Federal Reports

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.