Federal Reports

Why OIG Did This Audit The National Institutes of Health’s (NIH) use of “other transactions” (OTs), which are special award instruments that are generally not subject to Federal laws and regulations that apply to traditional award instruments, increased by $314 million from 2016 to 2019. The Federal Government generally uses OTs for high-risk, high-reward research and development projects. Although OTs are subject to fewer restrictions than contracts, grants, or cooperative agreements, they must be awarded and administered in a way that ensures proper stewardship of Federal funds.From October 1, 2016, through September 30, 2019 (audit period), the NIH National Heart, Lung, and Blood Institute (NHLBI) awarded $84.3 million in Federal funds under 29 OTs.Our objective was to determine whether NHLBI complied with applicable Federal requirements for awarding and administering OTs.How OIG Did This AuditOur audit covered a judgmental sample of 12 OTs totaling $71.9 million that NHLBI awarded and administered during the audit period.Our audit procedures focused on whether NHLBI documentation for the sampled OTs provided evidence of compliance with Federal requirements. This audit is responsive to a U.S. Office of Special Counsel complaint referral.

Ryan Kane, a resident of Pennsylvania, was sentenced in U.S. District Court, Northern District of Illinois, to time served, three years supervised release, and a $100 special assessment for his part in an Amtrak ticket fraud scheme. As part of his sentence, Kane was ordered to pay $124,544 in restitution; $35,000 of which is owed solely by Kane and $89,544 of which is owed jointly with co-conspirator Christian Newby. As a condition of his release, Kane was sentenced to 12 months of home detention with electronic monitoring. Kane previously pleaded guilty to theft of government funds after our investigation found that he participated in a scheme to defraud Amtrak and others by using stolen credit card information from more than 10 credit cards to purchase Amtrak tickets online.

The OIG investigated allegations that a Bureau of Indian Education (BIE) superintendent and one of the superintendent’s coworkers influenced the award of a subcontract on a BIE contract to a business owned by a family member of the superintendent. We also investigated allegations that the superintendent instructed other BIE employees to perform work for the family member’s business while on duty.We found no evidence the superintendent directly influenced the award of the contract because we found no evidence that the prime contractor had substantive contact with the superintendent before selecting subcontractors. We did find, however, that the superintendent’s coworker included the family member’s company on a list of recommended subcontractors sent to the prime contractor, which violated standing guidance. This failure may have contributed to an appearance of improper influence.We confirmed that BIE employees assisted subcontractors with tasks at the project site but did not find evidence that, in allowing this, the superintendent’s position was misused to benefit the family member’s business.

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 Ann Arbor VA Medical Center and multiple outpatient clinics in Michigan and Ohio. The inspection covers key clinical and administrative processes that are associated with promoting quality care. This inspection focused on Leadership and Organizational Risks; COVID-19 Pandemic Readiness and Response; Quality, Safety, and Value; Medical Staff Privileging; Medication Management: Long-Term Opioid Therapy for Pain; Mental Health: Suicide Prevention Program; Care Coordination: Life-Sustaining Treatment Decisions; Women’s Health: Comprehensive Care; and High-Risk Processes: Reusable Medical Equipment.The medical center executive leadership team appeared stable. All positions were permanently assigned and only the assistant director had been in the role for less than a year. Employee survey items revealed that leaders appeared to have created a positive workplace environment where employees felt safe bringing forth issues and concerns. Patient experience survey data indicated satisfaction with inpatient care provided and highlighted opportunities to improve veterans’ experiences in the outpatient settings. The OIG’s review of the medical center’s accreditation findings, sentinel events, and disclosures did not identify any substantial organizational risk factors. 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 nine recommendations for improvement in five areas:(1) Quality, Safety, and Value• Improvement action implementation(2) Medical Staff Privileging• Ongoing professional practice evaluations• Provider exit reviews(3) Mental Health• Suicide safety plans• Staff training(4) Women’s Health• Women Veterans Health Committee structure and reporting(5) High-Risk Processes• Daily cleaning schedule• Storage and reprocessing areas temperature and humidity• Staff continuing education

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

The OIG conducted a joint investigation with the U.S. Department of Transportation’s Office of Inspector General into allegations that a tribal transportation consortium fraudulently received more than $9 million between 2012 and 2015 by collecting Bureau of Indian Affairs (BIA) Roads Funds for tribes no longer affiliated with the consortium.We did not substantiate the allegations. We identified 24 tribes that were members of the consortium, and none of the representatives we spoke to corroborated the allegations. None of the representatives from tribes that had withdrawn from the consortium provided evidence that the consortium continued to collect their tribe’s BIA Roads Funds after they left.The consortium is a defunct entity and has not received BIA Roads Funds since 2015.

The OIG investigated allegations that a service-disabled veteran-owned small business (SDVOSB) acted as a pass-through entity to enable another company to obtain SDVOSB contracts that it was not eligible to receive. It was further alleged that the veteran identified as the SDVOSB’s owner had little or no involvement in the day-to-day operation of the SDVOSB.We found that the SDVOSB and the other company used the SDVOSB’s status to obtain approximately $3.5 million in U.S. Department of the Interior (DOI) SDVOSB contracts, which the other company would not otherwise have been eligible to receive. The SDVOSB shared the large company’s office space, support services, and staff, which were in Arizona, even though the SDVOSB was based outside of Arizona. Further, both the SDVOSB and the other company registered or updated System of Award Management profile records on the same days, using the same unique IP address. We also found no evidence that the SDVOSB’s veteran owner, who resided outside of Arizona, was involved in the day-to-day operations of the SDVOSB, even though this is a requirement to receive SDVOSB status.The U.S. Attorney’s Office for the Southern District of Arizona declined both criminal and civil prosecution of this matter. We have referred both the SDVOSB and the other company to our Administrative Remedies Division for consideration of suspension or debarment.

We conducted a performance audit of National Endowment for the Arts (Arts Endowment) awards issued to the Massachusetts Cultural Council (Council). Based on our review, we determined the Council generally met the financial and compliance requirements set forth in the award documents. However, the Council did not fully comply with Federal grants management requirements. For instance, the Council: did not report actual costs on one of three Federal Financial Reports (FFR); did not follow its FFR reporting policy; included unsupported costs and costs incurred outside the award period on all three FFRs; included unallowable fundraising, foreign travel, and entertainment costs on two of three FFRs; included unallowable sub-awards on two of three FFRs; did not follow Federal Financial Accountability and Transparency Act reporting requirements; and did not provide the required notification to all its Federal award participants; and did not submit its FFR and FDR reports by the reporting deadlines. Thus, we are questioning $3,014,242 in unsupported and unallowable costs, with a potential refund of $60,000 due to the Arts Endowment. There are 16 recommendations to address the findings, ten to the Council and six to the Arts Endowment.

This report was submitted to the Comptroller General in accordance with Section 5 of the Government Accountability Office Act of 2008. The report summarizes the activities of the Office of Inspector General (OIG) for the six-month reporting period ending March 31, 2021. During the reporting period, the OIG issued one audit report and began three performance audits. In addition, the OIG closed four investigations and two self-initiated inquiries, and opened seven new investigations. The OIG processed 46 hotline complaints, many of which were referred to other OIGs for action because the matters involved were within their jurisdictions. The OIG remained active in the GAO and OIG communities by briefing new GAO employees on its audit and investigative missions, and participating in committees and working groups of the Council of Inspectors General on Integrity and Efficiency, including those related to the Pandemic Response Accountability Committee. Details of these activities and other accomplishments are provided in the report.

Improved EPA oversight could ensure that state NPDES programs are protecting human health and the environment.

The EPA’s actions in the final SAFE Vehicles Rule undercut the rule’s quality.

The Office of the Inspector General conducted a review of the Johnsonville Combustion Turbine (JCT) organization to identify factors that could impact JCT’s organizational effectiveness. During the course of our evaluation, we identified behaviors that had a positive impact on JCT. These included leadership actions and positive relationships with team members. However, we also identified minimal risks to operations that, if unaddressed, could hinder JCT’s effectiveness. These were related to resource needs, such as specific training and budgetary needs for plant maintenance.

The Office of Inspector General (OIG) opened this review in March 2019 after receiving a congressional request to examine alleged delays in the disbursement of approximately $20 billion of disaster recovery and mitigation funds appropriated for Puerto Rico following Hurricanes Irma and Maria. Our review examined the decisions and actions of U.S. Department of Housing and Urban Development (HUD or Department) officials that affected the timing of HUD’s release of three tranches of funds intended to address Puerto Rico’s unmet needs for repairs and mitigation efforts. We examined (1) the effect that the government shutdown during late 2018 to early 2019 had on the release of these funds; (2) HUD’s decision-making process for making the second and third tranches of funding available to the Puerto Rico grantee; and (3) whether former HUD Deputy Secretary Pamela Patenaude resigned because of undue influence related to HUD’s administration of Puerto Rico disaster-recovery funds. Our examination of HUD officials’ decision-making in this review included inquiry into their interactions with Office of Management and Budget (OMB) and White House officials regarding the execution of HUD’s disaster-recovery programs. Our role in this review was not to opine on the appropriateness of any OMB or White House officials’ actions, as our oversight authority does not extend to their conduct, but we assessed the extent to which OMB or White House officials directed or influenced HUD officials’ actions.

This report updates NASA’s progress in achieving milestones for the major programs that support the Artemis mission, NASA’s most ambitious and costliest ongoing activity that seeks to land astronauts on the Moon in late 2024.

This is a management alert on the Business Applications Solution (BAS) program’s approach to business process reengineering, which requires immediate attention, given that the program is in a crucial design phase of the overall effort. The BAS program seeks to modernize the U.S. Department of Commerce’s (the Department’s) legacy financial applications and processes by acquiring commercial off-the-shelf software supported by cloud-based infrastructure. In April 2020, the Department awarded a contract to Accenture Federal Services worth approximately $341 million for fiscal years 2020 through 2040 for services in designing, implementing, migrating, and maintaining a BAS system under a Software-as-a-Service model.The objective of our ongoing audit is to assess the Department’s management and implementation of the BAS program. We are conducting this audit because the BAS program is linked to a Department strategic objective and there are challenges inherent to a large modernization effort.During our fieldwork, we observed that the BAS program lacks plans for business process reengineering and its ongoing process change efforts are not consistent with best practices. These conditions present risk that financial management processes may not be adequately supported by the new BAS system, which could ultimately lead to schedule delays and cost increases. This approach may also miss an opportunity to fundamentally improve how the Department conducts its financial business.

Does the Commission effectively collect, analyze, and review its core infrastructure system security logs?

Under the Medicare Advantage (MA) program, the Centers for Medicare & Medicaid Services (CMS) makes monthly payments to MA organizations according to a system of risk adjustment that depends on the health status of each enrollee. Accordingly, MA organizations are paid more for providing benefits to enrollees with diagnoses associated with more intensive use of health care resources than 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. CMS then maps certain diagnosis codes, on the basis of similar clinical characteristics and severity and cost implications, into Hierarchical Condition Categories (HCCs). CMS makes higher payments for enrollees who receive diagnoses that map to HCCs.For this audit, we reviewed one of the contracts that Humana, Inc., has with CMS with respect to the diagnosis codes that Humana submitted to CMS. Our objective was to determine whether Humana submitted diagnosis codes to CMS for use in the risk adjustment program in accordance with Federal requirements.

Our objective was to determine whether the Postal Inspection Service, Washington Division, implemented effective controls for case management, accountable property, and training.

Deficiencies in the EPA’s information technology internal controls could be used to exploit weaknesses in Agency applications and hinder the EPA’s ability to prevent, detect, and respond to emerging cyberthreats.

The EPA did not achieve its mission when senior leaders issued instructions to Region 5 that impacted the region’s ability to address ethylene oxide emissions and when the EPA delayed communicating health risks regarding ethylene oxide.

The VA Office of Inspector General (OIG) evaluated allegations regarding Veterans Crisis Line (VCL) responses to a caller (caller 1) with homicidal ideation and a second caller (caller 2) with suicidal and homicidal ideation. The OIG also evaluated concerns regarding caller 1’s care at the Montana VA Health Care System (facility).The OIG substantiated a VCL responder failed to assess caller 1’s homicidal risk factors, address lethal means restriction, complete an adequate risk mitigation plan, communicate critical information to a supervisor, and take actions to prevent a family member’s death. VCL leaders did not consider an administrative investigation board to review the responder’s potential misconduct.The OIG substantiated that two social service assistants (SSAs) failed to dispatch local emergency services for caller 2 following a responder’s rescue request. The OIG identified deficiencies in SSA oversight.VCL leaders did not fully adhere to Veterans Health Administration (VHA) policies related to reporting and disclosure of adverse events.A facility primary care provider failed to include caller 1’s mental health diagnosis in the assessment and plan of care. Also, the primary care provider did not submit caller 1’s non-VA medical records for scanning into the electronic health record or document a review of the records, as expected by VHA policy.The OIG made two recommendations to the Executive Director, Office of Mental Health and Suicide Prevention, related to the establishment of quality management and disclosure processes.The OIG made seven recommendations to the VCL Director related to a review of the callers’ contacts, administrative investigation board procedures, quality management processes, responders’ communication, and SSA oversight.The OIG made two recommendations to the Facility Director related to providers’ assessment and care plans and documentation of patients’ non-VA health records.

A TVA manager was accused of improperly providing employees with gifts. While no federal ethics standards were implicated, it was determined TVA Standard Programs and Processes 11.418, Employee Recognition and Acknowledgment (TVA SPP-11.418), was not followed.

Our objective was to report internal control weaknesses, noncompliance issues, and unallowable costs identified in the single audit to the Social Security Administration (SSA) for resolution action.

Review based on the requirements in OMB Circular A-123, Appendix C (M-18-20), OMB Circular A-136, and guidance issued by theCouncil of Inspectors General on Integrity and Efficiency.

OIG data analytics identified Merrifield, VA, Post Office permit postage refunds totaling about $179,613 for fiscal year (FY) 2020. In addition, we identified some months with unusually high refunds. The objective of this audit was to determine whether postage affixed BRM refunds were properly issued, supported, and processed at the Merrifield, VA, Post Office.

While reviewing the Veterans Health Administration’s (VHA) plans to document receipt and distribution of the COVID-19 vaccine, the VA Office of Inspector General (OIG) determined that VHA facilities did not consistently document the COVID-19 vaccination status of veterans living in VA’s Community Living Centers (CLCs).The OIG determined that VHA could not know at a national level whether the vaccine was offered to some CLC residents, and if so, what their status was. Because CLC residents are in the highest COVID-19 vaccine priority group, they should be offered the vaccine, when possible, before other groups of veterans. With vaccine supplies limited, VHA should know which CLC residents still need to be vaccinated.The OIG found VHA has made important strides in distributing vaccines to CLC residents, but can move toward more comprehensive and consistent data collection to guide ongoing actions and protect this vulnerable population. Doing so would include making sure all CLCs routinely track refusals and contraindications in a consistent manner. Guidance should be clear that all communications should be consistently documented in accordance with VHA processes.Similarly, clear guidance and consistent oversight should help ensure CLCs are properly tracking veterans who fall in the 23 percent of CLC residents missing information needed to determine their vaccination status. It was not possible by January 2021 to establish which of the 1,899 veterans in this cohort had been offered the vaccine.The OIG will continue its oversight work on vaccinations within VHA and plans to issue a full report, including specific recommendations. In the meantime, 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.

We analyzed delayed mail volumes from mail processing facilities nationwide and found that the North Houston, TX, Processing and Distribution Center (P&DC) reported the most delayed mail in the nation from January 1 to December 31, 2020. However, the North Houston P&DC also processed4 the most mail in the country during that timeframe. Our objective was to determine the cause of delayed mail at the North Houston P&DC.

HUD does not have a departmentwide policy for dealing with radon contamination. Instead, HUD relies on each program office to develop radon policies that align with HUD’s environmental regulations. The three program offices reviewed do not have consistent radon policies. Only Multifamily’s radon policy includes radon testing and mitigation requirements. PIH’s policy strongly encourages but does not require public housing agencies (PHA) to test for radon and to mitigate excessive radon levels, if possible. CPD does not have a radon policy. Instead, both PIH and CPD use the environmental review process to test for and mitigate excessive radon levels in their properties. Relying on the environmental review process to test for and mitigate excessive radon may result in radon testing that occurs too infrequently, if at all. Further, the flexibility PIH gives to PHAs in its radon policy does not align with statements in HUD’s environmental regulations.Absent a departmentwide radon policy, each program office has developed a radon policy or approach with varying degrees of testing and mitigation requirements. This approach does not align with HUD’s environmental regulations or support industry standards which state that radon testing should occur every 2 years after a mitigation system is installed. Given that environmental reviews generally occur only for specific funding or approval actions and exposure to radon shows no immediate health effects or other warning signs, HUD cannot ensure that residents in HUD-assisted housing receive consistent and sufficient protection from the hazardous health effects of radon exposure. During fieldwork, HUD could not confirm whether it has complied with certain requirements of the Stewart B. McKinney Homeless Amendments Act – namely, developing and recommending an effective policy on radon contamination to Congress, developing a memorandum with Environmental Protection Agency to address radon contamination, and submitting a radon report to Congress. We offer seven recommendations to help HUD better protect residents from hazardous health risks of indoor radon exposure. The statuses of recommendations 1, 2, 3, 4, 5, and 6 are all “unresolved-open.” Recommendation 7 is closed.

Audit of fiscal year 2020, third quarter financial and award data the Commission submitted for publication on USASpending.gov, and the applicable procedures, certifications, documentation, and controls to achieve this process.

The Southwest Station, Washington, D.C., is in the Capital District of the Atlantic Area. The Southwest Station has 48 city routes which are delivered by 59 full-time city carriers and 29 city carrier assistants. The Southwest Station also has 15 clerks, including 10 full-time and five postal support employees. We selected the Southwest Station for review based on the number of stop-the-clock (STC) scans occurring at the delivery unit. Our objective was to evaluate select mail delivery and customer service operations and determine whether internal controls are effective at the Southwest Station, Washington, D.C.

We selected the Lehigh Valley Processing and Distribution Center (P&DC) for audit because from January 1, 2019, to August 31, 2020, MCV reported about 605 million delayed mailpieces, or 32.2 percent of the total pieces handled at this facility. We reviewed operations with the most delayed mail — Delivery Point Sequence totaling about 476 million (or 78.7 percent) and Managed Mail Program (hereafter refer to as managed mail) incoming letters totaling 67.7 million (or 11.2 percent). Delivery Point Sequence is an automated process of sorting mail by carrier routes into delivery order and managed mail originating from other processing locations that requires additional processing at a destinating facility before delivery. Our objective was to determine the cause of delayed mail at the Lehigh Valley P&DC.

Our objective was to assess the Postal Service’s exit processing and determine whether managers revoked facility access for separated employees and inactive contractors in a timely manner.

The OIG analyzed revenues and costs of nearly all USPS-managed post offices in the U.S. The research found that both revenue and costs at post offices aligned closely with population density — highest in more urban areas, lowest in rural locations. However, rural post offices were more likely to have costs exceed revenue. Nationally, 42 percent of post offices did not cover their costs; in rural areas, it was 60 percent. Opportunities exist for the Postal Service to rethink its retail network either to increase retail network funding or reduce costs, or both.

An Amtrak Customer Service Representative based in Kansas City, Missouri, resigned from employment on April 12, 2021, prior to his administrative hearing. Our investigation found that the former employee violated company policies by leaving his post between two and four hours at a time during his shifts without authorization to do so and without clocking out. In addition, the former employee also violated company policy by initially lying to our agents about his abovementioned actions.

GPO OIG Semiannual Report to Congress October 1, 2020 - March 31, 2021.

This report communicates the results of the Fiscal Year 2020 Federal Trade Commission Office of Inspector General review of the FTC’s compliance with the Payment Integrity Information Act of 2019 (PIIA) (Public Law 116-117).

The OIG conducted a nationally representative survey to understand the ways the COVID-19 pandemic may have altered customer perceptions of the Postal Service and their habits around mail and other postal-related activities. The OIG found that Americans continued to hold favorable views of the Postal Service during the pandemic, underscoring the important role USPS plays for the nation. During the pandemic, the core ways customers interacted with the Postal Service were through mail receipt, post office visits, and delivery of online orders. Nearly 70 percent of survey respondents reported checking their mail every day. However, respondents sent mail and personal packages less frequently compared to the previous year. Ecommerce grew during the pandemic, with more online orders placed in 2020 than in previous years. Survey respondents expect some of this ecommerce growth to continue after the pandemic. The OIG survey results provide information on changes in customer behavior and expectations, and careful monitoring of emerging trends will allow the Postal Service to continue to prepare for new and growing demands moving forward.

Sidney Cobos, Allan Lummer, Farshad Sassounian and Ashkan Kohanpour, medical marketers based in Los Angeles, California, pleaded guilty in United States District Court, Central District of California, on April 9, 2021, to one count each of aiding and assisting in the preparation of a false tax return. The four defendants will be sentenced at a future date.Our investigation found that they aided in the preparation and presentation of a false tax return to the Internal Revenue Service for Pharmacy Acquisition LLC. The defendants knew the tax return falsely claimed a deduction for expenses that were actually distributions made to them, as owners of Pharmacy Acquisition LLC. Further, our investigation found that Pharmacy Acquisition LLC provided medically unnecessary compounded drug prescriptions to Precise Compounding Pharmacy that were reimbursed by health care benefit programs, including Amtrak’s plan. As a result of the scheme, Amtrak’s insurance providers were fraudulently charged approximately $22,000.

This report contains information about recommendations from the OIG's audits, evaluations, reviews, and other reports that the OIG had not closed as of the specified date because it had not determined that the Department of Justice had fully implemented them. The list omits information that the Department of Justice determined to be limited official use or classified, and therefore unsuitable for public release.The status of each recommendation was accurate as of the specified date and is subject to change. Specifically, a recommendation identified as not closed as of the specified date may subsequently have been closed.

Our objective for this report was to assess the extent to which the company is incorporating its injury claims financial data into its Safety Management System (SMS).We found that the company has made significant progress implementing its SMS, and, as of December 2020, the company’s SMS aligns with federal requirements and with other passenger transportation industry safety programs. The company, however, has lost several key staff in the safety department since August 2019. While the company has started to assess and replace some of these positions, until it fully assesses the skillsets needed for the program’s next phase and ensures they are in place, the company cannot be sure it will be able to implement the program to its desired outcomes.We recommended that the company continue to assess the current staffing needs of the Safety department and address any significant gaps in capacity and key skillsets that could impact the company’s ability to execute the SMS to its desired outcomes.

The Tipton, IA, Post Office is located in the Iowa, Nebraska, South Dakota District of the Central Area. Metered mail is any mail class or product with postage printed with a Postal Service approved postage meter or PC Postage product/system. Unused metered indicia are postage amounts (which may include fees) already imprinted onto any mailpiece, shipping label or meter strip (stamp) that was never mailed. Such meter indicia are considered for refund only if complete, legible, and valid. OIG data analytics identified the Tipton, IA, Post Office meter refunds totaling about $183,970 from April 1, 2019 to November 30, 2020, the eighth highest in the nation. We noted that there is a major mailer located in Tipton, IA. Our objective was to determine whether meter refunds were properly issued, supported, and processed.