Federal Reports

The Protecting Access to Medicare Act of 2014 (PAMA) reformed the way the Medicare program sets payment rates for clinical diagnostic laboratory tests (lab tests) under Part B. CMS's new rates, which took effect on January 1, 2018, are based on lab-reported data: rates paid by private payers such as private health insurers, Medicaid managed care organizations, and Medicare Advantage plans. As part of the same legislation reforming Medicare's payment system, PAMA mandates that OIG conduct analyses it determines appropriate with respect to the implementation and effect of the new payment system. This review focuses on CMS's implementation activities in 2017 and the new payment rates that took effect on January 1, 2018.

The OIG investigated an allegation that a National Park Service (NPS) biologist had coerced at least two interns into having a sexual relationship, and that the biologist misused his position to lead interns to believe he could influence their chances of gaining employment at the NPS.We found no evidence that the biologist manipulated any NPS interns, or that he misused his position. We determined that the biologist had a personal relationship with one former intern, but the intern was not an NPS employee at the time and the relationship did not violate any NPS policies. The biologist and former intern ended their relationship and the former intern is now an NPS employee. We found no evidence, however, that the biologist influenced the former intern’s selection for Federal employment.

We completed our work for the second part of our series evaluating the U.S. Bureau of Reclamation’s (USBR’s) operational and technical practices for protecting hydropower dams categorized as critical infrastructure from emerging cyber threats. The second part of this evaluation was limited to another USBR industrial control system that provides monitoring, alarming, and process control to ensure the safe and reliable operations of the water and power facilities for another dam. We determined that additional efforts on this project are not needed. Further, the recommendations in our first report in this series – to improve the USBR’s account management and personnel security practices – apply to all of USBR’s hydropower dams.

At the request of the Bureau of Reclamation (USBR), we audited Cooperative Agreement No. R16AC00087 between the USBR and the Panoche Drainage District. This agreement was awarded under the statutory authority of the San Luis Act of 1960 (Pub. L. No. 86-488 § 5) to fund operation and maintenance of the San Luis Demonstration Treatment Plant (Demo-Plant) located in the San Luis Unit of California’s Central Valley Project. The purpose of the Demo-Plant is to remove salts and selenium from agricultural drain water in the San Joaquin River Water Quality Improvement Project area. The period of performance for this agreement is June 14, 2016, through December 31, 2018.As of October 10, 2017, the original agreement had been modified three times and amounted to $4.38 million. Of this amount, the USBR had paid $1.23 million to the District. We audited $772,974 in costs claimed by the District for the period June 14, 2016, through May 4, 2017. We identified $20,077 as unsupported and $193,814 as unallowable for a total of $213,891 in questioned costs.In addition to the questioned costs, we identified other issues with the District’s management of the cooperative agreement. Specifically, we found missing and unacceptable single audits, unreliable financial records, an absence of clearly written accounting policies and procedures, personal use of District-owned vehicles, questionable employee qualifications, and questionable wage rates.We made 22 recommendations to the USBR to resolve questioned costs and to communicate the other issues we identified to the District. The Acting USBR Commissioner and Assistant Secretary for Water and Science responded to our draft report on May 9, 2018, and concurred with our recommendations. Based on the USBR’s response, however, we consider Recommendations 1 through 17 to be unresolved and not implemented and Recommendations 18 through 22 to be resolved and not implemented.We will refer the recommendations to the Assistant Secretary for Policy, Management and Budget for resolution and implementation tracking.