Archive
Alleged Nepotism and Wasteful Spending in the Office of Energy Efficiency and Renewable Energy
Alleged Nepotism and Wasteful Spending in the Office of Energy Efficiency and Renewable Energy
Source: U.S. Department of Energy, Office of Inspector General
The Department of Energy (Department) administers various hiring programs designed to generate a pipeline of talent to replenish its workforce and to maintain overall workforce vitality.
One of those programs is the Student Temporary Employment Program (STEP), which provides opportunities for students to gain work experience, while enhancing their awareness of the Department’s mission and functions. STEP appointments are exempted from the usual competitive selection examining procedures; however, this does not negate the responsibility for ensuring a fair and open competitive process during the selection of STEP participants. While the Office of the Chief Human Capital Officer provides various hiring related services to a number of program offices, selection authority is vested in individual program offices.
Recently, the Office of Inspector General (OIG) received allegations that a senior
Office of Energy Efficiency and Renewable Energy (EERE) official had violated these regulations by: (1) engaging in nepotism by advocating for his three children to obtain STEP employment at the Department; and (2) wasting funds by enrolling two of the three children in costly training courses unrelated to their duties as STEP interns.
Our inspection substantiated the allegation that the senior EERE official was actively involved in securing STEP intern appointments at the Department for his three college-aged children. The allegation related to enrolling his children in inappropriate training was not substantiated. Nepotism or even its appearance can have a decidedly negative impact on morale within an organization. As is readily apparent, providing inappropriate advantages for relatives of Federal employees damages the integrity of the competitive process and erodes public trust in the Federal hiring process. Management concurred with the recommendations in the report to strengthen internal controls over hiring processes within the Department.
Comparing Lab Test Payment Rates: Medicare Could Achieve Substantial Savings
Comparing Lab Test Payment Rates: Medicare Could Achieve Substantial Savings (PDF)
Source: U.S. Department of Health and Human Services, Office of Inspector General
WHY WE DID THIS STUDY
Medicare is the largest payer of clinical laboratory (lab) services in the Nation. It paid approximately $8.2 billion for lab tests in 2010, which accounted for 3 percent of all Medicare Part B payments. Prior to this evaluation, there had not been a comparison of Medicare payment rates to those of other health care service payers. Such a comparison will help ensure that Medicare is a prudent purchaser of lab services.HOW WE DID THIS STUDY
We collected payment data from 50 State Medicaid programs and 3 Federal Employees Health Benefits (FEHB) plans that pay for lab tests on a fee-for-service basis. We requested the payment rates in effect from January 1 through March 31, 2011, for 20 lab tests. For each lab test in each geographic area represented on the Medicare Clinical Laboratory Fee Schedule (CLFS), we compared Medicare paid claims with the State Medicaid program fee schedule amount and FEHB plan median claim payment amounts. We surveyed State Medicaid programs and FEHB plans to determine how their lab test fee schedules or payment rates were formulated, whether a copayment was charged to the patient, and whether lab test charges counted towards a member’s deductible.WHAT WE FOUND
In 2011, Medicare paid between 18 and 30 percent more than other insurers for 20 high-volume and/or high-expenditure lab tests. Medicare could have saved $910 million, or 38 percent, on these lab tests if it had paid providers at the lowest established rate in each geographic area. State Medicaid programs and 83 percent of FEHB plans use the Medicare CLFS as a basis for establishing their own fee schedules and payment rates, although most pay less. However, unlike Medicare, FEHB programs incorporate factors such as competitor information, changes in technology used in performing lab tests, and provider requests in their payment rates. Some State Medicaid programs and FEHB plans required copayments for lab tests, which, in effect, lowered the costs of lab tests for the insurer.WHAT WE RECOMMEND
We recommend that CMS seek legislation that would allow it to establish lower payment rates for lab tests and consider seeking legislation to institute copayments and deductibles for lab tests. In its comments, CMS stated that it is exploring whether it has authority under current statute to revise payments for lab tests consistent with OIG’s recommendation and that a proposal to establish “deductibles and coinsurance” for lab tests is not included in the fiscal year 2014 President’s Budget.
TSA OIG — Transportation Security Administration’s Screening of Passengers by Observation Techniques (REDACTE D)
Source: Transportation Security Administration, Office of Inspector General
We audited the Transportation Security Administration’s (TSA) Screening of Passengers by Observation Techniques program. The program’s intent is to screen passengers by observing their behavior in order to detect potential high-risk travelers. This program uses Behavior Detection Officers to detect passenger behaviors that may be indicative of stress, fear, or deception. Congressman Bennie Thompson requested an audit of TSA’s Screening of Passengers by Observation Techniques program to determine its effectiveness, efficiency, and economy as a security screening protocol at airports. The audit objective was to determine whether TSA’s Screening of Passengers by Observation Techniques program is structured to ensure that passengers at U.S. airports are screened in an objective and cost-effective manner to identify potential terrorists.
Since the Screening of Passengers by Observation Techniques program began in fiscal year 2007, data provided by TSA indicate that the program has expended an estimated $878 million and has more than 2,800 full-time equivalent positions, as of September 30, 2012. However, TSA has not implemented a strategic plan to ensure the program’s success. For example, TSA did not (1) assess the effectiveness of the Screening of Passengers by Observation Techniques program, (2) have a comprehensive training program, (3) ensure outreach to its partners, or (4) have a financial plan. As a result, TSA cannot ensure that passengers at United States airports are screened objectively, show that the program is cost-effective, or reasonably justify the program’s expansion. In fiscal year 2012, TSA’s Behavior Detection and Analysis Division developed a draft strategic plan that includes a statement of mission, goals, and objectives. However, the plan had not been approved and implemented at the time of our review.
We made six recommendations to improve the effectiveness of the Screening of Passengers by Observation Techniques program. TSA concurred with all recommendations.
EPA OIG — Early Warning Report: Main EPA Headquarters Warehouse in Landover, Maryland, Requires Immediate EPA Attention
Early Warning Report: Main EPA Headquarters Warehouse in Landover, Maryland, Requires Immediate EPA Attention (PDF)
Source: U.S. Environmental Protection Agency, Office of Inspector General
Our initial research at the EPA’s Landover warehouse raised significant concerns with the lack of agency oversight of personal property and warehouse space at the facility. In particular:
- The warehouse recordkeeping system was incomplete and inaccurate.
- The warehouse was filled with considerable valuable amounts of unusable, inoperable and obsolete furniture and other items.
- The warehouse contained multiple unauthorized and hidden personal spaces that included such items as televisions and exercise equipment.
- Numerous potential security and safety hazards existed at the warehouse, including unsecured personally identifiable information (such as passports).
- Deplorable conditions existed at the warehouse; corrosion, vermin feces, mold and other problems were pervasive.
As a result of the conditions noted, EPA property at the warehouse was vulnerable to theft and abuse (including personally identifiable information), EPA property was not properly maintained, the EPA may not have received sufficient value for the funds it pai d for the warehouse’s operation, and warehouse workers were subjected to unsafe conditions for which the EPA could be held liable.
Full Report (PDF),
Report Briefing/Photos (PDF),
Statement from IG (PDF)
Medicare Could Save Millions by Implementing a Hospital Transfer Payment Policy for Early Discharges to Hospice Care
Source: U.S. Department of Health and Human Services, Office of Inspector General
On the basis of our sample results, we estimated that Medicare could have saved $602.5 million for calendar years 2009 and 2010 by applying a hospital transfer payment policy for early discharges to hospice care. Medicare payments based on a per diem rate rather than a full payment for the sampled claims would have resulted in $380,000 in savings. Approximately 30 percent of all hospital discharges to hospice care were early discharges that would have received per diem payments rather than full payments under a hospital transfer payment policy. In addition, this transfer payment policy would not have caused a significant financial disadvantage for hospitals or disproportionately affected any hospital.
Medicare pays hospitals a per diem rate for early discharges when beneficiaries are transferred to another prospective payment system hospital or to postacute-care settings. This is based on the assumption that hospitals should not receive full payments for beneficiaries discharged early and then admitted for additional care in other clinical settings. Consistent with Medicare’s existing transfer payment policies, we define an early discharge as being more than 1 day earlier than the Medicare-established geometric mean length of stay for an applicable diagnosis-related group.
We recommended that CMS change its regulations or pursue a legislative change, if necessary, to establish a hospital transfer payment policy for early discharges to hospice care. CMS stated that it would like to study our recommendation further.
Joint Warfighting and Readiness: Better Oversight and Accountability Needed for the U.S. Army Special Operations Command C-12 Aircraft
Joint Warfighting and Readiness: Better Oversight and Accountability Needed for the U.S. Army Special Operations Command C-12 Aircraft
Source: U.S. Department of Defense, Office of Inspector General
USSOCOM officials did not provide adequate oversight and accountability of the USASOC C-12 aircraft in accordance with DoD guidance. USSOCOM officials did not report the aircraft in their Operational Support Airlift inventory for the Chairman of the Joint Chiefs of Staff’s FY 2012 review. In addition, USSOCOM officials did not make the aircraft visible for centralized scheduling. This occurred because USSOCOM, Army G-3/5/7, and USASOC officials expressed confusion about who was responsible for providing oversight and accountability of the aircraft. As a result, USASOC may be operating an underused aircraft in excess of the required Operational Support Airlift aircraft inventory. In addition, DoD is at an increased risk that misuse of the aircraft by senior officials may occur and go undetected.
Special Advisory Bulletin on the Effect of Exclusion from Participation in Federal Health Care Programs
Source: U.S. Department of Health and Human Services, Office of Inspector General
This updated Special Advisory Bulletin describes the scope and effect of the legal prohibition on payment by Federal health care programs for items or services furnished (1) by an excluded person or (2) at the medical direction or on the prescription of an excluded person. For purposes of Office of Inspector General (OIG) exclusion, payment by a Federal health care program includes amounts based on a cost report, fee schedule, prospective payment system, capitated rate, or other payment methodology. It describes how exclusions can be violated and the administrative sanctions OIG can pursue against those who have violated an exclusion. The updated Bulletin provides guidance to the health care industry on the scope and frequency of screening employees and contractors to determine whether they are excluded persons.
Medicare Hospice: Use of General Inpatient Care
Medicare Hospice: Use of General Inpatient Care
Source: U.S. Department of Health and Human Services, Office of Inspector General
WHY WE DID THIS STUDY
Hospice general inpatient care (GIP) is for pain control or symptom management provided in an inpatient facility that cannot be managed in other settings. The care is intended to be short-term and is the second most expensive level of hospice care. GIP may be provided in one of three settings: a Medicare-certified hospice inpatient unit, a hospital, or a skilled nursing facility (SNF). CMS staff have expressed concerns about possible misuse of GIP, such as care being billed for but not provided, long lengths of stay, and beneficiaries receiving care unnecessarily.
HOW WE DID THIS STUDY
We based this memorandum report on an analysis of Medicare Part A hospice claims. We analyzed the claims data to identify the hospice beneficiaries who received GIP during 2011, the number of days that each beneficiary received this care, and the setting in which the care was provided. We also determined from the claims data the terminal illness of each beneficiary. In addition, we identified all of the Medicare-certified hospices that provided hospice care in 2011.
WHAT WE FOUND
We found that Medicare paid $1.1 billion for GIP in 2011, most of which was provided in hospice inpatient units, as opposed to hospitals or SNFs. Twenty-three percent of Medicare hospice beneficiaries received GIP during the year. One-third of beneficiaries’ GIP stays exceeded 5 days, with 11 percent lasting 10 days or more. The hospices that used inpatient units provided GIP to more of their beneficiaries and for longer periods of time than hospices that used other settings. We also found that 953 hospices, or 27 percent of Medicare hospices, did not provide any GIP to Medicare beneficiaries in 2011 and that 429 of these hospices did not provide any level of hospice care other than routine home care.
These results raise several questions about GIP. Long lengths of stay and the use of GIP in inpatient units need further review to ensure that hospices are using GIP as intended and providing the appropriate level of care. Also, CMS should focus on hospices that do not provide GIP and ensure that these hospices are providing beneficiaries access to needed levels of care at the end of their lives. One option is for CMS to adopt a quality measure regarding hospices’ ability to provide all hospice services.
Alleged Improprieties Regarding the Canine Program at the Department Of Energy’s Y-12 Site
Alleged Improprieties Regarding the Canine Program at the Department Of Energy’s Y-12 Site
Source: U.S. Department of Energy, Office of Inspector General
The Department of Energy’s (Department) Canine Program is an essential component of its efforts to identify and deter potential threats to infrastructure and personnel. At the Y-12 National Security Complex (Y-12) and other nuclear material hosting sites in the Department, canines are used to detect explosives, narcotics, concealed humans and also track human presence at facilities that store, handle and maintain special nuclear material. As outlined in Department directives and adopted as best practices by law enforcement and security professionals, the performance of canine teams depends on continual reinforcement of skills through realistic performance testing, proficiency training and annual certifications. As required by their contract with the Department, canine services contractors are required to develop and implement a canine training and certification program that embodies these principles. Canine services at Y-12 were obtained through a 5-year contract that is valued at almost $15 million. Subsequently, in 2012, we received allegations that the Department’s Y-12 site: (1) possibly "rigged" testing for canine teams, and (2) worked canines beyond their physical capability to perform effectively. Because of conflicting testimony and a lack of supporting documentation, we could not conclusively determine whether there were instances of "rigged" testing. However, our inspection identified a number of issues that led us to question the efficacy of the processes used to test, train and certify canines at Y-12. For instance, performance testing, training and annual certifications of canine teams were not properly conducted and/or documented. We did substantiate the allegation that handlers had worked canines beyond their physical capability to perform assigned duties. Deficiencies associated with the management of a multi-layered contract structure for furnishing canine services at the Y-12 site contributed to the problems we observed. Finally, Federal officials and various contractor officials acknowledged that they had not reviewed the training and certification records for the canine teams because the Canine Program was not identified as a high-risk security area based on the Department’s graded approach for risk determination. Management concurred with the recommendations in the report and agreed to develop and implement standardized policies and guidelines for all National Nuclear Security Administration sites utilizing canine detection services.
Interim Investigative Report – Improper Contracting and Procurement Practices Utilized to Circumvent the Competitive Bid Process
Interim Investigative Report – Improper Contracting and Procurement Practices Utilized to Circumvent the Competitive Bid Process (PDF)
Source: U.S. Office of Personnel Management, Office of Inspector General
While we identified misuse of position and mismanagement within OPM, we did not identify any evidence that Director Berry engaged in any inappropriate conduct. During our investigation, w e learned that Director Berry established an initiative within the agency that directed OPM department heads to proactive ly address poor performance. OPM personnel later referenced the Director’s initiative when communicating about Mr. Liff, which may have contributed to the pressure or time sensitivity perceived by certain individuals.
In conclusion, our investigation has raised serious concerns a bout the stewardship of taxpayer funds by HRS and FSC . In this instance, Federal contracting procedures designed to promote economy, effectiveness, and efficiency were bypassed . This is consistent with the findings of the DOL – OIG ’s investigation .
High-Risk Compounded Sterile Preparations and Outsourcing by Hospitals That Use Them
High-Risk Compounded Sterile Preparations and Outsourcing by Hospitals That Use Them
Source: U.S. Department of Health and Human Services, Office of Inspector General
Summary
WHY WE DID THIS STUDY
A recent nationwide meningitis outbreak caused by contaminated injections, which were compounded by the New England Compounding Center, raised major concerns about the use of drugs supplied by compounding pharmacies. Hospitals may have sourcing arrangements with multiple outside compounding pharmacies and may also compound drugs within their own pharmacies. The meningitis outbreak and its aftermath revealed a gap in information about hospitals’ use of compounded drugs supplied by outside pharmacies and the steps that hospitals take to ensure the quality of compounded drugs.
HOW WE DID THIS STUDY
This study focused on hospital use of compounded sterile preparations (CSPs). CSPs are sterile compounded drugs that are generally administered to patients via injection or infusion. We surveyed a nationally representative sample of 298 acute-care hospitals operating in 2012 that participated in Medicare. We developed and used an online questionnaire to determine the extent and nature of hospital use of CSPs and outsourcing, including the extent to which hospitals outsource versus prepare onsite, and challenges in outsourcing and preparing CSPs. We received responses from 236 hospitals, an overall response rate of 79 percent. In addition, we interviewed stakeholders, including four practicing hospital pharmacists and officials of the trade association that represents hospital pharmacists.
WHAT WE FOUND
In 2012, 92 percent of hospitals used CSPs. Almost all hospitals (92 percent) used sterile-to-sterile CSPs and only 25 percent of hospitals used higher risk nonsterile-to-sterile products. Of the hospitals that used nonsterile-to-sterile CSPs, 85 percent outsourced at least some of these products (i.e., purchased them from outside pharmacies). Factors related to ensuring an adequate supply of CSPs were very important to hospitals when determining whether to outsource CSPs. Also, hospitals took limited steps to ensure the quality of outsourced CSPs but had few problems with the quality of products from outside pharmacies. Finally 56 percent of hospitals made changes or planned to make changes to CSP sourcing practices in response to the fall 2012 meningitis outbreak.
RECOMMENDATIONS
This report does not contain recommendations. OIG will pursue additional work to further examine the safety and quality of pharmaceutical compounding in hospitals, including work examining Federal oversight mechanisms.
Oversight of Private Health Insurance Submissions to the HealthCare.gov Plan Finder
Oversight of Private Health Insurance Submissions to the HealthCare.gov Plan Finder(PDF)
Source: U.S. Department of Health and Human Services, Office of Inspector General
WHY WE DID THIS STUDY
The HealthCare.gov Plan Finder is the first comprehensive, online portal that assists consumers in comparing their health insurance coverage options. All private health insurers in the individual and small group markets are required to submit information to populate the Plan Finder. The data collection conducted by CMS to populate the Plan Finder represents the first national attempt to identify these insurers and the products and plans they offer. To realize the benefits of expanded consumer information, the data displayed on the Plan Finder must be complete and accurate.
HOW WE DID THIS STUDY
We reviewed CMS’s policies and procedures, survey responses, and interview responses regarding oversight of insurers’ data submissions. We selected a purposive sample of 98 small group products and 94 individual plans displayed on the Plan Finder for its November 2011 and January 2012 updates, respectively. For each sampled product and plan, we identified aberrant or inconsistent data displayed on the Plan Finder and determined whether displayed data were consistent with information provided by insurers’ telephone customer service representatives.
WHAT WE FOUND
Most private insurers reported data to the Plan Finder. However, gaps exist in CMS’s oversight of private insurers’ compliance with Plan Finder reporting requirements. CMS did not conduct targeted follow-up with insurers that did not report detailed pricing and benefit information. CMS also has not been able to identify the entire population of insurers required to report basic company and product information. In addition, CMS has not asked insurers to certify to the completeness of submitted data in accordance with Federal regulation. CMS implemented numerous strategies to monitor data accuracy. However, the data displayed on the Plan Finder for the sample of products and plans contained some inconsistencies that may confuse consumers. The products and plans displayed were not always available for sale or were not always recognized by insurers’ representatives. When products and plans were available and were recognized, 81 percent of their data displayed on the Plan Finder matched the information provided by insurers’ representatives.
WHAT WE RECOMMEND
Our findings indicate that additional efforts are needed to oversee private insurers’ compliance with reporting requirements for the HealthCare.gov Plan Finder and to ensure that the data displayed on the Plan Finder are accurate.
Therefore, we recommend that CMS:
(1) Establish and implement procedures to identify and pursue private insurers that do not submit required data to the Plan Finder,
(2) Ensure that each private insurer’s Chief Executive Officer or Chief Financial Officer certifies to the completeness of data submitted to the Plan Finder,
(3) Design and implement additional strategies to ensure Plan Finder data accuracy, and
(4) Validate that products and plans submitted to the Plan Finder are available for sale.
CMS generally concurred with our recommendations and is taking steps to address them.
Surety Bonds Remain an Underutilized Tool To Protect Medicare From Supplier Overpayments
Surety Bonds Remain an Underutilized Tool To Protect Medicare From Supplier Overpayments
Source: U.S. Department of Health and Human Services, Office of Inspector General
WHY WE DID THIS STUDY
In 2009, CMS began to require suppliers of durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS) to obtain a minimum of $50,000 in surety bond coverage per location. A surety bond is issued by an entity (the surety) guaranteeing that the surety will pay CMS the amount of any monetary obligations incurred during the term of the bond, and for which the supplier is responsible, up to the surety’s maximum obligation. Surety bonds can discourage enrollment of fraudulent suppliers and aid the recovery of debts owed to Medicare. We set out to determine the extent to which CMS maintains complete and accurate surety bond data and to determine the amount of supplier debt that could have been recovered through surety bonds.
HOW WE DID THIS STUDY
We requested from CMS information on all outstanding overpayments that were identified for collection between October 2, 2009, and April 1, 2011. We also requested information regarding suppliers’ surety bond coverage and requested CMS’s written procedures for recovering DMEPOS overpayments through surety bonds.
WHAT WE FOUND
Two years after the surety bond requirement was implemented, CMS did not have accurate surety bond information for all suppliers. Information for thousands of bonded suppliers was missing, and surety bond amounts were not consistently maintained by supplier location. Bonded suppliers have tens of millions in uncollected overpayments. As of July 2012, CMS reported it collected $263,000 from the millions in overpayments eligible for surety bond recovery. Most of these overpayments will likely remain uncollected because a number of suppliers had overpayments of more than $50,000, and CMS can recover only up to the amount of the surety bond.
WHAT WE RECOMMEND
We recommend that CMS: (1) improve oversight of supplier data to ensure accurate and consistent information, (2) immediately begin utilizing the surety bond requirement to recover outstanding overpayments from suppliers’ surety bonds, (3) consider using the legislative authority given by the Patient Protection and Affordable Care Act of 2010 to require increased surety bond amounts for suppliers that receive high overall Medicare payments, and (4) revise collection guidelines to state that collection of debts through surety bonds is based on dates of service. CMS concurred with all four recommendations.
New From the GAO
New GAO Reports
Source: Government Accountability Office
INSPECTORS GENERAL
USDA Office of Inspector General Resources, Accomplishments, Coverage, and Quality
GAO-13-245, Mar 22, 2013
NATIONAL PREPAREDNESS
Improvements Needed for Measuring Awardee Performance in Meeting Medical and Public Health Preparedness Goals
GAO-13-278, Mar 22, 2013
A Review of the Operations of the Voting Section of the Civil Rights Division
A Review of the Operations of the Voting Section of the Civil Rights Division (PDF)
Source: U.S. Department of Justice, Office of Inspector General
As detailed in Chapter Three, our examination of the mix and volume of enforcement cases brought by the Voting Section revealed some changes in enforcement priorities over time, but we found insufficient support for a conclusion that Division leadership in either the prior or current administration improperly refused to enforce the voting rights laws on behalf of any particular group of voters, or that either administration used the enforcement of the voting laws to seek improper partisan advantage. Although we had concerns about particular decisions in a few cases, we found insufficient evidence to conclude that the substantive enforcement decisions by Division leadership in Voting Section cases were made in a discriminatory manner. Our conclusion encompasses our review of some of the more controversial enforcement decisions made in Voting Section cases from 2002 through 2011, by Division leadership in both the prior and current administrations.
Notwithstanding this conclusion, our investigation revealed several incidents in which deep ideological polarization fueled disputes and mistrust that harmed the functioning of the Voting Section. As detailed in Chapter Four, these disputes arose at various times both among career employees in the Voting Section and between career employees and politically appointed leadership in CRT. On some occasions the incidents involved the harassment and marginalization of employees and managers.
We believe that the high partisan stakes associated with some of the statutes that the Voting Section enforces have contributed to polarization and mistrust within the Section. Among other things, the Voting Section reviews redistricting cases that can change the composition of Congressional delegations and voter ID laws that have actual or perceived impacts on the composition of the eligible electorate. Moreover, the Division’s leadership makes choices on Voting Section enforcement priorities – such as whether to give greater emphasis to provisions intended to increase voter registration or those intended to ensure the integrity of registration lists and prevent voter fraud – that are widely perceived to affect the electoral prospects of the political parties differently. We found that people on different sides of internal disputes about particular cases in the Voting Section have been quick to suspect those on the other side of partisan motivations, heightening the sense of polarization in the Section. The cycles of actions and reactions that we found resulted from this mistrust were, in many instances, incompatible with the proper functioning of a component of the Department.
Polarization within the Voting Section has been exacerbated by another factor. In recent years a debate has arisen about whether voting rights laws that were enacted in response to discrimination against Blacks and other minorities also should be used to challenge allegedly improper voting practices that harm White voters. Views on this question among many employees within the Voting Section were sharply divergent and strongly held. Disputes were ignited when the Division’s leadership decided to pursue particular cases or investigations on behalf of White victims, and more recently when Division leadership stated that it would focus on “traditional” civil rights cases on behalf of racial or ethnic minorities who have been the historical victims of discrimination.
Growth of Domestic Airline Code Sharing Warrants Increased Attention
Growth of Domestic Airline Code Sharing Warrants Increased Attention
Source: U.S. Department of Transportation, Office of Inspector General
On February 14, 2013, we issued a report regarding the Office of the Secretary’s (OST) and the Federal Aviation Administration’s (FAA) oversight of domestic airline code share agreements. The number of code share agreements—in which a mainline air carrier contracts with a smaller regional carrier to provide flights to its hub airports—has grown rapidly in recent years, raising questions about both the oversight and consumer awareness of these agreements.
We found that OST and FAA are not required to review most domestic code share agreements. While OST is required to assess the potential economic impacts of certain agreements, the number of agreements that fall under the criteria for review is limited. We also found that some confusion still exists for consumers about which airline is operating their flight because carriers, travel agencies, and advertisers all disclose this information differently. Finally, as a safety regulator, FAA is not required to review any domestic code share agreements and does not voluntarily do so. FAA also does not have specific procedures to advance the Agency’s commitment of ensuring an equivalent level of safety between mainline air carriers and their code share partners. Instead, the Agency relies on its oversight of individual carriers to ensure the safe operation of passenger flights. We made five recommendations to enhance OST and FAA monitoring of domestic code share relationships and to increase code share transparency for consumers. In a joint response, OST and FAA concurred with two recommendations and partially concurred with three. We are requesting that the Agencies provide additional information or reconsider their response for two recommendations.
FAA’s Efforts To Track and Mitigate Air Traffic Losses of Separation Are Limited by Data Collection and Implem entation Challenges
Source: U.S. Department of Transportation, Office of Inspector General
On February 27, 2013, we issued a report on the Federal Aviation Administration’s (FAA) efforts to identify and mitigate risks of air traffic losses of separation—i.e., when two aircraft fly closer together than safety standards permit, due to an air traffic controller operational error, a pilot’s deviation, or other issue. Between fiscal years 2009 and 2010, the number of reported operational errors by controllers increased by more than 50 percent. According to FAA, this increase was mostly due to enhanced reporting through new voluntary and automated reporting programs. However, we found that the increase was linked, in part, to a rise in actual errors, as well as other contributing factors. In addition, we found that FAA lacks an accurate baseline of the actual total number of separation losses that occur. Although FAA has recently instituted new policies and procedures for improving the collection, investigation, and reporting of separation losses, we found that the effectiveness of these procedures is limited by incomplete data and implementation challenges. Finally, FAA has recently developed new corrective action plans to mitigate high-risk separation loss events. However, it is too early to determine the effectiveness of these plans. In addition, the Agency’s corrective action plans do not include all safety risks identified by FAA and will not address all losses of separation that air traffic facility officials consider to be high risk.
FAA concurred with four and partially concurred with two of our six recommendations to improve the Agency’s policies and processes for identifying and mitigating separation losses. We are requesting that FAA provide additional information or reconsider its response for two recommendations.
HHS OIG — Compendium of Unimplemented Recommendations
Compendium of Unimplemented Recommendations (PDF)
Source: U.S. Department of Health and Human Services, Office of Inspector General
The Department of Health & Human Services (HHS) Office of Inspector General (OIG) Compendium of Unimplemented Recommendations (Compendium) summarizes significant1 monetary and nonmonetary recommendations that, when implemented, will result in cost savings and/or improvements in program efficiency and effectiveness. The recommendations result from audits and evaluations that are performed pursuant to the Inspector General Act of 1978, as amended.
Inappropriate Payments to Skilled Nursing Facilities Cost Medicare More Than a Billion Dollars in 2009
Inappropriate Payments to Skilled Nursing Facilities Cost Medicare More Than a Billion Dollars in 2009
Source: U.S. Department of Health and Human Services, Office of Inspector General
Summary
WHY WE DID THIS STUDY
In recent years, the Office of Inspector General has identified a number of problems with billing by skilled nursing facilities (SNF), including the submission of inaccurate, medically unnecessary, and fraudulent claims. Further, the Medicare Payment Advisory Commission has raised concerns about SNFs’ improperly billing for therapy to obtain additional Medicare payments. In fiscal year (FY) 2012, Medicare paid $32.2 billion for SNF services.
HOW WE DID THIS STUDY
We based this study on a medical record review of a stratified random sample of SNF claims from 2009. The reviewers determined whether the information reported by the SNFs on the Minimum Data Set (MDS) was supported by and consistent with the medical record. The MDS is a standardized tool that SNFs use to assess each beneficiary. SNFs use the information on the MDS to classify beneficiaries into resource utilization groups (RUG). The RUGs determine how much Medicare pays the SNFs.
WHAT WE FOUND
SNFs billed one-quarter of all claims in error in 2009, resulting in $1.5 billion in inappropriate Medicare payments. The majority of the claims in error were upcoded; many of these claims were for ultrahigh therapy. The remaining claims in error were downcoded or did not meet Medicare coverage requirements. In addition, SNFs misreported information on the MDS for 47 percent of claims. SNFs commonly misreported therapy, which largely determines the RUG and the amount that Medicare pays the SNF.
WHAT WE RECOMMEND
We recognize that CMS has recently made several significant changes to SNF payments. However, more needs to be done to reduce inappropriate payments to SNFs. We recommend that CMS: (1) increase and expand reviews of SNF claims, (2) use its Fraud Prevention System to identify SNFs that are billing for higher paying RUGs, (3) monitor compliance with new therapy assessments, (4) change the current method for determining how much therapy is needed to ensure appropriate payments, (5) improve the accuracy of MDS items, and (6) follow up on the SNFs that billed in error. CMS concurred with all six recommendations.
Analyzing Changes to Medicaid Federal Upper Limit Amounts
Analyzing Changes to Medicaid Federal Upper Limit Amounts
Source: U.S. Department of Health and Human Services, Office of Inspector General
WHY WE DID THIS STUDY
Prior OIG work consistently found that the published prices used to set Medicaid’s Federal upper limit (FUL) amounts often greatly exceeded prices available in the marketplace. Partly because of OIG work, provisions of the Deficit Reduction Act of 2005, P.L. 109-171, were crafted to substantially change the method for calculating FULs and most likely would have resulted in lower FUL amounts; however, these changes were never implemented because of an injunction against CMS and subsequent changes in the law. The Patient Protection and Affordable Care Act (ACA), P.L. 111-148, enacted in March 2010, also includes provisions that seek to change FUL amounts. In September 2011, CMS began releasing the new FUL amounts to the public in draft form. Given our previous findings that FUL amounts based on published prices greatly exceeded pharmacy acquisition costs and that the new FUL amounts have not taken effect, we compared FUL amounts based on published prices to FUL amounts based on average manufacturer prices (AMP) and then compared both FUL amounts to pharmacy acquisition costs.
HOW WE DID THIS STUDY
We compared aggregate pharmacy acquisition costs for selected drugs to (1) FUL amounts based on published prices and (2) FUL amounts based on post-ACA AMPs. We also compared FUL amounts based on published prices to FUL amounts based on post-ACA AMPs and calculated the difference for each drug.
WHAT WE FOUND
We found that FUL amounts based on published prices were more than four times greater than sampled pharmacy acquisition costs. We also found that FUL amounts based on AMPs were 61 percent lower than FUL amounts based on published prices, at the median. Despite the reduction in proposed reimbursement, FUL amounts based on AMPs still exceed sampled pharmacy acquisition costs by 43 percent in the aggregate. CMS had not implemented FUL amounts based on AMPs as of August 2012. Although CMS has taken steps to implement FUL amounts based on AMPs by calculating the new amounts and issuing draft files for review, FUL amounts continued to be based on published prices as of August 2012.
WHAT WE RECOMMEND
Given the results of the body of OIG work and the potential reduction in Medicaid expenditures, we recommend that CMS complete the implementation of the post-ACA AMP-based FUL amounts. CMS concurred with our recommendation and stated that it plans to implement FUL amounts based on AMPs in the near future.
