Federal Reports

The OIG found that, over the past decade, the Postal Service has focused its technology development efforts on two areas: mail innovations and data analytics. The Postal Service’s recently released Delivering for America: Our Vision and Ten-Year Plan to Achieve Financial Sustainability and Service Excellence indicates that these technologies are and will continue to be a priority going into the future. Other emerging technologies that are expected to grow in importance in the near future are the Internet of Things, autonomous vehicles, and blockchain. Making effective use of new and emerging technologies will enable the Postal Service to become a more efficient organization that exceeds its customers’ expectations.

The purpose of this flash report is to share with the U.S. Department of Education (Department) observations made by the Office of Inspector General (OIG) concerning grantees and subgrantees inconsistently reporting audit data on Department subprograms, or unique components of a program, to the Federal Audit Clearinghouse (FAC), the designated repository of single audit data. We found that grantees and subgrantees are not consistently reporting expenditures of Education Stabilization Fund (ESF) subprogram awards in the FAC. Specifically, when entering Federal award information into the Data Collection Form, grantees and subgrantees either (1) did not identify which ESF subprogram their expenditures were awarded under or (2) used widespread variations of subprogram identifying information to identify which subprogram their expenditures were awarded under.

Although ICE had controls in place that required Capgemini Government Solutions, LLC to provide qualified labor, ICE did not properly construct or monitor the contract. This occurred because ICE awarded a firm-fixed-price contract but required a labor-hour performance measurement to monitor and track work hours, which was not appropriate for this type of contract. The contractor also did not provide the number of staff ICE required for specific labor categories. As a result, ICE cannot ensure it received all services, and it overpaid $769,869 in labor costs. Finally, ICE did not ensure the contractor met statement of work requirements for staff skill sets, education, and work experience, nor did it ensure all contractor staff worked at the designated place of performance

We did not substantiate the allegation that the WV Department of Environmental Protection showed preferential treatment to the West Virginia Governor.

During our audit period, CGS was a subsidiary of BCBS South Carolina, whose home office is in Columbia, South Carolina. CGS performed Medicare work upon being awarded the MAC contracts for Medicare Durable Medical Equipment (DME) Jurisdiction C and Medicare Parts A and B Jurisdiction 15 (including home health and hospice services), effective September 27, 2006, and July 8, 2010, respectively. , CGS continues to perform Medicare work for DME Jurisdiction C (re-awarded August 31, 2012) and Medicare Parts A and B Jurisdiction 15. During our audit period, CMS and BCBS South Carolina entered into an agreement called the “Advance Agreement on the Computation of Nonqualified Defined-Benefit Pension Plan Costs for Periods Beginning January 1, 2015” (agreement). This agreement allowed BCBS South Carolina to change its accounting methodology from a pay-as-you-go to an accrual method. This agreement also closed costs prior to January 1, 2015. Starting with January 1, 2015, the Excess Plan would, under the terms of this agreement, have three Medicare segments: (1) Palmetto Government Benefits Administrator, LLC (Palmetto), (2) Companion Data Services, LLC (CDS), and (3) Partial Medicare. This report addresses CGS’s compliance with the provisions of the Federal requirements and its Medicare contracts in claiming Excess Plan costs. We are addressing the Excess Plan costs claimed for the Palmetto and CDS Medicare segments in separate audits. The disclosure statement that CGS submits to CMS states that CGS uses pooled cost accounting. Medicare contractors use pooled cost accounting to calculate the indirect cost rates (whose computations include pension plan, Excess Plan, Supplement Executive Retirement Plan III, and PRB plan costs) that they submit on their ICPs. Medicare contractors use the indirect cost rates to calculate the contract costs that they report on their ICPs. In turn, CMS uses these indirect cost rates in determining the final indirect cost rates for each contract. Blue Cross Blue Shield of South Carolina Excess PlanBCBS South Carolina sponsors the Excess Plan. The purpose of the Excess Plan is to provide benefits in excess of the limits imposed by the Employee Retirement Income Security Act of1974 for participants in BCBS South Carolina’s qualified defined-benefit plan.