Federal Reports

We issued this to review the Social Security Administration’s telephone services during the COVID-19 pandemic, specifically during June 2020.

NHS is a subsidiary of Blue Cross Blue Shield of North Dakota (BCBS North Dakota) (formerly Noridian Mutual Insurance Company), whose home office is in Fargo, North Dakota. NHS administered Medicare Part A, Medicare Part B, and Medicare Durable Medical Equipment (DME) contract operations under MAC contracts for Medicare Parts A and B Jurisdictions E and F and Medicare DME Jurisdictions A and D. In addition, NHS held the Pricing, Data Analysis and Coding (PDAC) contract. Both BCBS North Dakota and NHS sponsor nonqualified plans called the Noridian Mutual Insurance Company Restoration Savings Plan and Noridian Healthcare Solutions, LLC, Restoration Savings Plan. The purpose of these plans is to provide deferred compensation for a select group of management or highly compensated employees within the meaning of the Employee Retirement Income Security Act of 1974. NHS claimed nonqualified costs using the pay-as-you-go basis of accounting. This report addresses the allowable restoration costs claimed by NHS under the provisions of its MAC contracts and CAS- and FAR-covered contracts. The disclosure statement that NHS submits to CMS states that NHS uses pooled cost accounting. Medicare contractors use pooled cost accounting to calculate the indirect cost rates (whose computations include pension, postretirement benefit, Supplemental Executive Retirement Plan, and Restoration 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. The Medicare contracts require NHS to calculate nonqualified 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, 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. At CMS’s request, Kearney and Company (Kearney) performed an audit of the ICPs that NHS submitted for CYs 2015 and 2016. The objectives of the Kearney audit were to determine whether costs were allowable in accordance with the FAR, the Department of Health and Human Services Acquisition Regulation, and the CAS. For our current audit, we relied on the Kearney audit findings and recommendations when computing the allowable restoration costs discussed in this report. We incorporated the results of the Kearney audit into our computations of the audited indirect cost rates, and ultimately the restoration costs claimed, for the contracts subject to the FAR. CMS will use our report on allowable restoration costs, as well as the Kearney audit report, to determine the final indirect cost rates and the total allowable contract costs for NHS for CYs 2015 and 2016. The cognizant Contracting Officer will perform a final settlement with the contractor to determine the final indirect cost rates. These rates ultimately determine the final costs of each contract.

EAC OIG, through the independent public accounting firm of Brown and Company, LLC, audited EAC's Purchase Card Program in accordance with the Government Charge Card Abuse Prevention Act of 2012.

The VA Office of Inspector General (OIG) reviewed community-based outpatient clinic (CBOC) closures that occurred due to the COVID-19 pandemic to evaluate the impact on patient care. The OIG virtually interviewed Veterans Health Administration (VHA) staff at 140 facilities that oversaw the 1,031 CBOCs that were operational prior to the World Health Organization’s pandemic declaration.Of these CBOCs, 173 were closed to face-to-face visits on or after February 1, 2020. Reasons for closure fell into four categories including (a) safety of patients and staff, (b) need for consolidation of resources, (c) lack of staff and personal protective equipment, and (d) small size of CBOC or proximity to other CBOCs or facilities.Clinicians of closed CBOCs triaged patients care needs and provided care options. The four most reported options used were telephone visit, VA Video Connect, rescheduled appointment for a later date, or an outpatient visit at the parent facility. Based on survey responses and interviews with facility leaders, the OIG concluded that, generally, patient care needs were not interrupted.Facility personnel frequently noted several impacts of the COVID-19 pandemic on CBOC operations:• Patient trust scores increased on the Veteran Signals survey.• Patients voiced appreciation of available care options.• Virtual care visits increased, which may positively affect patient access long-term.• Process changes such as drive-through testing and care services for pharmacy, laboratory, immunizations, prosthetics, and audiology were implemented.Other responses identified challenges encountered implementing virtual care and mitigating risk of patient and staff exposure to COVID-19, including problems with bandwidth and technical issues when using VA Video Connect at rural sites and limitations in housekeeping resources.Insights gained and shared related to CBOC closures can provide valuable information for VHA to incorporate into contingency planning for future emergencies and facilitate long term changes in care delivery.The OIG made no recommendations.

The Federal Information Security Modernization Act of 2014 (FISMA) requires Inspectors General toperform an annual independent evaluation of their agency’s information security programs and practices to determine the effectiveness of those programs and practices. HHS OIG engaged Ernst &Young LLP (EY) to conduct this audit.