OIG Issues Its FY 2015 Work Plan; Includes Several Audits Impacting Health Centers

By | Published On: November 20, 2014

On October 31, 2014, the Office of the Inspector General (OIG) for the U.S. Department of Health and Human Services (HHS) published its Work Plan for FY 2015, summarizing new and ongoing reviews and activities that the OIG plans to pursue with respect to HHS programs and operations during the current fiscal year. Similar to prior Work Plans, the current version includes three new reviews that may impact the way in which health centers conduct certain aspects of their operations.

  • Duplicate discounts for 340B purchased drugs: Under this review, the OIG will assess the risk of duplicate discounts under 340B-purchased drugs paid through Medicaid managed care organizations and States’ efforts to prevent them.  In particular, the OIG will assess whether existing tools and processes to prevent duplicate discounts under the Medicaid fee-for-service program are sufficient under managed care operations.  While this review does not focus directly on health centers, as 340B eligible entities the results of the review could impact the way in which health centers account for certain 340B drugs.  Further, when combined with the stated intention of the Office of Pharmacy Affairs to conduct an increased number of 340B compliance audits as well as the upcoming inclusion of 340B compliance questions in health centers’ Operational Site Visits, it is apparent that the 340B program in general will be facing increased scrutiny.
  • Health center compliance with grant requirements of the Affordable Care Act (ACA): Under this review, the OIG will assess whether health centers that received grant funds pursuant to the ACA are complying with federal laws and regulations. In particular, the review will focus on the allowability of expenditures and the adequacy of accounting systems to assess and account for program income. Similar reviews have been conducted previously over the last couple of years.  However, these will be the first OIG reviews regarding health center accounting systems since HRSA published Policy Information Notice (PIN) 2013-01: Health Center Budgeting and Accounting Requirements (the “Total Budget” PIN) in March 2014.  Given that the reviews are random, all centers should ensure that their particular systems are compliant with the PIN (Note: HRSA anticipates issuing before the end of November 2014 a revised Health Center Program Site Visit Guide, which will incorporate, among other things, the requirements of the Total Budget PIN).
  • Oversight of vulnerable health center grantees: Under this review, the OIG will assess the extent to which HRSA awards grant funds to health center grantees that have documented compliance or performance issues. Although HRSA has a variety of processes in place to monitor grantees, the OIG is concerned that the agency may still continue to fund grantees with serious, ongoing compliance or performance issues. As noted above, HRSA intends to issue a revised Health Center Program Site Visit Guide in the near future to incorporate the new policies issued since January 2014.  It is important that all health centers review the new Guide when issued and implement new requirements as soon as possible.

In addition to reviews related to health centers, the OIG will conduct the following reviews related to compliance with certain fraud and abuse and program integrity requirements:

  • Screening process for new Medicare providers. The OIG will determine the extent to which CMS and its contractors have implemented enhanced screening procedures for Medicare providers pursuant to the ACA.
  • Program integrity: The OIG will review whether states are complying with a new requirement that they terminate Medicaid program providers that have been terminated under Medicare or by another state Medicaid program. In addition, the OIG is continuing its review from last year of payments to providers with allegations of fraud deemed credible by states. The OIG is also continuing to review the suspension of payments processes in several states.
  • Federal debarment. In a new effort, the OIG will determine whether HHS operating divisions are taking adequate precautions to ensure that individuals and entities suspended or debarred are not awarded federal grants or contracts.

The OIG’s FY 2015 Work Plan can be read in its entirety here.

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