Each month, we are pleased to share the most recent additions to the HHS Office of Inspector General (OIG) Work Plan items. Starting in June 2017 OIG has been updating its Work Plan monthly with any new changes to the active list. Let’s take a look at the new updates from this month.
What is the OIG Work Plan?
The HHS OIG Work Plan sets forth various projects that OIG plans to undertake during the fiscal year (FY) and beyond.
Projects listed in the Work Plan span HHS’s operating divisions, including the following:
- Centers for Medicare & Medicaid Services (CMS)
- Public health agencies such as the Centers for Disease Control and Prevention (CDC)
- National Institutes of Health (NIH)
- Administration for Children and Families (ACF)
- Administration for Community Living (ACL)
- Various state and local governments – evaluating the use of federal funds as well as the administration of HHS
*Some of the projects described in the Work Plan are statutorily required.
The February agenda includes 13 new items from HHS Office of Inspector General (OIG). Let’s walk through this latest release so you can address it within your compliance program, if applicable.
- HHS Compliance with the Improper Payment Elimination and Recovery Act
- Ensuring Dual-Eligible Beneficiaries’ Access to Drugs Under Part D: Mandatory Review
- The Impact of Health Risk Assessments on Risk-Adjusted Payments in Medicare Advantage
- Medicare Capital Payments to New Hospitals
- Nationwide Audit of Medicare Part D Eligibility Verification Transactions
- Medicaid-Audit of Health and Safety Standards at Individual Supported Living Facilities
- Medicaid MCO PBM Pricing
- Data Brief: Characteristics of Hospitals With Wage Indexes in the Bottom Quartile for the Fiscal Year 2020 Inpatient Prospective Payment System
- Audit of CMS’s Assessment of National Security Risks to Genomic Testing Data
HHS Compliance with the Improper Payment Elimination and Recovery Act
The federal government requires the head of each agency with programs or activities that may be susceptible to significant improper payments to report certain information to Congress. HHS must report improper payment estimates, corrective action plans, and reduction targets when improper payments are expected to exceed $10 million and 1.5 percent, or $100 million regardless of the improper payment rate.
OIG will review HHS compliance with the Improper Payments Information Act of 2002 (IPIA) and determine how well HHS is assessing federal programs with accuracy and completeness in regards to releasing the HHS Agency Financial Report.
Ensuring Dual-Eligible Beneficiaries’ Access to Drugs Under Part D: Mandatory Review
Some of the most vulnerable patients for receiving care from excluded providers are those dually enrolled in Medicaid and Medicare. Dual beneficiaries are enrolled in Medicaid but qualify for Medicare Part D prescription drug coverage.
OIG will be conducting an annual review of the extent to which drug formularies by Medicare Part D sponsors include drugs commonly used by dual-eligible beneficiaries.
The Impact of Health Risk Assessments on Risk-Adjusted Payments in Medicare Advantage
Monthly advance CMS payments are made to Medicare Advantage Organizations (MAOs). To identify beneficiaries with higher expected costs, CMS uses a risk adjustment payment model to assess encounter data from MAOs including patient demographic information and previous year clinical diagnoses.
CMS defines risk assessments as visits to evaluate health risks for beneficiaries according to risk scores and risk-adjusted payments. OIG will be conducting a study to determine which diagnoses solely from risk assessments were associated with higher risk scores and Medicare Advantage payments.
Medicare Capital Payments to New Hospitals
Medicare-related capital costs can include depreciation, interest, rent, and property-related insurance and tax paid to hospitals through Medicare Part A. New hospitals are reimbursed for the first two years of operation on a cost basis. After the initial two years, payment occurs through the inpatient prospective payments system (IPPS).
HHS OIG will be evaluating the potential impact if Medicare capital payments to new hospitals were paid through IPPS for the first two years.
Nationwide Audit of Medicare Part D Eligibility Verification Transactions
Pharmacies submit E1 transactions to Medicare Part D facilitators to bill for a prescription or determine drug coverage billing order. Part D facilitators then return information to pharmacies to submit the prescription drug event.
E1 eligibility verification transactions are elements of the Coordination of Benefits and calculating true out of pocket costs. OIG will be reviewing CMS’s oversight of E1 transactions and determine whether they were created and used for intended purposes.
Medicaid-Audit of Health and Safety Standards at Individual Supported Living Facilities
According to OIG, “Recent media coverage throughout the country of deaths of people with developmental disabilities involving abuse, neglect, or medical errors has led to OIG audits in several States.”
Through home and community-based waiver programs, individual supported living facilities provide services to beneficiaries with developmental disabilities. OIG has emphasized oversight of home health services and personal care services due to the high risk of fraud, waste, and abuse (FWA).
OIG will be determining whether state agencies and providers complied with federal and state health and safety requirements for Medicaid beneficiaries with developmental disabilities in individualized supported living settings.
Medicaid MCO PBM Pricing
Managed Care Organizations (MCOs) contract with state Medicaid agencies to ensure beneficiaries receive covered services including prescription drugs. Some MCOs choose to contract with Pharmacy Benefit Managers (PBMs) to manage or administer drug benefits on their behalf.
In some instances, PBMs have been known to practice spread pricing by charging Managed Care Organizations (MAOs) more for drugs than amounts the PBM pays to pharmacies. HHS OIG will be auditing states to determine whether adequate oversight of Medicaid MCOs to ensure accountability over amounts paid for prescription drug benefits to its Pharmacy Benefit Managers (PBMs).
Data Brief: Characteristics of Hospitals With Wage Indexes in the Bottom Quartile for the Fiscal Year 2020 Inpatient Prospective Payment System
FY 2020, the Centers for Medicare and Medicaid Services (CMS) will be raising inpatient prospective payment system (IPPS) wage indexes for hospitals in the bottom quartile. The new change aims to address a lag between raises in employee compensation and when increases are reflected in the calculation of the wage index.
OIG will be conducting a data brief, and will analyze certain characteristics of the hospitals in that FY 2020 bottom quartile to provide information to CMS and other stakeholders during the roll-out year of CMS’s new bottom quartile wage index adjustment.
Audit of CMS’s Assessment of National Security Risks to Genomic Testing Data
Congress enacted the Clinical Laboratory Improvement Amendments (CLIA) in 1988 to establish “quality standards for all laboratory testing to ensure the accuracy, reliability, and timeliness of patient test results regardless of where the test was performed.”
At the request of Congress, OIG will be conducting an audit to address concerns that U.S. taxpayer money could be “potentially be used to pay for genetic testing at laboratories that have partnerships with foreign governments.” The audit will determine whether or not CMS has established an effective enterprise risk management process and conducts risk assessments that consider emerging national security threats in accordance with federal requirements.