Federal Reports

Since our FY 2020 evaluation, the Office of Intelligence and Analysis (I&A) has continued to provide effective oversight of the department-wide intelligence system and has implemented programs to monitor ongoing security practices. We determined that DHS' information security program for Top Secret/Sensitive Compartmented Information intelligence systems is effective this year as the Department achieved “Level 4 – Managed and Measurable” in three of five cybersecurity functions, based on current reporting instructions for intelligence systems. However, we identified deficiencies in DHS’ protect and recover functions. We made three recommendations to I&A to address the deficiencies identified, and I&A concurred with all three recommendations.

We identified deficiencies in E-Verify’s processes for confirming identity during employment verification. E-Verify’s photo matching process is not fully automated, but rather, relies on employers to confirm individuals’ identities by manually reviewing photos. We attribute these deficiencies to USCIS not developing or evaluating the plans and internal controls needed to improve its processes and detect, track, and investigate system errors. Until USCIS addresses E-Verify’s deficiencies, it cannot ensure the system provides accurate employment eligibility results. We made 10 recommendations to improve E-Verify’s accuracy, internal controls, and workload capabilities. USCIS concurred with all 10 recommendations.

The VA Office of Inspector General (OIG) conducted a healthcare inspection at the request of Chairman Mark Takano, and Representatives Julia Brownley, Chris Pappas, and Mike Levin, members of the House Committee on Veterans’ Affairs, to evaluate allegations related to a lack of care coordination for patients receiving ketamine for treatment-resistant depression (depression that has failed to respond after multiple treatments) in the community after authorizations for the care lapsed in September 2019 at the VA San Diego Healthcare System (facility) in California.The OIG substantiated that the facility ended authorizations for community care for patients receiving ketamine, a medication used for treatment-resistant depression, in October 2019 and again in March 2020. The discontinuation negatively affected 35 patients during the two time frames. While distress related to uncertainties about continuing ketamine treatment were identified as a contributory stressor, the OIG did not substantiate that discontinuation of community care resulted in a patient’s death by suicide as the community provider continued to offer ketamine treatment to that patient. The OIG also identified deficiencies in facility processes.The OIG concluded that risks for negative patient outcomes increased due to• communication and care coordination deficits,• terminating community care authorizations,• accelerating timelines for care transition,• uncertainties from changing treatment for complex patientsThe OIG made two recommendations to the Under Secretary for Health regarding community care providers’ review of VA’s protocol for ordering ketamine and research related to the use of ketamine for treatment-resistant depression. Four recommendations were made to the Facility Director related to community care processes for coordination of non-VA care and ensuring coordinated, clinically informed plans for transitioning remaining patients to care at the facility.

The VA Office of Inspector General (OIG) conducted an inspection at the Fayetteville VA Medical Center in North Carolina to determine the validity of allegations that facility staff failed to coordinate appropriate care for a patient seeking community living center (CLC) placement and respite care, and did not provide medications for the patient while at a community assisted living center.The OIG did not substantiate that the facility failed to coordinate placement for a patient seeking CLC care. The facility evaluated the submitted consults in a manner consistent with policy, and disapproved CLC placement when the patient’s functional status did not warrant placement. In the fall of 2020, the patient was approved for community nursing home placement.However, the facility failed to coordinate respite services for the patient. Community health staff did not properly determine the patient’s eligibility, and an interdisciplinary assessment was not completed to determine the patient’s eligibility as required.The OIG did not substantiate that the facility failed to provide medications for the patient while at a community assisted living center; however, when the patient needed to be seen by a community optometrist to obtain glaucoma medications, a community care optometry consult was not initiated.The OIG also identified that the psychiatrist used the involuntary commitment process in a manner that was inconsistent with the state’s established parameters, and failed to adequately assess and document the patient’s capacity to make informed decisions and determine whether the patient had a healthcare agent. In addition, the patient’s primary care providers and psychiatrist missed an opportunity to coordinate specialty care needs for the patient.The OIG made seven recommendations related to the evaluation, assessment of, and staff training for respite services; the psychiatrist’s use of involuntary commitment; patient decision-making capacity; identification of healthcare agents; and initiation of specialty care consults.

The Office of the Inspector General determined the Tennessee Valley Authority’s (TVA) industrial hygiene (IH) planning and assessment process had weaknesses that resulted in some hazards not being identified and evaluated. Specifically, we identified the following IH process weaknesses: (1) TVA relied on limited information to identify health hazards; (2) there was no formal evaluation of the risks posed by identified hazards; (3) IH plans did not prioritize hazards; and, (4) an incomplete monitoring process allowed for misalignment between plans and exposure assessments. We also determined TVA is taking appropriate actions to address adverse conditions which were identified during assessments at gas plants; however, hazard exposures were not documented and employees were not notified as required. In addition, we identified opportunities for improvement related to handling of IH issues in the contractor population.

The Office of the Inspector General included an audit of contractor use of TVA’s purchasing cards in its fiscal year 2021 Audit Plan, based on the significant amount of charges made using TVA purchasing cards assigned to contractors. The objective of the audit was to determine if adequate controls were in place to ensure purchases made by TVA contractors using a TVA purchasing card were (1) for TVA business purposes and not the use of another entity and (2) not being billed back to TVA. We found controls were generally adequate to ensure purchases made by TVA contractors using a TVA purchasing card were for TVA business purposes and not the use of another entity. However we also determined (1) TVA does not have controls in place to ensure purchases made by contractor employees assigned a TVA purchasing card are not being billed back to TVA on invoices from the contractor, (2) required language to govern contractor’s usage and liability for purchasing cards issued to TVA contractors is not included in contracts, and (3) over 50 percent of the transactions we tested were not reconciled by the cardholder in a timely manner, resulting in untimely approval by the approving official.

OIG data analytics identified the Industrial Station had $499,801 in postage affixed refunds recorded to account identification code (AIC) 526, Refund Spoiled/Unused Customer Meter Stamps. This was 86 percent of California 2 District total refunds for this period.The objective of this audit was to determine whether meter revenue refunds were properly issued, supported, and processed at the West Sacramento, CA Industrial Station.

The U.S. Government Accountability Office (GAO) OIG reviewed the system of quality control for the audit organization of the Federal Trade Commission (FTC) OIG in effect for the year ended March 31, 2021. The FTC OIG received an External Peer Review rating of PASS. In the GAO OIG's opinion, the system of quality control for the audit organization of the FTC OIG in effect for the year ended March 31, 2021, had been suitably designed and complied with to provide the FTC OIG with reasonable assurance of performing and reporting in conformity with applicable professional standards and applicable legal and regulatory requirements in all material respects.

The Office of the Inspector General determined the Tennessee Valley Authority’s (TVA) industrial hygiene (IH) planning and assessment process had weaknesses that resulted in some hazards not being identified and evaluated. Specifically, we identified the following IH process weaknesses: (1) TVA relied on limited information to identify health hazards; (2) there was no formal evaluation of the risks posed by identified hazards; (3) IH plans did not prioritize hazards; and (4) incomplete monitoring efforts allowed misalignment between procedures, plans, and exposure assessments. We also determined TVA took appropriate actions to address adverse conditions, which were identified during assessments at hydro plants; however, TVA did not maintain employee notification records as required by internal procedures. In addition, we identified opportunities for improvement related to clarifying responsibilities for notification and monitoring of contractor actions taken to address IH recommendations.

The U.S. Government Publishing Office (GPO) Office ofthe Inspector General (OIG) conducted an audit of GPO’s Capital Investments.

To see our report, click on the link below

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The audit report includes two findings that address weaknesses in the District’s internal control processes. The audit found that the District lacked adequate controls over its competitive bidding and inventory processes. The auditors provided four recommendations to address the findings, including a recommendation that the Universal Service Administrative Company, the USF administrator, recover E-Rate program funds in the amount of $39,985.

The audit objectives were to determine whether program funds were managed in accordance with the ARC and Federal grant requirements

Congress directed the VA Office of Inspector General (OIG) to review Veterans Health Administration’s (VHA) progress in developing a comprehensive staffing model. While VHA reported staffing models exist for all occupations, VA plans to develop the first iteration of staffing models that will determine staffing requirements by FY 2022. Limited staffing resources were reported as a barrier to staffing models.VA and VHA define staffing models differently, and the associated program office directors reported inconsistent staffing model roles and responsibilities. The governance of staffing models could be improved.Validated staffing models can provide consistency in how staffing requirements are determined, which can then be used to inform VHA’s budget and workload analysis. However, most facilities used facility-developed methods to determine requirements and prioritized staffing within the constraints of available budgets.Veterans integrated service network (VISN) directors were generally satisfied with the quality of staff hired during the pandemic and hoped the flexibilities used for hiring would become permanent. Although VA and VHA reported net increases in VHA staffing levels during the pandemic, the reported increases differed making it difficult to quantify pandemic hiring.The OIG made three recommendations to the VHA Under Secretary for Health to coordinate with VA to1. review the roles, responsibilities, and number of staff required for VA and VHA offices involved in the development, validation, and implementation of staffing models, and ensure that staffing model-related efforts are prioritized and supported;2. evaluate the status of, and provide a timeline for, the development, validation, and implementation of VHA staffing models for all occupations; andevaluate the status of, and provide a timeline for, implementation of HR Smart-related requirements referenced in VA and VHA policy, with a specific focus on authorizations, vacancies, budgeted positions, and unbudgeted requirements at the facility, VISN, and national levels.

This Office of Inspector General (OIG) Comprehensive Healthcare Inspection Program report provides a focused evaluation of the quality of care delivered in the inpatient and outpatient settings of the Montana VA Health Care System. The inspection covered key clinical and administrative processes associated with promoting quality care. It focused on Leadership and Organizational Risks; COVID-19 Pandemic Readiness and Response; Quality, Safety, and Value; Registered Nurse Credentialing; Medication Management: Remdesivir Use in VHA; Mental Health: Emergency Department and Urgent Care Center Suicide Risk Screening and Evaluation; Care Coordination: Inter-facility Transfers; and High-Risk Processes: Management of Disruptive and Violent Behavior.The healthcare system had vacancies in two of the five key leadership positions, with the Quality Management Officer serving as acting Assistant Director and acting Associate Director of Patient Care Services. Survey results indicated opportunities to improve employee attitudes toward leaders, the workplace, and workgroup relationships. Patient experience survey results highlighted opportunities for improvement in outpatient settings. Review of the healthcare system’s accreditation findings, sentinel events, and disclosures did not identify any substantial organizational risks. The executive leaders were generally knowledgeable about select data used in Strategic Analytics for Improvement and Learning models and should continue to take actions to sustain and improve performance.The OIG issued eight recommendations for improvement in four areas:(1) Quality, Safety, and Value• Systems redesign and improvement program reporting structure• Surgical work group processes• Action item implementation and monitoring(2) Registered Nurse Credentialing• Primary source verification of registered nurses’ licenses(3) Mental Health• Suicide prevention training(4) High-Risk Processes• Disruptive behavior committee attendance• Disruptive behavior training

The Office of the Inspector General included an audit of TVA’s Federal Sustainability Report and Implementation Plan (SRIP) in its FY 2021 Audit Plan, based on the reputational risk of disseminating inaccurate information to the public. The objective of the audit was to determine if information in TVA’s SRIP has been validated prior to being disseminated to the public in accordance with any best practices. We found TVA did not perform procedures to validate data used to calculate nine of the ten metrics reported in the FY 2020 SRIP. TVA validated data for the greenhouse gas emissions information included in the report, but at most, performed reviews for reasonableness for the remaining nine metrics reported and calculated by TVA’s Environment and Energy Policy group or subject matter experts.

During our audit period, CGS was a subsidiary of Blue Cross Blue Shield of South Carolina (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. 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 and PRB 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. Although the CGS employees did not participate in BCBS South Carolina’s qualified-defined benefit pension plan, certain costs from BCBS South Carolina’s home office were allocated to the CGS Medicare segment. Medicare Reimbursement of Pension CostsCMS reimburses a portion of the annual contributions that contractors make to their pension plans. The pension costs are included in the computation of the indirect cost rates reported on the ICPs. In turn, CMS uses indirect cost rates in reimbursing costs under cost-reimbursement contracts. To be allowable for Medicare reimbursement, pension costs must be (1) measured, assigned, and allocated in accordance with CAS 412 and 413 and (2) funded as specified by part 31 of the FAR. In claiming costs, contractors must follow cost reimbursement principles contained in the FAR, the CAS, and the Medicare contracts. Previous Audit of Allocable Pension CostsWe previously reviewed BCBS South Carolina’s allocable pension costs (A-07-17-00509, Aug. 28, 2017). Our previous BCBS South Carolina audit report identified Other segment allocable pension costs that its subsidiaries’ Medicare segments should have used when calculating the subsidiaries’ indirect cost rates for CYs 2006 through 2012. We recommended that BCBS South Carolina decrease the Medicare segment pension costs used to calculate its indirect cost rates by $6,193,748 for CYs 2006 through 2012.

During our audit period, CGS was a subsidiary of Blue Cross Blue Shield of South Carolina (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 SERP III plan would, under the terms of the agreement, identify its segments by individual participant. These segments allocate to each of the BCBS South Carolina’s Medicare subsidiaries: Palmetto Government Benefits Administrator, LLC; Companion Data Services, LLC; and CGS. This report addresses CGS’s compliance with the provisions of the Federal requirements and its Medicare contracts in claiming SERP III costs. 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, PRB plan, SERP III, and Excess 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. BCBS South Carolina sponsors a SERP III plan. The purpose of this deferred compensation plan is to supplement participants’ benefits payable under BCBS South Carolina’s retirement plans. This plan is provided to a limited group of management employees who are responsible for earnings and long-term growth of the company. BCBS South Carolina allocated costs to the CGS Medicare segment. The Medicare contracts require CGS to calculate the SERP III costs in accordance with the FAR and CAS 412 and 413. The FAR and the CAS require that the costs for nonqualified plans be measured under either the accrual method or the pay-as-you-go method. Under the accrual method, the allowable costs are based on the annual contributions that the employer deposits into its trust fund. For nonqualified plans that are not funded through the use of a funding agency, costs are to be accounted for under the pay-as-you-go method. This method is based on the actual benefits paid to participants, which are comprised of lump-sum payments and annuity payments. CGS claimed SERP III costs on an accrual basis. At CMS’s request, CliftonLarsonAllen, LLP (Allen), performed audits of the ICPs that CGS submitted for CYs 2015 and 2016. The objectives of these ICP audits were to determine whether costs were allowable in accordance with the FAR, the CAS, and the Department of Health and Human Services Acquisition Regulation System.

Personnel actions are changes to an employee’s status such as hiring, reassignment, promotion, benefit changes, separations, and retirements. Local Human Resources personnel, as well as supervisors and managers across the organization, are responsible for initiating actions by providing the relevant information online to the Human Resources Shared Services Center (HRSSC). Our objective was to assess the Postal Service’s effectiveness of processing selected personnel actions and identify potential process improvements. We limited our scope to selected late resignation and reassignment personnel actions.

The VA Office of Inspector General (OIG) conducted a healthcare inspection regarding allegations of incompletely screening for COVID-19 and treatment of a patient with serious mental illness who presented for same-day care at the Michael E. DeBakey VA Medical Center (facility).The OIG substantiated that facility staff did not complete the patient’s COVID-19 temperature screening.The OIG substantiated that facility staff failed to medically manage the patient with COVID-19 symptoms, sent the patient to the drive-through testing area without medical evaluation, and did not isolate the patient, complete a plan of care, or follow policy for transporting patients suspected to have COVID-19.The vulnerable patient disappeared while in the facility’s care, was found off-site four days later experiencing a medical emergency, taken back to the facility, and died the following day.The OIG determined that the Mental Health Intensive Case Management team failed to address documentation discrepancies related to the patient’s surrogate and educate the family on COVID-19 visitor policy and screening processes.The OIG identified the facility’s noncompliance with the missing patient policy, and facility leaders’ failure to report an adverse event and to ensure a timely review of the patient’s episode of care.The OIG identified that facility leaders did not timely or accurately disclose to the patient’s family the medical mismanagement that led to the patient’s adverse clinical outcome.The OIG concluded the failure to screen, isolate, and evaluate the patient resulted in potential COVID-19 exposure to staff, patients, and the public when the patient moved through facility grounds.The OIG made nine recommendations to the Facility Director related to COVID-19 screening, the visitor policy for patients requiring mental health support, identification of patients’ surrogates, mental health care coordination, missing and at-risk patients, adverse event reporting, issue briefs, root cause analyses, and institutional disclosures.

What We Looked AtThe Federal Aviation Administration (FAA) Contract Tower (FCT) Program consists of 257 contract towers in 46 States operated by 3 contractors and the Air National Guard. Contract towers manage about 28 percent of the Nation’s air traffic control operations. The FCT Program is governed by seven contracts, based on geographical regions, which establish controller staffing for contract towers. These contracts normally cover a 5-year period and require contractors to submit controller staffing plans for each tower during the contract solicitation process. Our audit objective was to assess FAA’s approach for establishing and modifying air traffic controller staffing levels at contract towers. What We FoundFAA does not establish controller staffing levels at contract towers; instead the Agency reviews and approves staffing levels the contractors submit during the contract solicitation process. While FAA requires a program-wide staffing minimum of four controllers per tower, this minimum is not based on any Agency analysis or a study of controller staffing levels at contract towers. Also, FAA does not adequately monitor whether contractors adhere to the staffing minimum requirement. This is because FAA has not formally documented its process for establishing and reviewing contract tower staffing minimums. In addition, FAA does not proactively review staffing data to identify when staffing changes are needed; instead it relies on contractors to request and justify such changes. Further, FAA did not provide evidence that it had conducted any reviews of contractor performance relative to the labor hours stated in the approved staffing plans. As a result, the Agency may have missed key indicators of the potential need for staffing modifications. Our RecommendationsWe made four recommendations to improve FAA’s approach for staffing contract towers and monitoring performance levels. FAA concurred with recommendations 1 through 3. Thus, we consider these recommendations resolved but open pending FAA’s completion of planned actions and an Office of Inspector General (OIG) review. FAA partially concurred with recommendation 4, which we consider open and unresolved and request that the Agency reconsider its position within 30 days of the date of this report.

The VA Office of Inspector General (OIG) conducted a risk assessment of VA’s charge card program, evaluating the three types of charge cards—purchase cards (including convenience checks), travel cards, and fleet cards—for transactions during fiscal year (FY) 2020.The OIG conducted its risk assessment from November 2020 through March 2021. The team reviewed applicable VA policies, procedures, and other controls. The team also analyzed FY 2018 and FY 2019 charge card data to identify transactions or patterns of activity that represent potentially illegal, improper, or erroneous charge card purchases.The OIG determined that the purchase card program remains at medium risk of illegal, improper, or erroneous purchases, as previously assessed for FY 2019. Data analytics of purchase card transactions identified potential misuse of purchase cards. OIG investigations and reviews continue to identify patterns of purchase card transactions that do not comply with the Federal Acquisition Regulation and VA policies and procedures.The OIG also found that VA’s Travel Card Program and Fleet Card Program both remain at low risk for illegal, improper, or erroneous purchases. The risk assessment team assigned a low risk level to both programs primarily because they had no year-end spending surges. Additionally, a low percentage of travel card transactions had potentially unauthorized third-party payers, and the Fleet Card Program benefited from VA’s practice of obtaining refunds for sales tax paid on fuel purchases. Travel card transactions represented only about 1.4 percent of the $4.9 billion spent by VA on charge card transactions during FY 2020. Fleet card transactions represented only about 0.3 percent of that amount.

The audit report includes two finding that address weaknesses in the District’s internal control processes and one condition reported as an “other matter” – a condition that does not rise to the threshold of a reportable finding. The auditors provided four recommendations to address the findings, including a recommendation that the Universal Service Administrative Company, the USF administrator, recover E-Rate program funds in the amount of $54,052.

FEMA did not use its SFM initiative to ensure that Public Assistance (PA) funds were obligated in accordance with Federal, Department, and component requirements. Specifically, FEMA obligated PA funds for 83 projects from fiscal years 2017 through 2019 that we reviewed, even though the subrecipients did not need the funding until after 180 days, which made them eligible for incremental obligation under SFM. This occurred because FEMA did not provide adequate oversight to its Regions. FEMA relied on the Regions’ decisions to determine whether subrecipients’ projects were eligible for SFM funding, without ensuring there was sufficient supporting documentation to validate the determinations. This increases the risk of projects being over obligated. As a result, FEMA is not meeting the intent of SFM, which is to better manage resources in the Disaster Relief Fund to fulfill present and future disaster funding requirements. We made two recommendations that, when implemented, should improve FEMA’s management and oversight of the Disaster Relief Fund. FEMA concurred with the recommendations.

Mark Hernandez, a psychiatrist based in Miami, Florida, Brian Dublynn, Vice President of Safe Haven Recovery Inc, and medical marketer, Jennifer Sanford, pleaded guilty in United States District Court for the Southern District of Florida on August 17, 2021, to conspiracy charges related to a health care fraud investigation. The defendants conspired to defraud private health companies by causing Safe Haven, a substance abuse treatment facility in Miami, along with several clinical laboratories, to submit false and fraudulent claims to health insurance plans for addiction treatment services that were not provided as billed and laboratory tests that were not medically necessary. As a result of the scheme, Amtrak’s insurance providers were fraudulently charged approximately $86,130. The three defendants will be sentenced at a future date.

This Office of Inspector General (OIG) Comprehensive Healthcare Inspection Program report provides a focused evaluation of the quality of care delivered in the inpatient and outpatient settings of the VA Western Colorado Health Care System in Grand Junction. The inspection covered key clinical and administrative processes associated with promoting quality care. It focused on Leadership and Organizational Risks; COVID -19 Pandemic Readiness and Response; Quality, Safety, and Value; Registered Nurse Credentialing; Mental Health: Emergency Department and Urgent Care Center Suicide Risk Screening and Evaluation; Care Coordination: Inter-facility Transfers; and High-Risk Processes: Examining the Management of Disruptive and Violent Behavior.When the OIG conducted the virtual review, the executive leadership team had worked together for three months. The acting Associate Director for Patient Care Services had covered the role since September 2020. Employee satisfaction survey results identified opportunities for the Associate Director for Patient Care Services to provide a safe culture at work. Patient experience survey scores generally reflected higher care ratings than the VHA average. The OIG’s review of the healthcare system’s accreditation findings, sentinel events, and disclosures did not identify any substantial organizational risk factors. Executive leaders were generally knowledgeable about selected data used in Strategic Analytics for Improvement and Learning models and should continue to take actions to sustain and improve performance.The OIG issued four recommendations for improvement in three areas:(1) Quality, Safety, and Value• Review of aggregated data• Implementation and monitoring of recommended improvement actions(2) Registered Nurse Credentialing• Primary source verification of registered nurses’ licenses(3) High-Risk Processes• Disruptive behavior committee meeting attendance

Beginning in FY 2017, independent auditors have been unable to render an opinion on the consolidated financial statements of AmeriCorps and the National Service Trust. The audits resulted in disclaimers of opinion and identified numerous material weaknesses that remained uncorrected. In lieu of financial statements audits for FY 2020, the OIG engaged CliftonLarsonAllen LLP (CLA) to assess AmeriCorps’ progress in resolving two areas of material weakness: AmeriCorps’ internal control program (ICP) and the National Service Trust Liability Model.Our auditors found that AmeriCorps’ internal control program testing was substantially incomplete and that key controls in many areas could not be tested due to a combination of internal and external limitations. In addition, because AmeriCorps did not complete the planned corrective actions for significant aspects of the Trust Model, we rescoped the objectives to focus on the process by which AmeriCorps validated the underlying data about member enrollment, terms of service, and entitlement to education awards. The audit found that AmeriCorps’ review process was flawed in design and could not support its stated conclusion about the accuracy of the data used in the Trust Model.AmeriCorps agreed with our recommendations to develop policies and procedures and update narratives and testing attributes to properly reflect its current ICP operations. AmeriCorps also agreed to renew focus on the FY 2019 financial statement audit recommendations and to develop and implement a detailed corrective action plan that aligns directly to the Trust Model recommendations. In addition, AmeriCorps agreed to assess and document errors and corrections in the Trust Model. AmeriCorps Management’s Response can be found in Appendix C of the report.

We audited lender reporting of COVID-19 forbearances for Federal Housing Administration (FHA)-insured loans in the Single Family Default Monitoring System (SFDMS). We compared default reporting data from SFDMS to loan data provided by five sampled servicing lenders that serviced a third of the FHA single-family portfolio. Our audit objective was to determine whether COVID-19 forbearance data available in SFDMS were consistent with the information maintained by loan servicers. We found that COVID-19 forbearance data available in SFDMS were generally consistent with the information maintained by the loan servicers reviewed. This report contains no recommendations.

The objective of our audit was to determine the extent to which the U.S. Department of Education had processes for ensuring that Federal Student Aid’s (FSA) fiscal year (FY) 2020–2024 strategic goals, objectives, and related performance indicators were effective. FSA did not have documented processes to guide its FY 2020–2024 strategic planning and to ensure that the strategic goals, objectives, and performance indicators included in the FY 2020–2024 Strategic Plan were effective. Despite FSA not having documented processes to guide its strategic planning, the strategic goals, objectives, and majority of performance indicators included in the final FY 2020–2024 Strategic Plan are effective. All 5 strategic goals and all 15 objectives are specific, measurable, achievable, relevant, and timebound. They also align with the former Secretary's goals and guidance and the Department's FY 2018–2022 Strategic Plan.

For our final report on the audit of the U.S. Census Bureau's (the Bureau's) incident response process, our audit objective was to assess the adequacy of the Bureau's process to respond to cybersecurity incidents according to federal and U.S. Department of Commerce requirements. We found the following: I. the Bureau missed opportunities to mitigate a critical vulnerability, which resulted in the exploitation of vital servers; II. the Bureau did not discover and report the incident in a timely manner; III. the Bureau did not maintain sufficient system logs, which hindered incident investigation; IV. the Bureau did not conduct a lessons-learned session; and V. the Bureau continued operating servers that were no longer supported by the vendor.

Each year, increased mail volume during peak mailing season — November through January — significantly strains the Postal Service’s processing and distribution network. During the peak mailing season of FY 2021, increased package volume and reduced employee availability resulting from the COVID-19 pandemic added even more strain on the distribution network and led to temporary embargoes of up to 17 days for certain mail types at nine mail processing facilities: the Birmingham, AL Annex; West Valley, AZ processing and distribution center (P&DC); Baltimore, MD P&DC; Detroit, MI network distribution center (NDC); New Jersey (City), NJ NDC; Northwest Rochester, NY NDC; Cleveland, OH P&DC; Springdale, OH Annex; and Philadelphia, PA NDC. Our objective was to evaluate the operational impacts experienced by the Postal Service before and after the embargoes and redirections at mail processing facilities during the fiscal year (FY) 2021 peak mailing season.

Objective: To determine the appropriateness of payments the Social Security Administration (SSA) issued to beneficiaries who were deceased according to Centers for Medicare &Medicaid Services (CMS) records.

SBA implemented or initiated action on all the OIG recommendations to strengthen internal controls related to the Paycheck Protection Program (PPP). The Economic Aid Act continued assistance under the PPP for small businesses financially affected by the ongoing coronavirus pandemic. We found SBA implemented the PPP in accordance with the Economic Aid Act with two exceptions. SBA did not 1) require an assessment of affiliation for faith-based organizations which contradicts its internal control procedures and 2) issue guidance regarding farm credit system institutions to ensure requirements were met.We recommend SBA assess affiliation for faith-based organizations to ensure only eligible faith-based organizations receive the applicable PPP loans. We are not making any recommendations regarding the farm credit system institution requirements and the $1 billion set aside because the PPP ended on May 31, 2021.SBA disagreed with the recommendation, stating it committed to not assessing or requiring lenders to assess the reasonableness of the faith-based organization’s determination, which they believe met the intent of Congress. This recommendation is considered resolved and closed upon issuance of this report based on SBA’s final decision not to assess the reasonableness of faith-based determinations and its revised updated affiliation worksheet.

While auditing the Veterans Health Administration’s (VHA) prescription drug return program, the VA OIG determined that VHA is at increased risk for not receiving all drug return credits due before the national drug return vendor—Pharma Logistics—issues final invoices to VA medical facilities. In October 2020, VA ended its contract with Pharma Logistics. The vendor continues to process and issue final invoices to facilities as the drugs they returned become eligible for and receive manufacturer credit. The final invoice process will continue until at least April 2022.VHA medical facility pharmacies lost at least an estimated $2.1 million worth of drug return credits because pharmacy chiefs did not always effectively monitor or review job settlement statements before Pharma Logistics issued final invoices. In addition, although the vendor established a dashboard that provided information on the status of drug return credits at the facility level, it cannot provide a national report on all outstanding credits. This hurt VHA’s ability to maximize potential drug return credits and minimize the risk of lost credits.VHA will continue to be unable to ensure it is receiving all credits for drugs returned by medical facilities if pharmacy chiefs do not routinely monitor preliminary invoices, reconcile job settlement statements to identify outstanding credits, and request extensions to final invoices to allow additional time for credit processing. This risk will persist for any future drug return contract(s)—whether awarded nationally or locally—if the reimbursement structure remains the same.The OIG will continue its oversight work on prescription drug returns within VHA and plans to issue a full report, including specific recommendations. The OIG requests to know what action, if any, VHA takes to mitigate the potential risks identified in this memorandum and the outcome of those actions.

The Veterans Health Administration (VHA) spent about $6.6 billion on prescription drugs in fiscal year (FY) 2019. Most were dispensed to veterans by medical facility pharmacies. VHA pharmacies can return drugs that become damaged or expire before use through a reverse distributor for credit or destruction. In FY 2019, VHA expected to receive about $52 million from drug returns.The VA Office of Inspector General (OIG) audited the prescription drug return program to determine if VHA was effectively overseeing the program to maximize benefits to taxpayers and ensure drugs waiting to be returned are not diverted or otherwise abused.The OIG found VHA pharmacy chiefs did not effectively implement the program and did not follow requirements in VA’s contract with the reverse distributor, Pharma Logistics. These issues increased the risk of drug diversion and ultimately put about $18.1 million at risk. Pharmacy chiefs did not always secure and track drugs held for return or complete required analyses to maximize returns. They also failed to meet contract requirements to return for credit only drugs due to expire within 120 days. VA’s National Contract Service and network contracting officers needed to do more to ensure contract terms were met. The Office of the Deputy Under Secretary for Health for Policy and Services and the Office of the Deputy Under Secretary for Health for Operations and Management did not effectively govern the program or communicate requirements to medical facilities.The OIG made eight recommendations, including ensuring medical facilities are properly securing and accounting for drugs set aside for return, minimizing the number of drugs returned while maximizing the value of returned drugs, and ensuring all offices and positions with defined responsibilities for the program or the administration of any future drug return contracts have the support and the authority to fulfill those responsibilities.

The audit objectives were to determine whether program funds were managed in accordance with the ARC and Federal grant requirements

The audit objectives were to determine whether program funds were managed in accordance with the ARC and Federal grant requirements

The audit objectives were to determine whether program funds were managed in accordance with the ARC and Federal grant requirements

From January 1, 2020, through March 31, 2021, the Raleigh, NC, Processing and Distribution Center (P&DC) reported 7,483 late arriving containers, about 1.44 billion pieces of delayed inventory, and 112,302 delayed dispatch containers. This site was selected based on the high number of delayed dispatch containers during this time period.The Raleigh P&DC is in the South Atlantic Division of the Eastern Processing Region. The facility processes letters, flats, and packages for ZIP Codes throughout NC.A portion of the audit scope and our site observations occurred during the COVID-19 pandemic. The Postal Service experienced decreased employee availability and increased package volume during this time, which impacted operations nationwide.Our objective was to evaluate mail conditions at the Raleigh, NC, P&DC.

The Center Ossipee, East Wakefield, and Conway (all leased) post offices are in the Maine-New Hampshire-Vermont District. The Postal Service is required to maintain a safe and healthy environment for both employees and customers in accordance with its internal policies and procedures and Occupational Safety and Health Administration (OSHA) safety laws. Our objective was to determine if Postal Service management is adhering to building maintenance, safety and security standards, and employee working condition requirements at post offices.

Our objective was to assess the effectiveness of plant load agreements in the New Jersey District. We selected this district based on volume and revenue declines from fiscal year (FY) 2019 to FY 2020 of 32 percent (500 million mailpieces) and 31 percent ($109.8 million in revenue), respectively. This district ranked sixth in the nation for revenue declines.

The State agency is responsible for administering the Medicaid program, including processing and paying claims for behavioral health services. Its goal is to facilitate quality health care services that will produce positive health outcomes for Oklahoma. The Oklahoma Department of Mental Health and Substance Abuse Services (ODMHSAS) has oversight responsibility for behavioral health services in Oklahoma. Its mission is to promote healthy communities and provide the highest quality care to enhance the well-being of all Oklahomans. ODMHSAS is primarily State funded (approximately 71 percent); the rest of its funding comes predominantly from Medicaid for individual beneficiary services (17 percent) and Federal grants (11 percent).The State agency and ODMHSAS have an interagency agreement to ensure that individuals being served by both organizations receive appropriate behavioral health care and to provide reimbursement to ODMHSAS for administrative costs, among other things. The agreement identifies the various roles each organization performs in providing and overseeing behavioral health in Oklahoma.The State agency has four key control activities to ensure that behavioral health services meet State requirements: (1) provider enrollment, (2) behavioral health program integrity audits, (3) claim processing edits, and (4) pharmacy requirements for medications used to treat OUD (OUDdrugs).ODMHSAS also has four key control activities to ensure that behavioral health services meet State requirements: (1) certification of agencies that provide services, (2) annual contract reviews at agencies that provide services, (3) beneficiary prior authorization to receive services, and (4) automated claim analyses to ensure that paid claims meet certain payment rules.Counseling helps people with OUD change how they think, cope, and react, and acquire the skills and confidence needed for recovery. CMS, numerous addiction treatment authorities and nationally recognized evidence-based guidelines, such as the American Society of Addiction Medicine’s (ASAM’s) National Practice Guidelines for the Use of Medications in the Treatment of Addiction Involving Opioid Use, and SAMHSA’s Treatment Improvement Protocol (TIP) 40 indicate that counseling for individuals taking OUD drugs can be helpful in treating OUD.8 SAMHSA’s TIP 63, Medications for Opioid Use Disorders, indicates that although counseling greatly benefits many patients, treatment should target the patient’s needs and, therefore, counseling should not be required.ODMHSAS’s objectives include providing the highest quality care to enhance the well-being of all Oklahomans. To help ensure quality of care and fulfill its oversight role of behavioral health services, ODMHSAS performs annual reviews at outpatient facilities that contract with it to provide the services. During the reviews, ODMHSAS staff evaluate a random sample of 10 non- Medicaid client files to ensure that the facilities appropriately provided and documented their services. ODMHSAS determines whether the services were performed, and it reviews clinical records to determine whether the services were individualized and were client and assessment driven. Review of clinical documentation may include, but not be limited to, screenings, assessments, treatment plans, corresponding progress notes, and other documentation, as necessary.

Missouri’s Medicaid Health Home ProgramMissouri has operated a Medicaid health home program since calendar year (CY) 2012. Health home providers directly provide health home services to eligible and enrolled beneficiaries. The State agency is primarily responsible for monitoring and overseeing the health home program. The State agency’s monitoring activities include determining whether health home providers have documentation that enrolled beneficiaries met the eligibility requirements discussed above and that the beneficiaries received health home services as defined in the relevant SPAs.The State agency administers two health home programs: a Primary Care Health Home (PCHH) and a Community Mental Health Center Healthcare Home (CMHC). Both programs require health home providers to furnish at least one core service (discussed below) to enrolled beneficiaries.The State agency made payments to health home providers using a payment model that allowed those providers to bill the State agency and receive a per member-per month (PMPM) payment for providing at least one health home service to a Medicaid beneficiary for a month. Core Health Home ServicesHealth home providers must furnish at least one of the six core services per month to receive a PMPM payment (SPA MO 11-0011, SPA MO 11-0015, SPA MO 16-0002, and SPA MO 16-0007): • comprehensive care management, which includes assessing preliminary service needs, developing treatment plans, and monitoring individual and population health status; • care coordination, which includes referring beneficiaries to long-term services, appointment scheduling, conducting referrals and followup monitoring, and participating in hospital discharge processes;• health promotion, which includes providing health education specific to an individual’s chronic conditions, developing self-management plans with the individual, and providing support for improving social networks; • comprehensive transitional care from inpatient care to other settings, which includes providing care coordination services designed to streamline plans of care and reduce hospitalizations; • patient and family support, which includes advocating for individuals and families, assisting with obtaining and adhering to medication, and identifying resources for patients; and• referrals to community and social support services, which include providing assistance for clients to obtain and maintain eligibility for health care, disability benefits, housing, and legal services. Primary Care Health Home ProgramThe PCHH program covers enrolled beneficiaries who have two or more chronic conditions or have one chronic condition and are at risk of developing another. The PCHH program defines qualifying chronic conditions as asthma; mental health conditions, including anxiety and depression; substance use disorder; developmental disabilities, diabetes, heart disease, and high body mass index. At-risk conditions include tobacco use, diabetes, pediatric asthma, and obesity (SPA MO 11-0015 and SPA MO 16-0002). Community Mental Health Center Healthcare Home ProgramThe CMHC program covers enrolled beneficiaries who have two or more chronic conditions, one chronic condition and the risk of developing another chronic condition, or one or more serious and persistent mental health condition (SMI). An SMI is a diagnosis of schizophrenia, delusional disorder, bipolar disorder, psychotic disorder, reoccurring major depressive disorder, obsessive-compulsive disorder, post-traumatic stress disorder, or borderline personality disorder (SPA MO 11-0011 and SPA MO-16-0007). Health home providers receive one payment for PCHH beneficiaries and one payment for CMHC beneficiaries.

The OIG assessed the oversight and stewardship of funds and identified opportunities for cost efficiency at the Miami VA Healthcare System in Florida. The review focused on four areas:1. Use of the Medical/Surgical Prime Vendor-Next Generation Program. The program is a collection of contracts that streamlines purchasing and distribution for certain supplies. The team found that the healthcare system was unable to fully achieve the program’s cost savings because the prime vendor did not have enough stock to fill orders consistently. In addition, staff did not always use available tools to report issues with prime vendor performance.2. Purchase card use. The healthcare system did not always maintain supporting documentation for transactions, conduct quarterly audits of the purchase card program on time, and consider contracts instead of purchase cards for ongoing, repetitive orders of goods or services. Using contracts can help VA leverage purchasing power and obtain competitive pricing.3. Administrative staffing and labor costs. The healthcare system had higher administrative staff levels than similar facilities and did not ensure all administrative labor costs were recorded correctly. A difference in the number of personnel should be a starting point for deeper examination and in itself is not a determining factor.4. Pharmacy efficiency. The healthcare system improved pharmacy inefficiencies, but it could avoid end-of-year purchases and increase the number of times inventory is used during the year. End-of-year purchases can reduce the inventory turnover rate, increase the cost to store inventory, and potentially lead to overstocking and spoilage.The OIG made 12 recommendations for improving cost efficiency to the healthcare system director. The number of recommendations should not be used, however, to gauge the system’s overall financial health. The intent is for system leaders to use these recommendations as a road map for improvement in the areas reviewed.

For our final report on the audit of the United States Patent and Trademark Office’s (USPTO’s) efforts to improve the accuracy of the trademark register, our audit objective was to determine whether USPTO’s trademark registration process is effective in preventing fraudulent or inaccurate registrations. To address this objective, we assessed whether USPTO prevents inaccurate trademark applications from entering and being maintained on the trademark register, as well as whether USPTO is adequately managing fraud risk.Overall, we found that USPTO’s trademark registration process was not effective in preventing fraudulent or inaccurate registrations. Specifically, we found the following:I. USPTO lacks controls to effectively enforce the U.S. counsel rule; II. USPTO approved trademark filings with digitally altered or mocked-up specimens; III. USPTO did not ensure accurate identification of goods and services; andIV. USPTO lacks a comprehensive fraud risk strategy.