Federal Reports

TVA's Nuclear Quality Assurance (QA) provides monitoring and assessment of plant activities to ensure they are conducted in a quality manner. Periodically, reviews are performed (internal and external) of QA that identify improvement opportunities. Due to the importance of QA's role in monitoring and assessing nuclear plant activities, we initiated an evaluation to determine if QA has taken actions to address issues identified during the internal and external reviews. We determined QA generally took actions to address issues identified during reviews of QA. However, we determined better documentation was needed when actions are not deemed necessary.

Statutorily mandated rebates, which include both basic rebates and inflation-indexed rebates (additional rebates owed when drug prices rise faster than inflation), amount to a substantial percentage of spending on Medicaid prescription drugs. Medicare does not have the authority to collect rebates for Part B drugs and biologicals (i.e., "Part B drugs"). In an earlier report, OIG found that a rebate program for Part B drugs could have resulted in at least $2.7 billion in rebates (both basic rebate and inflation-indexed rebate segments) in 2011. OIG conducted this current review after receiving a congressional request asking us to update our earlier rebate calculations using only the inflation-indexed portion of the Medicaid rebate methodology.

A joint investigation with the Lordsburg New Mexico Police Department found that Ms. Mary Cristina Ortiz, Executive Director,The Wellness Coalition, Lordsburg, NM, defrauded the U.S. Government when she allowed two AmeriCorps members (Ms. Ortiz’children) to submit timesheets that falsely claim they performed AmeriCorps service in Lordsburg, NM, while they attendedcollege in another state. Ms. Ortiz actions resulted in the loss of $16,500 in Federal funds.

When Congress established average sales price (ASP) as the basis for Medicare Part B drug reimbursement, it also provided a mechanism for monitoring market prices and limiting potentially excessive payment amounts. The Social Security Act mandates that OIG compares ASPs with average manufacturer prices (AMPs). If OIG finds that the ASP for a drug exceeds the AMP by a certain percentage (currently 5 percent), the Act directs the Secretary of Health and Human Services to substitute the ASP-based payment amount with a lower calculated rate. Through regulation, CMS outlined that it would make this substitution only if the ASP for a drug exceeds the AMP by 5 percent in the 2 previous quarters or 3 of the previous 4 quarters.

OIG conducted a healthcare inspection at the request of Congressman Mike Coffman to assess allegations received in 2014 regarding delays in scheduling diagnostic studies and other quality of care concerns at the William S. Middleton Memorial Veterans Hospital (facility), Madison, WI. After beginning our review, we also received a request from Senator Tammy Baldwin to review the same issues. We substantiated delays in scheduling in-house echocardiograms, stress tests, and sleep studies for patients in 2013 and 2015. We determined that two patients had an increased risk for sudden cardiac death due to a delay in scheduling an echocardiogram in 2013. After several months delay, both patients underwent echocardiograms followed by surgical procedures to treat their life-threatening conditions. We substantiated that a small number of 2013 and 2015 echocardiogram consults were discontinued within 30 days then later resubmitted as new consults without explanatory documentation. We could not determine that echocardiogram consults were discontinued within 30 days and resubmitted to appear timely. We did not substantiate that facility managers refused to approve non-VA echocardiograms and stress tests as a cost savings decision. We reviewed 2013 and 2015 non-VA echocardiogram and stress test consult requests to determine if facility managers refused to approve non-VA care. We substantiated that a cardiologist did not sign cardiac catheterization reports timely; however, we did not substantiate that untimely signing of cardiac catheterization reports resulted in delayed care for three identified patients. We did not substantiate that a cardiologist did not timely review an event monitor tracing strip, which resulted in a patient undergoing an invasive surgical procedure. We did not substantiate that pharmacy staff refused to give veterans a 90-day supply of clopidogrel and instead only gave a 30-day supply, and that this contributed to missed doses. We did not find evidence that giving three patients a 30-day supply of clopidogrel contributed to missed dosages for those patients. We made three recommendations.

Bisphenol-A (BPA), a chemical often used to produce food and drink packaging, has been linked to a variety of adverse health conditions, including cancer. The National Institute of Environmental Health Sciences (NIEHS) funds studies that test substances, including BPA, for carcinogenicity and other harmful biological effects. OIG received a congressional request to review the extent to which NIEHS funds research on the safety of BPA and the processes NIEHS used in planning and funding that research.

This report contains Sensitive But Unclassified information. To obtain further information, please contact the OIG Office of Counsel at OIGCounsel@oig.treas.gov, (202) 927-0650, or by mail at Office of Treasury Inspector General, 1500 Pennsylvania Avenue, Washington DC 20220.

Understanding, attracting, and retaining customers is necessary for the Postal Service to thrive in an increasingly competitive marketplace. The OIG researched four postal customer satisfaction surveys and found that measuring customer satisfaction and loyalty provide a robust picture of brand health and growth potential. Enhancements to its surveys could give the Postal Service an even more nuanced and comprehensive view of the postal customer’s total experience.

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Blue Cross Blue Shield of South Carolina overstated its allocable pension costs by $6.2 million for calendar years 2006 through 2012.

Companion Data Services, LLC, understated its allocable pension costs by $30,000 for calendar years 2008 through 2012.

Companion Data Services, LLC, overstated the Medicare segment pension assets by $118,000 from January 1, 2008, to January 1, 2013.

Medicare spending is expected to grow to $1.4 trillion by 2027. To control this increase and promote quality and healthy populations, the Centers for Medicare & Medicaid Services (CMS) has implemented and is considering a number of alternative payment models that reward providers for the quality and value of services. The goal is to incentivize providers to keep patients healthy and thus lower costs. The Medicare Shared Savings Program is one of the largest alternative payment models. As part of this program, health care providers form Accountable Care Organizations (ACOs) to coordinate care to reduce Medicare costs and improve quality of care. Information about the extent to which ACOs are able to reduce Medicare spending and improve quality is critical to inform future developments as ACOs and other alternative payment models evolve.

The Office of the Inspector General audited cyber security of the Tennessee Valley Authority's (TVA) gas secure rooms that provide remote logical access to all TVA gas fired plants. We found the architecture, current standard programs and processes, and draft standard operating procedures contain appropriate information as suggested by best practices. However, we found the logical controls for the gas secure rooms could be strengthened. Specifically, we found issues with the (1) network devices at the gas secure rooms and a sample of combined cycle and combustion turbine plants and (2) workstations and servers at the gas secure rooms. Additionally, we found the gas secure rooms were not being used for access as originally intended. TVA management agreed with our findings and recommendations.

As part of our annual audit plan, we audited costs billed to the Tennessee Valley Authority (TVA) by Williams Plant Services, LLC (WPS) for providing facilities maintenance services and technical support services for Bellefonte Nuclear Plant under Contract No. 4067. Our audit included $23.9 million in costs paid by TVA between January 1, 2013, and August 31, 2015. Our audit objective was to determine if the costs WPS billed to TVA were in accordance with the terms of Contract No. 4067. In summary, we found WPS overbilled TVA $2,595,222 as follows: $1,560,515 in labor costs were overbilled due to the use of labor classifications and billing rates not provided for in the contract. $654,852 in labor and related costs were overbilled, including (1) $454,838 for ineligible general liability insurance markups applied to craft labor, (2) $177,443 in unapproved craft labor costs, (3) $14,136 in excessive nonmanual fringe benefits, (4) $6,302 in ineligible overtime costs, and (5) $2,133 in excessive payroll tax costs. WPS also acknowledged the 2015 payroll tax adjustment required by the contract had not been completed. $246,304 in unapproved subcontractor costs were billed. $133,551 in overbillings occurred due to ineligible and unsupported temporary living allowances and travel costs, excessive fees, discounts that were not provided to TVA, and ineligible materials, supplies, and fitness for duty costs. (Summary Only)

The audit’s objective was to review the use of TARP funds for administrative expenses, operating expenses, or other spending by the 19 state housing finance agencies (and/or their contractors or partners) who receive Hardest Hit Fund dollars.

EAC OIG, through the independent public accounting firm of McBride, Lock & Associates LLC, audited the use of funds under the Help America Vote Act by the New Hampshire Secretary of State.

Several of the Consumer Operated and Oriented Plans (CO-OPs) that were operating at the beginning of 2016 are no longer viable or sustainable. Specifically, 5 of the 11 CO-OPs operating on January 1, 2016, had ceased or planned to cease operations by the end of the 2016 plan year, and each of the remaining 6 CO-OPs reported net losses and had drawn down nearly all available CO-OP loan amounts as of December 31, 2016. These six operational CO-OPs did not appear to be financially viable and sustainable based on the reported net income and available capital and surplus. When a CO-OP ceases operations during the plan year, health plan participants can be significantly affected.

Medicare Part B paid for some immunosuppressive drugs billed with the KX modifier that were not eligible for Part B payment. Of the 75 claims in our random sample, pharmacies had documentation to support the KX modifier for 65 claims but did not have support for the remaining 10.

In accordance with our Fiscal Year (FY) 2017 annual plan, the Office of Inspector General(OIG) conducted a performance audit to determine whether the United States Capitol Police (USCP or Department) established adequate controls over its Purchase Card Program to ensure compliance with policies and procedures. Our scope included controls, processes, and operations from October 1, 2016, through March 31, 2017. Of 31 purchase cards the Department authorized, 26 card holders used their cards for 1,661 individual transactions, spending more than $1 million during the audit period.

In February and March 2017, we evaluated the Philadelphia, PA, VA Regional Office (VARO) to determine how well Veterans Service Center (VSC) staff processed veterans’ disability claims, how timely and accurately they processed proposed rating reductions, how accurately they entered claims-related information, and how well they responded to special controlled correspondence. VSC staff did not consistently process some of the disability claims we reviewed. OIG reviewed 30 veterans’ traumatic brain injury claims and found Rating Veterans Service Representatives (RVSRs) accurately processed 27. This represented a significant improvement from our 2013 inspection. RVSRs did not always process entitlement to special monthly compensation (SMC) and ancillary benefits consistent with Veterans Benefits Administration (VBA) policy. OIG reviewed 30 claims involving entitlement to SMC and related ancillary benefits and found RVSRs incorrectly processed 13, resulting in 189 improper monthly payments to 10 veterans totaling approximately $123,000. This occurred because of an ineffective second signature review process. VSC staff generally processed proposed rating reductions accurately. OIG reviewed 30 rating reduction cases and found staff delayed or incorrectly processed 10 because management placed higher priority on other workload. OIG reviewed 30 newly established claims and found staff did not correctly input claim and claimant information into the electronic systems at the time of claims establishment in 15 because of lack of training and staff rushing to establish claims. VSC staff processed special controlled correspondence timely but needed to improve accuracy. OIG reviewed 30 special controlled correspondences and found staff incorrectly processed 13 because of lack of training and inadequate oversight by management. OIG recommended the VARO Director develop and implement a plan to assess the accuracy of secondary reviews involving higher level SMC, ensure oversight of rating reductions, monitor the effectiveness of claims establishment training, and develop a plan to monitor the effectiveness of training and reviews of special controlled correspondence. The VARO Director concurred with our recommendations and planned actions are responsive.

CNCS-OIG investigators found no evidence to support an allegation that AmeriCorps members with the Volunteers in Service to America, Student Veterans of America, Washington, DC, a service site of the American Legion Auxiliary, Indianapolis, IN., engaged in prohibited activities to influence proposed legislation.

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EAC OIG, through the independent public accounting firm of McBride, Lock & Associates, LLC, audited $30.6 million in funds received by the Mississippi Secretary of State under the Help America Vote Act. The objectives of the audit were to determine whether the Office: 1) used payments authorized by Sections 101, 102, and 251 of the Grant in accordance with Grant and applicable requirements; 2) accurately and properly accounted for property purchased with Grant payments and for program income; 3) met HAVA requirements for Section 251 funds for creation of an election fund, providing required matching contributions, and meeting the requirements for maintenance of a base level of state outlays, commonly referred to as Maintenance of Expenditures (MOE).

This memorandum alerts the Centers for Medicare & Medicaid Services (CMS) to the preliminary results of our ongoing review of potential abuse or neglect of Medicare beneficiaries in skilled nursing facilities (SNFs). This audit is part of the ongoing efforts of the Office of Inspector General (OIG) to detect and combat elder abuse. We are communicating these preliminary results because of the importance of detecting and combating elder abuse. Also, according to Government Auditing Standards, "early communication to those charged with governance or management may be important because of their relative significance and the urgency for corrective follow-up action."

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OIG conducted a healthcare inspection to assess allegations made regarding patient flow and quality of care in the Emergency Department (ED) at the Baltimore VA Medical Center (facility), part of the VA Maryland Health Care System (system). We substantiated patients remained in the ED for more than 4 hours while waiting for an inpatient bed, and found the median ED length of stay (LOS) for admitted patients, the delay in inpatient admission, and the percentage of patients boarded exceeded Veterans Health Administration (VHA) targets and thresholds during the period October 2013–December 2016. We did not identify patients who were clinically impacted by delays. We found that the accuracy of the ED metrics could be compromised when a provider encountered challenges using Emergency Department Integration Software (EDIS). We found that system policy did not include the maximum number of ED boarders as required by VHA. We found that staff failed to consistently utilize the Bed Management Solution software. We also found that Environmental Management Services staff schedules and cleaning processes were inadequate to support the patient flow process. We found that Patient Flow Committee members did not take adequate action to improve patient flow. We substantiated the system’s capping practice may limit the number of patients the admitting teams can treat and that facility managers had not established alternative processes to improve patient flow. Although we substantiated that on a day in 2015, ED patients waited extended times, we found no reports of adverse patient events. We substantiated that inpatient nurses were sometimes unavailable to receive the handoff report from ED nurses. We substantiated that the ED administrative support staffing level was not compliant with the VHA requirement. Further, we found that the lack of timely after-hours coverage of computerized tomography scan services contributed to the extended LOS for some ED patients. We made 11 recommendations.

In December 2016, OIG evaluated the Louisville VA Regional Office (VARO) to determine how well Veterans Service Center (VSC) staff processed disability claims, how timely and accurately they processed proposed rating reductions, how accurately they input claims-related information, and how well VARO staff responded to special controlled correspondence. Staff did not consistently process one of the two types of disability claims we reviewed. OIG reviewed 30 veterans’ traumatic brain injury claims and found staff accurately processed all 30 claims. OIG reviewed 30 special monthly compensation (SMC) benefits claims and found that a Rating Quality Review Specialist and Rating Veterans Service Representatives incorrectly processed 11 claims due to ineffective training and weaknesses in the VSC’s second signature review process. Overall, VSC staff incorrectly processed 11 of the 60 disability claims OIG reviewed—resulting in 160 improper payments to 9 veterans totaling approximately $146,000. OIG reviewed 30 rating reductions cases and found that staff delayed 13 cases because staff placed higher priority on other workloads. This resulted in 128 improper monthly payments, representing approximately $140,000 in overpayments. OIG reviewed 30 newly established claims and found staff did not correctly input claim and claimant information into the electronic systems for 14 claims generally because staff were unaware of Veteran Benefits Administration policies. The VARO did not process any special controlled correspondence within the scope of our inspection. Therefore, we were unable to assess VARO staff’s effectiveness in this area. OIG recommended the Louisville VARO Director develop a plan to monitor the effectiveness of training, strengthen oversight, and assess the accuracy of secondary reviews involving higher-level SMC; ensure oversight of proposed rating reduction cases; and provide training for claims establishment procedures. The VARO Director concurred with our recommendations; planned corrective actions are responsive.

Our objective was to review the accuracy and completeness of the Commission’s reporting, as well as agency performance in reducing and recapturing improper payments, if applicable. Overall, we found that the Denali Commission met the applicable OMB criteria for compliance with IPIA, as amended, for FY 2016.

Medicare Part B provides for the coverage of outpatient therapy services, including occupational, physical, and speech therapy. Previous OIG reports identified unallowable claims for these services. Fox Rehabilitation (Fox), headquartered in New Jersey, was among the largest providers of outpatient therapy services in the country. Our objective was to determine whether claims for outpatient therapy services provided in New Jersey and submitted for Medicare reimbursement by Fox complied with Medicare requirements.

Accredo Health Group, Inc. (which is located in Memphis, Tennessee, and has pharmacies across the United States) complied with Medicare requirements when billing for inhalation drugs. Specifically, all 100 claim lines in our sample complied with the requirements. Consequently, this report has no recommendations.

Audit Report

The objective was the review the accuracy and completeness of the Commission/s reporting, as well as agency performance in reducing and recapturing improper payments, if applicable. Overall it was found that the Denali Commission met the applicable OMB criteria for compliance with IPIA, as amended, for FY 2016.

The Office of the Inspector General conducted a review of Talent Acquisition and Diversity (TAD) to identify strengths and risks that could impact TAD's organizational effectiveness. Our evaluation identified strengths within TAD related to (1) organizational alignment, (2) collaboration, (3) support from TAD management, and (4) department morale and ethics. However, we also identified potential risks that could negatively affect the achievement of the mission. These risks include (1) the potential for increased noncompliance risk due to (a) the use of social media in the recruitment process and (b) no documentation requirements for hiring interns, (2) talent acquisition process inefficiencies, and (3) the potential for ineffective inclusion metrics and programs.

OIG conducted an inspection in response to a February 2015 request from Congresswoman Gwen Moore to review prescribing practices related to controlled substances at the Clement J. Zablocki VA Medical Center (facility), Milwaukee, WI. We also received an allegation that a provider at the facility had questionable opioid prescribing practices. To review the overall opioid prescribing practices at the facility, we evaluated whether facility and Veterans Integrated Service Network (VISN) leadership complied with specific goals (2, 3, 7, 8, and 9) delineated in the Veterans Health Administration (VHA) Opioid Safety Initiative (OSI) Update. We determined the facility met Goal 2 (the number of patients who had an annual urine drug screen increased by nearly twofold from fiscal year 2014 through the second quarter of fiscal year 2015); Goal 8 (complementary and alternative medicine modalities were available), and Goal 9 (a collaborative model to manage opioids and benzodiazepines prescribing had been established). We made recommendations related to Goals 3 and 7. We substantiated that a provider prescribed opioid medications for some patients in a manner that varied from clinical guidelines and other facility providers. We recommended that the Veterans Integrated Service Network Director convene an expert panel knowledgeable in the subspecialties of Pain Medicine and Addiction Medicine to review the subject provider’s opioid prescribing practices within the context of the patients whose treatment varied from guidelines and submit a report of findings to the Veterans Integrated Service Network and Facility Directors; ensure the monitoring of patients on Suboxone; and ensure the Pain Committee strengthens processes to improve communication with the facility to ensure information is relayed timely. We also recommended that the Facility Director ensure that providers access the Prescription Drug Monitoring Program database as required by facility policy and monitor compliance and that adequate resources are allocated for patient reviews for opioid therapy appropriateness.

Medicare Compliance Review of Parkridge Medical Center, Inc., for 2014 and 2015 Parkridge Medical Center, Inc. (the Hospital), located in Chattanooga, Tennessee, complied with Medicare billing requirements for 88 of 100 inpatient claims we reviewed. However, the Hospital did not fully comply with Medicare billing requirements for the remaining 12 claims for the audit period (calendar years 2014 and 2015). On the basis of our sample results, we estimated that the Hospital received overpayments totaling at least $201,808 for the audit period. These errors occurred primarily because the Hospital did not have adequate controls to prevent the incorrect billing of Medicare claims within the selected risk areas that contained errors.

OIG administers the Medicaid Fraud Control Unit (MFCU or Unit) grant awards, annually recertifies the Units, and oversees the Units' performance in accordance with the requirements of the grant. As part of this oversight, OIG conducts periodic reviews of all Units and prepares public reports based on these reviews. These reviews assess the Units' adherence to the 12 MFCU performance standards and compliance with applicable Federal statutes and regulations.

Smoking is the leading cause of preventable disease and death in the United States. In 2009, Congress passed the Family Smoking Prevention and Tobacco Control Act, authorizing FDA to begin regulating tobacco products in the United States. It granted FDA comprehensive authority over domestic tobacco products and established the Center for Tobacco Products at FDA to oversee the manufacturing, distribution, and marketing of these products. Our work focuses on FDA's efforts to regulate and oversee domestic tobacco manufacturing establishments in the early years of implementing the Tobacco Control Act.