On May 28, 2021, OIG released its Semiannual Report to Congress (the Report). The Report describes OIG’s work during the 6-month semiannual reporting period of October 1, 2020, through March 31, 2021 (the Semiannual Reporting Period). Principal Deputy Inspector General Christi Grimm highlighted that OIG is “aggressively investigating pandemic-related fraud that harms individuals and jeopardizes public health efforts.”

The Report highlights OIG’s audit and investigation activities. During the Semiannual Reporting Period, OIG issued 95 reports in which HHS programs were audited and evaluated to improve efficiency and effectiveness, with an emphasis on preventing fraud and abuse. These reports identified $566.46 million in expected recoveries. The audits identified: costs which were not supported by adequate documentation; expenditures where the intended purpose was unnecessary or unreasonable; and expenditures which were questioned by OIG because of an alleged violation. OIG’s audit work additionally identified $919.97 million in potential savings for HHS, should HHS implement the entirety of the OIG’s 228 audit and evaluation programs. Further, OIG worked with the DOJ, Medicaid Fraud Control Units, and other Federal, State, and local law enforcement agencies to investigate and prosecute fraud. This investigative work led to $1.37 billion in expected investigative recoveries and 221 criminal actions during the Semiannual Reporting Period.

OIG has additionally implemented methods to promote HHS’s COVID-19 response and recovery. During the Semiannual Reporting Period, OIG: (1) analyzed onsite surveys of nursing homes during the pandemic and identified opportunities for infection control and ways to improve overall care provided to patients; (2) conducted a survey of hospitals to conduct an evaluation of how health care delivery was strained due to COVID-19; (3) partnered with six federal OIGs to analyze COVID-19 testing, including the amounts paid by Medicare Part B for these tests; and (4) alerted the public about various types of fraudulent schemes relating to COVID-19.

During the Semiannual Reporting Period, OIG found that the pandemic may be placing Medicaid beneficiaries at a greater risk of opioid misuse or overdose, as during the first 8 months of 2020, at least 5,000 Medicare Part D beneficiaries per month suffered opioid overdoses. OIG stressed that it is essential that CMS and HHS monitor trends in prescriptions for drugs for medication-assisted treatment and naloxone and take appropriate actions if the number of prescriptions begins to fall off.

The Report details specific administrative actions, public health reports, and reviews on improper payments for Medicare and Medicaid services during the Semiannual Reporting Period. OIG provides several recommendations including, but not limited to:

• CMS should conduct targeted reviews of Medicare Severity Diagnosis Related Groups (MS-DRGs) and stays that are vulnerable to upcoding, as well as the hospitals that bill them more frequently;

• In response to the COVID-19 pandemic, CMS should: (1) assess the results of infection control surveys in nursing homes and revise the surveys as appropriate; (2) work with the States to help overcome challenges with PPE and staffing, and (3) clarify expectations for States to complete backlogs of standard surveys and high-priority complaint surveys;

• CMS should take steps to provide data to consumers regarding nursing staff turnover and take additional steps to strengthen oversight of nursing home staffing; and

• CMS should work with states to expand alternative reimbursement models to address the rising costs for drugs categorized as specialty drugs.

Moreover, OIG found that in February 2021, hospitals reported that operating in “survival mode” for extended periods of time has resulted in new challenges in health care delivery, access and health outcomes. In particular, hospitals have reported that staffing shortages have impacted patient care, and exhaustion and trauma have affected staff’s mental health. Many hospitals also continue to report financial instability due to increased pandemic-related expenses and lower revenues from the decreased use of other services. OIG noted that this survey reveals longer-term opportunities for improvement to address challenges that existed before and were ultimately exacerbated by the pandemic.

The Semiannual Report is available here.