Department of Health and Human Services’ (HHS) Office of Inspector General (OIG) releases Solutions to Reduce Fraud, Waste and Abuse in HHS Programs

By Sarah Wirskye - On

The U.S. Department of Health and Human Services’ (HHS) Office of Inspector General (OIG) released its annual Solutions to Reduce Fraud, Waste, and Abuse in HHS Programs: OIG’s Top Unimplemented Recommendations. The OIG directed most of its recommendations to CMS to help “reduce improper payments, prevent and deter fraud, and foster economical payment policies.” Specific areas of focus include opioids, nursing homes, hospice, long term care, home health, inpatient hospital stays, durable medical equipment, laboratory, imaging, prescription medication, home health services, cybersecurity and covid-19.

It will be interesting to see which of these will be implemented and their impact on enforcement actions. Regardless of whether they are implemented, these areas will likely be a government focus based on their significance to the OIG. Below is a summary of the 25 recommendations from report.

 CMS–Protecting Patients

  1. Ensure that nursing homes are implementing actions to prevent the spread of COVID-19 and that they are protecting residents.
  2. CMS should take actions to ensure that incidents of potential abuse or neglect of Medicare and Medicaid beneficiaries are identified and reported.

CMS—Medicare Parts A & B

  1. CMS should take steps to tie Medicare hospice payments to beneficiary care needs and quality of care to ensure that services rendered adequately serve beneficiaries’ needs.
  2. CMS should reevaluate the inpatient rehabilitation facility (IRF) payment system, to make any changes necessary to more closely align IRF payment rates and costs.
  3. CMS should seek legislative authority to comprehensively reform the hospital wage index system.
  4. CMS should recover overpayments of $1 billion resulting from incorrectly assigning severe malnutrition diagnosis codes to inpatient hospital claims, ensure that hospitals bill appropriately moving forward, and conduct targeted reviews of claims at the highest severity level that are vulnerable to upcoding.
  5. CMS should analyze the potential impacts of counting time spent as an outpatient toward the 3-night requirement for skilled nursing facility (SNF) services so that beneficiaries receiving similar hospital care have similar access to these services.
  6. CMS should consider seeking legislative authority to implement least costly alternative policies for Part B drugs under appropriate circumstances.

CMS—Medicare Parts C & D

  1. CMS should pursue strategies to educate beneficiaries and providers about access to medication-assisted treatment drugs and naloxone (drug that reverses opioid overdoses).
  2. CMS should provide targeted oversight for Medicare Advantage organizations that received a disproportionate share of risk-adjusted payments for diagnoses identified through in-home health risk assessments with no other service records.
  3. CMS should require Medicare Advantage organizations to submit an ordering provider’s national provider identifier (NPI) on encounter records for durable medical equipment, prosthetics, orthotics, and supplies, and for laboratory, imaging, and home health services.
  4. CMS should develop and execute a strategy to ensure that Part D does not pay for drugs that should be covered by the Part A hospice benefit.


  1. CMS should ensure that States’ reporting of national Medicaid data is complete, accurate, and timely.
  2. CMS should develop policies and procedures to improve the timeliness of and recover uncollected amounts identified by OIG’s audits.
  3. CMS should improve Medicaid managed care organizations’ identifications and referrals of cases of suspected fraud or abuse.
  4. CMS should identify States with limited availability of behavioral health services and develop strategies and share information to ensure that Medicaid managed-care enrollees have timely access to these services.

Administration for Children and Families (ACF)

  1. ACF and HHS should improve their operational, management, and communication systems to better address the safety, security, and mental health needs of unaccompanied children.
  2. ACF should develop a comprehensive strategy to improve States’ compliance with requirements related to treatment planning and medication monitoring for children who are prescribed psychotropic medication.

Indian Health Service (IHS)

As a management priority, IHS should develop and implement a staffing program for recruiting, retaining, and transitioning staff and leadership to remote hospitals.

National Institutes of Health (NIH)

NIH should continue to build on its efforts to identify and mitigate potential foreign threats to research integrity.

Food and Drug Administration (FDA)

FDA should improve its use of Risk Evaluation and Mitigation Strategies (REMS) by enhancing the assessment review process, ensuring that assessment reviews are timely, and strengthening REMS to better address the opioid crisis.

General Departmental

  1. HHS should ensure it has effective response plans and provide necessary guidance to effectively respond to domestic and international public health emergencies.
  2. HHS should improve administration and management of contracts related to inherently government functions and personal services and provide training to political appointees and senior leaders related to contract administration.
  3. HHS should ensure that all future web application developments incorporate security requirements from an industry-recognized web application security standard.
  4. HHS should address gaps in cybersecurity incident response capabilities across the department.

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