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USPS OIG — Competition Advocate – Audit Report

August 19, 2014 Comments off

Competition Advocate – Audit Report (PDF)
Source: U.S. Postal Service, Office of Inspector General

Background
The U.S. Postal Service established the competition advocate (advocate) on January 28, 2011. The advocate promotes competition by helping contracting officials develop effective ways to obtain best value in contracting and issuing an annual report on noncompetitive purchase activity. The advocate must review noncompetitive requests for contractual actions (steps to create or modify a contract) greater than $1 million. The advocate does not approve or deny noncompetitive purchases but offers feedback to contracting officers (CO) on how to increase competition, including how to transition work to internal resources and research potential suppliers. COs are supposed to consider this feedback when evaluating whether the Postal Service should compete a contract. The advocate does not decide appeals by contractors.

What the OIG Found
We could not determine the advocate’s impact in promoting contract competition because the Postal Service does not have metrics to measure advocate performance. For example, for 35 of the 74 contractual actions, the advocate provided feedback on ways to increase competition, but there are no metrics to determine the impact of this feedback. Without such metrics, the Postal Service cannot accurately gauge the advocate’s success in promoting competition. In addition, the advocate did not review requests for 12 of the 74 contractual actions, totaling about $40 million. This occurred because there is no process to ensure that the advocate reviews all applicable requests. These actions were awarded without an opportunity for the advocate to suggest ways to promote competition.

Further, COs did not document their consideration of the advocate’s comments on requests for two contractual actions, totaling about $2.8 million. This occurred because Postal Service policy does not explicitly state how the CO should document responses to the advocate’s comments.

What the OIG Recommended
We recommended management develop metrics to gauge the impact of the advocate, reiterate the requirement to obtain the advocate’s review of applicable requests, and establish a process to verify that the advocate reviewed all applicable noncompetitive actions. We also recommended management clarify how COs should address the advocate’s feedback.

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HHS OIG — Nursing Facilities’ Compliance with Federal Regulations for Reporting Allegations of Abuse or Neglect

August 19, 2014 Comments off

Nursing Facilities’ Compliance with Federal Regulations for Reporting Allegations of Abuse or Neglect
Source: U.S. Department of Health and Human Services, Office of Inspector General

WHY WE DID THIS STUDY
To protect the well-being of residents, nursing facilities must comply with Federal regulations to develop and implement written policies related to reporting allegations of abuse, neglect, mistreatment, injuries of unknown source, and misappropriation of resident property (allegations of abuse or neglect). Further, allegations of abuse or neglect must be reported to the facility administrator or designee and the State survey agency within 24 hours. Results of investigations of these allegations must be reported to the same authorities within 5 working days. Nursing facilities must also notify owners, operators, employees, managers, agents, or contractors of nursing facilities (covered individuals) annually of their obligation to report reasonable suspicions of crimes.

HOW WE DID THIS STUDY
This study included a: (1) review of sampled nursing facilities’ policies related to reporting allegations of abuse or neglect, (2) review of sampled nursing facilities’ policies related to reasonable suspicions of crimes, and (3) survey of administrators from those sampled facilities. It also included an examination of a random sample of allegations of abuse or neglect identified from the sampled nursing facilities, and a review of documentation related to those sampled allegations of abuse or neglect.

WHAT WE FOUND
It is both required and expected that nursing facilities will report any and all allegations of abuse or neglect to ensure resident safety. We found that 85 percent of nursing facilities reported at least one allegation of abuse or neglect to OIG in 2012. Additionally, 76 percent of nursing facilities maintained policies that address Federal regulations for reporting both allegations of abuse or neglect and investigation results. Further, 61 percent of nursing facilities had documentation supporting the facilities’ compliance with both Federal regulations under Section 1150B of the Social Security Act. Lastly, 53 percent of allegations of abuse or neglect and the subsequent investigation results were reported, as Federally required.

WHAT WE RECOMMEND
We recommend that CMS ensure that nursing facilities: (1) maintain policies related to reporting allegations of abuse or neglect; (2) notify covered individuals of their obligation to report reasonable suspicions of crimes; and (3) report allegations of abuse or neglect and investigation results in a timely manner and to the appropriate individuals, as required. CMS concurred with all three of our recommendations.

Significant Security Deficiencies in NOAA’s Information Systems Create Risks in Its National Critical Mission

August 15, 2014 Comments off

Significant Security Deficiencies in NOAA’s Information Systems Create Risks in Its National Critical Mission
Source: U.S Department of Commerce, Office of Inspector General
From Abstract (PDF):

Information systems connected to NESDIS’ critical satellite ground support systems increases the risk of cyber attacks. The Polar-orbiting Operational Environmental Satellites’ (POES’) and Geostationary Operational Environmental Satellites’ (GOES’) mission-critical satellite ground support systems have interconnections with systems where the flow of information is not restricted, which could provide a cyber attacker with access to these critical assets.

NESDIS’ inconsistent implementation of mobile device protections increases the likelihood of a malware infection. In our review of selected Windows components on four NESDIS systems, we found that (a) unauthorized mobile devices had been connected to POES, GOES, and Environmental Satellite Processing Center (ESPC), and (b) GOES and ESPC did not consistently ensure that Microsoft Windows’ AutoRun feature was disabled.

Improvements are needed to provide assurance that independent security control assessments are sufficiently rigorous. We found that 28 of 60 (47 percent) of the independent assessments of security controls have deficiencies and may not have provided NOAA’s authorizing official with an accurate implementation status of the system’s security controls.

Transparency — Sen. Chuck Grassley (R-IA) on Lack of Access Concerns from Inspectors General

August 13, 2014 Comments off

Grassley on Lack of Access Concerns from Inspectors General
Source: Senator Chuck Grassley (R-IA)

Sen. Chuck Grassley, Ranking Member of the Judiciary Committee, is a long-time advocate for independent agency inspectors general. Grassley has been concerned by problems inspectors generals have had accessing necessary information from their agencies. For example, the Peace Corps inspector general was stonewalled simply trying to get access to records to ensure the agency was acting in accordance with the law in addressing sexual abuse cases. Grassley sent three letters to the agency explaining the law and ultimately held up the nomination of the director before a temporary solution was found. The Justice Department inspector general in 2009 suddenly ran into problems getting access to material previously received from the FBI. Grassley pressed the FBI Director for answers to this abrupt change in position during an oversight hearing on May 21, 2014. The Justice Department responded to an April 2 letter on June 24 to try to justify its position. The dispute continues.

Grassley was copied on a letter today to congressional committees of jurisdiction from 47 inspectors general expressing concern about agency refusal to provide access to critical agency records. The inspectors general cite the Department of Justice, the Chemical Safety Board and the Peace Corps as examples.

Combined Assessment Program Summary Report: Evaluation of Hospice and Palliative Care in Veterans Health Administration Facilities

August 12, 2014 Comments off

Combined Assessment Program Summary Report: Evaluation of Hospice and Palliative Care in Veterans Health Administration Facilities (PDF)
Source: U.S. Department of Veterans Affairs, Office of Inspector General

The VA Office of Inspector General Office of Healthcare Inspections completed an evaluation of hospice and palliative care in Veterans Health Administration facilities. The purposes of the evaluation were to determine whether VHA facilities performed active hospice and palliative care case finding, provided end-of-life care training to staff, and met selected documentation standards and to assess selected Palliative Care Consult Team processes, documentation, and staffing.

Inspectors evaluated hospice and palliative care at 54 facilities during Combined Assessment Program reviews conducted from October 1, 2012, through September 30, 2013.

Although we observed many positive practices, we identified two opportunities for Veterans Health Administration facilities to improve. We recommended that the Under Secretary for Health, in conjunction with Veterans Integrated Service Network and facility leaders, ensures that:

+ Facilities provide at least the minimum required Palliative Care Consult Team staffing.

+ Facilities provide end-of-life care training to staff who work in areas where they are likely to encounter patients at the end of their lives.

DHS OIG — Domestic Nuclear Detection Office Has Taken Steps To Address Insider Threat, but Challenges Remain

August 1, 2014 Comments off

Domestic Nuclear Detection Office Has Taken Steps To Address Insider Threat, but Challenges Remain
Source: U.S. Department of Homeland Security, Office of Inspector General

We reviewed the efforts of the Domestic Nuclear Detection Office (DNDO) to address the risk posed by trusted insiders. Our objective was to assess DNDO’s progress toward protecting its information technology assets from threats posed by its employees, especially those with trusted or elevated access to sensitive, but unclassified information systems or data.

Steps are underway to address and mitigate the insider risk at DNDO. Specifically, the Department of Homeland Security (DHS) Acting Under Secretary of Intelligence and Analysis established an Insider Threat Task Force to develop a program to address the risk of insider threats for DHS, including DNDO. In addition, the DHS Office of Intelligence and Analysis has detailed a counterintelligence officer to DNDO to help mitigate espionage‐related insider risks. The DHS Office of Intelligence and Analysis routinely briefs DNDO on counterintelligence awareness, including insider threat indicators. In addition, DNDO provides security awareness training to its employees and contractors regarding security‐related topics that could help prevent or detect the insider risk. In September 2013, the DHS Office of the Chief Security Officer began a comprehensive vulnerability assessment of DNDO assets, which includes identifying insider risks and vulnerabilities. The DHS Security Operations Center monitors DNDO information systems and networks to respond to potential insider based incidents. Finally, the DHS Special Security Programs Division handles and investigates security incidents, including those types attributed to malicious insiders.

Additional steps to address the insider risk at DNDO are required. Specifically, DNDO needs to implement insider threat procedures, upon receipt of policy issued by the DHS Office of the Chief Information Officer (OCIO) that defines roles and responsibilities for addressing insider risks to unclassified networks and systems. DNDO also needs to provide documentation that clearly shows the effectiveness of controls or processes in place to detect and respond to unauthorized data exfiltration from DNDO unclassified information technology assets via email services provided by the DHS OCIO.

DNDO can strengthen processes and controls for its own technology infrastructure. They can disable portable media ports on controlled information technology assets where there is no legitimate business need. DNDO can apply critical security patches to these assets and perform periodic security assessments of controlled sites to identify any indication of unauthorized wireless devices or connections to DHS networks.

Review of Waste and Mismanagement at the Patent Trial and Appeal Board

August 1, 2014 Comments off

Review of Waste and Mismanagement at the Patent Trial and Appeal Board (PDF)
Source: U.S. Department of Commerce, Office of Inspector General
From Transmittal Memo (PDF):

Attached is our final report detailing the findings of our investigation into allegations received from multiple whistleblowers alleging waste and mismanagement at the Patent Trial and Appeal Board (PTAB) , one of the components within the U.S. Patent and Trademark Office.

Our investigation uncovered waste in the PTAB that persisted for more than four years (2009-13) and resulted in the misuse of federal resources totaling more than $5 million. The bulk of the wasted resources related to PTAB’s paralegals, who had insufficient workloads and considerable idle time during those years. Paralegals told the OIG that they engaged in a variety of personal activities including watching television; surfing the internet; using Facebook and other social media; washing laundry and cleaning dishes; and shopping online while in an official pay status.

PT AB managers, including its senior-most personnel, were aware of this problem but took little action to prevent such waste because they believed the problem would disappear once PTAB hired additional judges. We found that, by failing to report the significant waste incurred by the PT B when Paralegal Specialists were being paid to not work, numerous PTAB employees appear to have violated certain regulations and Department of Commerce policies.

DHS OIG — Oversight of Unaccompanied Alien Children

July 31, 2014 Comments off

Oversight of Unaccompanied Alien Children (PDF)
Source: U.S. Department of Homeland Security, Office of Inspector General
From press release (PDF):

The Office of Inspector General (OIG), Department of Homeland Security (DHS), today issued the first of a series of reports on conditions at detention centers being used to temporarily house unaccompanied alien children.

The report is based on 87 unannounced site visits conducted by OIG agents from July 1-16 at 63 detention centers in Texas, Arizona and California, largely operated by Customs and Border Protection. The OIG’s oversight of the detention centers is ongoing and reports will be issued monthly.

The OIG’s findings are contained in a memorandum from Inspector General John Roth to Homeland Security Secretary Jeh C. Johnson.

OIG Agents checked the sites for sanitation, availability of medical care, food services and other factors. Sites and their staff were found to be largely in compliance with rules and regulations. Some problems were identified, including children requiring treatment for communicable diseases and DHS employees who have become ill from contact with their charges.

Approaches for Establishing Fraud Risk Assessment Programs and Conducting Fraud Audit Risk Assessments Within the Department of Defense

July 25, 2014 Comments off

Approaches for Establishing Fraud Risk Assessment Programs and Conducting Fraud Audit Risk Assessments Within the Department of Defense
Source: U.S. Department of Defense, Office of Inspector General

Objective
The objective of the review was to identify approaches for establishing fraud risk assessment programs and conducting fraud risk assessments within the DoD. The review focused on various DoD activities including procurement, retail, and financial operations.

What We Found
We identified numerous innovative approaches for conducting fraud risk assessments. Of the 33 DoD organizations we interviewed,* 13 were conducting entity-wide risk assessments, 26 were conducting fraud risk assessments when performing audit-related work, 23 were providing fraud awareness training, and 3 were concentrating on internal control evaluations.

DoD entities are encouraged to modify any of the described approaches to suit their specific mission, size, and fraud vulnerabilities. The approaches were developed through research and interviews with 100 subject matter experts representing DoD organizations, academic institutions, private companies, and nonprofit organizations.

Fraud risk assessment approaches developed by the Marine Corps Nonappropriated Funds Audit Service; Army and Air Force Exchange Service, Audit Division; and the Army Audit Agency are highlighted within this report. Additionally, entity-wide fraud risk assessment approaches developed by the DoD Investigative Organizations; Naval Exchange Service Command, Office of Internal Audit; and the Naval Sea Systems Command Office of the Inspector General are also discussed in detail. The report also contains information on auditor and entity-wide fraud risk assessment approaches developed by external DoD organizations.

We used documentation obtained from the subject matter experts to develop example documents included in the report Appendixes. Example documents include audit organization fraud risk assessment policies, financial statement audit fraud interview questionnaire, and an entity-wide fraud risk assessment report. The report also provides information on auditor fraud brainstorming and interviewing techniques and DoD fraud case study examples.

Management Comments and Our Response
We have incorporated draft report comments received from the Commander, Naval Sea Systems Command; Naval Audit Service; Defense Health Agency; Defense Information Systems Agency, Office of the Inspector General; Air Force Office of Special Investigations; and Board of Regents of the University System of Georgia. No further comments are required.

USPS OIG — Package Services: Get Ready, Set, Grow!

July 22, 2014 Comments off

Package Services: Get Ready, Set, Grow! (PDF)
Source: U.S. Postal Service, Office of Inspector General

The package delivery market has been growing considerably. Between 2008 and 2013, the U.S. Postal Service experienced a more than 20 percent increase in package volume. The main reason is the growing popularity of e-commerce, particularly online shopping. American businesses and consumers spent more than $68 billion to ship packages domestically in 2013. E-commerce sales in the U.S. alone this year will top $430 billion; global e-commerce will exceed $1.5 trillion.

There is no doubt that packages are growing in importance to the Postal Service’s future. To meet emerging customer demands, the Postal Service needs to position itself for long-term success and broaden its role across the package delivery value chain. The Postal Service has already taken some steps towards enhancing its ability to handle an increase in packages. However, it needs a strategy that includes expanding beyond the traditional postal expertise of last-mile delivery to offer one-stop.

VA OIG — Administrative Investigation, Prohibited Personnel Practice and Preferential Treatment, National Cemetery Administration, VA Central Office

July 22, 2014 Comments off

Administrative Investigation, Prohibited Personnel Practice and Preferential Treatment, National Cemetery Administration, VA Central Office (PDF)
Source: U.S. Department of Veterans Affairs, Office of Inspector General

The former Under Secretary for Memorial Affairs engaged in a prohibited personnel practice when he created a position and preselected an employee for that position. He also engaged in preferential treatment of an NCA contractor when he developed a less-than-arm’s-length relationship with the contractor. Further, NCA improperly gave the contractor sole-source contracts to provide one-to-one services to select NCA employees.

DOG OIG — Development and Implementation of Sexual Assault Evidence and Criminal Records Retention Policy

July 18, 2014 Comments off

Development and Implementation of Sexual Assault Evidence and Criminal Records Retention Policy
Source: U.S. Department of Defense, Office of Inspector General

Objective
We initiated this review as required by the “National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2014.” Our objective was to review the Military Criminal Investigative Organizations’[1] (MCIO) progress in implementing DoD policy on the retention of and access to evidence and criminal records relating to sexual assault of service members as required by “The National Defense Authorization Act for Fiscal Year 2012,” and Department of Defense Instruction (DODI) 5505.18, “Investigation of Adult Sexual Assault in the Department of Defense,” January 25, 2013, Incorporating Change 1, May 1, 2013.

Findings
DoD has developed policy for retaining and accessing evidence and criminal records for sexual assault victims as required by NDAA FY 2012. The MCIOs have issued Service-specific policies and procedures to implement Federal law and DoD guidance.

Recommendations
None.

Management Comments
No written response to this report was required.

DOJ OIG — An Assessment of the 1996 Department of Justice Task Force Review of the FBI Laboratory

July 17, 2014 Comments off

An Assessment of the 1996 Department of Justice Task Force Review of the FBI Laboratory (PDF)
Source: U.S. Department of Justice, Office of Inspector General

This is the third review by the Office of the Inspector General (OIG) since 1997 related to alleged irregularities by the Federal Bureau of Investigation (FBI) Laboratory (Lab). 2 The first two OIG reports focused on alleged FBI Lab deficiencies, the conduct of individuals brought to our attention by a whistleblower, and remedial actions the FBI took in response to our recommendations. This report addresses how the Criminal Division Task Force (Task Force), created by the Department in 1996 and whose mission was redefined in 1997, managed the identification, review, and follow-up of cases involving the use of scientifically unsupportable analysis and overstated testimony by FBI Lab examiners in criminal prosecutions. We analyzed the Task Force’s review of cases involving 13 FBI examiners the Task Force determined had been criticized in the 1997 OIG report. We included in our review a close examination of cases handled by 1 of the 13 examiners, Michael Malone, the Lab’s Hairs and Fibers Unit examiner whose conduct was particularly problematic.

Although the Task Force made a diligent effort to manage a complex review of thousands of cases, we found the following serious deficiencies in the Department’s and the FBI’s design, implementation, and overall management of the case review process…

VA OIG — Review of the Special Initiative To Process Rating Claims Pending Over 2 Years

July 15, 2014 Comments off

Review of the Special Initiative To Process Rating Claims Pending Over 2 Years (PDF)
Source: U.S. Department of Veterans Affairs, Office of Inspector General

On April 19, 2013, the Veterans Benefits Administration (VBA) began a Special Initiative to process all claims pending over 2 years. VA Regional Office (VARO) staff were to issue provisional ratings for cases awaiting required evidence and complete these older claims within 60 days. Our review focused on whether (1) provisional ratings resulted in veterans receiving benefits more quickly and helped eliminate the backlog, and (2) older claims were accurately. The Special Initiative rating process was less effective than VBA’s existing rating process in providing benefits to veterans quickly. Further, VBA removed all provisional claims from its pending inventory, despite more work being needed to complete them. This process misrepresented VBA’s actual workload of pending claims and its progress toward eliminating the overall claims backlog. At the end of June 2013 following completion of the Special Initiative, VBA reported 516,922 rating claims pending in its backlog, but only 1,258 rating claims pending over 2 years. We estimated 7,823 provisionally rated claims had been removed from the inventory though they still awaited final decisions. These claims represented less than 2 percent of VBA’s reported backlog, but about 12 percent of claims completed under the Initiative. VAROs did not prioritize finalization of the provisionally rated claims once they were issued. We estimated 6,860 provisional ratings were still waiting for final decisions as of January 2014, 6 months after the Initiative had ended. Because VBA did not ensure existing controls were functioning as needed to effectively identify and manage provisionally rated claims, some veterans may never have received final rating decisions if not for our review. Additionally, VBA did not accurately process 77 (32 percent) of 240 rating decisions we reviewed under this Initiative. Generally, these errors occurred because VAROs felt pressured to complete these claims within VBA’s 60 day deadline. We estimated VARO staff inaccurately processed 17,600 of 56,500 claims, resulting in $40.4 million in improper payments during the Initiative period. We recommended the Under Secretary for Benefits establish controls for all provisionally-rated claims, reflect these claims in VBA’s pending workload statistics, expedite finalization of provisional ratings, and review for accuracy all claims that received provisional ratings under the Special Initiative. The Under Secretary for Benefits concurred with our recommendations. Management’s planned actions are responsive and we will follow up as required on all actions.

OIG HHS — Questionable Billing for Medicare Part B Clinical Laboratory Services

July 11, 2014 Comments off

Questionable Billing for Medicare Part B Clinical Laboratory Services
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. From 2005 to 2010, Part B Medicare enrollment increased by 10 percent, while spending for lab services increased by 29 percent. In 2010, Medicare payments for all Part B lab services totaled $8.2 billion. We conducted this study to identify questionable billing patterns among Medicare lab services.

HOW WE DID THIS STUDY
We based this study on an analysis of Part B claims for lab services with dates of service in 2010. Labs submit claims for each lab service provided for Medicare beneficiaries. Each claim contains information about the lab provider, the ordering physician, the beneficiary, and the lab service. We developed 13 measures to describe labs’ billing patterns and to identify labs with questionable billing patterns. We calculated and analyzed the distribution of the measures for each lab. We then calculated a statistical threshold for the 13 measures and determined whether a lab’s billing was unusually high for each measure. Additionally, we calculated the total number of claims and total allowed amount associated with certain measures of questionable billing.

WHAT WE FOUND
In 2010, over 1,000 labs exceeded the thresholds (i.e., had unusually high billing) for 5 or more measures of questionable billing for Medicare lab services. For example, a lab might have an unusually high percentage of claims with ineligible and/or invalid ordering-physician numbers, or an unusually high allowed amount per ordering physician. Almost half of the labs that exceeded the thresholds for five or more measures of questionable billing-compared to 13 percent of all labs-were located in California and Florida, areas known to be vulnerable to Medicare fraud. Some labs that exceeded the thresholds for fewer than five measures also exhibited billing that may warrant further review. Medicare allowed $1.7 billion across all labs for claims associated with questionable billing.

WHAT WE RECOMMEND
There may be some labs that have legitimate reasons for exceeding certain thresholds. However, collectively, these findings call for stronger oversight of labs and identify specific issues with Medicare payments for lab services that need to be addressed to more effectively safeguard Medicare. Therefore, we recommend that CMS (1) review the labs identified as having questionable billing and take appropriate action, (2) review existing program integrity strategies to determine whether these strategies are effectively identifying program vulnerabilities associated with lab services, and (3) ensure that existing edits prevent claims with invalid and ineligible ordering-physician numbers from being paid. CMS concurred with all recommendations.

DOD OIG — Procedures to Ensure Sufficient Rare Earth Elements for the Defense Industrial Base Need Improvement

July 10, 2014 Comments off

Procedures to Ensure Sufficient Rare Earth Elements for the Defense Industrial Base Need Improvement
Source: U.S. Department of Defense, Office of Inspector General

Objective
We determined whether DoD effectively planned for life-cycle sustainment of rare earth elements (REE) for the defense industrial base (DIB). Specifically, we determined whether DoD effectively implemented procedures to maintain a sufficient and available supply of REEs for the DIB.

Finding
DoD lacked a comprehensive and reliable process to assess REE supply and demand. Specifically, Defense Logistics Agency, Strategic Materials Division officials did not ensure that its modeling and simulation contractor used: REE supply forecasts that considered market and environmental risks; complete REE demand survey results; and verified economic consumption data to forecast REE demand.

This occurred because the Defense Logistics Agency, Strategic Materials Division did not have adequate verification and validation procedures in place to ensure realistic supply and demand inputs and did not require that the contractor use an accredited model to forecast REE supply and demand.

As a result, DoD may not have identified all REEs with expected shortfalls, increasing the risk that those shortfalls will adversely affect critical weapons systems production in the DIB, and overall DoD readiness.

Recommendations
We recommend that the Director, Defense Logistics Agency–Strategic Materials Division:

  • develop and implement a verification and validation plan for REE supply and demand forecasting model inputs;
  • develop and implement procedures to ensure that future shortfall analyses compare DoD demand and supply for REEs under the same scenarios;
  • develop and implement procedures for obtaining DoD REE consumption data by leveraging Service acquisition executive participation and other techniques as appropriate;
  • develop and implement an accreditation plan for theforecasting model’s intended use; and
  • ensure that current and future contracts for models, simulations and associated data include verification, validation and accreditation procedures in the contract requirements.

Management Comments and Our Response

The Director, Defense Logistics Agency, Acquisition Directorate generally addressed the recommendations; however, comments on Recommendation 2 partially addressed the recommendation. Therefore, we are requesting additional comments on Recommendation 2 by August 4, 2014.

Laws Prohibit the Use of HHS Grant Funds for Lobbying, but Limited Methods Exist To Identify Noncompliance

July 9, 2014 Comments off

Laws Prohibit the Use of HHS Grant Funds for Lobbying, but Limited Methods Exist To Identify Noncompliance
Source: U.S. Department of Health and Human Services, Office of Inspector General

WHY WE DID THIS STUDY
This evaluation responded to a congressional request for OIG to review grantees’ use of Department of Health and Human Services (HHS) funds and awarding agencies’ implementation and oversight regarding the prohibitions on the use of grant funds for lobbying activities.

HOW WE DID THIS STUDY
This evaluation included 13 grantmaking agencies (awarding agencies) within HHS. We collected and reviewed departmental and awarding agency directives in place for fiscal years (FYs) 2011 and 2012. We conducted structured telephone interviews with each agency’s Chief Grants Management Officer and/or his or her designated staff. We asked about awarding agencies’ notifications to grantees of the prohibitions on the use of grant funds for lobbying. We also asked about awarding agencies’ mechanisms for identifying grantees that may have violated lobbying prohibitions and the mechanisms in place for reviewing allegations of lobbying. We conducted surveys with a sample of grantees from five awarding agencies regarding their awareness of the lobbying prohibitions.

WHAT WE FOUND
All awarding agencies reported using Federal and departmental sources of guidance regarding the prohibitions on the use of grant funds for lobbying. Through grant applications, notices of award, and/or training, all awarding agencies informed grantees of the prohibitions. For all sampled grant awards, grantees reported being aware of the lobbying prohibitions. However, limited methods exist to identify noncompliance. HHS awarding agencies found two instances of noncompliance in FYs 2011 and 2012.

WHAT WE RECOMMEND
We recommend that ASFR facilitate Departmentwide information sharing among awarding agencies about methods to identify the use of grant funds for prohibited lobbying activities. We also recommend that ASFR centralize on its Web site the guidance pertaining to the prohibitions on the use of grant funds for lobbying. ASFR concurred with our recommendations.

If It Prints, It Ships: 3D Printing and the Postal Service

July 8, 2014 Comments off

If It Prints, It Ships: 3D Printing and the Postal Service (PDF)
Source: U.S. Postal Service, Office of Inspector General

Highlights

  • 3D printing is in the initial stages of transforming major parts of our economy, such as aerospace and healthcare. It also promises to revolutionize the way consumers get customized goods by making them cheaper and more accessible.
  • Prominent industry forecasts show the 3D printing market exploding over the next several years.
  • 3D printing could lead to an increase in packages delivered by the Postal Service worth $485 million in new annual revenue, based on analysis of commercial package volume data.
  • Emerging 3D printing businesses could use the ubiquitous first- and last-mile postal network to connect with their customers.
  • The Postal Service could partner with 3D printing businesses, perhaps using excess space in postal facilities, to help streamline the fast delivery of 3D printed goods.

HHS OIG — Marketplaces Faced Early Challenges Resolving Inconsistencies With Applicant Data

July 2, 2014 Comments off

Marketplaces Faced Early Challenges Resolving Inconsistencies With Applicant Data
Source: U.S. Department of Health and Human Services, Office of Inspector General

WHY WE DID THIS STUDY
This evaluation examines how the Federal and State health insurance marketplaces ensured the accuracy of information submitted by applicants for enrollment in qualified health plans and for advance payment of premium tax credits and cost sharing reductions. This evaluation complements a separate Office of Inspector General report (A-09-14-01000) issued in response to the mandate in the Continuing Appropriations Act, 2014, by providing an analysis of how and the extent to which marketplaces resolved inconsistencies between applicants’ self-attested information and the data received through the Federal Data Hub or from other data sources.

HOW WE DID THIS STUDY
We requested data on inconsistencies for October through December 2013 from all marketplaces although four did not provide any. We conducted interviews or site visits with the staffs at the Federal marketplace and all 15 State marketplaces between January and March 2014. We reviewed each marketplace’s policies and procedures for resolving inconsistencies.

WHAT WE FOUND
During the period of our review, marketplaces were unable to resolve most inconsistencies, which they reported most commonly as citizenship and income. Each applicant can have multiple inconsistencies. Inconsistencies do not necessarily indicate that an applicant provided inaccurate information or is enrolled in a qualified health plan or is receiving financial assistance through insurance affordability programs inappropriately. Specifically, the Federal marketplace was unable to resolve 2.6 million of 2.9 million inconsistencies because the CMS eligibility system was not fully operational. The abilities of State marketplaces to resolve inconsistencies varied. Four State marketplaces reported that they were unable to resolve inconsistencies, seven reported that they resolved inconsistencies without delay, one reported that it resolved only some inconsistencies, and three reported that their State Medicaid offices resolved inconsistencies. We also found that data on inconsistencies are limited. For example, the Federal marketplace could not determine the number of applicants who had at least one inconsistency. Finally, marketplaces faced challenges resolving inconsistencies despite having policies and procedures in place.

WHAT WE RECOMMEND
CMS should develop and make public a plan on how and by what date the Federal marketplace will resolve inconsistencies. CMS should conduct additional oversight of State marketplaces to ensure that they are resolving inconsistencies according to Federal requirements. CMS concurred with both of our recommendations.

USPS OIG — Monitoring of Government Travel Card Transactions: Management Advisory Report

July 1, 2014 Comments off

Monitoring of Government Travel Card Transactions: Management Advisory Report (PDF)
Source: U.S. Postal Service, Office of Inspector General

Background
Citibank issues VISA branded SmartPay 2® cards to U.S. Postal Service employees for use on official travel. The Postal Service has travel card coordinators who monitor employee card use to identify transactions that could indicate misuse such as nontravel related purchases or unauthorized cash advances. There were 44,104 government travel cards issued to Postal Service personnel as of January 15, 2014. From April 1, 2012, through March 31, 2013, employees made 247,419 purchases totaling about $44.9 million and 8,793 cash advances totaling about $1.6 million.

Our objective was to determine whether Postal Service travel card coordinators were effectively monitoring government travel card transactions. Specifically, we evaluated the internal controls managed by the travel card coordinators, but did not determine the appropriateness of individual travel card transactions.

What The OIG Found
Postal Service travel card coordinators need to more effectively monitor cash advances. We judgmentally selected 1,832 cash advances for review based on noncompliance with Postal Service travel policy. We found travel coordinators did not identify for further review 1,260 transactions, totaling $215,466, that potentially did not comply with travel policy.

In addition, travel card coordinators for the U.S. Postal Inspection Service and Postal Service Headquarters need to better monitor purchases. We judgmentally selected 486 purchase transactions based on potential noncompliance with travel policy and the amount of the transaction. We found 282 purchases totaling $55,516 that were not identified by coordinators for follow up with employees’ managers. We also determined the Postal Service did not process cardholder personnel changes in a timely manner to allow coordinators to monitor travel card transactions.

Although individual employee cardholders are responsible for repayment of all cash advances and payment for all items purchased with their travel cards, effective monitoring of travel card transactions reduces the risk of credit card delinquencies or negative publicity when employees misuse their travel cards.

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