Exclusion Screening

Overview of OIG’s Management and Performance Challenges in 2021


Emptech's founder, Jeff Aleixo


Jeffrey Aleixo

OIG Management, Healthcare Issues, Healthcare Compliance

Once a year, the Office of Inspector General (OIG) prepares a summary of the most significant management and performance challenges facing the Department of Health and Human Services (HHS).   

OIG’s management and performance challenges reflect continuing vulnerabilities identified over recent years as well as new and emerging issues that HHS will face in the coming year. This summary meets OIG’s requirement under the Reports Consolidation Act of 2000, Public Law 106-531 to identify management challenges, assess the Department’s progress in addressing each challenge, and submit the annual statement. 

Top OIG’s Management and Performance Challenges

When it comes to OIG’s management and performance challenges in 2021, there are six main issues that emerged in the process of fulfilling the mission to enhance the health and well-being of every citizen. These top challenges reflect overarching concerns that affect multiple HHS programs and responsibilities. The impact of COVID-19 on HHS and fraud affects nearly every challenge noted in the 2021 publication. 

Consequences of the COVID-19 Pandemic 

The impact of the COVID-19 pandemic on HHS has been profound. As the lead Federal agency for medical support and coordination during this public health emergency (PHE), HHS has numerous and significant responsibilities in providing assistance as the country confronts the pandemic. Therefore, it is not surprising that the COVID-19 remains dominant among OIG’s management and performance challenges, especially the potential for fraud during the pandemic.  

As of May 2021, the Centers for Medicare and Medicaid Services (CMS) had made advanced and accelerated payments to Medicare providers and paid providers for certain services at enhanced rates applicable during the PHE. CMS also suspended or reduced the scope of many program integrity safeguards, such as provider enrollment screening.  While these steps were necessary, they also increase the risk of fraud. Consequently, OIG has identified serious concerns related to fraud schemes that would divert funds intended for COVID-19 response and recovery. 

In the effort to mitigate COVID-19 fraud, the summary of OIG’s management and performance challenges includes a number of necessary actions, such as:

  • HHS should ensure that funds are paid only to eligible recipients in the correct amounts and used in accordance with program requirements.
  • HHS should apply effective internal controls and efficiently manage the collection, maintenance, and analysis of relevant data that are key to ensuring that COVID-19 funds are used for their intended purposes.
  • HHS has to take action to protect individuals from being defrauded under the guise of the PHE.

Fraud, Waste, and Abuse

Fraud, waste, and abuse present top issues among OIG’s management and performance challenges for 2021. As many providers faced financial and practice challenges due to COVID-19, CMS took steps to provide increased flexibility and advance payments to mitigate the financial effects of the pandemic. At the same time, this approach increased the risk of improper payments and fraud schemes. As a result, HHS has been faced with balancing the challenges created by the PHE with the need to ensure effective use of federal funds amid the global pandemic.

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Medical Costs

Given the size of the healthcare programs under HHS as the largest civilian agency in the federal government, the risk of overpayments and controlling medical costs remains a considerable challenge. Reducing improper payments is critical to safeguarding federal funds and OIG’s management and performance challenges include some of the largest estimated improper payments. For example, OIG and CMS have identified especially high rates of improper payments for:

  • home health services,
  • hospice and SNF care,
  • durable medical equipment,  
  • prosthetics, orthotics, & supplies,
  • chiropractic services, and
  • certain hospital services. 

Fraud Detection and Prevention

CMS’s Fraud Prevention System (FPS) has been in use since 2011 for detecting and preventing fraud and improper payments. The OIG recognizes FPS as an important tool for fraud detection and prevention but also highlights that FPS is not as effective as it could be. Therefore, OIG recommended CMS to make better use of the performance results within its FPS to refine and enhance predictive analytic models.

An effective provider enrollment screening process is another important tool for preventing Medicaid and Medicare fraud. However, unscrupulous providers continue to enroll in Medicaid and Medicare. As a result, OIG recommended that CMS should:

  • ensure that all States fully implement fingerprint-based criminal background checks for high-risk Medicaid providers,
  • work with States to ensure that they have the controls required to prevent unenrolled providers from participating in Medicaid, and
  • follow up with States to remove terminated providers that OIG identified as inappropriately enrolled in Medicaid.

The Importance of Meeting OIG’s Management and Performance Challenges

The mission of HHS is to provide independent and objective oversight that promotes the economy, efficiency, and effectiveness of HHS programs and operations. Taking this into consideration, documents such as the summary of OIG’s management and performance challenges are necessary to address and solve different areas of concern. While the challenges and recommendations are complex, it is important to meet them, especially given the pressing issues related to COVID-19. Furthermore, every healthcare organization and provider should contribute to HHS meeting its mission by ensuring an effective culture of healthcare compliance. To that end, the integration of proper software solutions can help healthcare organizations ensure compliance,  eliminate the risk of fines and penalties, and meet demanding healthcare directives and guidelines.

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