Federal Reports

Under the Medicare Advantage (MA) program, the Centers for Medicare & Medicaid Services (CMS) makes monthly payments to MA organizations based in part on the characteristics of the enrollees being covered. Using a system of risk adjustment, CMS pays MA organizations the anticipated cost of providing Medicare benefits to a given enrollee, depending on such risk factors as the age, sex, and health status of that individual. Accordingly, MA organizations are paid more for providing benefits to enrollees with diagnoses associated with more intensive use of health care resources relative to healthier enrollees, who would be expected to require fewer health care resources. 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. We are auditing MA organizations because some diagnoses are at higher risk for being miscoded, which may result in overpayments from CMS.This audit is part of a series of audits in which we are reviewing the accuracy of diagnosis codes that MA organizations submitted to CMS. Using data mining techniques and considering discussions with medical professionals, we identified diagnoses that were at higher risk for being miscoded and consolidated those diagnoses into specific groups. (For example, we consolidated 28 major depressive disorder diagnoses into 1 group.) This audit covered Anthem Community Insurance Company, Inc. (Anthem), for contract number H3655 and focused on seven groups of high-risk diagnosis codes. Our objective was to determine whether selected diagnosis codes that Anthem submitted to CMS for use in CMS’s risk adjustment program complied with Federal requirements.

As part of our annual audit plan, we audited costs billed to the Tennessee Valley Authority (TVA) by Stantec Consulting Services, Inc. (Stantec) to provide coal combustion residual engineering services under Contract No. 13051. The contract provided for TVA to compensate Stantec for work on either a cost reimbursable, time and material (T&M), unit rate, or fixed price basis. Our audit objectives were to determine if (1) costs were billed in accordance with the terms and conditions of the contract and <br> (2) tasks were issued using the most cost efficient pricing methodology. Our audit scope included about $55.3 million in costs billed to TVA from January 5, 2018, through February 29, 2020, of which over 99.9 percent was billed using T&M compensation terms. In summary, we determined:Stantec overbilled TVA $93,916, including (1) $73,099 for mileage rates not specified in the contract and (2) $20,817 for ineligible travel costs.The use of T&M terms on projects caused TVA to pay at least $1.65 million more than it would have if cost reimbursable payment terms had been used for those projects. Additionally, if TVA utilized cost reimbursable pricing for the remaining contract spend, they could potentially avoid $1.01 million in future costs.(Summary Only)

During this semiannual reporting period, we issued five audit reports which included $3,340,428 in questioned costs and 48 recommendations to improve agency operations and award recipient’s stewardship of Federal funds. Through our audit follow-up process, we assisted the National Endowment for the Arts (Arts Endowment) staff and award recipients in clearing 32 recommendations based on corrective actions taken. In addition, we resolved a total of 19 hotline complaints -- 16 new complaints and three from prior reporting periods. I applaud the Arts Endowment and OIG staff for pressing forward and working together when needed to avoid unreasonable and unnecessary work delays during the Pandemic. This enabled staff to continue delivering the missions of the Agency and OIG in a high quality and timely manner in spite of COVID-19, which required staff to work virtually during this period. The value-added work that we accomplished this period is due to my staff’s commitment toexcellence, continued growth, and dedicated work effort; along with the support of the Arts Endowment Acting Chairman and her staff. I look forward to continuously working with my staff, the Chairman, and her staff in promoting economy, efficiency, and effectiveness while helping to ensure integrity, excellence, and value in the delivery of the Arts Endowment mission.

Pivotal Stage – the future: Semiannual Report to Congress for October 1, 2020 – March 31, 2021.

Our objective was to assess the Postal Inspection Service’s response to mail fraud and mail theft during the COVID-19 pandemic. After we began the audit, we received a congressional request from seven members of Congress asking us to identify what actions, if any, the Postal Inspection Service had taken to address the increase in mail theft during the COVID-19 pandemic.