Federal Reports

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The Wisconsin Department of Health Services (State agency) did not always comply with Federal Medicaid requirements for invoicing manufacturers for rebates for physician-administered drugs. The State agency did not invoice manufacturers for rebates associated with $3 million ($1.8 million Federal share) in physician-administered drugs. Of this amount, $2.9 million ($1.7 million Federal share) was for single-source drugs, and $165,000 ($99,000 Federal share) was for top-20 multiple-source drugs. Because the State agency's internal controls did not always ensure that it invoiced manufacturers to secure rebates, the State agency improperly claimed Federal reimbursement for these single-source drugs and top-20 multiple-source drugs.

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This narrative report is a follow-up to our FY 2016 Federal Information Security Modernization Act (FISMA) Submission to the Office of Management and Budget (LTR 2017-04/FA-16-110-3) to provide findings and recommendations related to PBGC's information security program.We contracted with CliftonLarsonAllen LLP, an independent public accounting firm, to perform an evaluation of PBGC’s information security program as required by the Federal Information Security Modernization Act (FISMA). In FY 2016, PBGC made progress improving its information security program by publishing its Information Security Risk Management Framework Process and requiring the use of PIV for authentication; however, additional action is needed. More specifically, PBGC needs to permanently fill its risk executive position and ensure it fully and consistently implements current NIST access controls. The Corporation also needs to complete implementation of its information system continuous monitoring program. We reported 20 new recommendations based on the results of our FY 2016 independent evaluation. In addition to the recommendations in this report, there were eight FISMA-related recommendations reported in the Corporation’s FY 2016 internal control report AUD-2017-3/FA-16-110-2.

This Newsletter provides a bimonthly summary of selected investigative accomplishments.

The University of Arkansas for Medical Sciences Medical Center (the Hospital) complied with Medicare billing requirements for 54 of the 70 inpatient claims and all 60 outpatient claims. However, the Hospital did not fully comply with Medicare billing requirements for the remaining 16 inpatient claims. On the basis of our sample results, we estimated that the Hospital received overpayments of at least $279,000 for claims paid during 2013 and 2014.

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Congress authorized the President's Emergency Plan for AIDS Relief (PEPFAR) to receive $48 billion in funding for the 5-year period beginning October 1, 2008, to assist foreign countries in combating HIV/AIDS, tuberculosis, and malaria. Congress authorized additional funds to be appropriated through 2018.

The Office of Inspector General evaluated NASA’s ongoing efforts to manage its technical capabilities (workforce, facilities, and other assets) to ensure the Agency is prepared for current and future missions.

Audit Report

A hotline call alleged that Senior Corps management with the Central County United Way (CCUW), Hemet, CA, were inflating volunteer service hours, assigning volunteer service activities outside the scope of the grant and displacing staff.

On the basis of our review of 100 sampled deficiencies, we determined that the Missouri Department of Health and Senior Services verified nursing homes' correction of deficiencies identified during surveys in calendar year 2014 in accordance with Federal requirements. Accordingly, this report contains no recommendations.

Ensuring that only eligible applicants can enroll in qualified health plans (QHPs) and insurance affordability programs depends on the integrity of the enrollment process. A key part of that process involves resolving inconsistencies between self-attested information submitted by applicants and data received through Federal and other data sources. In June 2014, CMS reported to OIG that the Federal Marketplace was unable to resolve most inconsistencies from the first open enrollment period because the eligibility system was not fully operational. This report follows up on our earlier work, focusing on CMS's data management and resolution of prior inconsistencies.

This is our final report on the evaluation of the Census Bureau’s 2020 decennial program preparation and planning efforts. We initiated our evaluation of the 2016 Census Test to review (1) the effectiveness of the new management structure and (2) the effectiveness of the operational control system (OCS) to support nonresponse followup (NRFU) operations. Our first objective was to determine whether the Bureau documented its decision to utilize the enumerator-to-supervisor ratios selected for the 2016 test. Our second objective was to determine whether the Bureau designed the test to (a) assess the effectiveness of the OCS in supporting supervisors during NRFU operations by comparing 2016 test results to results of previous tests and (b) determine the feasibility and effectiveness of a higher enumerator-to-supervisor ratio compared to the 2010 Census.

We issued a management information report to the Department to highlight several areas of concern and some positive practices identified through our audits of SEA oversight of LEA single audit resolution. The results of our audits in the three States (Illinois, Massachusetts, andNorth Carolina) indicated a need for the Department to take steps to help ensure that these SEAs effectively carry out their responsibilities for oversight of LEA single audit resolution. Other SEAs likely have similar needs, and it is important that SEAs promptly address any weaknesses in their oversight to help ensure that LEAs take appropriate corrective actions identified in single audits to ensure that Federal education funds are reaching the intended recipients and achieving the desired results.

This audit evaluated NARA’s cloud computing environment and determine whether NARA was properly prepared to manage its transition to cloud computing services and meet OMB’s goals of a “Cloud First” policy.

The Mississippi Division of Medicaid (State agency) claimed school-based Medicaid administrative costs that were not in accordance with Federal requirements. The State agency used statistically invalid random moment sampling (RMS) in allocating costs to Medicaid, and it did not maintain adequate support to validate its sample results and related extrapolations. In addition, it claimed these costs without promptly submitting to the U.S. Department of Health and Human Services, Division of Cost Allocation (DCA), for review its cost allocation plan (CAP) amendments describing its random moment time study (RMTS) methodologies. Instead, the State agency claimed costs based on either of two implementation plans describing different RMTS methodologies. As a result, the almost $42.4 million (more than $21.1 million Federal financial participation) that the State agency claimed in school-based Medicaid administrative costs for Federal fiscal years 2010 through 2012 was unallowable.

For this audit, our objective was to evaluate the National Telecommunications and Information Administration’s (NTIA’s) management of the State and Local Implementation Grant Program (SLIGP). We also reviewed the National Institute of Standards and Technology’s (NIST’s) related grants administration.

This is our audit of the Economic Development Administration’s (EDA’s) fiscal years (FYs) 2014 and 2015 solicitation, evaluation, and selection processes for Public Works (PW) and Economic Adjustment Assistance (EAA) grant recipient selections. Our objective was to evaluate the effectiveness of EDA’s FYs 2014 and 2015 solicitation, evaluation, and selection processes to determine whether the PW and EAA grant recipient selections were made competitively and on a merit basis as required by federal, Departmental, and agency regulations.

Alta Bates Medical Center, located in Berkeley, California, did not comply with all Medicare requirements for reporting wage data in its fiscal year 2010 Medicare cost report. We estimated that, as a result, in 2014 Medicare overpaid the Medical Center $154,000 and overpaid 32 other hospitals in 2 core-based statistical areas a total of approximately $5.3 million.

The OIG worked with an expert in postal costing and economics to analyze product cost changes in four traditional USPS products: First-Class Mail, Standard Mail, Periodicals, and Package Services. The analysis compares costs from fiscal year (FY) 2006 to FY 2015. Four external factors drove product cost changes: inflation, change in product mix, individual volume change, and overall volume decline. The report attributes the remaining change in unit costs to other factors, some which are at least partially within the Postal Service’s control. When the main cost factors over which the Postal Service has no real control over are accounted for, unit costs were lower in FY 2015 than in FY 2006 for First-Class Mail, Standard Mail, and Package Services. Only Periodicals’ unit costs increased.

In accordance with the Office of National Drug Control Policy Circular, “Accounting of Drug Control Funding and Performance Summary,” we authenticated the Department’s accounting of FY 2016 drug control funds and performance measures for key drug control programs by expressing a conclusion about the reliability of each assertion made in the Department’s accounting report and performance report. Based on our review, nothing came to our attention that caused us to believe that management’s assertions contained in the Department’s detailedaccounting report and performance summary report were not fairly stated in all material respects

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OIG initiated the audit to determine whether (1) the Library’s internal controls over the program are appropriately designed and (2) the controls are effectively working. In the course of conducting the audit, OIG determined that the OCFO needs to strengthen the purchase card program’s internal control environment.

Medicare acute-care hospitals must report wage data annually to the Centers for Medicare & Medicaid Services (CMS). Wage data include wages, associated hours, and wage-related costs. CMS uses the wage data to calculate acute-care hospital wage indexes, which measure geographic area labor market costs relative to a national average. Federal law requires CMS to annually adjust Medicare hospital payments to reflect local labor markets; CMS uses area wage indexes to do this. Federal law also requires that the area wage indexes applied to hospitals in urban areas of a State may not be less than the area wage index of hospitals located in rural areas in that State. This provision is known as the "rural floor." Section 3141 of the Affordable Care Act requires that CMS apply this rural floor in a manner that is budget neutral on a national level. Accordingly, to balance the increase in wage indexes for hospitals receiving the benefit of their States' rural floors, CMS must lower wage indexes nationally by applying a rural floor budget neutrality factor.

Jackson-Madison County General Hospital (the Hospital), located in Jackson, Tennessee, complied with Medicare billing requirements for 141 of the 200 inpatient claims that we reviewed. However, the Hospital did not fully comply with Medicare billing requirements for the remaining 59 claims, resulting in net overpayments of approximately $189,000 for the audit period. On the basis of our sample results, we estimated that the Hospital received overpayments of at least $1.4 million 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.