards for cybersecurity
protections; (4) strengthen the pre-award process to identify and address how cybersecurity risk
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will be assessed; and (5) strengthen the NIH post-award process to confirm that cybersecurity
protections to adequately safeguard sensitive and confidential data have been implemented.
Human Services Agency Reports and Reviews
Administration for Children and Families
National Snapshot of Trends in the National Domestic Violence Hotline’s Contact Data Before and
During the COVID-19 Pandemic (A-09-21-06000), April 2022
Although our analysis showed little change in total contact volume for the National Domestic
Violence Hotline from the period before to the period during the pandemic, we identified notable
changes in the contact data for some subcategories of data that we analyzed. Furthermore, our
analysis showed notable fluctuations in the number of contacts for some subcategories of data in
certain months during the pandemic. Although the Hotline provided explanations for what could
have contributed to these fluctuations, it could not determine whether they were a result of the
pandemic. The Hotline believed that the full impact of the pandemic may not be reflected in the
contact data until more time has passed.
The Hotline identified four challenges that it faced during the pandemic: (1) connecting victims to
providers and resources that were operating at a limited capacity because of the pandemic, (2)
tracking the unique impact of the pandemic on victims to better serve contacts’ needs,
(3) addressing a decrease in contact volume from victims who may have needed help but did not
contact the Hotline because they were in closer proximity to their abusers as a result of shelter-in-
place orders, and (4) fostering meaningful connections among Hotline staff to carry its mission
forward. To address these challenges, the Hotline took actions to help ensure that it continued to
support those affected by domestic violence. This report includes no recommendations.
National Snapshot of State Agency Approaches to Reporting and Locating Children Missing From
Foster Care (A-07-20-06095), May 2022
There were 110,446 missing children episodes during our audit period, from July 1, 2018, through
December 31, 2020. The average number of days that the children were missing ranged from 7 to
96 days; the number of children who were still missing as of December 31, 2020, was 6,619; and the
majority (65 percent) of missing children were between 15 and 17 years old. The data also showed
that among the missing children, 51 percent were females, 48 percent were males, and 1 percent
were reported without gender data, or reported as transgender or undecided.
All 50 State agencies said that they had implemented policies and procedures regarding measures
to report and locate missing children. Some State agencies reported enhanced procedures when a
high-risk child went missing, or created special units or had specifically designated staff to help
locate missing children.
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We identified several barriers and other deficiencies in State agencies’ policies and procedures.
These barriers included limitations in State agencies’ data systems, lack of oversight to ensure
timeliness when reporting missing children, and issues involving the collaboration and exchange of
information with Federal agencies and law enforcement.
The most frequently identified challenges were: (1) locating children who repeatedly go missing
from foster care, (2) obtaining cooperation from missing children’s families and friends and from
law enforcement, (3) finding correct placements for children to prevent them from running away,
and (4) lack of awareness of the support and technical assistance that ACF provides. This report
makes no recommendations.
California Collected and Disbursed Stimulus Payments and Income Tax Refunds Under the Federal
Tax Refund Offset Program in Accordance With Federal and State Requirements (A-01-21-01501),
June 2022
California collected and disbursed stimulus payments and income tax refunds under the Federal
Tax Refund Offset (FTR Offset) program in accordance with Federal and State requirements during
our audit period. For all 115 noncustodial parents sampled, we found that California collected and
disbursed $144,262 in FTR Offset payments.
Specifically, California complied with Federal and State requirements by having in its records a
copy of the support order and modifications that specifies the date of issuance and amount of
support. California maintained a copy of the payment record and provided written notices of the
FTR Offset to noncustodial parents. In addition, California accurately and timely disbursed FTR
Offset payments to custodial parents and updated the noncustodial parents’ arrears balances. This
report contains no recommendations.
Office of Refugee Resettlement’s Influx Care Facility and Emergency Intake Sites Did Not Adequately
Safeguard Unaccompanied Children From COVID-19 (A-06-21-07002), June 2022
During our site visits, we found that most facilities could have done more to meet CDC and HHS
recommendations and requirements designed to keep children safe and protect against the spread
of COVID-19. We found that these facilities lacked: (1) procedures for COVID-19 testing of children,
employees, and volunteers; (2) measures to protect against the spread of COVID-19; and (3)
procedures to report required testing and results to ORR and State and local health entities.
These issues occurred, in part, because ORR was rapidly expanding capacity, setting up emergency
intake sites (EISs), and developing COVID-19 protocols and guidance for their use. However, ORR
did not have a process in place for widely disseminating the guidance and frequent updates to
appropriate staff at the EISs. Moreover, ORR did not effectively monitor facilities to ensure
compliance with guidance on COVID-19 testing, mitigation, and reporting requirements. As a
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result, facilities did not fully implement procedures related to COVID-19, thereby potentially placing
the health and safety of children, employees, and volunteers at risk.
ACF concurred with our recommendations that ORR: (1) develop a process to clearly communicate
COVID-19 guidance and updates to the appropriate staff at the EISs, (2) reiterate to facilities that
they must comply with ORR’s COVID-19 testing and reporting requirements and with State
reporting requirements, (3) improve and increase training provided to facilities regarding COVID-19
mitigation strategies, and (4) perform routine oversight of facilities to reinforce implementation
and compliance with all requirements related to COVID-19.
Nevada’s Monitoring Did Not Ensure Child Care Provider Compliance With State Criminal
Background Check Requirements at 9 of 30 Providers Reviewed (A-09-21-01000), August 2022
Nevada’s monitoring of child care providers did not ensure provider compliance with State
requirements related to criminal background checks for 9 of the 30 child care providers we
reviewed. These deficiencies occurred because providers did not notify Nevada of a new
household member or newly hired staff, and Nevada officials stated that they misinterpreted the
State regulations on completing criminal background checks for minors. Additionally, Nevada did
not have an explicit requirement or policy to conduct an in-State sex offender registry check for all
child care staff members.
We recommended that Nevada: (1) ensure that child care providers notify Nevada when a new
household member is added or a new employee is hired so that the State may conduct the
required criminal background checks; (2) ensure that all required criminal background checks are
conducted for the 21 individuals we identified who did not have all of the required checks at the
time of our audit; (3) ensure that all required criminal background checks are conducted for all
employees who are under the age of 18; (4) revise its policies and procedures to ensure that all
child care staff members, regardless of age, are fingerprinted and have background checks
completed immediately after being hired; and (5) add a written requirement and policy to conduct
the in-State sex offender registry check for all child care staff members. Nevada agreed with our
findings and provided information on actions that it had taken or planned to take to address our
recommendations.
The Municipality of Barceloneta Did Not Always Manage Its Head Start Disaster Assistance Awards in
Accordance With Federal and Commonwealth Requirements (A-02-20-02003), August 2022
The Municipality of Barceloneta (the Municipality) did not always manage Head Start disaster
assistance awards in accordance with Federal and Commonwealth requirements. Specifically, the
Municipality’s financial management system did not always ensure compliance with requirements
for: (1) submitting timely and accurate Federal financial reports, (2) maintaining support for award
drawdowns, and (3) timely completing bank reconciliations. Additionally, the Municipality did not
conduct timely criminal background checks for nine individuals associated with our sampled
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expenditure transactions. These deficiencies occurred because the Municipality did not have
adequate controls in place to ensure proper financial management and compliance with criminal
background checks. As a result, the Municipality did not minimize the risk of fraud, waste, and
abuse of Federal funds, and potentially jeopardized the safety of children.
The Municipality did not indicate concurrence or nonconcurrence with our recommendations,
including that it reinforce existing financial management policies and procedures and ensure that
criminal background checks are completed within required timeframes.
Operational Challenges Within ORR and the ORR EIS at Fort Bliss Hindered Case Management for
Children (OEI-07-21-00251), September 2022
We found that operational challenges within the Office of Refugee Resettlement (ORR)—which is
part of ACF—and at the ORR EIS at Fort Bliss, Texas, hindered case management from the facility’s
opening in March 2021 through June 2021. (This EIS is one of 14 that ORR opened in 2021 to
handle the substantial increase in unaccompanied children arriving at the U.S. southern border.)
These challenges may have adversely affected children’s well-being while in ORR care and their
safety following their release to sponsors (i.e., parents, guardians, or relatives or other parent-
designated individuals).
ACF concurred with all five of our recommendations, which were that: (1) ACF should develop and
issue a plan that supports ORR and its contractors in securing qualified case managers during an
influx to help ensure children’s safe and timely release to sponsors, (2) ACF should provide case
managers with timely and comprehensive training and support to help ensure children’s safe and
timely release to sponsors, (3) ACF should create an emergency policy development protocol that
ensures that ORR field guidance developed during an influx receives adequate input from career
staff with expertise in child welfare, (4) ACF should ensure that ORR’s case management system
addresses challenges regarding usability and search capabilities, and (5) ACF should ensure that
ORR’s employees and employees of ORR’s contractors and recipients are informed about Federal
whistleblower protections.
ACF Should Improve Oversight of Head Start To Better Protect Children’s Safety (OEI-BL-19-00560),
September 2022
ACF is not aware of all incidents in which children in the care of a Head Start center are abused, left
unsupervised, or released to an unauthorized person, impeding ACF’s efforts to protect children’s
safety. Head Start grant recipients did not always comply with Federal requirements to self-report
all incidents of child abuse, lack of supervision, or unauthorized release. Furthermore, using data
from 2 States, OIG identified 130 such incidents that occurred in Head Start centers but of which
ACF was not aware. Our findings can help ACF ensure that it is aware of all significant incidents
and can take appropriate action to protect children’s safety.
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ACF concurred with all four of our recommendations, which were that: (1) ACF should improve
Head Start grant recipients’ self-reporting of incidents of child abuse, lack of supervision, and
unauthorized release through better guidance and stronger consequences for failure to report; (2)
ACF should extend the reporting requirement to include incidents of child abuse, lack of
supervision, and unauthorized release in blended classrooms in which the victim is not a Head
Start-funded child; (3) ACF should improve data-sharing with States about incidents of child abuse,
lack of supervision, and unauthorized release in Head Start centers; and (4) ACF should disseminate
information about innovative practices that Office of Head Start regional offices have developed to
better identify and prevent incidents that threaten children’s safety.
Indiana Did Not Comply With Requirements for Documenting Psychotropic and Opioid Medications
Prescribed for Children in Foster Care (A-05-21-00020), September 2022
Indiana did not always comply with State requirements related to the psychotropic and opioid
medications prescribed for children in foster care who were eligible for assistance under Title IV-E
of the Act. Specifically, we found that: (1) the health care records for 109 of the 115 children in the
sample did not contain medical passports, (2) the psychotropic or opioid medications prescribed
for 76 of the 115 children were not recorded in the Management Gateway for Indiana’s Kids system,
(3) the health care records for 49 of the 85 children in the sample who were prescribed
psychotropic medications did not include authorizations for those medications, and (4) the health
care records for 13 of the 21 children residing in residential facilities and prescribed psychotropic
medications did not contain the required written reports and medical reviews from the prescribing
health care providers.
Indiana concurred with our recommendations, including that it: (1) ensure that health care records
for the children under its care and supervision are maintained in accordance with State
requirements by providing training, technical assistance, and implementing additional controls and
procedures; (2) obtain the psychotropic medication authorizations for the children in the sample
who are currently in foster care and did not have the authorizations documented; and (3) continue
efforts with the Indiana Family and Social Services Administration to obtain access to Medicaid
claim history.
Safety of Children in Foster Care
In Five States, There Was No Evidence That Many Children in Foster Care Had a Screening for Sex
Trafficking When They Returned After Going Missing (OEI-07-19-00371), July 2022
In five States, we found that the case file documentation for two-thirds of children lacked evidence
that they were screened to identify whether they were victims of sex trafficking when they returned
to foster care after going missing, as required by Federal law. For some of the children who were
screened, their case file documentation lacked information to ensure that the children were
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accurately identified as possible victims of sex trafficking. As a result, many children’s risks and
potential needs may have gone unidentified and unaddressed, and ACF cannot be assured that
children in foster care are protected from the dangers of sex trafficking, or that victims of sex
trafficking are identified and are provided with needed support services.
ACF concurred with all recommendations, which were that: (1) ACF should work with States to
improve compliance with requirements to screen children who return to foster care after going
missing to identify whether they are victims of sex trafficking, (2) ACF should encourage all States
to evaluate the value of adding an assessment of risk for sex trafficking when children return to
foster care after going missing, and (3) ACF should conduct oversight activities to identify States
that may not screen all children for sex trafficking when they return to foster care after going
missing.
Health Resources and Services Administration
The Health Resources and Services Administration Should Improve Its Oversight of the Cybersecurity
of the Organ Procurement and Transplantation Network (A-18-21-11400), August 2022
The Health Resources and Services Administration (HRSA) had ensured that most of the general IT
controls that we selected to test were implemented for the Organ Procurement and
Transplantation Network (OPTN) by the United Network for Organ Sharing (UNOS) to protect the
confidentiality, integrity, and availability of transplant data in accordance with Federal
requirements. However, we identified areas for which HRSA could improve its oversight of UNOS
to ensure that all Federal cybersecurity requirements are being met in a timely manner. We noted
that HRSA could improve its oversight of UNOS to ensure that UNOS performs adequate reviews
of local user access of the OPTN, and that certain key cybersecurity policies and procedures were
finalized and in place.
We recommend that HRSA develop additional oversight controls and procedures (e.g., deliverable
schedules, compliance assessments, and monitoring) to ensure that the OPTN contractor complies
with all Federal cybersecurity requirements and implements security controls over the OPTN in an
effective and timely manner. HRSA stated that it has made efforts to continuously strengthen its
oversight and controls over OPTN.
HHS’s and HRSA’s Controls Related to Selected Provider Relief Fund Program Requirements Could Be
Improved (A-09-21-06001), September 2022
In the context of unprecedented challenges from the COVID-19 national emergency, HHS and
HRSA developed controls related to selected Provider Relief Fund (PRF) program requirements
designed to ensure that providers received the correct PRF payments from the Phase 1 General
Distribution in a fast, fair, and transparent manner. However, we determined that some of these
controls could be improved.
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Because of statutory requirements, HHS and HRSA prioritized rapid disbursement of payments
over the risk of making improper payments, because HHS and HRSA determined that activities to
lower the risk would have delayed the payments. As HRSA fully implements postpayment quality
control review processes, it should consider the information and recommendations in this
report. In addition, HHS should use the information and recommendations when determining
lessons learned and look for additional ways to safeguard taxpayers’ money when rapidly
disbursing assistance payments to health care providers in response to future national
emergencies.
HRSA concurred with all of our recommendations, including that it continue to perform
postpayment quality control reviews of selected providers, consider reviewing 189 providers that
were identified for manual review, and seek repayment of any overpayments from providers. We
also recommended that HRSA ensure that the HHS Program Support Center collects payments
made to selected providers that did not return their rejected payments as of March 9, 2022.
Furthermore, we recommended that HRSA could conduct a cost-benefit analysis for manual review
of additional providers and, if the benefit outweighs the cost, it could select additional providers
for review.
Substance Abuse and Mental Health Services Administration
Louisiana Faced Compliance and Contracting Challenges in Implementing Opioid Response Grant
Programs (A-06-20-07003), April 2022
Louisiana implemented State Targeted Response (STR) grant programs by expanding prevention,
treatment, and recovery services for opioid use disorder. However, we found that Louisiana faced
challenges in complying with Federal regulations related to reporting and oversight. Additionally,
Louisiana met program goals of the STR grant for prevention, treatment, and recovery services, but
did not adequately address challenges it faced meeting grant terms.
During the first year of the State Opioid Response (SOR) grant, Louisiana implemented a
collaborative approach to enhance and expand the capacity of treatment providers. Louisiana
created crisis mobile teams to increase outreach to community programs by partnering with the
local governing entities (LGEs) and expanded access to recovery support services by increasing safe
recovery housing. Louisiana complied with Federal regulations related to the SOR grant. However,
we found that Louisiana did not meet treatment services and naloxone distribution goals during
the first year of its SOR grant.
Louisiana concurred with our recommendations that it: (1) develop a process to ensure accurate
reporting on the Annual Progress Reports, (2) improve monitoring of subrecipients to ensure that
distribution of naloxone kits are tracked and distribution requirements are met, (3) work with the
LGEs and OTPs to identify ways to support clients’ access to transportation to obtain treatment and
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determine how transportation could be addressed in each specific region of the State, and (4)
review the contracting process to determine whether there are ways to expedite the process to
provide funds to subrecipients and outside organizations in a timely manner.
Legal and Investigative Activities Related to
Public Health and Human Service Agencies
Health Education Assistance Loan Program Exclusions
OIG excludes from Federal health care programs individuals who have defaulted on Health Education
Assistance Loan (HEAL) loans. Under the HEAL program, which stopped making loans in 1998, HRSA
guaranteed commercial loans to students seeking education in health-related fields. The students can
defer repayment of the loans until after they graduate and begin to earn income. Although HHS’s
Program Support Center (PSC) takes steps to ensure repayment, some loan recipients do not resolve their
debt. After PSC has exhausted efforts to secure repayment of a debt, it declares an individual in default.
The Social Security Act permits that thereafter, such individuals may not receive reimbursement under
Medicare, Medicaid, and all other Federal health care programs for nonpayment of the loans.
Currently, there is a moratorium on collection activities. Accordingly, PSC is not referring any individuals in
default at this time. Therefore, OIG has no figures to report for this semiannual reporting period.
Child Support Enforcement Activities
OIG Investigations
OIG investigates noncustodial parents who violate 18 U.S.C. § 228 by failing to pay court-ordered
child support. OIG works with ACF’s Office of Child Support Enforcement; DOJ; U.S. Attorneys’
Offices; the U.S. Marshals Service; and Federal, State, and local partners to address egregious child
support enforcement cases with appropriate law enforcement and prosecutorial action. During this
semiannual reporting period, OIG investigations of child support enforcement cases nationwide
resulted in zero criminal actions and no court-ordered restitution or settlements.
Engaging the Public in Capturing Deadbeat Parents
Because of the success of OIG’s Most Wanted Fugitives website, OIG launched its Most Wanted
Deadbeat Parents website. The site identifies parents who fail to pay court-ordered child support
for their children and thereby put an unnecessary strain on the custodial parents and the children
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as well as on agencies that enforce these matters. The site, which is updated frequently, includes
information on OIG’s role in pursuing parents who fail to pay court-ordered child support. OIG’s
Most Wanted Deadbeat Parents website can be found at https://oig.hhs.gov/fraud/child-support-
enforcement/index.asp.
Other HHS-Related Reviews and Investigative
Activities
Cross-Cutting Medicare and Medicaid
Selected Dialysis Companies Implemented Additional Infection Control Policies and Procedures To
Protect Beneficiaries and Employees During the COVID-19 Pandemic (A-05-20-00052), May 2022
The nine selected dialysis companies surveyed (representing 83 percent of the ESRD facilities that
had a Medicare or Medicaid certification at any point during 2020) implemented additional
infection control policies and procedures in accordance with CMS and CDC recommendations to
protect high-risk ESRD beneficiaries and employees during the COVID-19 pandemic. We found
that all nine companies had infection control policies and procedures in place to protect
beneficiaries and employees, and when recommended by CMS and CDC, the companies
implemented additional policies and procedures. However, although two companies provided
education about the importance of hand hygiene, they did not emphasize the importance of hand
hygiene immediately before and after any contact with a face mask or cloth face covering, as
recommended by CDC.
Because the nine selected companies implemented additional infection control policies and
procedures as recommended by CMS and CDC, this report contains no recommendations.
An Estimated 91 Percent of Nursing Home Staff Nationwide Received the Required COVID-19 Vaccine
Doses, and an Estimated 56 Percent of Staff Nationwide Received a Booster Dose (A-09-22-02003),
June 2022
On the basis of our sample results, as of the week ended March 27, 2022, we estimated that 91
percent of staff nationwide had received the required vaccine doses, 56 percent of staff nationwide
had received a booster dose, and 6 percent of staff nationwide had been granted a religious
exemption. We did not estimate the percentages among the small number of staff members (i.e.,
38) in our nationwide sample results who were partially vaccinated, who were granted a medical
exemption, who applied for an exemption that was being reviewed, or for whom the vaccination
status could not be determined.
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In addition, the estimated percentages of staff who received the required vaccine doses, staff who
received a booster dose, and staff who were granted a religious exemption varied depending on
the locations (i.e., HHS regions) of the nursing homes in which they worked. This report includes
no recommendations.
The Centers for Medicare & Medicaid Services Had Policies and Procedures in Place To Mitigate
Vulnerabilities in a Timely Manner, but Improvements Are Needed (A-18-20-06500), June 2022
CMS had cybersecurity controls in place to remediate known vulnerabilities in accordance with
Federal regulations and standards; however, it did not consistently apply security updates to
systems with known vulnerabilities and did not consistently upgrade or patch operating systems
that had reached the end-of-life period and were no longer supported by the vendor. This
occurred because CMS did not have effective management oversight to ensure that CMS mitigated
vulnerabilities in a timely manner. As a result, some CMS systems had open vulnerabilities that
were vulnerable to exploitation by malicious actors beyond the acceptable limits defined in Binding
Operational Directive (BOD) 19-02.
CMS concurred with our recommendations that it: (1) remediate the vulnerabilities identified on
internet-facing systems and implement procedures to ensure compliance with BOD 19-02
requirements; (2) implement procedures to ensure that unsupported software that no longer
receives security updates, repairs, bug fixes, and threat mitigation is replaced prior to the known
end of support or implement compensating controls (if possible) and accept risk in accordance
with existing CMS policies and procedures; (3) implement oversight to ensure that corrective
actions are performed in accordance with Federal requirements and in the timeframe set forth in
CMS policy; and (4) implement a process to centralize the monitoring and reporting of
vulnerabilities identified in all CMS systems across all CMS data centers.
Certain Nursing Homes May Not Have Complied With Federal Requirements for Infection Prevention
and Control and Emergency Preparedness (A-01-20-00005), July 2022
Selected nursing homes may not have complied with Federal requirements for infection prevention
and control and emergency preparedness. Specifically, 28 of the 39 nursing homes had possible
deficiencies. We found 48 instances at 25 nursing homes of possible noncompliance with infection
prevention and control requirements and 18 instances at 18 nursing homes of possible
noncompliance with emergency preparedness requirements related to all-hazards risk assessments
and strategies to address emerging infectious diseases. The nursing homes attributed the possible
noncompliance to: (1) nursing home inadequate internal controls, (2) nursing home inadequate
management oversight, (3) nursing home administrative and leadership changes, (4) inadequate
communication and training from CMS, and (5) inconsistent and confusing regulations.
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CMS generally agreed with our recommendations that it: (1) instruct SSAs to follow up with the 28
nursing homes that we have identified with potential infection prevention and control and
emergency preparedness deficiencies to ensure that they have taken corrective actions,
(2) issue updated phase 3 interpretive guidance as soon as feasible, (3) provide training to SSAs on
the updated phase 3 interpretive guidance as soon as feasible, and (4) consider updating the
regulation to make clear that nursing homes must include emerging infectious diseases as a risk on
their facility- and community-based all-hazards risk assessments.
Audits of Nursing Home Life Safety and Emergency Preparedness in Eight States Identified
Noncompliance With Federal Requirements and Opportunities for the Centers for Medicare
& Medicaid Services To Improve Resident, Visitor, and Staff Safety (A-02-21-01010), July 2022
We identified a total of 2,233 areas of noncompliance with life safety and emergency preparedness
requirements at 150 of the 154 nursing homes we visited. As a result, residents, visitors, and staff at
the nursing homes were at increased risk of injury or death during a fire or other emergency. CMS
subsequently followed up with State survey agencies to determine whether they had addressed the
recommendations included in our prior audits. According to CMS, the States had already taken
acceptable actions to address our recommendations.
We identified several opportunities for CMS to expand on its life safety requirements for nursing
homes to improve the safety of residents, visitors, and staff. Among other findings, CMS could
propose regulations requiring nursing homes to install carbon monoxide detectors according to
national standards. We also noted areas in which CMS could improve its support for State survey
operations and nursing home training. CMS could work with State survey agencies to address
issues preventing more frequent surveys of high-risk facilities and require mandatory participation
in standardized nursing home staff training.
We made a series of recommendations to CMS to address our findings, including that it propose
regulations requiring nursing homes to install carbon monoxide detectors and work with States to
encourage mandatory participation in standardized training for nursing home staff. CMS generally
agreed with our recommendations and described steps it has taken or plans to take to address
them.
UPICs Hold Promise To Enhance Program Integrity Across Medicare and Medicaid, but Challenges
Remain (OEI-03-20-00330), September 2022
Although Unified Program Integrity Contractors (UPICs) hold promise for leveraging cross-program
consolidation to strengthen oversight across Medicare and Medicaid, improvements are needed to
better combat fraud, waste, and abuse—particularly in Medicaid. The UPICs conducted only
minimal activities related to Medicaid managed care, even though most Medicaid enrollees receive
services through managed care. We also found wide unexplained disparities in program integrity
activities across UPICs, even after adjusting for the size of their respective oversight responsibilities.
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However, the development of collaborative processes, analytical tools, and new technologies
across the UPICs—including the Unified Case Management System and Major Case Coordination
initiative—helps to achieve the benefits of unifying program integrity activities. Our findings can
help CMS identify ways to strengthen UPICs’ abilities to detect and deter fraud, waste, and abuse in
both Medicare and Medicaid.
CMS concurred with all of our recommendations, which were that: (1) CMS should implement a
plan to increase UPICs’ Medicaid program integrity activities, particularly related to managed care;
(2) CMS should make improvements to the Unified Case Management System; (3) CMS should
implement a plan to help ensure the success of the Major Case Coordination initiative for Medicaid
referrals; and (4) CMS should identify the reasons for the unexplained variation in program integrity
activities across UPICs.
General Departmental
Review of the Department of Health and Human Services’ Compliance With the Federal Information
Security Modernization Act of 2014 for Fiscal Year 2021 (A-18-21-11200), April 2022
Overall, through the evaluation of FISMA metrics, it was determined that HHS’s information
security program was Not Effective. This determination was made based on HHS not meeting the
Managed and Measurable maturity level for the Identify, Protect, Detect, and Recover function
areas as required by DHS guidance and the FY 2021 Inspector General FISMA Reporting Metrics.
However, HHS continues to implement changes to strengthen the maturity of its enterprisewide
cybersecurity program. We identified opportunities where HHS can strengthen its overall
information security program.
We made recommendations to the Office of the Chief Information Officer that should further
strengthen HHS’s cybersecurity program and enhance information security controls at HHS.
Recommendations specific to deficiencies found at the reviewed HHS OpDivs were provided
separately.
Department of Health and Human Services Met Many Requirements, but It Did Not Fully Comply
With the Payment Integrity Information Act of 2019 and Applicable Improper Payment Guidance for
the Fiscal Year 2021 (A-17-22-52000), May 2022
Ernst & Young (EY), LLP, determined that HHS met many requirements but did not fully comply
with the Payment Integrity Information Act of 2019 (PIIA). Among the items required for
compliance with PIIA that HHS complied with, EY determined that HHS: (1) published the Agency
Financial Report for FY 2021; (2) conducted risk assessments for 38 programs not susceptible to
improper payments and determined that the programs were not at risk for improper payments;
and (3) published corrective action plans for 8 of the 11 programs that are susceptible to significant
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improper payments as determined by HHS management, OMB, or through legislation. EY also
determined that HHS developed a plan to meet improper payment and unknown payment
reduction targets for 7 of 11 programs, and also reported an improper and unknown payment rate
of less than 10 percent for 5 of the 11 programs.
EY concluded that HHS did not comply with several other PIIA requirements. EY found HHS: (1) did
not report an improper and unknown payment estimate for the Temporary Assistance for Needy
Families program, advanced premium tax credit, and foster care; (2) reported improper and
unknown payment rates in excess of 10 percent for Medicaid, the Children’s Health Insurance
Program, and Medicare Advantage; and (3) had completed minimal recovery audit activities for the
identified improper payments for the Medicare Advantage and Medicare Prescription Drug Benefit
programs.
Cost Allocation Services Needs To Update Its Indirect Cost Rate-Setting Guidance (A-06-20-01000),
June 2022
We found that Cost Allocation Services’ (CAS’s) indirect cost rate-setting process for nonprofit
organizations did not always comply with Federal regulations and its own policies. Specifically, we
found that: (1) CAS did not ensure compliance with Federal regulations when negotiating indirect
cost rates, (2) CAS did not always follow its Review Guide, (3) CAS did not always follow its internal
guidance or negotiate rates in a timely manner, and (4) indirect cost rate proposals included
potentially unallowable compensation costs. These errors occurred because CAS had not updated
the Review Guide since 2003 to ensure that it reflected Federal requirements and its internal
guidance. According to CAS officials, CAS also faced issues with the heavy workload associated
with negotiating indirect cost rates and has been unable to fill positions for negotiators and branch
chiefs lost through attrition.
CAS generally concurred with our recommendation that it: (1) update its Review Guide to include
applicable Federal regulations and CAS internal policies and procedures and (2) provide training to
its branch chiefs and negotiators to ensure that its indirect cost rate-setting process conforms with
Federal regulations. Additionally, CAS should review its staffing levels and determine whether they
are sufficient to meet the agency’s objectives and seek clarification on whether the executive
compensation policy complies with Federal law and Governmentwide policy.
HHS Made Some Progress Toward Compliance With the Geospatial Data Act (A-18-22-11400),
September 2022
HHS made some progress toward compliance with the Geospatial Data Act (GDA), but we
identified certain covered agency responsibilities that HHS had yet to meet. Additionally, HHS had
not maintained a departmentwide inventory of all geospatial data assets, or accurately reported its
achievements in implementing the GDA requirements, as required by GDA section 759(b).
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These conditions occurred because there was limited Departmentwide oversight and coordination
in HHS’s implementation of geospatial-related responsibilities, requirements, policies, and activities.
These conditions contributed to HHS’s noncompliance with the covered agency responsibilities
established in the GDA. As a result, HHS is susceptible to inefficient and ineffective management
of geospatial assets, which increases the risk of inconsistent efforts or inability to minimize the
costs to acquire, manage, share, and use geospatial data, expertise, technology, and services.
HHS concurred with our recommendations that it: (1) ensure that HHS and its components fully
implement the covered agency responsibilities found in GDA section 759(a); (2) ensure that the
HHS Senior Agency Official for Geospatial Information or designated official oversee, coordinate,
and facilitate HHS’s implementation of the geospatial-related requirements, policies, and activities;
(3) maintain an inventory of all geospatial data assets, per section 759(b) of the GDA; and (4)
prepare the required annual reports or self-assessments based on the status of all of HHS’s
components.
Grants and Contracts
HHS is the largest grantmaking organization and one of the largest contracting agencies in the Federal
Government. In FY 2022, HHS awarded more than $792 billion in grants and more than $33 billion in
contracts across all program areas. OIG’s direct annual discretionary appropriation funding is used to
conduct program integrity and enforcement activities with regard to the more than 100 public health and
human services programs carried out by more than 80,000 employees worldwide. The size and scope of
departmental awards make their operating effectiveness crucial to the success of programs designed to
improve the health and well-being of the public.
Grant Fraud Investigations
The following case example relates to misuse of grant funds:
Tennessee—On August 22, 2022, Patrick Martin was sentenced to 15 months in prison for
embezzling approximately $211,000 from the Community Prevention Coalition of Jackson
County while serving as the Coalition’s Executive Director. Martin was initially charged in
May 2019 and pleaded guilty in August 2021 to wire fraud, failure to pay overemployment
taxes, and filing a false income tax return. According to court documents, beginning in
2014, Martin submitted applications to an agency of the Department of Health and Human
Services for Drug Free Communities program grants and received awards for the Coalition
totaling $375,000 over 3 years. Martin was supposed to use the grant funds on behalf of
the Coalition, but instead used the money for his own personal benefit, including to make
an automobile purchase, pay personal bills, make home renovations, and provide financial
support to someone outside of his family. As the Executive Director of the Coalition, Martin
also was responsible for paying over certain employment taxes withheld from employees’
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paychecks to the IRS. Martin failed to do so and used this money for his own personal
benefit as well. Martin also filed false income tax returns with the IRS for tax years 2014 and
2015, failing to report the income from his embezzlement scheme.
Martin was also ordered to pay restitution in the amount of $507,373.76, with $375,000 to
be paid to HHS’s Substance Abuse and Mental Health Services Administration, the agency
that awarded the grant; and $132,373.76 to be paid to the IRS. Martin was also ordered to
forfeit $211,795.84.
Small Business Innovative Research Program
The National Defense Authorization Act for Fiscal Year 2012, § 5143, requires OIG to report annually
on the number of cases referred to OIG to fraud, waste, or abuse in the Small Business Innovation
Research/Small Business Technology Transfer (SBIR/STTR) program. OIG must also report on the
actions taken in each case; justification for not taking action on a case; and an accounting of funds
used to address waste, fraud, and abuse in this program. From October 1, 2022, through
September 30, 2022, OIG received zero referrals related to potential fraud, waste, or abuse with
respect to HHS SBIR/STTR programs, and no cases were opened. For FY 2022, there was
approximately one civil action with total money associated at $541,531. The total number of case
hours worked was 654.25 for a total cost of case time of $129,214.38. At the end of FY 2022, OIG
was working on one SBIR/STTR investigation.
Recovery Act Retaliation Complaint Investigations
The Recovery Act, § 1553, prohibits non-Federal employers that have received Recovery Act
funding from retaliating against employees who disclose evidence of mismanagement of Recovery
Act funds or any violation of law related to Recovery Act funds. OIGs are required to include in
their Semiannual Report the retaliation complaint investigations that they decided not to conduct
or continue during the reporting period. During this semiannual reporting period, OIG did not
close, decline, or give extensions on Recovery Act Retaliation Complaint investigations of
whistleblower retaliation.
Contract Audits
Pursuant to the National Defense Authorization Act for FY 2008, § 845, OIGs appointed under the
Inspector General Act of 1978 are required to submit information on final completed contract audit
reports issued during the period to the contracting activity as part of their semiannual report,
pursuant to section 5 of the Inspector General Act. This information must contain significant audit
findings. OIG issued no final reports meeting § 845 criteria during this semiannual reporting
period.
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OIG Reviews of Non-Federal Audits
OIG reviews audits conducted by non-Federal auditors of entities receiving Federal awards. During
this semiannual reporting period, OIG’s Single Audit Division reviewed 261 reports covering
$2.1 trillion in audited costs. Federal dollars covered by these audits totaled $994.6 billion, of which
about $374.9 billion were HHS funds.
Uniform guidance at 2 CFR 200 Subpart F establishes audit requirements for State and local
governments, colleges and universities, and nonprofit organizations receiving Federal
awards. Under the uniform guidance, covered entities must conduct annual organizationwide
“single audits” of all Federal money they receive. These audits are conducted by non-Federal
auditors, such as public accounting firms and State auditors. OIG reviews the quality of these
audits and assesses the adequacy of the entities’ management of Federal funds.
OIG’s oversight of non-Federal audit activity informs Federal managers about the soundness of
management of Federal programs and identifies any significant areas of internal control weakness,
noncompliance, and questioned costs for resolution or followup. We identify entities for high-risk
monitoring, alert program officials to any trends that could indicate problems in HHS programs,
and profile non-Federal audit findings of a particular program or activity over time to identify
systemic problems. We also provide training and technical assistance to grantees and members of
the auditing profession. OIG maintains a process to assess the quality of the non-Federal reports
received and the audit work that supports the selected reports.
OIG’s reports on non-Federal audits reviewed during this reporting period are categorized in the
following table.
Non-Federal Audits, April 1, 2022, Through September 30, 2022
Not requiring changes or having minor changes 209
Requiring major changes 5
Having significant technical inadequacies 47
Total Number of Non-Federal Audits 261
Other Reporting Requirements and Reviews
Legislative and Regulatory Reviews
Pursuant to the Inspector General Act, § 4(a)(2), OIG is required to review existing and proposed
legislation and regulations relating to HHS’s programs and operations and make recommendations
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concerning their impact on economy and efficiency or the prevention and detection of fraud and
abuse. Most audits and other reviews that we conduct are designed to test compliance with
and/or assess the administration and oversight of existing laws and regulations. Our reports of
such reviews describe findings, which include questioned costs, inefficiencies, vulnerabilities to
fraud, inconsistencies, errors in application, or weaknesses in oversight or supporting systems. Our
corresponding recommendations tell HHS and its OpDivs or StaffDivs what administrative,
regulatory, or legislative actions we believe are needed to effectively respond to the findings. Our
regularly published core publications reflect the relationship between our work and laws and
regulations.
• This report, like our previous Semiannual Reports, describes findings and recommendations
from recently completed reviews, many of which focus on existing laws and regulations.
• OIG’s Top Unimplemented Recommendations: Solutions To Reduce Fraud, Waste, and Abuse in
HHS Programs describes priority findings and recommendations from past periods that remain
to be implemented.
• Our Work Plan provides citations to laws and regulations that are the subject of ongoing or
future reviews.
We also review proposed legislation and regulations related to HHS programs and operations. In
addition, we provide independent, objective technical assistance on a bipartisan, bicameral basis to
congressional committees and members who request it.
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Appendix A: Questioned Costs and Funds To
Be Put to Better Use
The following tables summarize OIG’s monetary recommendations and HHS responses to them. This
information is provided in accordance with the Inspector General Act, §§ 5(a)(8) and (a)(9) (5 U.S.C. App. §§
5(a)(8) and (a)(9)), and the Supplemental Appropriations and Rescissions Act of 1980.
The lists of issued reports includes all reports and is provided in accordance with the Inspector General Act,
§§ 5(a)(6).
Audit Reports With Questioned Costs
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 law, regulation, contract, grant, cooperative
agreement, or other agreement or document governing the expenditure of funds; (2) a cost that is not
supported by adequate documentation at the time of the audit; or (3) the expenditure of funds for the
intended purpose is unnecessary or unreasonable. Questioned costs that HHS program officials have, in a
management decision, sustained or agreed, should not be charged to the Government are disallowed
costs. Superscripts indicate end notes that follow the tables below.
Table 1: Audit Reports With Questioned Costs
Number of Dollar Value Dollar Value
Description Reports Questioned Unsupported
Section 1
Reports for which no management decisions had been
made by the beginning of the reporting period 1 42 $1,688,550,000 $1,060,782,000
Issued during the reporting period2 27 $612,549,000 $115,075,000
Total Section 1 69 $2,301,099,000 $1,175,857,000
Section 2
Reports for which management decisions were made
during the reporting period3
Disallowed costs 17 *$62,898,000 $687,000
Costs not disallowed 2 $637,950,000 $636,621,000
Total Section 2 19 $700,848,000 $637,308,000
* Audit receivables (expected recoveries).
Section 3
Reports for which no management decisions had been
made by the end of the reporting period
(Section 1–Section 2)4 50 $1,600,251,000 $538,549,000
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Section 4
Reports for which no management decisions were made
within 6 months of issuance5 24 $594,970,000 $0
Table 1 End Notes
1
The opening balance was adjusted upward by $6.5 million because of a reevaluation of previously issued
recommendations.
2
An issued report containing recommendations for both questioned costs and funds put to better use will
be counted in Table 1 and Table 2.
3
Revisions to previously reported management decisions:
A-05-17-00038, Indiana Claimed Unallowable Federal Reimbursement for Some Medicaid Physician-
Administered Drugs. CMS subsequent review determined that disallowed cost should be reduced by
$431,000.
4
Included are management decisions submitted during the period on $428,126,000 which are under
management review.
5
Because of administrative delays, some of which were beyond management control, resolution of the
following 24 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.
Audits for Which No Management Decision Was Received Within 6 Months of Issuance
Audit CIN Audit Title
A-07-16-01165 Medicare Advantage Compliance Audit of Diagnosis Codes That Humana, Inc.
(Contract H1036), Submitted to CMS, APR 2021, $197,720,651
A-02-14-02017 New York Misallocated Costs to Establishment Grants for a Health Insurance
Marketplace, NOV 2016, $149,654,512
A-07-17-01169 Medicare Advantage Compliance Audit of Diagnosis Codes That SCAN Health Plan
(Contract H5425), Submitted to CMS, FEB 2022, $54,318,154
A-01-14-02503 Maryland Misallocated Millions to Establishment Grants for a Health Insurance
Marketplace, MAR 2015, $28,400,000
A-04-14-07050 Kentucky Misallocated Millions to Establishment Grants for a Health Insurance
Marketplace, FEB 2017, $25,530,429
A-07-18-04111 Mississippi Needs To Improve Oversight of Its Child Care Payment Program, APR
2020, $22,284,900
A-02-15-02008 New York Did Not Comply With Federal Grant Requirements for Allocating and
Claiming Marketplace Contract Costs, DEC 2017, $20,415,344
87
Department of Health and Human Services, Office of Inspector General
Semiannual Report to Congress—April 1, 2022, Through September 30, 2022
A-07-15-04226 Not All of Missouri's Child Care Subsidy Program Payments Complied With Federal
and State Requirements, NOV 2017, $19,076,167
A-07-19-01188 Medicare Advantage Compliance Audit of Specific Diagnosis Codes That UPMC
Health Plan, Inc. (Contract H3907) Submitted to CMS, NOV 2021, $6,401,297
A-02-18-01028 Medicare Advantage Compliance Audit of Specific Diagnosis Codes That Blue Cross
Blue Shield of Michigan (Contract H9572) Submitted to CMS, FEB 2021, $14,534,375
A-06-17-07004 Southwest Key Programs Failed To Protect Federal Funds Intended for the Care and
Placement of Unaccompanied Alien Children, SEP 2020, $13,130,848
A-01-15-02500 Vermont Did Not Properly Allocate Millions to Establishment Grants for a Health
Insurance Marketplace, SEP 2016, $11,243,006
A-09-21-03002 Medicare Improperly Paid Physicians for Spinal Facet-Joint Denervation Sessions, DEC
2021, $9,528,296
A-02-18-01029 Medicare Advantage Compliance Audit of Specific Diagnosis Codes That Healthfirst
Health Plan, Inc., (Contract H3359) Submitted to CMS, JAN 2022, $5,221,901
A-01-19-00500 Medicare Advantage Compliance Audit of Specific Diagnosis Codes That Tufts Health
Plan (Contract H2256) Submitted to CMS, FEB 2022, $3,758,335
A-07-19-01187 Medicare Advantage Compliance Audit of Specific Diagnosis Codes That Anthem
Community Insurance Company, Inc. (Contract H3655) Submitted to CMS, MAY 2021,
$3,468,954
A-02-16-02013 The Children's Village Inc., an Administration for Children and Families Grantee, Did
Not Always Comply With Applicable Federal and State Policies and Requirements,
APR 2019, $2,623,785
A-07-17-02808 The Colorado Health Insurance Marketplace’s Financial Management System Did Not
Always Comply With Federal Requirements, JUL 2018, $2,567,604
A-07-11-06013 The University of Colorado Denver Did Not Always Claim Selected Costs Charged
Directly to Department of Health and Human Services Awards in Accordance With
Federal Regulations, JUN 2013, $1,419,524
A-05-14-00045 The Minnesota Marketplace Misallocated Federal Funds and Claimed Unallowable
Costs, NOV 2016, $1,279,677
A-02-18-02011 Gateway Community Action Partnership Claimed Unallowable Costs, Did Not
Comply With Federal Regulations on Construction and Major Renovations, and Did
Not Accurately Account for Grant Funds, MAY 2021, $932,907
A-09-14-01007 Nevada Misallocated Costs for Establishing a Health Insurance Marketplace to Its
Establishment Grants, FEB 2016, $893,464
A-07-17-01173 Medicare Advantage Compliance Audit of Specific Diagnosis Codes That Coventry
Health Care of Missouri, Inc. (Contract H2663) Submitted to CMS, OCT 2021,
$548,852
A-03-16-00250 Youth for Tomorrow–New Life Center, Inc., an Administration for Children and
Families Grantee, Did Not Comply With All Applicable Federal Policies and
Requirements, SEP 2020, $16,851
TOTAL CINS: 24
TOTAL AMOUNT: $594,970,000
88
Department of Health and Human Services, Office of Inspector General
Semiannual Report to Congress—April 1, 2022, Through September 30, 2022
Audit Reports With Funds Recommended To Be Put to Better Use
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. Table 2 reports HHS
program officials’ decisions to take action on these audit recommendations.
Table 2: Audit Reports With Funds Put to Better Use
Number of
Description Reports Dollar Value
Section 1
Reports for which no management decisions had been made by the
beginning of the reporting period 9 $17,247,368,000
Reports issued during the reporting period 1
2 $40,039,000
Total Section 1 11 $17,287,407,000
Section 2
Reports for which management decisions were made during the
reporting period
Value of recommendations agreed to by management
Based on proposed management action 2 $116,992,000
Based on proposed legislative action 0 $0
Value of recommendations not agreed to by management 2 $48,756,000
Total Section 2 4 $165,748,000
Section 3
Reports for which no management decisions had been made by the
end of the reporting period1 (Section 1–Section 2)2,3 9 $17,121,659,000
Table 2 End Notes
1
An issued report containing recommendations for both questioned costs and funds put to better use will be
counted in Table 1 and Table 2.
2
Included is a management decision submitted during the period on $15 billion which is under management review.
3
Because of administrative delays, some of which were beyond management control, three of the seven audits open
at end of the period were not resolved within 6 months of report issuance. OIG is working with management to
reach resolution on these recommendations before the end of the next semiannual reporting period.
89
Department of Health and Human Services, Office of Inspector General
Semiannual Report to Congress—April 1, 2022, Through September 30, 2022
Audits for Which No Management Decision Was Received Within 6 Months of Issuance
Audit CIN Audit Title
A-03-17- Hospitals Overbilled Medicare $1 Billion by Incorrectly Assigning Severe Malnutrition Diagnosis Codes to
00010 Inpatient Hospital Claims, JUL 2020, $1,024,623,449
A-03-13- HHS Did Not Identify and Report Antideficiency Act Violations, MAY 2017, $49,445,025
03002
A-07-17- Incorrect Acute Stroke Diagnosis Codes Submitted by Traditional Medicare Providers Resulted in Millions of
01176 Dollars in Increased Payments to Medicare Advantage Organizations, SEP 2020, $14,417,533
TOTAL CINS: 3
TOTAL AMOUNT: $1,088,486,000
Audit Reports by Issue Date
Report Number Title Issued Questioned Funds Put to
Costs Better Use
A-04-18-07078 South Carolina Did Not Fully Comply With 4/1/2022 - -
Requirements for Reporting and Monitoring Critical
Events Involving Medicaid Beneficiaries With
Developmental Disabilities
A-05-20-00005 Posthospital Skilled Nursing Facility Care Provided to 4/7/2022 - -
Dually Eligible Beneficiaries in Indiana Generally Met
Medicare Level-of-Care Requirements
A-06-20-07003 Louisiana Faced Compliance and Contracting 4/8/2022 - -
Challenges in Implementing Opioid Response Grant
Programs
A-09-20-02009 California Improperly Claimed at Least $23 Million of 4/20/2022 $23,139,767 -
$260 Million in Total Medicaid Reimbursement for
Opioid Treatment Program Services
A-01-20-00003 Massachusetts Implemented Our Prior Audit 4/25/2022 - -
Recommendations and Generally Complied With
Federal and State Requirements for Reporting and
Monitoring Critical Incidents
A-18-21-11200 Review of the Department of Health and Human 4/25/2022 - -
Services’ Compliance with the Federal Information
Security Modernization Act of 2014 for Fiscal Year
2021
A-09-21-06000 National Snapshot of Trends in the National Domestic 4/27/2022 - -
Violence Hotline's Contact Data Before and During
the COVID-19 Pandemic
A-17-22-52000 Department of Health and Human Services Met Many 5/9/2022 - -
Requirements, but It Did Not Fully Comply With the
Payment Integrity Information Act of 2019 and
Applicable Improper Payment Guidance for Fiscal
Year 2021
A-09-20-02008 Washington State Did Not Comply With Federal and 5/13/2022 $403,740 -
State Requirements for Claiming Enhanced Federal
Reimbursement for Medicaid Managed-Care Health
Home
90
Department of Health and Human Services, Office of Inspector General
Semiannual Report to Congress—April 1, 2022, Through September 30, 2022
A-07-20-06095 National Snapshot of State Agency Approaches to 5/19/2022 - -
Reporting and Locating Children Missing From Foster
Care
A-05-20-00052 Selected Dialysis Companies Implemented Additional 5/24/2022 - -
Infection Control Policies and Procedures To Protect
Beneficiaries and Employees During the COVID-19
Pandemic
A-06-18-05002 Medicare Advantage Compliance Audit of Specific 5/25/2022 $3,312,219 -
Diagnosis Codes That Peoples Health Network
(Contract H1961) Submitted to CMS
A-06-20-04003 Vanderbilt University Medical Center: Audit of 5/25/2022 $686,500 -
Outpatient Outlier Payments
A-06-20-04004 Texas Did Not Report and Return All Medicaid 5/25/2022 $11,122,401 -
Overpayments for the State's Medicaid Fraud Control
Unit Cases
A-09-20-03016 Medicare Improperly Paid Durable Medical 5/31/2022 $41,137 $11,687,528
Equipment Suppliers an Estimated $8 Million of the
$40 Million Paid for Power Mobility Device Repairs
A-01-21-01501 California Collected and Disbursed Stimulus 6/1/2022 - -
Payments and Income Tax Refunds Under the Federal
Tax Refund Offset Program in Accordance with
Federal and State Requirements
A-06-20-01000 Cost Allocation Services Needs To Update Its Indirect 6/1/2022 - -
Cost Rate-Setting Guidance
A-01-20-00007 Maine Implemented Our Prior Audit 6/6/2022 - -
Recommendations and Generally Complied With
Federal and State Requirements for Reporting and
Monitoring Critical Incidents
A-07-18-02815 Medicare and Beneficiaries Paid Substantially More to 6/10/2022 - -
Provider-Based Facilities in Eight Selected States in
Calendar Years 2010 Through 2017 Than They Paid to
Freestanding Facilities in the Same States for the
Same Types of Services
A-06-21-07002 Office of Refugee Resettlement’s Influx Care Facility 6/22/2022 - -
and Emergency Intake Sites Did Not Adequately
Safeguard Unaccompanied Children From COVID-19
A-01-20-00006 More Than 90 Percent of the New Hampshire 6/23/2022 $7,943,271 -
Managed Care Organization and Fee-for-Service
Claims for Opioid Treatment Program Services Did
Not Comply With Medicaid Requirements
A-09-22-02003 An Estimated 91 Percent of Nursing Home Staff 6/23/2022 - -
Nationwide Received the Required COVID-19 Vaccine
Doses, and an Estimated 56 Percent of Staff
Nationwide Received a Booster Dose
A-01-19-01500 The Food and Drug Administration's Foreign For- 6/24/2022 - -
Cause Drug Inspection Program Can Be Improved To
Protect the Nation's Drug Supply
A-18-20-06500 The Centers for Medicare & Medicaid Services Had 6/29/2022 - -
Policies and Procedures in Place To Mitigate
Vulnerabilities in a Timely Manner, but Improvements
Are Needed
91
Department of Health and Human Services, Office of Inspector General
Semiannual Report to Congress—April 1, 2022, Through September 30, 2022
A-05-19-00019 The Reduced Outlier Threshold Applied to Transfer 7/5/2022 - -
Claims Did Not Significantly Increase Medicare
Payments to Hospitals
A-02-19-01018 Medicare Hospice Provider Compliance Audit: Vitas 7/14/2022 $140,370,745 -
Healthcare Corporation of Florida
A-02-21-01010 Audits of Nursing Home Life Safety and Emergency 7/15/2022 - -
Preparedness in Eight States Identified
Noncompliance With Federal Requirements and
Opportunities for the Centers for Medicare &
Medicaid Services to Improve Resident, Visitor, and
Staff Safety
A-02-20-01009 Medicare Advantage Compliance Audit of Specific 7/18/2022 $9,212,531 -
Diagnosis Codes That Cariten Health Plan, Inc.,
(Contract H4461) Submitted to CMS
A-03-20-00002 Medicare Critical Care Services Provider Compliance 7/19/2022 $6,015 -
Audit: Lahey Clinic Inc.
A-04-18-03085 CMS Reported Collecting Just Over Half of the 7/25/2022 - -
$498 Million in Medicare Overpayments Identified by
OIG Audits
A-01-20-00005 Certain Nursing Homes May Not Have Complied 7/26/2022 - -
With Federal Requirements for Infection Prevention
and Control and Emergency Preparedness
A-18-22-11300 Review of Medicare Administrative Contractor 7/27/2022 - -
Information Security Program Evaluations for Fiscal
Year 2021
A-04-22-04088 The National Institutes of Health Administered 8/10/2022 - -
Superfund Appropriations During Fiscal Year 2021 in
Accordance With Federal Requirements
A-07-21-07003 South Carolina Did Not Always Invoice Rebates to 8/10/2022 $15,851,354 -
Manufacturers for Physician-Administered Drugs
A-06-21-07000 The National Institutes of Health Did Not Ensure That 8/12/2022 - -
All Clinical Trial Results Were Reported in Accordance
With Federal Requirements
A-17-22-00009 Independent Service Auditor’s Report on the 8/15/2022 - -
Department of Health & Human Services’ Program
Support Center, Grants Finance and Administrative
Services, Payment Management System for the
Period October 1, 2021–June 30, 2022
A-17-22-00010 Independent Service Auditor’s Report on the 8/15/2022 - -
Department of Health & Human Services, Center for
Information Technology at the National Institutes of
Health, Information Technology General Controls
System for the UNIX and Windows Environments
A-03-18-00002 Medicare Advantage Compliance Audit of Diagnosis 8/19/2022 $39,612 -
Codes That Cigna HealthSpring of Florida, Inc.
(Contract H5410) Submitted to CMS
A-09-21-01000 Nevada’s Monitoring Did Not Ensure Child Care 8/23/2022 - -
Provider Compliance With State Criminal Background
Check Requirements at 9 of 30 Providers Reviewed
92
Department of Health and Human Services, Office of Inspector General
Semiannual Report to Congress—April 1, 2022, Through September 30, 2022
A-07-21-03246 Montana Claimed Federal Medicaid Reimbursement 8/26/2022 $5,065,966 -
for More Than $5 Million in Targeted Case
Management Services That Did Not Comply With
Federal and State Requirements
A-04-19-07084 Medicare Advantage Compliance Audit of Specific 8/29/2022 $3,518,465 -
Diagnosis Codes That WellCare of Florida, Inc.,
(Contract H1032) Submitted to CMS
A-18-21-11400 The Health Resources and Services Administration 8/29/2022 - -
Should Improve Its Oversight of the Cybersecurity of
the Organ Procurement and Transplantation Network
A-02-20-02003 The Municipality of Barceloneta Did Not Always 8/30/2022 - -
Manage Its Head Start Disaster Assistance Awards in
Accordance With Federal and Commonwealth
Requirements
A-02-20-02002 HHS Did Not Fully Comply With Federal 9/1/2022 - -
Requirements and HHS Policies and Procedures
When Awarding and Monitoring Contracts for
Ventilators
A-18-21-03100 IHS Telehealth System Was Deployed Without Some 9/7/2022 - -
Required Cybersecurity Controls
A-02-21-01001 New York Claimed $196 Million, Over 72 Percent of 9/12/2022 $196,358,172 -
the Audited Amount, in Federal Reimbursement for
NEMT Payments to New York City Transportation
Providers That Did Not Meet or May Not Have Met
Medicaid Requirements
A-09-20-03009 Medicare Advantage Compliance Audit of Specific 9/13/2022 $1,890,855 -
Diagnosis Codes That Regence BlueCross BlueShield
of Oregon (Contract H3817) Submitted to CMS
A-07-21-06096 Tennessee Did Not Always Invoice Rebates to 9/14/2022 $12,028,934 $28,351,111
Manufacturers for Physician-Administered Drugs
Dispensed to Enrollees of Medicaid Managed-Care
Organizations
A-01-20-00004 Certain Nursing Homes May Not Have Complied 9/15/2022 - -
With Federal Requirements for Infection Prevention
and Control and Emergency Preparedness
A-07-21-07004 System Review Report: External Quality Control 9/15/2022 - -
Review of the Audit Organization of the U.S.
Department of Labor, Office of Inspector General
A-07-20-04124 IHS's National Supply Service Center Was Generally 9/16/2022 - -
Effective in Providing Supplies to Facilities During the
COVID-19 Pandemic, but Its Internal Controls Could
Be Improved
A-05-20-00025 Nearly All States Made Capitation Payments for 9/19/2022 - -
Beneficiaries Who Were Concurrently Enrolled in a
Medicaid Managed Care Program in Two States
93
Department of Health and Human Services, Office of Inspector General
Semiannual Report to Congress—April 1, 2022, Through September 30, 2022
A-06-21-05003 Medicare Part B Overpaid and Beneficiaries Incurred 9/19/2022 $1,188,759 -
Cost-Share Overcharges of Over $1 Million for the
Same Professional Services
A-18-20-06300 National Institutes of Health Grant Program 9/19/2022 - -
Cybersecurity Requirements Need Improvement
A-02-20-01028 New York Generally Determined Eligibility for Its Basic 9/20/2022 $8,615 -
Health Program Enrollees in Accordance With
Program Requirements
A-05-20-00051 End-Stage Renal Disease Network Organizations' 9/21/2022 - -
Reported Actions Taken in Response to the COVID-19
Pandemic
A-09-22-03007 CMS's System Edits Significantly Reduced Improper 9/22/2022 $39,310,499 -
Payments to Acute-Care Hospitals After May 2019 for
Outpatient Services Provided to Beneficiaries Who
Were Inpatients of Other Facilities
A-02-20-01001 Medicare Hospital Provider Compliance Audit: 9/23/2022 $42,336,162 -
Hospice of Palm Beach County, Inc.
A-05-18-00020 Medicare Advantage Compliance Audit of Diagnosis 9/26/2022 $5,372,998 -
Codes that Inter Valley Health Plan, Inc. (Contract
H0545), Submitted to CMS
A-09-21-06001 HHS's and HRSA's Controls Related to Selected 9/26/2022 - -
Provider Relief Fund Program Requirements Could Be
Improved
A-18-22-11400 HHS Made Some Progress Toward Compliance With 9/26/2022 - -
the Geospatial Data Act
A-04-20-01019 CDC's Corrective Actions Improved Program 9/27/2022 - -
Operations at the National Institute of Health in
Mozambique and Facilitated the Institute's
Implementation of Prior OIG Audit Recommendations
A-05-21-00020 Indiana Did Not Comply With Requirements for 9/27/2022 - -
Documenting Psychotropic and Opioid Medications
Prescribed for Children in Foster Care
A-05-20-00010 Medicare Dialysis Services Provider Compliance Audit: 9/28/2022 $14,193,677 -
Dialysis Clinic, Inc.
A-03-19-00001 Medicare Advantage Compliance Audit of Specific 9/29/2022 $6,227,005 -
Diagnosis Codes That Highmark Senior Health
Company (H3916) Submitted to CMS
A-06-19-09002 Texas Claimed or May Have Claimed More Than $30 9/29/2022 $30,719,788 -
Million of $9.89 Billion in Federal Funds for Medicaid
Uncompensated Care Payments That Did Not Meet
Federal and State Requirements
A-07-19-01195 Medicare Advantage Compliance Audit of Specific 9/29/2022 $7,784,540 -
Diagnosis Codes That BlueCross BlueShield of
Tennessee, Inc. (Contract H7917) Submitted to CMS
A-05-19-00039 Medicare Advantage Compliance Audit of Specific 9/30/2022 $34,414,828 -
Diagnosis Codes That HumanaChoice (Contract
R5826) Submitted to CMS
Total Reports: 68 $612,548,555 $40,038,639
94
Department of Health and Human Services, Office of Inspector General
Semiannual Report to Congress—April 1, 2022, Through September 30, 2022
Evaluation Reports by Operating Division
Report Number Title Operating Issue Date
Division
OEI-07-19-00371 In Five States, There Was No Evidence That Many Children in Foster Care ACF 7/05/2022
Had a Screening for Sex Trafficking When They Returned After Going
Missing
OEI-07-21-00251 Operational Challenges Within ORR and the ORR EIS at Fort Bliss ACF 9/22/2022
Hindered Case Management for Children
OEI-BL-20-00670 HHS Should Improve Internal Coordination and Better Protect the ACF 5/02/2022
Wellbeing of Unaccompanied Children
OEI-BL-19-00560 ACF Should Improve Oversight of Head Start To Better Protect Children's ACF 9/26/2022
Safety
OEI-05-20-00540 CDC Found Ways To Use Data To Understand and Address COVID-19 CDC 7/13/2022
Health Disparities, Despite Challenges With Existing Data
OEI-02-22-00310 2021 Performance Data for the Senior Medicare Patrol Projects CMS 6/08/2022
OEI-02-21-00100 Inaccuracies in Medicare's Race and Ethnicity Data Hinder the Ability to CMS 6/13/2022
Assess Health Disparities
OEI-02-20-00522 Certain Medicare Beneficiaries, Such as Urban and Hispanic Beneficiaries, CMS 8/29/2022
Were More Likely Than Others to Use Telehealth During the First Year of
the COVID-19 Pandemic
OEI-02-20-00720 Medicare Telehealth Services During the First Year of the Pandemic: CMS 9/02/2022
Program Integrity Risks
OEI-02-22-00390 Opioid Overdoses and the Limited Treatment of Opioid Use Disorder CMS 9/13/2022
Continue To Be Concerns for Medicare Beneficiaries
OEI-03-22-00200 Comparison of Average Sales Prices and Average Manufacturer Prices: CMS 5/12/2022
Results for the Fourth Quarter of 2021
OEI-03-22-00210 Comparison of Average Sales Prices and Average Manufacturer Prices: CMS 8/11/2022
Results for the First Quarter of 2022
OEI-03-20-00231 CMS Has Opportunities to Strengthen States' Oversight of Medicaid CMS 9/19/2022
Managed Care Medical Loss Ratios
OEI-03-22-00170 Medicare Part B Drug Payments: Impact of Price Substitutions Based on CMS 9/23/2022
2020 Average Sales Prices
OEI-03-20-00330 UPICs Hold Promise to Enhance Program Integrity Across Medicare and CMS 9/29/2022
Medicaid, But Challenges Remain
OEI-04-20-00620 Reducing Medicare’s Payment Rates for Intermittent Urinary Catheters CMS 8/31/2022
Can Save the Program and Beneficiaries Millions of Dollars Each Year
OEI-05-22-00230 Part D Plans Generally Include Drugs Commonly used by Dual Eligibles: CMS 6/21/2022
2022
OEI-06-18-00400 Adverse Events in Hospitals: A Quarter of Medicare Patients Experienced CMS 5/09/2022
Harm in October 2018
95
Department of Health and Human Services, Office of Inspector General
Semiannual Report to Congress—April 1, 2022, Through September 30, 2022
OEI-07-20-00181 National Background Check Program for Long-Term Care Providers: An CMS 5/09/2022
Interim Assessment
OEI-09-18-00260 Some Medicare Advantage Organization Denials of Prior Authorization CMS 4/27/2022
Requests Raise Concerns About Beneficiary Access to Medically Necessary
Care
OEI-BL-21-00200 Part D Plan Preference for Higher-Cost Hepatitis C Drugs Led to Higher CMS 8/09/2022
Medicare and Beneficiary Spending
OEI-01-20-00381 FDA’s Work With the Tri-Agency Task Force for Emergency Diagnostics FDA 9/16/2022
Helped Labs Implement COVID-19 Tests
OEI-01-20-00380 FDA Repeatedly Adapted Emergency Use Authorization Policies To FDA 9/16/2022
Address the Need for COVID-19 Testing
OEI-01-21-00401 Delays in Confirmatory Trials for Drugs Granted FDA’s Accelerated FDA 9/26/2022
Approval Raise Concerns
OEI-06-22-00320 Initial Observations of IHS Capacity To Manage Supplemental $3.5 Billion IHS 9/28/2022
Appropriated to Sanitation Facilities Construction Projects
OEI-06-21-00360 Connecticut Medicaid Fraud Control Unit: 2021 Inspection MFCU 9/01/2022
OEI-06-21-00270 Michigan Medicaid Fraud Control Unit: 2021 Review MFCU 9/26/2022
OEI-07-21-00340 Iowa Medicaid Fraud Control Unit: 2021 Inspection MFCU 6/15/2022
OEI-03-20-00210 Opportunities Exist To Strengthen NIH Grantees’ Oversight of NIH 6/02/2022
Investigators’ Foreign Significant Financial Interests and Other Support
Total Reports 29
96
Department of Health and Human Services, Office of Inspector General
Semiannual Report to Congress—April 1, 2022, Through September 30, 2022
Appendix B: Savings Decisions Supported by
OIG Recommendations
The table below lists policy decisions reflected in legislation, regulations, or other directives from prior
years that are supported by OIG recommendations and for which cost savings were estimated, usually by
third parties, such as the Congressional Budget Office (CBO) or HHS actuaries. Of the $23.9 billion in
savings estimated for the decisions below, $2.9 billion was attributed to FY 2022. This figure reflects the
most recent available savings estimates issued by the third-party appraiser; actual savings may be higher
or lower.
After laws involving HHS programs are enacted, OIG analyzes the laws to identify the provisions that
comport with our prior recommendations, that is, whether our recommendations support the decisions
that were made. A similar process occurs with respect to administrative decisions in regulations or other
directives or agreements (e.g., modifications to Medicaid State Plans). Most of the decisions reported in
this appendix reflect ways in which funds could be put to better use, such as reductions in Federal
spending or the avoidance of unnecessary or inappropriate expenditures, or both.
To quantify the value of administrative decisions, we use estimates developed by, or in consultation with,
HHS OpDivs or StaffDivs. To quantify the value of legislative decisions, we generally use estimates
developed by CBO. CBO projects the annual increases or reductions in Federal spending that it expects
would result from enacting the legislation. The policy decisions shown on the table beginning on the next
page mirror both OIG’s recommendations and the contributions of others, such as HHS staff and OpDivs,
congressional committees, and the GAO.
Centers for Medicare & Medicaid Services Programs
OIG Recommendations Policy Decisions Estimated Savings
Calculation of Average Manufacturer Section 1603 of the Continuing Appropriations $280 million
Price (AMP) Under the Medicaid Drug Act, 2020, and Health Extenders Act of 2019
Rebate Program amended section 1927(k)(1)(C) of the Social
Seek legislative change to exclude Security Act (the Act) to exclude generic drug
authorized generic drug transactions transactions to secondary manufacturers in the
to secondary manufacturers from the brand name drug's AMP calculations. CBO
AMP calculation of the brand name estimated savings of $3.15 billion over 10 years.
drug. The recommendation reflected
findings in OIG report A-06-18-
04002.
Medicaid Rebate for Generic Drugs Section 602 of the Bipartisan Budget Act of 2015 $134 million
(P.L. No. 114-74) (See Tab 2) was enacted and
97
Department of Health and Human Services, Office of Inspector General
Semiannual Report to Congress—April 1, 2022, Through September 30, 2022
Generic drug price increases included provisions extending the additional
exceeded the specified statutory rebate to generic drugs. The additional rebate
inflation factor applicable to brand- for generic drugs will apply to rebate periods
name drugs for 22 percent of the beginning with the first quarter of 2017. CBO
quarterly AMPs that OIG reviewed. If estimated savings of $1.008 billion over 10
the provision for brand-name drugs years.
were extended to generic drugs, the
Medicaid program would receive
additional rebates. This finding was
noted in OIG reports A-06-07-00042
and A-06-15-00030.
Hospital Transfer Policy for Early Section 53109 of the Bipartisan Budget Act $545 million
Discharges to Hospice Care of 2018 modified existing law to require that,
Change regulations or pursue a beginning in FY 2019, discharges to hospice
legislative change, if necessary, to care would also qualify as a post-acute-care
establish a hospital transfer transfer and be subject to payment
payment policy for early discharges adjustments.
to hospice care. The
recommendation reflected findings
in OIG report A-01-12-00507.
Reductions in Medicare Bad Debt Section 3201 of the Middle Class Tax $1,590 million
Reimbursement Extension and Job Creation Act of 2012
Seek legislative authority to applied percentage reductions in bad debt
eliminate (or reduce) Medicare reimbursement to all providers eligible to
payments to hospitals for bad debt receive bad debt reimbursement. CMS
associated with beneficiaries’ failure estimated savings to Medicare of $10.92
to pay their deductibles and billion over 10 years with $1.39 billion
coinsurance. The recommendations attributed to FY 2020. (77 Fed. Reg. 67450,
reflected findings in OIG report A- 67523 (Nov. 9, 2012)).
14-90-00339 and subsequent
reviews.
Payments for Prescription Drugs CMS issued a final rule about the Contract $211 million
Provided to Incarcerated Year 2015 Policy and Technical Changes to the
Beneficiaries Medicare Advantage and the Medicare
Work with prescription drug plan Prescription Drug programs. The eligibility
sponsors to identify and resolve requirements to enroll in Medicare Advantage
improper Medicare Part D and Part D are outlined in Sections
payments made for prescription 1851(a)(3)(B) and 1860D-1(a)(3)(A) of the
drugs provided to incarcerated Act. To enroll in Medicare Advantage, a
beneficiaries. The recommendation beneficiary must be entitled to Part A and
reflected findings in OIG report A- enrolled in Part B. To enroll in Part D, a
07-12-06035. beneficiary must be entitled to Part A and/or
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enrolled in Part B. An incarcerated beneficiary
is not precluded from meeting the eligibility
requirements for Part A and Part B, but in
general, no Medicare Payment is made for
these individuals. CMS promulgated
regulations to require Part D plans to disenroll
incarcerated beneficiaries. CMS estimated
savings of $1.6 billion over 10 years with
$172 million attributed to FY 2020. (79 Fed.
Reg. 29844, 29953 (May 23, 2014)).
Medicare Payments for Vacuum Section 203 of the Achieving a Better Life $44.4 million
Erection Systems Experience Act of 2014 implements changes
Seek legislative authority to include to treat VES prosthetic devices and related
vacuum erection systems (VES) in accessories as statutorily noncovered in the
the Competitive Bidding program same manner that erectile dysfunction drugs
and then implement a National are treated in Medicare Part D. CBO
Mail-Order Competitive Bidding estimated savings of $444 million over 10
Program for VES. The years.
recommendation reflected findings
in OIG report A-07-12-05024.
Excessive Medicaid Payments to Agreement between CMS and the State of $100 million
New York State New York, dated March 20, 2015, to repay
Ensure that expenditures related to $1.95 billion over 12 years with $100 million
developmental centers and other attributed to FY 2020.
intermediate care facilities and any
revised payment methodology be
consistent with efficiency and
economy. The recommendation
reflected findings in OIG reports A-
02-11-01029, A-02-13-01008, and
other reviews.
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Appendix C: Peer Review Results
The Inspector General Act of 1978, as amended, requires OIGs to report the results of peer reviews of their
operations conducted by other OIGs, the date of the last peer review, outstanding recommendations from
peer reviews, and peer reviews conducted by an OIG of other OIGs in the semiannual reporting period.
Peer reviews are conducted by member organizations of CIGIE.
Office of Audit Services
During this semiannual reporting period, one peer review involving OAS was completed. Information
concerning OAS’s peer review activity during prior reporting periods are listed below.
OAS Date Reviewing Office Office Reviewed
September 2022 HHS-OIG, OAS Department of Labor OIG
The system of quality control for the audit organization of Labor OIG in effect for the year ending
September 30, 2021, has been suitably designed and complied with to provide Labor OIG with
reasonable assurance of performing and reporting in conformity with applicable professional
standards in all material respects. Federal audit organizations can receive a rating of Pass, Pass
With Deficiencies, or Fail. Labor OIG received a peer review rating of Pass.
OAS Date Reviewing Office Office Reviewed
March 2021 General Services HHS-OIG, OAS
Administration OIG
The system of quality control for the audit organization of HHS-OIG in effect for the year ending
September 30, 2020, has been suitably designed and complied with to provide HHS-OIG with
reasonable assurance of performing and reporting in conformity with applicable professional
standards in all material respects. Federal audit organizations can receive a rating of Pass, Pass
With Deficiencies, or Fail. HHS-OIG received a peer review rating of Pass.
Office of Investigations
During this semiannual reporting period, no peer reviews involving OI were completed. Listed below is
information concerning OI’s peer review activities during prior reporting periods.
OI Date Reviewing Office Office Reviewed
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October 2018 Social Security HHS-OIG, OI
Administration OIG
The system of internal safeguards and management procedures for the investigative function of
HHS-OIG in effect for the year ending September 30, 2018, was in full compliance with the quality
standards established by CIGIE and the Attorney General’s guidelines.
OI Date Reviewing Office Office Reviewed
August 2017 HHS-OIG, OI U.S. Postal Service OIG
The system of internal safeguards and management procedures for the investigative function of
the U.S. Postal Service OIG in effect for the year ending September 30, 2015, was in full compliance
with the quality standards established by CIGIE and the Attorney General’s guidelines.
Office of Evaluation and Inspections
During this semiannual reporting period, no peer reviews involving OEI were completed. Information
concerning OEI’s peer review activity during a prior reporting period is also listed below.
OEI Date Reviewing Office Office Reviewed
November 2020 Department of State, HHS-OIG, OEI
OIG
A CIGIE external peer Review Team assessed the extent to which HHS-OIG, OEI met seven Quality
Standards for Inspection and Evaluation (Blue Book) standards. The seven covered standards are:
Quality Control, Planning, Data Collections and Analysis, Evidence, Records Maintenance,
Reporting, and Followup. The assessment included a review of OEI’s internal policies and
procedures documented in the OEI procedures manual. It also included a review of four reports
issued between June 1, 2019, and June 1, 2020, to determine whether the reports compiled with the
seven standards and internal policies and procedures. The Review Team determined that OEI’s
policies and procedures generally met the seven standards. The four reports reviewed generally
met the standards and complied with OEI’s internal policies and procedures.
OEI Date Reviewing Office Office Reviewed
June 2020 HHS-OIG, OEI Department of Veterans Affairs
(VA) OIG
The Veterans Affairs, Office of Inspector General, Office of Audits and Evaluations and Office of
Healthcare Inspections (collectively, VA-OIG) policies and procedures addressed the Quality
Standards for Inspection and Evaluation of CIGIE. The seven covered standards are: Quality
Control, Planning, Data Collections and Analysis, Evidence, Records Maintenance, Reporting, and
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Followup. In addition, each of the four reviewed VA-OIG reports complied with those standards
and the VA-OIG’s internal policies and procedures. As a result of our findings, there are no
recommendations associated with this external peer review. The report also noted a VA-OIG
beneficial practice of using specialized staff to conduct independent referencing reviews of its
reports to achieve greater consistency in its quality assurance processes.
OEI Date Reviewing Office Office Reviewed
September 2019 HHS-OIG, OEI Department of Interior (DOI)
OIG
The DOI-OIG Inspection and Evaluation component’s policies and procedures mostly met CIGIE’s
Blue Book standards. We reviewed four reports: two fully met the applicable Blue Book standards
and two did not. DOI-OIG concurred with recommendations related to Evidence, Planning, and
Data Collection and Analysis but did not concur with recommendations related to Reporting.
OEI Date Reviewing Office Office Reviewed
September 2018 HHS-OIG, OEI U.S. Department of Defense
(DoD) OIG
The DoD-OIG Inspection and Evaluation components’ policies and procedures generally met
CIGIE’s Blue Book standards. In addition, the 10 reports reviewed generally met the applicable Blue
Book standards. Onsite visits for these reviews were conducted from October 2, 2017, through
November 17, 2017.
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Appendix D: Summary of Sanction Authorities
The Inspector General Act of 1978, as amended, specifies requirements for semiannual reports to be made
to the HHS Secretary for transmittal to Congress. A selection of other authorities appears below.
Program Exclusions
Section 1128 of the Social Security Act (42 U.S.C. § 1320a-7), provides numerous grounds for excluding
individuals and entities from participation in Medicare, Medicaid, and other Federal health care programs.
Exclusions are required (mandatory exclusion) for individuals and entities convicted of the following types
of criminal offenses: (1) Medicare or Medicaid fraud; (2) patient abuse or neglect; (3) felonies for other
health care fraud; and (4) felonies for illegal manufacture, distribution, prescription, or dispensing of
controlled substances.
OIG is authorized (permissive exclusion) to exclude individuals and entities on 17 other grounds, including
misdemeanors for health care fraud other than Medicare or Medicaid fraud; suspension or revocation of
a license to provide health care for reasons bearing on professional competence, professional
performance, or financial integrity; provision of unnecessary or substandard services; submission of false or
fraudulent claims to a Federal health care program; or engaging in unlawful kickback arrangements.
Providers subject to exclusion are granted due process rights. These include a hearing before an
administrative law judge and appeals to the HHS Departmental Appeals Board and Federal district and
appellate courts regarding the basis for and the length of the exclusion.
Civil Monetary Penalties Law
The CMPL, found at Section 1128A of the Social Security Act (42 U.S.C. § 1320a-7a), authorizes penalties,
assessments, and exclusion from participation in Federal health care programs for engaging in certain
activities. For example, a person who submits, or causes to be submitted, to a Federal health care program
a claim for items and services that the person knows, or should know, is false or fraudulent is subject to a
penalty of up to $20,000 for each item or service falsely or fraudulently claimed, an assessment of up to
three times the amount falsely or fraudulently claimed, and exclusion.
For the purposes of the CMPL, “should know” is defined to mean that the person acted in reckless
disregard or deliberate ignorance of the truth or falsity of the claim. The law and its implementing
regulations also authorize actions for a variety of other violations, including submission of claims for items
or services furnished by an excluded person; requests for payment in violation of an assignment
agreement; and payment or receipt of remuneration in violation of the Federal anti-kickback statute (42
U.S.C. § 1320a-7b(b)).
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The 21st Century Cures Act (enacted on December 13, 2016) added more grounds for imposing CMPs,
assessments, and exclusions from Federal health care programs for fraudulent and other improper conduct
related to HHS grants, contracts, and other agreements. OIG may impose a CMP of up to $10,000 per
specified claim, an assessment of up to three times the amount claimed, and an exclusion upon any person
who knowingly presents a specified claim under and HHS grant, contract, or other agreement that they
know or should know is false or fraudulent. In addition, OIG may impose a CMP of up to $50,000, an
assessment of up to three times the amount of funds at issue, and an exclusion upon any person who: (1)
knowingly makes a false statement in a document required to be submitted to receive funds under an HHS
contract, grant, or other agreement; (2) knowingly makes or uses a false record or statement that is
material to a false or fraudulent claim; or (3) knowingly makes or uses a false record or statement material
to an obligation to pay or transmit funds or property owed to HHS. OIG may also impose a CMP of up to
$10,000 per day, an assessment of up to three times the amount at issue, and an exclusion upon any
person who for knowingly conceals, or knowingly and improperly avoids or decreases, an obligation owed
to HHS with respect to an HHS grant, contract, or other agreement. Finally, OIG may impose a penalty of
up to $15,000 per day and an exclusion upon any person who fails to grant timely access to OIG upon
reasonable request for the purpose of audits, investigations, evaluations, or other statutory functions of the
OIG in matters involving HHS grants, contracts, or other agreements.
Patient Dumping
Section 1867 of the Social Security Act (42 U.S.C. § 1395dd), provides that when an individual goes to the
Emergency Department of a Medicare-participating hospital, the hospital must provide an appropriate
medical screening examination to determine whether that individual has an emergency medical condition.
If an individual has such a condition, the hospital must provide either treatment to stabilize the condition
or an appropriate transfer to another medical facility when the hospital does not have the capabilities to
stabilize the condition
If a transfer is ordered, the transferring hospital must provide stabilizing treatment to minimize the risks of
transfer and must ensure that the receiving hospital agrees to the transfer and has available space and
qualified personnel to treat the individual. In addition, the transferring hospital must effect the transfer
through qualified personnel and transportation equipment. Further, a participating hospital with
specialized capabilities or facilities may not refuse to accept an appropriate transfer of an individual who
needs services if the hospital has the capacity to treat the individual.
OIG is authorized to collect CMPs of up to $53,484 against small hospitals (fewer than 100 beds) and up
to $106,965 against larger hospitals (100 beds or more) for each instance in which the hospital negligently
violated any of the section 1867 requirements. In addition, OIG may collect a penalty of up to
$106,965 from a responsible physician for each negligent violation of any of the section 1867 requirements
and, in some circumstances, may exclude a responsible physician.
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Anti-Kickback Statute and Civil False Claims Act Enforcement Authorities
The Anti-Kickback Statute
The Federal anti-kickback statute makes it a criminal offense to knowingly and willfully offer, pay,
solicit, or receive any remuneration to induce, or in return for, the referral of an individual to a
person for the furnishing of, or arranging for the furnishing of, any item or service reimbursable
under a Federal health care program. The statute’s prohibition also extends to remuneration to
induce, or in return for, the purchasing, leasing, or ordering of, or arranging for or recommending
the purchasing, leasing, or ordering of, any good, facility, service, or item reimbursable by a Federal
health care program. (Social Security Act, § 1128B(b) (42 U.S.C. § 1320a-7b(b)).
Individuals and entities who engage in conduct prohibited by the anti-kickback statute may be
subject to criminal penalties and fines under the anti-kickback statute; CMPs under OIG’s authority
pursuant to the Social Security Act, § 1128A(a)(7) (42 U.S.C. § 1320a-7a(a)(7)-); and/or program
exclusion under OIG’s permissive exclusion authority under the Social Security Act, § 1128(b)(7) (42
U.S.C. § 1320a-7(b)(7)). In addition, a conviction under the anti-kickback statute leads to mandatory
exclusion under the Social Security Act, §1128(a)(1) (42 U.S.C. § 1320a-7a(a)(1)). Finally, a claim that
includes items or services resulting from a violation of the Federal anti-kickback statute constitutes
a false or fraudulent claim for purposes of the False Claims Act. (Social Security Act, § 1128B(b)(g)
(42 U.S.C. § 1320a-7b(b)(g)).
The False Claims Act
OIG investigates alleged violations of the False Claims Act (31 U.S.C. §§ 3729–3733). Under the
False Claims Act, a person or an entity is liable for up to treble damages and a penalty between
$11,181 and $22,363 for each false claim it knowingly submits, or causes to be submitted, to a
Federal program. Similarly, a person or an entity is liable under the False Claims Act if it knowingly
makes or uses, or causes to be made or used, a false record or statement to have a false claim
paid. Similar to the CMPL, the False Claims Act defines “knowing” to include instances in which the
person acted in deliberate ignorance or reckless disregard of the truth or falsity of the information.
Further, the False Claims Act contains a qui tam, or whistleblower, provision that allows a private
individual to file a lawsuit on behalf of the United States and entitles that whistleblower to a
percentage of any fraud recoveries. The False Claims Act was amended in 2009. Among other
things, the amendments clarified the reach of the False Claims Act to false claims submitted to
contractors or grantees of the Federal Government.
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Appendix E: Reporting Requirements in the
Inspector General Act of 1978
The reporting requirements of the Inspector General Act of 1978, as amended, are listed in the following
table along with the location of the required information.
Section Requirement Location
Section 4
(a)(2) Review of legislation and regulations “Other HHS-Related
Reviews and
Investigations” section
Section 5
(a)(1) Significant problems, abuses, and deficiencies Throughout this report
(a)(2) Recommendations with respect to significant problems, Throughout this report
abuses, and deficiencies
(a)(3) Prior significant recommendations on which corrective Solutions To Reduce
action has not been completed Fraud, Waste, and Abuse
in HHS Programs: Top
Unimplemented
Recommendations
(a)(4) Matters referred to prosecutive authorities “Legal and Investigative
Activities Related to the
Medicare and Medicaid
Programs” section
(a)(5) Summary of instances in which information requested by None for this reporting
OIG was refused period
(a)(6) List of audit reports Throughout this report
and Appendix A
(a)(7) Summary of significant reports Throughout this report
(a)(8) Statistical Table 1―Reports With Questioned Costs Appendix A
(a)(9) Statistical Table 2―Funds Recommended To Be Put to Appendix A
Better Use
(a)(10) Summary of previous audit reports without management Appendix A
decisions, in which no establishment comment was returned
within 60 days, and in which there are any outstanding
unimplemented recommendations
(a)(11) Description and explanation of revised management Appendix A
decisions
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Section Requirement Location
(a)(12) Management decisions with which the Inspector General None for this reporting
disagrees period
(a)(13) Information required by the Federal Financial Management Nothing to report
Improvement Act of 1996
(a)(14)-(16) Results of peer reviews of HHS-OIG conducted by other Appendix C
OIGs or the date of the last peer review, outstanding
recommendations from peer reviews, and peer reviews
conducted by HHS-OIG of other OIGs
(a)(17) Investigative statistical tables Appendix F
(a)(18) Metrics description for statistical tables Appendix F
(a)(19) Investigations on senior Government employees Appendix F
(a)(20) Description of whistleblower retaliation instances Appendix F
(a)(21) Description of attempts to interfere with OIG independence Appendix F
(a)(22) Description of closed and nondisclosed reports and Appendix F
investigations regarding senior Government employees
Other Reporting Requirements
Section Requirement Location
845 Significant contract audits required to be reported pursuant “Other HHS-Related
to the National Defense Authorization Act for FY 2008 Reviews and
(P.L. No. 110-181), § 845. Investigations” section
205 Pursuant to HIPAA (P.L. No. 104-191), § 205, the Inspector Appendix G
General is required to solicit proposals annually via a Federal
Register notice for developing new and modifying existing
safe harbors to the anti-kickback statute of the Social
Security Act, § 1128(b) and for developing special fraud
alerts. The Inspector General is also required to report
annually to Congress on the status of the proposals received
related to new or modified safe harbors.
1553 Pursuant to the American Recovery and Reinvestment Act of “Other HHS-Related
2009, P.L. No. 111-5, § 1553, OIG reports to Congress the Reviews and
retaliation complaint investigations it decided not to Investigations” section
conduct or continue during the period.
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Appendix F: Reporting Requirements in the
Inspector General Empowerment Act of 2016
The Inspector General Empowerment Act of 2016 establishes new reporting requirements for the
Semiannual Reports. These requirements amend portions of section 5 of the Inspector General Act. The
requirements are below in italics, followed by OIG’s responses.
Each Inspector General shall, not later than April 30 and October 31 of each year, prepare
semiannual reports summarizing the activities of the Office during the immediately preceding 6
month periods ending March 31 and September 30. Such reports shall include, but need not be
limited to-
(10) A summary of audit, inspection, and evaluation reports issued before the commencement of the
reporting period-
(A) for which no management decision has been made by the end of the reporting period (including
the date and title of each such report), an explanation of the reasons such management decision has
not been made, and a statement concerning the desired timetable for achieving a management
decision on each such report;
For audit and evaluation reports issued from FY 2011 through FY 2022 OIG had a total of 86 reports
with overdue final management decisions (FMDs) as of the end of this reporting period. The
breakdown of those 86 reports by HHS OpDiv is as follows:
OpDiv Overdue FMDs
ACF 17
ASPR 4
CMS 46
FDA 1
IHS 10
NIH 3
OASH 1
OS 4
OIG is unable to provide reasons and timetables for each of these overdue management decisions,
because of the volume and that OIG did not historically track this information.
(B) for which no establishment comment was returned within 60 days of providing the report to the
establishment; and
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For draft reports that include recommendations, OIG typically requests establishment comments
within 30 days. In some instances, OIG grants extensions when requested and appropriate. When
OIG does not receive establishment comments or a request for extension within the 30-day
timeframe, OIG typically issues the report and notes the lack of establishment comments.
For this semiannual reporting period, OIG had zero reports for which no establishment comment
was returned within 60 days of providing the report to the establishment.
(C) for which there are any outstanding unimplemented recommendations, including the aggregate
potential cost savings of those recommendations.
OIG is actively tracking 1,451 unimplemented open recommendations made in reports issued since
FY 2011. Given the volume of recommendations OIG makes each year, the table below reflects
summary data by FY:
Number of Reports
Number of
FY (2011– With Dollar Value of Aggregate
Unimplemented
2022) Unimplemented Potential Cost Savings
Recommendations
Recommendations
2011 12 17 $408,135,515
2012 18 21 $369,932,148
2013 24 37 $234,261,321
2014 22 38 $15,072,080,989
2015 22 36 $304,720,009
2016 18 35 $184,156,192
2017 30 90 $1,100,958,099
2018 38 119 $525,408,004
2019 59 175 $728,613,733
2020 80 249 $2,458,020,804
2021 98 230 $880,662,095
2022 106 404 $2,495,003,205
Totals 527 1,451 $24,761,952,114
OIG annually produces OIG’s Top Unimplemented Recommendations: Solutions To Reduce Fraud,
Waste, and Abuse in HHS Programs, which constitutes OIG’s response to a specific requirement of
the Inspector General Act, as amended (§ 5(a)(3)). It identifies significant recommendations with
respect to problems, abuses, or deficiencies for which corrective actions have not been completed.
It also includes an appendix listing OIG’s significant unimplemented recommendations, which
represent opportunities to achieve expected impact through cost savings, improvements in
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program effectiveness and efficiency, or increasing quality of care and safety of beneficiaries. In
OIG’s view, these recommendations would most positively impact HHS programs in terms of cost
savings and/or quality improvements and should therefore be prioritized for implementation.
(17) Statistical tables showing-
(A) the total number of investigative reports issued during the reporting period;
(B) the total number of persons referred to the DOJ for criminal prosecution during the reporting
period;
(C) the total number of persons referred to State and local prosecuting authorities for criminal
prosecution during the reporting period; and
(D) the total number of indictments and criminal information during the reporting period that
resulted from any prior referral to prosecuting authorities;
Total number of investigative reports issued during the reporting period, None
including Management Implication Reports and Investigative Advisories
Total number of persons referred3 to Federal prosecuting authorities for 1,041
criminal prosecution during the reporting period4
Total number of persons referred to State and local prosecuting authorities 120
for criminal prosecutions during the reporting period
Total number of Federal indictments and criminal information during the 314
reporting period that resulted from any prior referral to prosecuting
authorities
Total number of State and local indictments and criminal information during 66
the reporting period that resulted from any prior referral to prosecuting
authorities
(18) A description of the metrics used for developing the data for the statistical tables under
paragraph (17);
Regarding (17)(A), OIG considers Investigative Reports as Management Implication Reports and
Investigative Advisories. A Management Implication Report identifies systemic weaknesses or
vulnerabilities within HHS programs, which are generally identified during the course of an OIG
investigation and could lead to fraud, waste, or abuse. It provides recommendations to correct or
minimize the problem. Corrective actions may require administrative, procedural, policy,
regulatory, or legislative change. When a Management Implication Report is issued to an HHS
OpDiv or StaffDiv, it is generally signed by the Inspector General. Investigative Advisories are
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similar documents that bring renewed attention to an identified HHS issue and are generally signed
by the Deputy Inspector General for Investigations.
Regarding (17)(B) and (C), OIG defines this measure as the term “presentations” to both Federal and
State/local prosecuting jurisdictions as the representation of the work we do. For example, when
OIG opens an investigation, it evaluates the complaint and decides whether to “present” the matter
for prosecution. Generally, if the case has prosecutorial merit, and is accepted for Federal
prosecution, OIG works with DOJ as the primary investigative agency, as opposed to referring the
matter to DOJ without further involvement on OIG's part. OIG works with State and local
prosecutorial authorities in addition to working with DOJ.
Regarding (17)(D), the table above provides the number of indictments and criminal information
during the semiannual reporting period, including sealed indictments and criminal information.
However, the information cannot be limited to only those that occurred as a result of a
presentation in a previous period. In certain situations, the presentation and charging dates are in
the same reporting period.
(19) A report on each investigation conducted by the Office involving a senior Government employee
where allegations of misconduct were substantiated, including a detailed description of-
(A) the facts and circumstances of the investigation; and
(B) the status and disposition of the matter, including-
(i) if the matter was referred to DOJ, the date of the referral; and
(ii) if DOJ declined the referral, the date of the declination;
For this section, OIG describes investigations, both criminal and administrative, involving senior
Government employees for whom allegations of misconduct were investigated and substantiated.
For the reporting period, the OIG investigation of one senior Government employee for
misconduct was substantiated.
Description of Status Disposition DOJ DOJ DOJ DOJ
Investigation Referral Referral Declination Declination
Date Date
A senior Government official Closed Substantiated Yes 1/8/2021 Yes 1/8/2021
allegedly violated conflict of
interest rules applicable to all
Executive Branch employees.
OIG provides investigative facts for the purpose of referring a matter or allegation to the
appropriate deciding authority (Department, OpDiv, DOJ, etc.). OIG does not make findings
regarding its investigations of departmental employees. Our reports relay the facts obtained
during the investigations (e.g., parties involved, dates of events). At the conclusion of an OIG
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investigation related to allegations concerning possible employee misconduct, OIG provides a
report to management in the employing agency. The agency management makes determinations
of employee misconduct. The disposition of the matter and any resulting administrative actions
are taken by the agency. Although, we request from the agency a copy of an SF-50 documenting
a personnel action, if one is taken, there are sometimes settlement agreements that may impact
the final action. Therefore, OIG may not have a complete record of the disposition of the
investigation.
(20) A detailed description of any instance of whistleblower retaliation, including information about
the official found to have engaged in retaliation and what, if any, consequences the establishment
imposed to hold that official accountable;
OIG conducts investigations into whistleblower retaliation against current and former HHS
employees, applicants for HHS employment, HHS contractors, subcontractors, personal services
contractors, grantees, and subgrantees who disclose information to OIG, and other protected
sources, under the authority of the Whistleblower Protection Act of 1989, 41 U.S.C. § 4712, the
Military Whistleblower Protection Act (10 U.S.C. 1034), and Presidential Policy Directive 19. OIG
makes a determination as to whether retaliatory action has been taken and includes these findings
in reports, along with recommendations for corrective action. OIG provides a summary of any
substantiated retaliation report on the OIG website to enhance transparency and employer
accountability. In the reporting period, OIG submitted one report to the Office of the Secretary of
HHS that included findings of retaliation.
When determining the level of detail to provide for a description of any instance of whistleblower
retaliation, OIG is always mindful of the risk that a detailed description of the allegation could
inadvertently reveal the whistleblower’s identity, thus having a chilling effect on future
whistleblowers.
OIG conducted an investigation in response to allegations made by a complainant at the
Tennessee Coalition to End Domestic and Sexual Violence (Coalition), a CDC grantee. The
complainant alleged that, while working for the Coalition, under Domestic Violence Prevention
Enhancement and Leadership Through Alliances (DELTA) program grants, the complainant’s
supervisors and responsible management officials (RMOs), terminated the complainant for making
allegations that Federal grant laws were being repeatedly violated by the Coalition. Specifically,
investigators found that the complainant made written and oral protected disclosures to the RMOs
and a CDC employee alleging DELTA grant mismanagement. OIG investigators found that the
RMOs terminated the complainant’s employment in retaliation for making protected disclosures.
The OIG investigative report included recommendations for corrective action and was provided to
the Office of the Secretary of HHS, which may seek to implement alternative or additional actions
as deemed appropriate.
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The report included the following recommendations for corrective action: (1) that whistleblower
protection training be required for the grantee and its employees, as well as for CDC employees
who work in the DELTA program; and (2) that the complainant be made whole in the form of
backpay since their constructive discharge.
(21) A detailed description of any attempt by the establishment to interfere with the independence of
the Office, including:
(A) with budget constraints designed to limit the capabilities of the Office; and
(B) incidents where the establishment has resisted or objected to oversight activities of the Office
or restricted or significantly delayed access to information, including the justification of the
establishment for such action; and
Although there have been instances in which HHS agencies have questioned OIG oversight
activities or have not provided all information in the precise content, format, and timeline as
requested, OIG has not identified any instances in which HHS interfered with the independence of
OIG during this reporting period. OIG would immediately take appropriate action in accordance
with the Inspector General Act if it were unable to resolve these issues within HHS.
(22) Detailed descriptions of the particular circumstances of each:
(A) inspection, evaluation, and audit conducted by the Office that is closed and was not
disclosed to the public; and
The table below lists inspection, evaluation, and audit reports for this semiannual reporting period
that did not result in public reports.
Number of
Category/Description
Reports
IT security reviews (involve IT systems, e.g., penetration test audits) 0
Other 0
HHS technical assistance reports 0
Finance-related attestation reviews 2
Total 2
(B) Investigation conducted by the Office involving a senior Government employee that is closed and
was not disclosed to the public.
OIG interprets section 5(a)(22)(B) as requiring reporting on investigations with either substantiated
or unsubstantiated allegations. As such, we refer to our section 5(a)(19) response to address
investigations of senior Government employees in which allegations were substantiated that were
closed and not disclosed to the public. Our section 5(a)(22)(B) response describes four
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investigations closed during this reporting period involving senior Government employees for
whom allegations of misconduct were investigated and not substantiated.
When determining the level of detail to provide for the investigations described above, OIG is
mindful of the risk that a detailed description of the investigation could inadvertently reveal the
subject’s identity
Description of Status Disposition DOJ DOJ DOJ DOJ
Investigation Referral Referral Declination Declination
Date Date
A senior Government Closed Unsubstantiated No N/A N/A N/A
employee allegedly inappropriately
touched/sexually assaulted another
Government employee and a
former patient.
A senior Government employee Closed Unsubstantiated No N/A N/A N/A
allegedly attempted to pressure
employees to contract with a
company for which the senior
Government employee’s family
member has a financial interest.
A senior Government employee Closed Unsubstantiated No N/A N/A N/A
supervised a contracted employee.
The contracted employee allegedly
attempted to pull a patient’s pants
down during an examination
despite the patient’s objection.
A senior Government employee Closed Unsubstantiated No N/A N/A N/A
allegedly retaliated against an
employee for reporting violations
of law and department policies.
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Appendix G: Anti-Kickback Statute—Safe
Harbors
Pursuant to HIPAA, § 205, the Inspector General is required to solicit proposals annually via a Federal
Register notice 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. The Inspector
General is also required to report annually to Congress on the status of the proposals received related to
new or modified safe harbors.
In crafting safe harbors for a criminal statute, it is incumbent upon OIG to engage in a complete and
careful review of the range of factual circumstances that may fall within the proposed safe harbor subject
area to uncover all potential opportunities for fraud and abuse by unscrupulous industry
stakeholders. Having done so, OIG must then determine, in consultation with DOJ, whether it can develop
effective regulatory limitations and controls—not only to foster beneficial or innocuous arrangements—
but also to protect the Federal health care programs and their beneficiaries from abusive practices.
]
Public proposals for new and modified safe harbors
Annual Solicitation
In December 2021, OIG published its annual solicitation in the Federal Register (Annual Solicitation).1 In
response to the Annual Solicitation, OIG received the following proposals related to safe harbors:
Proposal OIG Response
Repeal or modification of existing safe harbors OIG is not adopting commenters’ suggestions to
(e.g., the group purchasing organization (GPO) repeal or modify the GPO safe harbor, among
safe harbor, 42 C.F.R. § 1001.952(f)) to address others, to address their comments and concerns
comments and concerns regarding the manner about the financial arrangements for which GPOs
in which GPOs and pharmacy benefit managers and PBMs may be using these safe harbors. We
(PBMs) may be using such safe harbors to may consider this topic in future rulemaking or in
protect purportedly abusive arrangements. future guidance. OIG highlights that there is a
statutory exception addressing GPOs at section
1128B(b)(3)(C) of the Social Security Act.
Modification of the Cooperative Hospital OIG is not adopting this suggestion. We may
Services Organization (CHSO) safe harbor, 42 consider this topic in future rulemaking.
C.F.R. § 1001.952(q), to: (i) protect only CHSO
1 OIG, Solicitation of New Safe Harbors and Special Fraud Alerts, 86 Fed. Reg. 71,611 (Dec. 17, 2021),
https://www.govinfo.gov/content/pkg/FR-2021-12-17/pdf/2021-27314.pdf.
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arrangements that involve the provision of items
or services that are components of the direct or
indirect overhead costs associated with the
inpatient or outpatient hospital services of the
nonprofit patron-hospitals; and (ii) exclude
protection for the creation of revenue-producing
joint venture arrangements for non-hospital,
post-discharge home care services and the
distribution of CHSO revenues to patrons based
on referrals.
A new safe harbor to protect: (i) value-based OIG is not adopting this suggestion. We
price-adjustment arrangements that are appreciate learning about ways in which
dependent on the achievement of a measurable pharmaceutical manufacturers, medical device
clinical or cost outcome associated with the manufacturers, and durable medical equipment,
value of a seller’s reimbursable items or services; prosthetics, orthotics, and supplies (DMEPOS)
and (ii) the provision of value-based services, entities believe that they could contribute to the
such as services that enable parties to measure coordination of care and the overall delivery of
outcome measures associated with value-based high-value care through, for example, value-
price-adjustment arrangements. based price-adjustment arrangements or value-
based services arrangements. However, we
continue to have concerns about the offer of
remuneration by these entities that raises many
of the traditional fraud and abuse risks under the
Federal anti-kickback statute. We may consider
this topic in future rulemaking.
A new safe harbor to protect drug copayment OIG is not adopting this suggestion. The offer of
assistance in situations where a less expensive cost-sharing assistance for a drug, particularly by
and equally effective alternative drug does not the manufacturer of such drug (either directly or
exist. indirectly), presents many of the traditional risks
of fraud and abuse that the Federal anti-kickback
statute is designed to prevent.
New safe harbors to protect: (i) value-based OIG is not adopting these suggestions. We
purchasing arrangements between continue to evaluate the ways in which
pharmaceutical manufacturers and payors or pharmaceutical manufacturers may be able to
PBMs; and (ii) the provision of data analytics by a contribute to the coordination of care and the
drug, biologic, or device manufacturer. overall delivery of high-value care through, for
example, value-based purchasing arrangements
or data sharing arrangements. However, we
continue to have concerns about the offer of
remuneration through these programs, which
raises many of the traditional fraud and abuse
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risks under the Federal anti-kickback statute. We
may consider this topic in future rulemaking.
Modifications to the safe harbors for value-based As explained in the preamble to the final rule at
arrangements, including the safe harbors for 85 Fed. Reg. 77,684 (Dec. 2, 2020) (referred to in
arrangements for patient engagement and this Appendix G as the “2020 final rule”),
support to improve quality, health outcomes, remuneration exchanged by pharmaceutical
and efficiency, 42 C.F.R. § 1001.952(hh), to protect manufacturers and, in certain circumstances,
the exchange of remuneration by certain entities medical device manufacturers and DMEPOS
that currently cannot use the safe harbors (e.g., entities, are not eligible for protection under the
pharmaceutical manufacturers, medical device value-based safe harbors due to (among other
manufacturers, laboratory companies, and reasons) concerns that such entities could use
suppliers of durable medical equipment, the safe harbor to protect arrangements that are
prosthetics, orthotics, or supplies). intended to market their products or
inappropriately tether clinicians to the use of a
particular product.2 Consequently, OIG declines
to adopt this suggestion.
New safe harbors to implement the Final Rule for OIG is not adopting this suggestion. Section
the Removal of Safe Harbor Protection for 11301 of the Inflation Reduction Act of 2022
Rebates Involving Prescription Pharmaceuticals extended the moratorium on the implementation
and Creation of New Safe Harbor Protection for of the Final Rule for the Removal of Safe Harbor
Certain Point-of-Sale Reductions in Price on Protection for Rebates Involving Prescription
Prescription Pharmaceuticals and Certain Pharmaceuticals and Creation of New Safe
Pharmacy Benefit Manager Service Fees. Harbor Protection for Certain Point-of-Sale
Reductions in Price on Prescription
Pharmaceuticals and Certain Pharmacy Benefit
Manager Service Fees until January 1, 2032.
New safe harbor for charitable assistance OIG is not adopting this suggestion. We may
programs to protect the provision of medical consider this topic in future rulemaking.
products and pharmaceutical products at no
charge to patients in financial need.
Modification to existing safe harbor at 42 C.F.R. § OIG is not adopting this suggestion. A rebate is
1001.952(h) to define “rebate” to include any a type of discount, and a discount is a reduction
service fee paid as a percent-of-sales. in price charged for an item or service. A
discount, including a rebate, does not include
payment for a service. In a final rule issued in
1991, OIG stated that contracts for personal or
2 Medicare and State Health Care Programs: Fraud and Abuse; Revisions to Safe Harbors Under the Anti-Kickback Statute, and Civil
Monetary Penalty Rules Regarding Beneficiary Inducements, 85 Fed. Reg. 77,684, 77,709 (Dec. 2, 2020),
https://www.govinfo.gov/content/pkg/FR-2020-12-02/pdf/2020-26072.pdf.
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management services do not fit within the
statutory discount exception or the definition of
“discount” in the regulatory safe harbor.3 We
decline to revise the definition of “rebate” to
include service fees paid as a percent of sales.
New safe harbor for manufacturer-sponsored OIG is not adopting this suggestion. We
patient engagement and product support continue to evaluate the ways in which
programs, including therapy management and pharmaceutical manufacturers may be able to
medication adherence support to encourage contribute to the delivery of quality care for
patients to manage and follow their treatment patients through programs such as medication
plans. adherence support, but we continue to have
concerns about the offer of remuneration to
patients through these programs, which raises
many of the traditional fraud and abuse risks
(e.g., patient steering). We may consider this
topic in future rulemaking.
New safe harbor to protect internal cost sharing OIG is not adopting the suggestion to create a
(or gainsharing) payments or modification to the new safe harbor or modify the personal services
personal services and management contracts and management contracts and outcomes-
and outcomes-based payment arrangements based payment arrangements safe harbor. We
safe harbor, 42 C.F.R. § 1001.952(d), to expand continue to believe, as stated in the preamble to
the definition of "outcomes-based payment" to the 2020 final rule, that payments for
include internal cost sharing (or gainsharing) arrangements that reduce internal costs may
payments. pose risks to patient care, among other
concerns.4 At this time, we continue to believe
that the risks outweigh any potential benefits of
these arrangements such that safe harbor
protection is not warranted.
New safe harbor for payments from hospitals to OIG is not adopting this suggestion. We believe
post-acute-care providers to transition patients that existing regulations, including new and
to clinically appropriate, lower-cost care settings. modified safe harbors that were finalized in the
2020 final rule, provide sufficient regulatory
flexibility for financial arrangements between
referral sources that balance the goals of care
coordination and delivery of value-based care
with the need to protect both patients and
3 42 C.F.R. § 1001.952(h)(5)(vi); OIG, Medicare and State Health Care Programs: Fraud and Abuse; OIG Anti-Kickback Provisions, 56
Fed. Reg. 35,952 (July 29, 1991), https://oig.hhs.gov/documents/compliance/857/072991.htm.
4 85 Fed. Reg. at 77,845.
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Federal health care programs. We may consider
this topic in future rulemaking.
A new safe harbor for the waiver or offset of OIG has repeatedly expressed concerns
cost-sharing obligations for items and services regarding routine waivers of Medicare cost-
provided in connection with: (i) value-based sharing amounts that do not meet an exception
arrangements for care management or remote to the civil monetary penalty provision
patient monitoring; and (ii) the Acute Care prohibiting inducements to beneficiaries at
Hospital at Home program and any follow-on section 1128A(i)(6)(A) of the Social Security Act.
model that may be established by CMS following Accordingly, we decline to adopt these
the expiration of the Section 1135 public health suggestions.
emergency waiver.
A new safe harbor that would protect OIG is not adopting this suggestion. We may
remuneration between wholly owned consider this topic in future rulemaking.
subsidiaries and between a parent company and
a subsidiary.
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