U.S. Department of Health & Human Services   
Office of Inspector General 
S
EMIANNUAL 
to 
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EPORT  
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ONGRESS 
October 1, 2016  to 
March 31, 2017   
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o A MESSAGE FROM  THE INSPECTOR GENERAL  
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Daniel R. Levinson  

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Inspector General 

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I am pleased to submit this Semiannual Report to Congress summarizing activities of the Office  
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of Inspector General (OIG), Department of Health and Human Services (HHS or the Department), for the 6-month  
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period that ended March 31, 2017.  OIGs mission is to protect the integrity of HHS programs and ensure the health and  
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welfare of the beneficiaries they serve.  Our dedicated employees work to fight fraud; enhance safety and quality of  
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  care; improve efficiency of program operations; reduce improper payments; foster prudent payment policies; and  
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improve data integrity and information security.  OIGs diverse workforce combines traditional disciplinesauditors,  
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evaluators, investigators, and attorneyswith additional expertise in medicine, technology, data analytics, and  
 
e economics to prevent fraud and abuse through recommendations to improve program operations; to use data  
c modeling and other techniques to detect problems quickly; and to take appropriate enforcement action when we  
i identify fraudulent and abusive practices. 
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During this reporting period, we had significant accomplishments overseeing the Departments more than $1 trillion  
portfolio of health and human services.  For example, we continued to partner with HHS, the Department of Justice,  
U.S. Attorneys Offices, the Federal Bureau of Investigation, and State and local law enforcement in Health Care Fraud  
Strike Force teams.  During the reporting period, Strike Force efforts resulted in the filing of charges against 49  
individuals or entities, 152 criminal actions, and more than $266.8 million in investigative receivables.  Also during this  
reporting period, we issued noteworthy reviews of many critical Department services and expenditures.  One such  
review examined Federal payments for Medicare Part D catastrophic coverage; these payments exceeded $33 billion in  
2015, more than triple the amount paid in 2010.  OIG data analysis revealed 10 high priced drugs that accounted for  
nearly one-third of this spending, and we determined that CMS will likely need additional tools to secure the future of  
the Part D program.  In two reviews, we closely examined the challenges affecting the ability of Indian Health Service  
hospitals to provide safe, quality care to patients.  Through issuance of new Anti-Kickback Statute safe harbors,  
HHS OIG Semiannual Report to Congress      |     October 1, 2016  March 31, 2017  ii  OFFICE OF   including one that aids beneficiaries in obtaining needed transportation for treatment, we enhanced flexibility for  
INSPECTOR   providers to improve efficiency and access to quality care while we continued to protect programs and patients from  
GENERAL fraud and abuse.  
Looking to the future, OIG is tracking its own performance in priority areas, such as the following:  (1) protecting  
beneficiaries from prescription drug abuse; (2) reducing improper payments for home health services in fraud hot  
spots; (3) improving program integrity for the Child Care and Development Fund grant programs; and (4) maximizing  
the effectiveness of State Medicaid Fraud Control Units.  We will build on our experience and expertise in pursuit of  
measurable improvements in these and other important areas.  We will remain an agile organization focused on the  
most pressing issues facing Department programs.   
OIG remains committed to working collaboratively with our partners to protect beneficiaries and oversee HHSs  
programs.  The success reflected in this Semiannual Report to Congress derives from the efforts of a dedicated,  
multidisciplinary workforce in OIG.  Once again, I would like to express my appreciation to Congress and to the  
Department for their sustained commitment to the important work of our office. 
Daniel R. Levinson  

Inspector General  

HHS OIG Semiannual Report to Congress      |     October 1, 2016  March 31, 2017   iii   
n
 THE  DEPARTMENT  OF  HEALTH  AND  HUMAN  SERVICES  (HHS),  Office of Inspector General (OIG), provides  
o independent and objective oversight that promotes economy, efficiency, and effectiveness in HHS programs and operations.  OIGs  
program integrity and oversight activities are shaped by legislative and budgetary requirements and adhere to professional standards  
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t established by the Government Accountability Office (GAO), the Department of Justice (DOJ), and the Inspector General community.   
a OIG carries out its mission to protect the integrity of HHS programs and the health and welfare of the people served by those  
z programs through a nationwide network of audits, investigations, and evaluations.  Our work is conducted by the following operating  
compo nents.   
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OAS 
The Office of Audit Services (OAS). OAS conducts audits of HHS programs and operations through its own resources or  
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by overseeing audit work done by others.  Audits examine the performance of HHS programs and/or its grantees and  
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contractors in carrying out their respective responsibilities and are intended to provide independent assessments of  
r HHS programs and operations.  These assessments help reduce waste, abuse, and mismanagement and promote the  
O economy, efficiency, and effectiveness of programs and operations throughout HHS. 
OEI 
  The Office of Evaluation and Inspections (OEI). OEI conducts national evaluations to provide HHS, Congress, and the  
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public with timely, useful, and reliable information on significant issues.  These evaluations focus on preventing fraud,  
I waste, and abuse and promoting economy, efficiency, and effectiveness in HHS programs.  OEI reports also present  
O practical recommendations for improving program operations. 
OI 
The Office of Investigations (OI). OI conducts criminal, civil, and administrative investigations of fraud and  
misconduct related to HHS programs, operations, and beneficiaries.  With investigators working in almost every State,  
the District of Columbia, and Puerto Rico, OI coordinates with DOJ and other Federal, State, and local law enforcement  
authorities.  OI also coordinates with OAS and OEI when audits and evaluations uncover potential fraud.  OIs  
investigative efforts often lead to criminal convictions, administrative sanctions, or civil monetary penalties (CMPs). 
OCIG 
The Office of Counsel to the Inspector General (OCIG). OCIG provides general legal services to OIG, rendering advice  
and opinions on HHS programs and operations and providing all legal support for OIGs internal operations.  OCIG  
represents OIG in all civil and administrative fraud and abuse cases involving HHS programs, including False Claims Act,  
program exclusion, self-disclosure, and CMP cases.  In connection with these cases, OCIG also negotiates and monitors  
corporate integrity agreements (CIAs).  OCIG renders advisory opinions, issues compliance program guidance, publishes  
fraud alerts, and provides other guidance to the health care industry about the anti-kickback statute and other OIG  
enforcement authorities. 
EM 
Executive Management (EM). EM is composed of the Immediate Office of the Inspector General and the Office of  
Management and Policy.  EM is responsible for overseeing the activities of OIGs components; setting vision and  
direction, in collaboration with the components, for OIGs priorities and strategic planning; ensuring effective  
management of budget, finance, information technology (IT), human resources, and other operations; and serving as a  
liaison with HHS, Congress, and other stakeholders.  EM plans, conducts, and participates in a variety of cooperative  
projects within HHS and with other Government agencies.  EM provides critical data analytics, data management, and  
IT infrastructure that enables OIG components to conduct their work efficiently and effectively. 
HHS OIG Semiannual Report to Congress      |     October 1, 2016  March 31, 2017  iv    
oe AS  DELINEATED  IN  OIGS  STRATEGIC  PLAN, OIGs approach to protecting the integrity of HHS programs has  
tg four key goals: (1) fight fraud, waste, and abuse; (2) promote quality, safety, and value; (3) secure HHS programs future;  
h n and (4) advance excellence and innovation.  These goals drive OIGs work planning for audits and evaluations as well as  
a OIGs approach to enforcement.  OIG focuses on efficient oversight and on achieving outcomes that benefit the  
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h Departments programs and the people they serve. 
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e Top Management Challenges Facing HHS 
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i To focus the Departments attention on the most pressing issues, each year OIG identifies the Top Management and  
At Performance Challenges facing the Department.  These top challenges arise across HHS programs and Operating  
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 s Divisions, including Medicare, Medicaid, Administration for Children and Families (ACF), the Public Health Service, the  
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o Indian Health Service (IHS), and the Food and Drug Administration (FDA).  The top challenges cover critical HHS  

P responsibilities that include delivering quality services and benefits, exercising sound fiscal management, safeguarding  
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public health and safety, and enhancing cybersecurity.   
 
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i OIG Work Plan 
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i OIGs Work Plan sets forth various projects that OIG plans to undertake during the fiscal year (FY) and beyond.  Projects  
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listed in the Work Plan span the Departments Operating Divisions, including the Centers for Medicare & Medicaid  
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Services (CMS), public health agencies such as the Centers for Disease Control and Prevention (CDC) and National  
Institutes of Health (NIH), and human resources agencies such as ACF and the Administration on Aging.  The Work Plan  
also includes oversight of State and local governments use of Federal funds as well as the administration of the  
Department.  Some of the projects described in the Work Plan are statutorily required.   
Compendium of Unimplemented Recommendations 
OIG drives positive change not only by identifying problems, abuses, and deficiencies but also by recommending  
solutions to address them.  OIG maintains a list of recommendations to address vulnerabilities detected in its reviews and  
identifies the top unimplemented recommendations that, if implemented, are likely to garner significant savings and  
improvements in quality, efficiency, and effectiveness.  OIG systematically follows up on its recommendations with  
responsible Operating Divisions.  OIG compiles its top and most significant unimplemented recommendations in our  
Compendium of Unimplemented Recommendations. 
HHS OIG Semiannual Report to Congress      |     October 1, 2016  March 31, 2017   v  y
 OUR  SEMIANNUAL  REPORT  TO  CONGRESS  (SEMIANNUAL  REPORT)  describes OIGs work in  
r identifying significant problems, abuses, deficiencies, remedies, and investigative outcomes relating to the administration  
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of HHS programs and operations.  This edition addresses work completed during the reporting period, October 1, 2016,  
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to March 31, 2017.   
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Enhancing Safety and Quality of Care 
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Programs operated and administered by HHS touch the lives of nearly all Americans.  For example, FDAs oversight of our  
 
e food, drugs, and medical devices is critical to the well-being of the American population.  Furthermore, the Medicare and  
v Medicaid programs provide essential health care services to more than 120 million people.  HHS faces special challenges  
i serving vulnerable populations, including recipients of nursing home care, hospice care, and home- and community-
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based services (HCBS); IHS beneficiaries; and children.   
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During this semiannual period, OIG continued its work identifying whether States verify that nursing homes are  
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correcting previously identified deficiencies.  In our report, we found that Arizona did not verify nursing homes  
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correction  of deficiencies in accordance with  Federal requirements for more than  half of the deficiencies identified  during  
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previous State surveys.  We found that Arizonas practice for less serious deficiencies was to accept the nursing homes  
correction plans as confirmation of substantial compliance without obtaining the required evidence of correction.   
During this reporting period, OIG also issued two reports examining issues affecting IHS hospitals ability to provide  
quality care and comply with Medicare standards.  These reports described  longstanding challenges in IHS hospitals,  
including ensuring access to needed care, maintaining clinical competence, recruiting and retaining essential staff, and  
keeping patients safe despite outdated buildings and equipment.  We also found  limitations in IHSs monitoring of quality  
of care.  IHS has few sources of information on its hospitals performance and a limited capacity to provide clinical  
support; moreover, it lacks the quality assurance infrastructure and monitoring efforts that it urgently needs.  
Improving Efficiency of Program Operations  
To protect taxpayer dollars, HHS must run its programs efficiently.  OIG looks for opportunities for the Department to  
enhance efficiency in fiscal management, as well as in administrative infrastructure and program execution.  
During this semiannual period, OIG continued to engage in management reviews of new program implementation.  In  
December 2016, OIG issued an early implementation review of CMSs management of the Quality Payment Program  
(QPP). OIG found that CMS made significant progress toward implementing the QPP, a set of clinician payment reforms  
HHS OIG Semiannual Report to Congress      |     October 1, 2016  March 31, 2017   vi  EXECUTIVE  designed to put increased focus on the quality and value of care.  However, OIG identified two vulnerabilities that CMS  
SUMMARY  must address in 2017 because they are critical to the programs success:  providing sufficient guidance and technical  
assistance to ensure that clinicians are ready to participate in the QPP and developing IT systems to support data  
reporting, scoring, and payment adjustment. 
OIGs work on sound financial management includes ensuring that Medicaid programs obtain prescription drug rebates  
to which they are entitled.  In a series of reports, OIG is determining whether each State billed and collected from  
pharmaceutical manufacturers the rebates they owed to States and the Federal Government for outpatient drugs  
dispensed in the Medicaid program.  In this semiannual reporting period, OIG issued reports focusing on claims from  
three States (Colorado, California, and  Virginia) for Federal reimbursement for some Medicaid physician-administered  
drugs.  Consistent with previous findings, OIG found instances in which the audited States did not always invoice and  
collect all rebates due for drugs administered by physicians. 
Efficiency of operations also extends to oversight of HHSs $100 billion discretionary grant portfolio.  During this  
semiannual period, OIG continued its oversight of grants by focusing on childcare program grant funds.  In one report in  
which we reviewed Head Start funds received by the Newark Preschool Council, we identified $10 million in unallowable  
funds for costs applicable to under-enrollment, general and administrative expenses, unauthorized purposes, and salary  
payments.  In another report, OIG found that Puerto Rico lacked sufficient policies and procedures to properly identify  
and assign childcare funds to voucher payments in accordance with Federal requirements.  
Reducing Improper Payments 
Improper payments, as reported in the Departments financial statements, have demonstrated a steady increase over the  
last several years.  In FY 2016, the Department reported estimated improper payments of more than $96 billion.  
During this semiannual period, OIG issued several audits that identified improper payments as a result of issues related to  
eligibility determinations: 
  	 Express Lane Eligibility.   Under the express lane eligibility option, which allows States to expedite and simplify  
enrollment in Medicaid and the Childrens Health Insurance Program (CHIP) by relying on findings from other  
agencies eligibility determinations, we estimated  that improper Medicaid payments on behalf of potentially ineligible  
beneficiaries totaled $284.1 million. CHIP payments for potentially ineligible beneficiaries totaled $10.6 million.   
  	 Payments after death. Medicare and Medicaid continue to make improper payments on behalf of beneficiaries  
who are deceased.  During this reporting period, we found that Florida did not always stop making capitation  
payments to Medicaid managed care organizations (MCOs) after a beneficiarys death, resulting in more than $26  
million in overpayments. 
HHS OIG Semiannual Report to Congress      |     October 1, 2016  March 31, 2017	   vii  EXECUTIVE    	 Incarcerated beneficiaries. We continued our work reviewing inappropriate payments for incarcerated	 

SUMMARY  beneficiaries, recently reporting that CMS has not taken steps to recoup $34 million in potentially improper	
 
payments made on behalf of incarcerated beneficiaries.	
  
OIG also issued  several audits identifying payments for medical devices and services that providers should not have billed: 
  	 Improper Payments for Chiropractic Services. Based on our sample results, we estimated that $358.8 million (82  
percent) of $438.1 million paid by Medicare for chiropractic services was unallowable.   
  	 Room and Board Costs Associated with HCBS Waiver Program Payments. State Agencies claimed at least $176  
million in unallowable Medicaid reimbursements for services under the HCBS waiver program. 
  	 Improper Payments for Cochlear Devices. Medicare spent $2.7 million inappropriately for cochlear devices	
 
(hearing aid devices) that were replaced without cost to the hospital or beneficiary.	
  
In addition to work identifying situations in which providers should not have billed CMS for specific medical devices or  
services, OIG also has a body of work looking at situations where providers billed for goods and services at higher rates  
than allowed by program regulations.  In this reporting period, OIG looked at how a hospitals reporting of inaccurate  
wage data affected Medicare payments for hospital services.   
Fostering Prudent Payment Policies 
In an effort to secure HHS programs future, OIG assesses payment policies and identifies vulnerabilities and misaligned  
incentives.   
During this semiannual reporting period, OIG reported on several vulnerabilities in hospital billing under Medicares  
2-midnight policy for determining a patients status as inpatient or outpatient.  OIG identified a large number of  
potentially inappropriate short inpatient stays and an increased number of beneficiaries in outpatient stays facing higher  
coinsurance costs and more limited access to skilled nursing facility (SNF) services compared to beneficiaries receiving  
the same care as inpatients.  These findings raise concerns about costs to Medicare and beneficiaries.   
In another report on payment policies, OIG found that Federal payments for Part D catastrophic coverage exceeded $33  
billion in 2015, which is more than triple the amount paid in 2010.  Spending for high-price drugs contributed significantly  
to this growth.  Ten high-price drugs accounted for nearly one-third of all drug spending for catastrophic coverage in  
2015. The issue of high-price drugs is not exclusive to catastrophic coverage; it affects Federal payments for the entire  
Part D benefit and can lead to higher premiums and drug costs for patients. 
HHS OIG Semiannual Report to Congress      |     October 1, 2016  March 31, 2017	   viii  EXECUTIVE  Improving Data Integrity and Information Security 
SUMMARY 
To fulfill its mission, the Department maintains and uses data related to Federal health insurance programs, public health  
and human services, and the beneficiaries whom the Department serves.  With the sheer amount of data and its  
complexity, however, the Department continues to face challenges in effectively using data to detect and prevent  
improper payments and to ensure safety and quality of care for program beneficiaries.  HHS also faces challenges to  
protect the privacy and security of the data it collects and maintains.   
During this reporting period, OIG continued to work on privacy and security of data, focusing on network and web  
application penetration testing.  The objective of the testing is to determine whether security controls are effective in  
preventing certain cyber-attacks, the likely level of sophistication an attacker needs to compromise systems or data, and  
the agencies ability to detect attacks and respond appropriately.   
Fighting Fraud in HHS Programs 
OIG remains at the forefront of the Nations efforts to fight fraud, waste, and abuse in HHS programs and hold  
wrongdoers accountable for their actions.  During the first half of FY 2017, OIG reported expected investigative recoveries  
of over $2.04 billion.  OIG also reported 468 criminal actions against individuals or entities that engaged in crimes against  
HHS programs, 461 civil actions, and 1,422 exclusions of individuals and entities from participation in Federal health care  
programs. 
To fulfill our mission, OIG uses state-of-the-art investigative techniques and innovative data analytics.  These techniques  
support our investigations as part of the Medicare Fraud Strike Force  a partnership between OIG, DOJ, and other  
Federal, State, and local law enforcement agencies to combat health care fraud.  Strike Force teams use data analytics to  
detect and investigate health care fraud through a coordinated and data-driven approach.  During this semiannual period,  
Strike Force efforts led to multiple investigations, including a case in which four defendants involved in a home health  
care and hospice Medicare fraud scheme were sentenced to a combined 35 years and 2 months in prison and ordered to  
pay $33 million in restitution, joint and several.   
OIG has formed strong public and private partnerships to amplify our enforcement success.  During this reporting period,  
OIG special agents partnered with Medicaid Fraud Control Units (MFCUs) on 714 criminal investigations.  Results from  
those investigations included a 33-year prison sentence for a former staff physician for the City of Houston who was  
convicted on 14 counts of health care fraud.  OIG continues to participate in the Health Care Fraud Prevention  
Partnership, a national publicprivate partnership aimed at fighting and preventing health care fraud though information  
sharing.   We also work with industry groups focused on fraud prevention, such as the National Health Care Anti-Fraud  
Association and the Health Care Compliance Association.    
HHS OIG Semiannual Report to Congress      |     October 1, 2016  March 31, 2017   ix  EXECUTIVE  During the semiannual period, OIG conducted a wide array of enforcement activities.  Key areas for enforcement  
SUMMARY  included: 
  	 Prescription drugs: OIG is committed to combating drug diversion and pursues numerous cases against providers  
who knowingly engage in drug diversion.  In one recent example, an OIG investigation led to a physician being  
sentenced to 30 years for operating a pill mill with Pagans Motorcycle Club. 
  	 Care in non-institutional settings: OIG continues to focus on fraud in non-institutional settings, including in  
Medicare home health services and HCBS, including personal care services (PCS).  For example, during this reporting  
period, an OIG investigation led to guilty pleas of nine defendants in a $33 million Detroit home health and hospice  
fraud scheme  Further, we issued an  Investigative Advisory on Medicaid fraud and patient harm involving PCS. 
  	 Grant fraud: A significant and growing portion of OIGs enforcement efforts target grant fraud.  In one grant fraud  
case during this reporting period, an executive of a health care center received an 18-year prison sentence and was  
ordered to pay $13.5 million in restitution for embezzling $17 million in HHS grant funds. 
The body of this Semiannual Report provides further details about the examples used in this Executive Summary.  The  
remainder of this report is organized by HHS program area and includes audit and evaluation reports and the results of  
our investigations for this reporting period.  This report also includes appendices that fulfill our reporting requirements  
under the Inspector General Act of 1978 and Inspector General Empowerment Act of 2016.   
HHS OIG Semiannual Report to Congress      |     October 1, 2016  March 31, 2017	   x      
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s Vicki L. Robinson, Senior  Ann T. Maxwell, Assistant  Daniel R.  Levinson, 
 s Counselor for Policy,  Inspector General, testified  Inspector General, testified 
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testified before the House  before the House  before the House 
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Committee on Oversight  Committee on Energy and  Committee on 
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and Government Reform:  Commerce: Subcommittee  Appropriations: 
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Subcommittee on Health  on Oversight and  Subcommittee on Labor, 
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Care, Benefits, and  Investigations:  Existing  Health and Human 
C Administrative Rules:  Problems and Ways to  Services, Education, and 
Fraud, Waste, and Abuse  Strengthen the Program.  Related Agencies: 
Under the Affordable Care  Management Challenges 
Act.  at the Departments of 
Labor, Health and Human 
Services, and Education 
and the Social Security 
Administration. 
HHS OIG Semiannual Report to Congress      |     October 1, 2016  March 31, 2017   xi    
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 ACA   Patient Protection and Affordable Care Act  HCBS   home and community-based services 
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ACF   Administration for Children and Families  HHS   Department of Health and Human Services 
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nti CDC   Centers for Disease Control and Prevention  IHS   Indian Health Service 
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CIA   corporate integrity agreement  IT   information technology 
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c CHIP    Childrens Health Insurance Program  MAC   Medicare Administrative Contractors  
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CMP   civil monetary penalty  MCO   managed care organization 
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b CMS   Centers for Medicare & Medicaid Services  MFCU   Medicaid Fraud Control Unit 
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t CY   calendar year  NIH   National Institutes of Health 
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e DMEPOS  	 durable medical equipment,    OIG   Office of Inspector General 
ln     prosthetics, orthotics, and supplies 
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a OMB   Office of Management and Budget 
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DOJ   Department of Justice 
PCS   personal care services 
FBI   Federal Bureau of Investigation 
SAMHSA  	  Substance Abuse and Mental Health   
FDA   Food and Drug Administration      Services Administration 
FY   fiscal year  SNF   skilled nursing facility 
GAO   Government Accountability Office 
HHS OIG Semiannual Report to Congress      |     October 1, 2016  March 31, 2017 	  xii  s Centers for Medicare & Medicaid Services .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 1
 
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Legal and Investigative Activities Related to Medicare	 
 
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and Medicaid   .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  15	

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o Public Health Agencies Reviews and Enforcement Activities .  .  .  .  29	

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  Human Services Agencies Reviews and Enforcement Activities  .  . 31
 
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Other HHS-Related Reviews and Investigations   .  .  .  .  .  .  .  .  .  .  .  33 

 
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l Appendixes    .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  40
	
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a Appendix A:  Questioned Costs and Funds Put to Better Use  .  . 40
	
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Appendix B:  Peer-Review Results   .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 48	

Appendix C:  Summary of Sanction Authorities  .  .  .  .  .  .  .  .  .  .  50	

Appendix D:  Reporting Requirements in the Inspector General 
 
Act of 1978.  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 53	

Appendix E:  Reporting Requirements in the Inspector General 
 
                        Empowerment Act of 2016   .  .  .  .  .  .  .  .  .  .  .  .  . 55	

HHS OIG Semiannual Report to Congress      |     October 1, 2016  March 31, 2017   xiii
    
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 The Medicare Program  with Medicare requirements. 
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ac CMS Oversight of Medicare Contractor   A-06-16-05003     March 2017 
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v Performance 
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ee CMS relies on contractors to administer the Medicare   Medicare Payments, Policies, and Practices 
MS program and is responsible for overseeing contractors  
performance.  Medicare contractors are responsible for   Medicare Improperly Paid Providers Millions of Dollars for 
 
 d administering more than half a trillion dollars in benefits   Incarcerated Beneficiaries Who Received Services During 
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oai each year.  Medicare Administrative Contractors (MACs)   2013 and 2014 
process Parts A and B claims; Medicare Advantage plans  
fc The Medicare Access and CHIP Reauthorization Act of  
  provide managed care services under Part C; Part D  
si 2015 (MACRA) requires CMS to establish policies and  
d plans provide prescription drug coverage under Part D;  
r implement claim edits to ensure that payments are not  
e and various benefit integrity contractors serve to  
e made for Medicare services rendered to incarcerated  
tM protect Medicare from fraud, waste, and abuse.  beneficiaries.  Our audit found that CMSs policies and  
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procedures did not allow CMS to detect and recoup  
  Medicare Contractors Payments to Providers for Hospital 
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& improper payments to beneficiaries who were  
Outpatient Dental Services Generally Did Not Comply With 
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incarcerated.  CMS has not taken steps to determine  
Medicare Requirements 
whether any of the $34.6 million in potentially improper  
In our previous audits of six Medicare contractors, we   payments (for claims for incarcerated beneficiaries)  
found that payments made to providers for hospital   made in 2013 and 2014 should have been denied. 
outpatient dental services generally did not comply with  
We also found that CMSs planned corrective revisions  
Medicare requirements.  Of the 600 dental services in  
to its policies and procedures do not comply with  
our 6 stratified random samples, 542 did not comply  
Medicare requirements.  When CMS implements its  
with Medicare requirements.  We estimated that the six  
revised policies and procedures, it will, according to  
Medicare contractors in our audits improperly paid  
CMS officials, further adjudicate the $34.6 million in  
providers an estimated $9.8 million for hospital  
claims. However, because the data that CMS plans to  
outpatient dental services that did not comply with  
use will be incomplete, these efforts will not identify all  
Medicare requirements. 
improper payments. 
CMS disagreed with our recommendation to implement  
CMS did not concur with our recommendation to  
national edits for hospital outpatient dental services but  
develop and implement a system that allows CMS to  
agreed to work with the Medicare contractors to  
collect the information necessary to fully comply with  
develop or strengthen their local edits to ensure that  
Medicare requirements and, if necessary, seek the  
payments made to providers for dental services comply  
HHS OIG Semiannual Report to Congress      |     October 1, 2016  March 31, 2017   1  CENTERS FOR   appropriate legislation and funding.  CMS concurred   CMS concurred with all of our recommendations to  
MEDICARE &   with our recommendations to review the $34.6 million   direct Medicare contractors to initiate recoupment for  
in claims to determine which portion, if any, was not   $415,000 in improper payments associated with the  
MEDICAID  
claimed in accordance with Medicare requirements;   332 claims whose dates of service were after the  
SERVICES
direct the Medicare contractors to recoup any ensuing   individuals dates of death; confirm that the $11,000 in  
improper payments; and identify improper payments   improper payments associated with the 95 claims that  
made on behalf of incarcerated beneficiaries after our   we identified have been recouped; and review the  
audit period to ensure that Medicare contractors recoup   accuracy of the beneficiary dates of death to determine  
those payments.  whether any of the $1.5 million relating to the 1,047  
claims with conflicting date-of-death information were  
A-07-15-01158    October 2016 
improper payments and, if so, direct Medicare  
contractors to initiate recoupment for the identified  
amounts. 
The Medicare Program  
Medicares Policies and Procedures Identified Almost All 
The Medicaid Program  A-07-16-05089  October 2017 
Improper Claims Submitted for Deceased Individuals and 
Recouped Almost All Improper Payments Made for These 
Centers for Medicare  
Claims for January 2013 Through October 2015 
& Medicaid Services   Hundreds of Millions in Medicare Payments for Chiropractic 
  OIG found that CMS had policies and procedures in   Services Did Not Comply With Medicare Requirements 
Legal and   place to ensure that payments were not made for  
A previous OIG report found that, as chiropractic care  
Investigative Activities   Medicare services ostensibly rendered to deceased  
for a beneficiary extended beyond 12 treatments in a  
  individuals.  These policies and procedures generally  
year, it became increasingly likely that individual services  
Public Health Agencies   ensured that CMS did not make improper payments  
were medically unnecessary.  In addition, four OIG  
  when its data systems indicated at the time a claim was  
Human Services   reviews of individual chiropractors found that Medicare  
processed that the individual had died before the  
Agencies   made improper payments for chiropractic services that  
claimed date of service.  They also ensured that CMS  
 
were medically unnecessary, incorrectly coded,  
Other HHS-Related  correctly identified and recouped improper payments  
insufficiently documented, or not documented.  Our  
Reviews and   for almost all of the cases in which the Enrollment  
current report found that most Medicare payments for  
Investigations   Database (EDB) was updated with date-of-death  
  chiropractic services did not comply with Medicare  
information after the claims had been processed and  
Appendixes  requirements.  Based on our sample results, we  
paid. 
estimated that $358.8 million (82 percent) of the $438.1  
We also found that CMS did not identify and recoup all   million paid by Medicare for chiropractic services was  
improper payments.  Specifically, for our audit period   unallowable.  These overpayments occurred because  
we identified $426,000 in improper payments for 427   CMSs controls were not effective in preventing  
Medicare claims and $1.5 million  in potentially improper   payments for medically unnecessary chiropractic  
payments for 1,047 Medicare claims with dates of   services.   
service that were after the individuals dates of death.   
HHS OIG Semiannual Report to Congress      |      October 1, 2016  March 31, 2017   2  CENTERS FOR   We made four recommendations to CMS that could   $6.1 million.  These improper claims included both  
MEDICARE &   have saved Medicare an estimated $358.8 million for   unallowable and unsupported patient days. 
2013. CMS concurred with our recommendations to  
MEDICAID  
determine a reasonable number of chiropractic services   WPS concurred with our recommendation to revise the  
SERVICES
necessary to actively treat spinal subluxation and   finalized Medicare cost report settlements to recover  
identify services for review in excess of that number and   and refund $6.1 million in Medicare DSH overpayments.   
to improve education of chiropractors on Medicare   WPS did not concur with our recommendations to  
coverage requirements for chiropractic services.  CMS   revise final cost report settlements that we did not  
did not concur with our recommendation to determine   review, recover and refund any additional Medicare DSH  
a reasonable limit for the number of chiropractic   overpayments, and identify and obtain any State-level  
services that Medicare will reimburse and implement a   guidance affecting recipient categories that figure into  
system edit to disallow services in excess of that limit.    Medicare DSH cost report payments.   
CMS did not comment on our recommendation to  
The Medicare Program   A-07-15-04219   November 2016 
identify significant obstacles to developing a more  
The Medicaid Program  reliable control for identifying maintenance therapy and  
work to establish such a control. 
Hospitals Did Not Always Comply With Medicare 
Centers for Medicare  
A-09-14-02033   October 2016 
& Medicaid Services   Requirements for Reporting Cochlear Devices Replaced 
  Without Cost  
Legal and  
Previous OIG reviews found that hospitals did not always  
Investigative Activities   Wisconsin Physicians Service Insurance Corporation Did Not 
comply with Medicare requirements for reporting  
  Properly Settle Indiana Medicare Disproportionate Share 
credits received from manufacturers for replaced  
Public Health Agencies  
Hospital Cost Report Payments   medical devices.  Our compliance reviews at specific  
 
Medicare, like Medicaid, includes provisions under   hospitals nationwide identified approximately $10  
Human Services  
Agencies   which Medicare-participating hospitals (providers) that   million in Medicare overpayments attributable to  
  serve a disproportionate share of low-income patients   hospitals that did not report to CMS device  
Other HHS-Related  may receive disproportionate share hospital (DSH)   manufacturer credits that they received or that were  
Reviews and  
payments.  Because these payments are the result of   available under the terms of manufacturer warranties  
Investigations  
calculations to which a number of sometimes complex   that they did not obtain.  During this review, we found  
 
Appendixes  factors and variables (one of which is referred to as   that hospitals nationwide did not always comply with  
Medicaid patient days) contribute, they are at risk of   Medicare requirements for reporting cochlear devices  
overpayment.  We found that Wisconsin Physicians   (hearing aids) replaced without cost to the hospital or  
Service (WPS) did not properly settle Medicare cost   beneficiary.  For the 116 incorrectly billed claims we  
reports submitted by Indiana hospitals for Medicare   identified, hospitals received $2.7 million in Medicare  
DSH payments in accordance with Federal   overpayments.  
requirements, resulting in DSH overpayments totaling     
HHS OIG Semiannual Report to Congress      |      October 1, 2016  March 31, 2017   3  CENTERS FOR   CMS concurred with our recommendations that it   Because of the cost reporting errors, we estimated that  
MEDICARE &   instruct the Medicare contractors to (1) verify the $1.4   Medicare overpaid the Hospital $156,000 for FY 2015  
million in identified overpayments that hospitals stated   inpatient services and CY 2015 outpatient services.  We  
MEDICAID  
they refunded  to Medicare during our review; (2) recover   also estimated that Medicare overpaid 55 other  
SERVICES
$686,000 in identified overpayments for calendar years   hospitals in Massachusetts a total of $133.6 million for  
(CY) 2013 and 2014 that had not been refunded to   FY 2015 inpatient services and CY 2015 outpatient  
Medicare; (3) assist hospitals in returning the agreed- services because the Hospitals wage data set the rural  
upon overpayments of $553,000 for CY 2012 claims that   floor wage index for Massachusetts.   
are outside the Medicare 4-year reopening period; and  
The Hospital did not concur with our recommendation  
(4) educate hospitals on how to appropriately bill for and  
to ensure that all personnel involved in Medicare cost  
report medical devices replaced without cost to the  
report preparation follow the requirements in the CMS  
hospital or beneficiary, including cochlear devices.  
  Provider Reimbursement Manual.  The Hospital  
The Medicare Program   A-01-15-00508   November 2016  concurred with our recommendation to strengthen  
The Medicaid Program  review and reconciliation procedures to ensure that the  
Medicare wage data it reports to CMS in the future are  
Nantucket Cottage Hospital Did Not Accurately Report  accurate, allowable, supportable, and in compliance  
Centers for Medicare  
with Medicare requirements.  
& Medicaid Services   Certain Wage Data, Resulting in Overpayments to 
  Massachusetts Hospitals 
A-01-15-00502   March 2017 
Legal and  
Medicare acute-care hospitals must report wage data  
Investigative Activities  
annually to CMS.  CMS uses the wage data to calculate  
 
acute-care hospital wage indexes, which measure   Vulnerabilities Remain Under Medicares 2-Midnight  
Public Health Agencies  
geographic area labor market costs relative to a national  
  Hospital Policy 
Human Services   average.  Federal law requires CMS to annually adjust  
CMS implemented the 2-midnight rule to address  
Agencies   Medicare hospital payments to reflect local labor  
concerns about hospitals use of short inpatient and  
  markets; CMS uses area wage indexes to do this.   
Other HHS-Related  long outpatient stays.  The rule establishes that inpatient  
Previous OIG reviews found that hospitals often  
Reviews and   payment is generally appropriate if physicians expect  
reported inaccurate wage data, which resulted in  
Investigations  
beneficiaries care to last at least 2 midnights;  
increased Medicare payments in their designated  
 
otherwise, outpatient payment is generally appropriate.   
Appendixes  geographic area.  Our current review found that  
During our review, we identified several vulnerabilities in  
Nantucket Cottage Hospital (the Hospital) did not always  
hospital billing under Medicares 2-midnight policy,  
comply with Medicare requirements for reporting wage  
including a large number of potentially inappropriate  
data in its FY 2011 Medicare cost report.  As a result, the  
short inpatient stays and an increased number of  
Hospital overstated wages and wage-related costs by  
beneficiaries in outpatient stays paying more and having  
$232,000 (net) and understated hours by 18,060 (net).   
limited access to skilled nursing facility (SNF) services  
HHS OIG Semiannual Report to Congress      |      October 1, 2016  March 31, 2017   4  CENTERS FOR   compared to inpatients.  These findings raise concerns   assistance, and to optimize back-end IT systems support.   
MEDICARE &   about the cost to Medicare and beneficiaries.  We  
OEI-12-16-00400   December 2016 
recommended that CMS conduct analyses like those in  
MEDICAID  
this evaluation to target their oversight.  We also  
SERVICES
recommended that CMS explore ways to ensure that  
beneficiaries receiving hospital care in outpatient status   Drug Pricing and Reimbursement 
have similar cost-sharing protections and access to SNF  
care as beneficiaries receiving similar hospital care in  
High-Price Drugs Are Increasing Federal Payments for 
inpatient status.  CMS concurred with all of our  
recommendations.   Medicare Part D Catastrophic Coverage  
Federal payments for Part D catastrophic coverage 
OEI-02-15-00020   December 2016 
exceeded $33 billion in 2015, which is more than triple 
the amount paid in 2010.  Spending for high-price 
The Medicare Program  
Early Implementation Review: CMSs Management   drugs contributed significantly to this growth.  
The Medicaid Program 
of the Quality Payment Program   Moreover, 10 high-price drugs accounted for nearly 
one-third of all drug spending for catastrophic 
CMS has made significant progress toward  
Centers for Medicare   coverage in 2015.  The issue of high-price drugs is not 
implementing the Quality Payment Program (QPP), a set  
& Medicaid Services   exclusive to catastrophic coverage; it affects the entire 
of clinician payment reforms designed to put increased  
 
Part D benefit and can lead to higher costs for patients. 
focus on the quality and value of care.  As of December  
Legal and  
2016, CMS had finalized key policies to implement the   Securing the future of the Part D program while  
Investigative Activities  
  QPP, initiated engagement and outreach activities to   ensuring that patients have access to needed drugs is a  
Public Health Agencies   clinicians, launched a public-facing informational   complex issue that calls for a multifaceted approach.   
  website, and awarded various contracts for technical   Recently, CMS has taken steps in response to rising drug  
Human Services   assistance and training.  Although many milestones   prices.  Moving forward, CMS will likely need additional  
Agencies   remain before the QPP payment adjustments begin in   tools.  Potential tools have been discussed by experts  
  2019, OIG identified two vulnerabilities that are critical   and include restructuring the Part D benefit, creating  
Other HHS-Related 
for CMS to address in 2017 because of their potential   more transparency, promoting value-based options, and  
Reviews and  
Investigations   impact on the programs success: providing sufficient   revising the law to allow the Federal Government to  
  guidance and technical assistance to ensure that   negotiate prices for certain drugs.  CMS should carefully  
Appendixes  clinicians are ready to participate in the QPP, and   assess these and other options and, working with  
developing IT systems to support data reporting,   Congress, make any needed changes to the Part D  
scoring, and payment adjustment.  program.  
CMS officials stated they were committed to continuing   OEI-02-16-00270   January 2017  
to engage with clinicians and provide them with  
HHS OIG Semiannual Report to Congress      |      October 1, 2016  March 31, 2017   5  CENTERS FOR   Oversight of the Medicare Competitive   our data to help ensure that contracted suppliers bids  
MEDICARE &   Bidding Program  adhere to the 50-percent rule.   
MEDICAID  
For the second review, we found that from July through  
SERVICES Medicare Market Shares of Mail Order Diabetes Test Strips From  
September 2016, sampled suppliers provided 18 types  
April to June 2016 and Medicare Market Shares of Mail Order  
of diabetes test strips via mail order.  The top strip type  
Diabetes Test Strips From July Through September 2016   accounted for 43 percent of the mail order market, and  
The Medicare Prescription Drug, Improvement, and   the top 10 strip types accounted for 98 percent.  The  
Modernization Act of 2003 requires CMS to phase in a   third report will be published in summer 2017.  
Competitive Bidding Program for durable medical  
OEI-04-16-00470   November 2016  
equipment, prosthetics, orthotics, and supplies  
(DMEPOS). Under this program, suppliers compete to  
become Medicare contract suppliers for selected   OEI-04-16-00471   February 2017 
The Medicare Program  
DMEPOS items, including diabetes test strips provided  
The Medicaid Program  via mail order.  Additionally, the Medicare Improvements  
for Patients and Providers Act (MIPPA) requires mail  
Quality of Care and Beneficiary Access 
Centers for Medicare   order suppliers to demonstrate in their bids that they  
& Medicaid Services   can provide at least 50 percent, by volume, of the types  
Case Review of Inpatient Rehabilitation Hospital Patients Not 
  of diabetes test strips provided to Medicare beneficiaries. 
Suited for Intensive Therapy 
Legal and  
Investigative Activities   OIG is conducting three studies to determine the   Inpatient rehabilitation (rehab) hospitals are  
  Medicare market shares of diabetes test strips for the   freestanding facilities that specialize in providing  
Public Health Agencies   periods April through June 2016, July through   intensive rehab therapy to patients recovering from  
  September 2016, and October through December 2016,   illness, injury, or surgery.  This intensive therapy requires  
Human Services   respectively.  For the first review, we found that from   endurance that some patients receiving post-acute care  
Agencies  
April to June 2016, sampled suppliers provided 30 types   do not have, potentially causing those patients to be  
 
Other HHS-Related  of diabetes test strips via mail order.  Of these strips,   better suited for an alternate setting, such as a SNF.   
Reviews and   two types accounted for about one-half of the mail   Medicare criteria for admission to post-acute care help  
Investigations   order market.  Therefore, a suppliers bid would meet   ensure that patients receive the most appropriate care  
  the MIPPA 50-percent rule if the bid declared that the   for their conditions and needs.  We found that Medicare  
Appendixes 
supplier intended to provide either (1) both of these 2   patients who were not suited for intensive rehab  
types of strips or (2) at least 1 of these 2 types of strips   therapy had physical limitations, lacked endurance, had  
and a combination of certain subsets of the other 28   unresolved health problems, or had an altered mental  
types of strips sufficient to reach 50 percent.  Further,   status.  Most of these patients (32 of 39 stays) remained  
we found that 5 types of diabetes test strips accounted   in inpatient rehab hospitals for extended periods (which  
for 81 percent of the Medicare mail order market share,   we defined as stays lasting longer than 3 days) despite  
and 10 types accounted for 93 percent.  CMS will use   being unable to participate and benefit from intensive  
HHS OIG Semiannual Report to Congress      |      October 1, 2016  March 31, 2017   6  CENTERS FOR   therapy.  For 7 of the 39 stays, the medical records   type of public assistance cost that can be reimbursed, if  
MEDICARE &   indicated that the patients were in exceptionally poor   costs claimed comply with Federal requirements.  
condition and died within a few weeks after being   Random moment sampling (RMS) is one acceptable  
MEDICAID  
admitted to an inpatient rehab hospital.    method for allocating salaries and wages among  
SERVICES
Medicaid and other programs. 
We encouraged CMS to consider providing additional  
technical assistance to ensure that Medicare patients   In prior reviews of school-based and community-based  
are placed  in  the most appropriate setting for post-acute   administrative costs that States allocated to Medicaid  
care, and that inpatient rehab hospitals do not admit   using RMS, we identified significant overpayments.  As  
patients who are unable to participate in and benefit   part of our Medicaid risk assessment, we noted that  
from intensive therapy.    North Carolina and Mississippi used statistically invalid  
RMS in allocating costs to Medicaid and did not  
OEI-06-16-00360   December 2016 
promptly submit to HHS for review their cost allocation  
The Medicare Program  
plan (CAP) amendments describing their new random  
The Medicaid Program  moment time study (RMTS) methodology.  As a result,  
The Medicaid Program  North Carolina claimed almost $107.5 million (almost  
$53.8 million Federal financial participation) and  
Centers for Medicare  
& Medicaid Services   Payments, Policies, and Practices  Mississippi claimed almost $42.4 million (almost $21.2  
  million Federal financial participation) in unallowable  
To fund their Medicaid programs, States receive Federal  
Legal and   school-based Medicaid administrative costs for Federal  
grant awards that pay for the Federal share of their  
Investigative Activities   FYs 2010 through 2012. 
Medicaid medical and administrative expenditures.  OIG  
 
conducts audits on States withdrawals of Federal  
Public Health Agencies   North Carolina and Mississippi did not specifically  
Medicaid funds to determine whether a State submitted  
  address our recommendations to refund unallowable  
an improper claim for Federal reimbursement and,  
Human Services   costs to the Federal Government; address the statistical  
Agencies   therefore, may owe money to the Federal Government.    validity issues we identified; implement policies and  
  If a State disagrees with our recommendation to refund  
procedures to ensure that their RMTS comply with  
Other HHS-Related 
questioned costs identified in an audit, CMS still has the  
Federal requirements for statistical validity; maintain  
Reviews and  
authority to recoup those costs. 
Investigations   adequate support for school-based administrative costs;  
  promptly submit to HHS for review and approval future  
Appendixes  North Carolina Claimed Millions in Unallowable School-Based   CAP amendments; and review school-based Medicaid  
administrative costs claimed after our audit period and  
Medicaid Administrative Costs and Mississippi Claimed Millions  
refund unallowable amounts.  
in Unallowable School-Based Medicaid Administrative Costs 
States can be reimbursed for school-based   A-04-15-00101   October 2016 
administrative activities that directly support identifying  
and enrolling potentially eligible children in Medicaid.    A-04-15-00103   March 2017 
School-based Medicaid administrative costs are one  
HHS OIG Semiannual Report to Congress      |      October 1, 2016  March 31, 2017   7  CENTERS FOR   State Agencies Claimed Unallowable and Unsupported  North Carolina Improperly Claimed Federal Reimbursement for  
MEDICARE &   Medicaid Reimbursements for Services Under the Home- and  Some Medicaid Nonemergency Transportation Services and  
MEDICAID   Community-Based Services Waiver Program   Louisiana Did Not Always Comply With Federal and State  
SERVICES In this review, we described instances from eight   Requirements for Claims Submitted for the Nonemergency  
previous audits in which States did not always comply  
Medical Transportation Program  
with Federal requirements in administering their HCBS  
The objective of these reviews was to determine  
waiver programs.  Specifically, States did not always  
whether the State agencies claimed Federal Medicaid  
exclude unallowable room-and-board costs when  
reimbursement for nonemergency medical  
determining payment rates under the HCBS waiver  
transportation (NEMT) services claims submitted by  
program, resulting in unallowable Medicaid  
transportation providers in accordance with certain  
reimbursement.  States did not have adequate controls  
Federal and State requirements.  We found that North  
to ensure that their HCBS waiver programs complied  
Carolina and Louisiana claimed Federal Medicaid  
The Medicare Program   with applicable Federal requirements regarding the  
reimbursement for some NEMT services that did not  
need to exclude unallowable room-and-board costs  
The Medicaid Program  comply with Federal or State requirements.  Based on  
when determining payment rates and to ensure that  
our sample results, we estimated that North Carolina  
certain other costs complied with the requirements  
Centers for Medicare   improperly claimed at least $18.7 million ($12 million  
associated with their HCBS waiver programs.  As a  
& Medicaid Services   Federal share) for unallowable NEMT services for the  
result, the States claimed  at least $176.5 million  (Federal  
  audit period, and Louisiana claimed approximately $1.1  
share) in unallowable and unsupported Federal  
Legal and   million.  North Carolina also improperly claimed $20  
Medicaid reimbursement for services under their HCBS  
Investigative Activities   million in NEMT administrative expenditures, which  
waiver programs.  
 
resulted in excess Federal reimbursement of $3.1  
Public Health Agencies  
million.  Additionally, none of the 16 counties in our  
CMS concurred with our recommendations to share the 
 
sample fully complied with the States NEMT policy.   
Human Services   findings of our HCBS waiver program audits with all  
Louisiana did not have adequate support for about  
Agencies   States to reinforce Medicaid requirements that prohibit  
  the inclusion of unallowable room-and-board costs   $183,000 (Federal share) of costs claimed.  
Other HHS-Related   
when determining payment rates, share (at CMSs  
Reviews and   discretion) the other findings of our HCBS waiver   North Carolina generally disagreed with our  
Investigations  
program audits with all States, and encourage all States   recommendations to refund $12 million for unallowable  
 
Appendixes  to review their procedures for calculating and claiming   NEMT services identified in our sample, refund $3.1  
costs under their HCBS waiver programs.   million for the additional Federal reimbursement  
received for NEMT expenditures improperly claimed at  
A-07-16-03212   October 2016  the incorrect rate, improve the design of the NEMT  
program, monitor the results of the counties reviews of  
  transportation services and vendors, update its  
HHS OIG Semiannual Report to Congress      |      October 1, 2016  March 31, 2017   8  CENTERS FOR   procedures for claiming Federal reimbursement for   unallowable.  As a result, the State agency claimed $9.9  
MEDICARE &   NEMT administrative costs, and implement regulations   million in unallowable Federal Medicaid reimbursement.  
MEDICAID   requiring safety and risk management measures as  
conditions of payment.    California partially agreed with our recommendation to  
SERVICES
refund $9.9 million to the Federal Government.   
Louisiana partly agreed with our recommendations to   California agreed with our recommendations to identify  
refund $1.1 million for improper claims, refund   and refund the Federal share of overpayments for any  
$183,000 for costs claimed without adequate support,   quarters in State FYs 2015 and 2016 in which claims  
strengthen its policies and procedures to ensure that   were approved for payment in one quarter and paid in a  
providers comply with all State and Federal   subsequent quarter, and to ensure that the MMIS  
requirements, and strengthen controls over its process   correctly identifies all nonreimbursable claims for  
for reporting expenditures claimed for NEMT services.    nonemergency services provided to qualified aliens.  
The Medicare Program   A-04-15-04037   November 2016  A-09-15-02020   January 2017  
The Medicaid Program 
A-06-15-00019   January 2017 
Review of Massachusetts Medicaid Managed Care Program  
Centers for Medicare  
Potential Savings With Minimum Medical Loss Ratio; Review of  
& Medicaid Services  
  California Improperly Claimed Federal Medicaid  South Carolina Medicaid Managed Care Program Potential  
Legal and   Reimbursement for Certain Nonemergency Services   Savings With Minimum Medical Loss Ratio; and Review of  
Investigative Activities  
Federal health care benefits are generally allowable  California Medicaid Managed-Care Program Potential Savings  
 
when provided to a beneficiary who is a U.S. citizen,  With Minimum Medical Loss Ratio 
Public Health Agencies  
U.S. national, or qualified alien.  In general, a qualified 
  We conducted a series of reviews to determine whether  
Human Services   alien is not permitted to receive Federal benefits until  Medicaid could achieve savings if States required  
Agencies   5 years from the date he or she enters the United 
Medicaid MCOs to meet a minimum medical loss ratio  
  States with qualified alien status.  States must have a 
(MLR) standard and pay remittances if the MLR standard  
Other HHS-Related 
system that verifies whether qualified aliens have met 
Reviews and   was not met.  An MLR is the percentage of premium  
the required waiting period.  
Investigations   dollars an insurer spends to provide medical services  
    and health care quality improvement activities for its  
Appendixes  We found that California did not correctly identify all  
members compared to the premium dollars it uses to  
non-reimbursable claims for nonemergency services  
pay for administrative expenses. 
provided to qualified aliens for select quarters in State  
FYs 2010 through 2014.  Specifically, the State agencys   The Massachusetts Medicaid program could have saved  
Medicaid Management Information System (MMIS) did   $4.7 million (approximately $3.5 million Federal share)  
not identify all claims for its adjustment reports for the   in 2014 if the State agency required its Medicaid  
audit period for which Federal reimbursement was   managed care plans to meet the minimum MLR  
HHS OIG Semiannual Report to Congress      |      October 1, 2016  March 31, 2017   9  CENTERS FOR   standard and required remittances when Medicaid   made overpayments to MCOs totaling $26.2 million  
MEDICARE &   managed care plans did not meet the MLR standard.    ($15.4 million Federal share) during our audit period.   
South Carolinas Medicaid managed care program and  
MEDICAID  
Florida did not indicate whether it agreed or disagreed  
nine California Medicaid MCOs would not have saved  
SERVICES
with our recommendations to identify and recover  
any Medicaid funds in 2014 if they had required their  
overpayments totaling $26.2 million from MCOs and  
Medicaid managed care plans to meet the minimum  
refund $15.4 million (Federal share) to the Federal  
MLR standard and required remittances when Medicaid  
Government; perform monthly reviews of Florida  
managed care plans did not meet the MLR standard.   
Medicaid Management Information System (FMMIS)  
Accordingly, we made no recommendations to South  
records to ensure that beneficiaries with dates of death  
Carolina or California. 
(DODs) are removed from the Florida Statewide  
Massachusetts agreed with our recommendations to   Medicaid Managed Care Program; implement policies  
incorporate into its contracts with Medicaid MCOs the   and procedures for identifying and correcting inaccurate  
The Medicare Program   MLR standards adopted in the CMS final rule and   death information received through its sources of death  
The Medicaid Program  consider implementing into its Medicaid MCO contracts   data, specifically ensuring that differences in the DODs  
a remittance requirement, if appropriate.    between the FMMIS and incoming death records are  
quickly resolved; and improve its collaborative efforts  
Centers for Medicare  
A-01-15-00505   November 2016  with the Social Security Administration, the Department  
& Medicaid Services  
of Children and Families, and Floridas Bureau of Vital  
 
Statistics to identify and resolve inconsistencies in  
Legal and   A-04-16-06191   December 2016 
Investigative Activities   recipient information.  Florida described steps it had  
  taken or planned to take to implement our  
A-09-15-02025   January 2017 
Public Health Agencies   recommendations.    
 
Human Services   Florida Managed Care Organizations Received Medicaid  A-04-15-06182   November 2016 
Agencies  
Capitation Payments After Beneficiarys Death 
 
Other HHS-Related  The Florida Statewide Medicaid Managed Care Program   New Jersey Claimed Medicaid Adult Mental Health Partial 
Reviews and  
pays MCOs to provide covered health care services in  
Investigations   Care Services That Were Not in Compliance With Federal and 
return for a monthly fixed payment for each eligible  
  State Requirements 
Appendixes  beneficiary (capitated payment).  In 2014, nearly all of  
Floridas Medicaid beneficiaries were moved into   During a prior review of New Jerseys claims for  
managed care.  Our audit found that Florida did not   Medicaid services to adults with mental illness who  
always stop making capitation payments after a   reside in community residences, we identified a  
beneficiarys death, despite its efforts to identify and   significant number of services improperly submitted for  
recover any overpayments.  We estimated that Florida   Federal Medicaid reimbursement.  Based on these  
HHS OIG Semiannual Report to Congress      |      October 1, 2016  March 31, 2017   10  CENTERS FOR   results, we decided to review clinic services provided to   assess whether State agencies met Federal  
MEDICARE &   these Medicaid beneficiaries on an outpatient basis.  For   requirements in making eligibility determinations using  
this review, we estimated that New Jersey improperly   ELE and developing eligibility error rates.  See results of  
MEDICAID  
claimed at least $94.8 million in Federal Medicaid   those reports below. 
SERVICES
reimbursement for partial care services that did not  
meet Federal and State requirements.  The partial care  
State Use of Express Lane Eligibility for Medicaid and CHIP 
services program provides individualized outpatient  
Enrollment 
clinic services (e.g., group and individual therapy,  
prevocational services, and medication management) to   This study examined the benefits and barriers to State  
beneficiaries with mental illness to reduce unnecessary   use and expansion of ELE.  We found that States that  
hospitalization.  The deficiencies occurred because New   used ELE to expedite and simplify enrollment in  
Jersey did not adequately monitor the partial care   Medicaid and CHIP adopted variations of three models,  
services program to ensure that providers complied  with   with more than half adopting an automated model that  
The Medicare Program  
these requirements.    requires minimal action from staff and beneficiaries.  All  
The Medicaid Program  14 States that used ELE reported benefits, including  
New Jersey disagreed with our recommendation to   reduced administrative burden and cost savings, and  
Centers for Medicare   refund $94.8 million to the Federal Government and   some States reported that they rely heavily on ELE.   
& Medicaid Services   generally agreed with our recommendations to issue   Eleven States reported that they encountered barriers  
  guidance to the partial care provider community on   when they implemented ELE, such as problems sharing  
Legal and   Federal and State requirements for claiming these   information across agencies, but reported that they  
Investigative Activities   services and improve its monitoring of partial care   overcame these barriers through strong partnerships  
  providers to ensure compliance with Federal and State   and integrated eligibility systems.  Despite largely  
Public Health Agencies   requirements.   positive experiences using ELE, 5 of the 14 States that  
 
adopted ELE discontinued its use, mainly because of  
Human Services   A-02-13-01029   December 2016 
competing priorities, system changes, and short-term  
Agencies  
  agreements with partner agencies.  None of the nine  
Other HHS-Related  States still using ELE plan to expand its use. 
Reviews and   Express Lane Eligibility 
Investigations   We concluded that although State use of ELE is not  
 
Congress authorized States to adopt the Express Lane   widespread, ELE appears to meet the intended objective  
Appendixes 
Eligibility (ELE) option, which allows States to expedite   of easing the eligibility and enrollment process.  Based  
and simplify enrollment in Medicaid and CHIP by relying   on this review of State experiences with ELE, OIG did not  
on findings from other agencies eligibility   identify any significant impediments to continuing to  
determinations.  Congress will determine whether to   allow voluntary use of ELE once States and CMS have  
reauthorize the ELE option in 2017.  OIG conducted   corrected process problems and gaps in oversight  
three studies that fulfill a congressional mandate to   identified by OIG audits of ELE enrollments.   
HHS OIG Semiannual Report to Congress      |      October 1, 2016  March 31, 2017   11  CENTERS FOR   Reauthorization of the ELE option would allow States   enrolled on the basis of eligibility determinations that  
MEDICARE &   that rely on ELE to continue its use and give other States   were not made in compliance with Federal  
the opportunity to adopt ELE and likely experience   requirements.    
MEDICAID  
similar benefits.    
SERVICES
A-04-15-08043   October 2016 
OEI-06-15-00410   October 2016 
Childrens Health Insurance Program Enrollment Using the 
Medicaid Enrollment Using the Express Lane Eligibility  Express Lane Eligibility Option Did Not Always Meet Federal 
Option Did Not Always Meet Federal Requirements  Requirements 
Under the ELE option, a State Medicaid agency can use   We found that States generally determined CHIP  
findings (e.g., income) from eligibility determinations   eligibility using the ELE option in accordance with  
The Medicare Program   made by a different agency within the State to facilitate   Federal requirements.  However, on the basis of our  
enrollment into Medicaid.  Based on our sample, we   sample, we estimated that Federal and State CHIP  
The Medicaid Program 
estimated that Federal and State Medicaid payments on   payments on behalf of potentially ineligible beneficiaries  
behalf of potentially ineligible beneficiaries totaled   totaled $10.6 million.  We attribute the enrollment of  
Centers for Medicare  
$284.1 million.  We attribute the enrollment of   potentially ineligible beneficiaries to State-specific  
& Medicaid Services  
potentially ineligible beneficiaries to State-specific   eligibility determination errors.  In addition, States did  
 
eligibility determination errors.  In addition, States did   not develop mandated error rates specific to the ELE  
Legal and  
Investigative Activities   not develop the mandated error rates specific to the ELE   population because CMS did not provide States with an  
  population because CMS did not provide States with an   error rate methodology.  
error rate methodology.   
Public Health Agencies  
CMS concurred with our recommendations to monitor  
 
Human Services   CMS concurred with our recommendations to monitor   States that use the ELE option for CHIP eligibility  
Agencies   States that use the ELE option for Medicaid eligibility   determinations for compliance with Federal  
  determinations for compliance with Federal   requirements; provide technical assistance to States to  
Other HHS-Related  requirements; provide technical assistance to States to   accurately identify beneficiaries who enroll through the  
Reviews and  
accurately identify beneficiaries who enroll through the   ELE option; issue guidance to States to calculate  
Investigations  
  ELE option; issue guidance to States to calculate   statutorily required eligibility error rates for those  
Appendixes  statutorily required eligibility error rates for those   enrolled through the ELE option; and ensure States  
enrolled through the ELE option; and ensure that States   appropriately redetermine, if necessary, the current  
appropriately redetermine, if necessary, the current   eligibility status of the sample applicants who were  
eligibility status of the sample applicants who were   enrolled on the basis of eligibility determinations that  
HHS OIG Semiannual Report to Congress      |      October 1, 2016  March 31, 2017   12  CENTERS FOR   were not made in compliance with Federal   reimbursement for physician-administered drugs, and  
MEDICARE &   requirements.     that it work with CMS to determine the unallowable  
portion of $1.2 million and refund that amount.   
MEDICAID  
A-04-15-08045   October 2016 
Colorado did not concur with our recommendations  
SERVICES
that it refund to the Federal Government $6.5 million  
for claims for physician-administered drugs that were  
Rebates for Physician-Administered Drugs   ineligible for Federal reimbursement.    
Dispensed to Medicaid Enrollees 
A-07-14-06050  January 2017 
Colorado Claimed Unallowable Federal Reimbursement for 
Some Medicaid Physician-Administered Drugs  California Did Not Bill Manufacturers for Rebates for Physician-
We  conducted a review to determine whether States   Administered Drugs Dispensed to Enrollees of Some Medicaid  
The Medicare Program  
are complying with Federal Medicaid requirements for  
Managed-Care Organizations and Virginia Did Not Bill  
The Medicaid Program  billing manufacturers for rebates for physician-
Manufacturers for Some Rebates for Physician-Administered  
administered drugs.  For a covered outpatient drug to  
Drugs Dispensed to Enrollees of Medicaid Managed-Care  
Centers for Medicare   be eligible for Federal reimbursement under Medicaids  
& Medicaid Services   drug rebate requirements, manufacturers must pay   Organizations 
  rebates to the States for the drugs.  States generally   We conducted reviews in California and Virginia to  
Legal and   offset their Federal share of these rebates against their   determine whether States are complying with Federal  
Investigative Activities  
Medicaid expenditures and bill the manufacturers for   Medicaid requirements for billing manufacturers for  
 
rebates to reduce the cost of drugs to the program.    rebates for physician-administered drugs dispensed to  
Public Health Agencies  
However, a prior OIG review found that States did not   enrollees of MCOs.  For a covered outpatient drug to be  
 
always invoice and collect all rebates due for drugs   eligible for Federal reimbursement under Medicaids  
Human Services  
Agencies   administered by physicians.  We found that Colorado did   drug rebate requirements, manufacturers must pay  
  not invoice manufacturers for rebates associated with   rebates to the States for the drugs.  States generally  
Other HHS-Related  $6.5 million in physician-administered drugs and $1.6   offset their Federal share of these rebates against their  
Reviews and   million that did not have National Drug Codes (NDC) in   Medicaid expenditures and bill the manufacturers for  
Investigations  
the utilization data or may have been otherwise   rebates to reduce the cost of drugs to the program.   
 
Appendixes  ineligible for Federal reimbursement.  However, a prior OIG review found that States did not  
always invoice and collect all rebates due for drugs  
Colorado concurred with our recommendations that it  
administered by physicians.  We found that California  
strengthen its internal controls to ensure that all  
claimed an estimated $7.3 million in Federal  
physician-administered drugs eligible for rebates are  
reimbursement that was unallowable and $35.2 million  
involved, that it work with CMS to determine and  
that may have been unallowable because it did not  
refund the unallowable portion of Federal  
HHS OIG Semiannual Report to Congress      |      October 1, 2016  March 31, 2017   13  CENTERS FOR   comply with Federal Medicaid requirements.  Virginia   CMS or their respective State survey agency for certain  
MEDICARE &   did not bill manufacturers for an estimated $2.9 million   deficiencies identified during surveys, such as nursing  
in rebates.  homes failure to provide necessary care and services.   
MEDICAID  
State survey agencies must verify the correction of  
SERVICES
California concurred with our recommendations to work  
identified deficiencies by obtaining evidence of  
with its MCOs to ensure submission of drug utilization  
correction or through onsite reviews.  This review of the  
data and to implement a rebate and NDC reporting  
State survey agency in Arizona is part of an ongoing  
requirement.  California partially concurred with   series of reviews of States verification of correction of  
collecting an estimated $7.3 million in Federal   deficiencies. 
reimbursement that was unallowable and $35.2 million  
that may have been unallowable because California did   We found that Arizona did not always verify nursing  
not comply with Federal Medicaid requirements.  homes correction of deficiencies identified during  
surveys in 2014 in accordance with Federal  
The Medicare Program   Virginia concurred with recommendations that it work   requirements.  We estimated that Arizona did not verify  
The Medicaid Program  with CMS to resolve the drug utilization data without   nursing homes correction of deficiencies in accordance  
valid NDCs by determining the correct NDCs, to bill for   with Federal requirements for 361 (56 percent) of the  
the estimated rebates and refund the Federal share,   650 deficiencies identified during surveys in 2014.   
Centers for Medicare  
that it implement Medicaid Management Information   Arizonas practice for less serious deficiencies was to  
& Medicaid Services  
System edits to verify that NDCs are valid, and that it   accept the nursing homes correction plans as  
 
ensure that MCOs submit drug utilization data   confirmation of substantial compliance without  
Legal and  
Investigative Activities   containing NDCs for all physician-administered drugs.   obtaining the required evidence of correction. 
 
A-09-15-02035   December 2016  Arizona concurred with our recommendation to  
Public Health Agencies  
improve its practices for verifying nursing homes  
 
correction of identified deficiencies by obtaining nursing  
Human Services   A-03-15-00201   December 2016 
Agencies   homes evidence of correction for less serious  
  deficiencies.  
Other HHS-Related 
Reviews and   Quality of Care and Beneficiary Access  A-09-16-02013   October 2016 
Investigations  
 
Arizona Did Not Always Verify Correction of Deficiencies 
Appendixes 
Identified During Surveys of Nursing Homes Participating in 
Medicare and Medicaid 
Federal regulations require nursing and skilled nursing  
facilities (nursing homes) to submit correction plans to  
HHS OIG Semiannual Report to Congress      |      October 1, 2016  March 31, 2017   14    
s
d
 OIG  INVESTIGATES  ALLEGATIONS  OF  FRAUD, waste,   NIH, Substance Abuse and Mental Health Services  
ei and abuse in all HHS programs.  Our largest body of   Administration (SAMHSA), and other HHS agencies.   
a
i work involves investigating matters related to the   Under certain circumstances, OIG investigates  
tc
i Medicare and Medicaid programs, such as patient harm;   noncustodial parents who fail to pay court-ordered child  
vdi billing for services not rendered, medically unnecessary   support.  OIG also investigates allegations of employee  
i services, or upcoded services; illegal billing, sale,   misconduct, whistle blower reprisals, and wrongdoing  
te
c diversion, and off-label marketing of prescription drugs;   by HHS agency officials.  
M
A and solicitation and receipt of kickbacks, including illegal  
One of the most common types of fraud perpetrated  
  payments to patients for involvement in fraud schemes  
 d against Medicare, Medicaid, and other Federal health  
e and illegal referral arrangements between physicians  
n care programs involves filing false claims for  
v and medical companies. 
ia reimbursement.  False claims may be pursued under  
t  Specific case types include fraud schemes related to:   Federal and State criminal statutes and, when  
ae
appropriate, under the False Claims Act (FCA).   
gr    controlled and noncontrolled prescription drugs,  
Depending on the types of fraud or other violations  
ia    home health agencies and personal care services,  
t involved, OIG investigations may culminate in criminal or  
sc    ambulance transportation,   civil court judgments and decisions, administrative  
edi    DME, and   sanctions and decisions, and/or negotiated settlement  
v
e    diagnostic radiology and laboratory testing.   agreements.  Investigative outcomes take many forms,  
n
including incarceration, restitution, fines, penalties,  
M
I OIG also conducts investigations involving organized   forfeitures, assessments, and exclusion of individuals or  
 
d  criminal activity, including medical identity theft and   entities from participation in all Federal health care  
o
fraudulent medical schemes established for the sole  
n programs.  Frequently used exclusion and penalty  
t purpose of stealing Medicare dollars.  Investigators are  
authorities are described on our website at:   
a 
d opening an increasing number of cases against health   http://oig.hhs.gov/fraud/enforcement/cmp/. 
 
le care providers and patients who engage in these health  
at care fraud schemes.  Those who participate in the   During the first half of FY 2017, we reported 415  
ga schemes may face heavy fines, jail time, and exclusion   criminal and 458 civil actions against individuals or  
el from participation in Federal health care programs.   entities that engaged in health-care-related offenses.   
e
L We also reported over $1.52 billion in investigative  
R In addition to investigating Medicare and Medicaid  
receivables due to HHS and more than $482.7 million in  
fraud, OIG investigates fraud, waste, and abuse in other  
non-HHS investigative receivables, including civil and  
HHS programs, including ACF, IHS, Health Resources and  
administrative settlements or civil judgments related to  
Services Administration (HRSA), and Administration for  
Medicare, Medicaid, and other Federal, State, and  
Community Living (ACL).  OIG investigates potential  
private health care programs.  
misuse of grants and contract funds awarded by CDC,  
HHS OIG Semiannual Report to Congress      |     October 1, 2016  March 31, 2017   15  LEGAL AND   The following are recently completed actions and   Fernandez acknowledged that she directed her co-
INVESTIGATIVE   settlements organized by allegation or subject type:  conspirators to make kickback payments and write and  
cash checks for the purpose of facilitating kickback  
ACTIVITIES  
Prescription Drugs  payments and concealing fraud proceeds.  Alvarez  
RELATED TO  
admitted that he participated in the conspiracy by  
MEDICARE AND  
Pennsylvania  William J. OBrien III was a doctor of   writing checks to money launderers to obtain cash to  
MEDICAID osteopathic medicine.  According to evidence presented  
pay the kickbacks to Medicare beneficiaries.  Fernandez  
at trial, OBrien worked with Pagans Motorcycle Club,  
and Alvarez each pleaded guilty to conspiracy to  
an outlaw gang known for violence and drug dealing, to  
commit health care fraud and were sentenced to a  
operate a pill mill out of OBriens medical offices.   
combined 12 years and 6 months in prison and ordered  
Health Care Fraud  
OBrien wrote fraudulent prescriptions for oxycodone  
Prevention   to pay $11 million in restitution.  Two other defendants  
and Enforcement   and other drugs, while the Pagans recruited pseudo- involved in the scheme were previously sentenced to a  
  patients to buy the fraudulent prescriptions.  After   combined 3 years in prison and ordered to pay $10.9  
Other Criminal and Civil  filling the prescriptions, the Pagans resold the pills on  
million in restitution. 
Enforcement Activities 
the street.  From March 2012 to January 2015, OBrien  
distributed more than 700,000 pills containing  
Pharmaceutical Companies 
oxycodone and other Schedule II controlled substances  
Centers for Medicare  
& Medicaid Services   in furtherance of the conspiracy.  OBrien was found   Florida  Shire Holdings US AG, Shire Pharmaceuticals,  
  guilty of distribution of controlled substances resulting   LLC, and Shire Regenerative Medicine LLC (collectively,  
Legal and   in death and sentenced to 30 years in prison and  
Shire) entered into a settlement agreement to resolve  
Investigative Activities   ordered to pay $5.3 million in restitution, joint and  
allegations in connection with the sale of a human skin  
 
several.  Eight additional defendants involved in the  
substitute product called Dermagraft from 2007 to  
Public Health Agencies  
scheme were sentenced to a combined 49 years and 10  
2014. Specifically, Shire allegedly paid kickbacks to  
 
months in prison.  Five defendants have pleaded guilty  
Human Services   physicians who purchased Dermagraft and, in turn,  
Agencies   and are awaiting sentencing.    billed Medicare, Medicaid, and other federally funded  
  health care programs for the product and related  
Other HHS-Related 
services, and paid kickbacks to physicians employed by  
Reviews and   Pharmacy 
the Veterans Administration (VA) who caused the VA to  
Investigations  
  purchase Dermagraft under a contract with Shire.   
Florida  From July 2012 through March 2016, Niurka  
Appendixes  Shire also marketed Dermagraft for uses not approved  
Fernandez co-owned and operated several pharmacies  
by the FDA to physicians who billed Federal programs.   
in the Miami area, and her son, Roberto Alvarez, was  
The company made false statements intended to inflate  
the registered agent of one of the pharmacies.   
the price of Dermagraft and to conceal, avoid, or  
Fernandez admitted to leading a fraud scheme that paid  
decrease an obligation to pay money to the United  
Medicare beneficiaries and patient recruiters for  
States.  The company also caused physicians to upcode  
prescriptions that were medically unnecessary.   
HHS OIG Semiannual Report to Congress      |      October 1, 2016  March 31, 2017   16  LEGAL AND   claims to Federal programs for Dermagraft and related   Fraud Strike Force case worked jointly with the Federal  
INVESTIGATIVE   services.  Shire agreed to pay $350 million to resolve   Bureau of Investigation (FBI). 
their liability under the False Claims Act. 
ACTIVITIES  
Louisiana  Elaine Davis was the owner of Christian  
RELATED TO  
Wisconsin  Forest Laboratories, LLC and Forest   Home Health Agency (Christian), and Dr. Pramela Ganji  
MEDICARE AND  
Pharmaceuticals, Inc. (collectively Forest) entered into   was the medical director of the agency.  According to  
MEDICAID a settlement agreement to resolve kickback allegations   evidence presented at trial, Davis and Ganji caused  
relating to three Forest products.  Specifically, between   Christian to bill for home health services that were not  
January 2008 and December 2011, Forest allegedly paid   medically necessary or were not provided, based upon  
kickbacks to physicians to induce them to prescribe the   false certifications of medical necessity signed by Ganji.   
Health Care Fraud  
drugs Bystolic, Savella, and Namenda.  The alleged   The vast majority of these patients did not require home  
Prevention  
kickbacks took the form of payments and meals   health care services, and Ganji falsely claimed that  
and Enforcement  
  provided in connection with speaker programs about   beneficiaries she had never examined were qualified to  
Other Criminal and Civil  the three drugs.  Forest agreed to pay $38 million to   receive these services.  The defendants were sentenced  
Enforcement Activities 
resolve its liability under the False Claims Act.  for conspiracy to commit health care fraud and health  
care fraud.  Davis was sentenced to 8 years in prison  
while Ganji was sentenced to 6 years in prison.  They  
Centers for Medicare  
Home Health Care  were ordered to pay a combined $9 million in  
& Medicaid Services  
  restitution, joint and several.  This case was investigated  
Michigan    Zafar Mehmood and Badar Ahmadani were  
Legal and   as part of the Southern Louisiana Strike Force. 
owners of 16 home health care agencies in the Detroit  
Investigative Activities  
  area.  According to evidence presented at trial,  the  
Public Health Agencies   defendants, from October 2004 through 2011, obtained   Transportation Services 
  patients by paying cash kickbacks to recruiters, who in  
Human Services  
turn paid cash to patients to induce them to sign up for   Massachusetts  Medstar Ambulance, Inc., Medstar  
Agencies  
home health care with their agencies.  Mehmood and   EMS, Inc., MetroWest Emergency Medical Services, Inc.,  
 
Ahmadani also paid kickbacks to physicians to refer   Fitchburg Emergency Medical Services, Inc., Pioneer  
Other HHS-Related 
Reviews and   patients to the companies for home health care services   Valley EMS, Inc., Critical Systems, Inc., Nicolas Melehov,  
Investigations   that were medically unnecessary and were not provided.    and Gregory Melehov (collectively, Medstar) agreed  
 
The defendants were found guilty and sentenced for   to pay $12.7 million and enter into a CIA to resolve its  
Appendixes 
health-care-related charges and other charges stemming   liability under the False Claims Act.  From January 2011  
from this scheme.  Mehmood was sentenced to 30 years   through October 2014, Medstar allegedly submitted  
in prison and ordered to pay $40.4 million in restitution,   false claims to Medicare for ambulance transportation  
joint and several, and Ahmadani was sentenced to 8   services in which the services did not qualify for  
years in prison and ordered to pay $38.1 million in   reimbursement because the transports were not  
restitution, joint and several.  This was a Health Care   medically reasonable and necessary; the transport was  
HHS OIG Semiannual Report to Congress      |      October 1, 2016  March 31, 2017   17  LEGAL AND   not to or from a covered destination; claims were   Laboratories 
INVESTIGATIVE   submitted without the necessary beneficiary and/or  
provider signatures and/or complete documentation;   Wisconsin  Gottfried Kellermann, NeuroScience, Inc.,  
ACTIVITIES  
and bills were submitted for higher levels of services   and Pharmasan Labs, Inc.  (collectively, Defendants),  
RELATED TO  
than were required by patients conditions.   entered into a settlement agreement to resolve  
MEDICARE AND  
allegations that they submitted false claims to Medicare  
MEDICAID
and TRICARE for urinary transmitter testing.  From  
Durable Medical Equipment  January 2008 through January 2014, Pharmasan and  
Kellermann allegedly violated Clinical Laboratory  
Pennsylvania  Biocompatibles, Inc., entered into a   Improvement Amendments (CLIA) regulations by  
Health Care Fraud  
settlement agreement to resolve allegations that the   intentionally subjecting certain Pharmasan as-measured  
Prevention  
and Enforcement   defendant knowingly caused false claims to be   urinary neurotransmitter test results to a shift factor  
  submitted to Medicare and Medicaid.  Specifically,   that they had not validated pursuant to CLIA regulations.   
Other Criminal and Civil  Biocompatibles allegedly marketed a device known as   In addition, the United States contended that, during  
Enforcement Activities 
LC Bead, which was cleared by the FDA as an   this same period, the Defendants applied unvalidated  
embolization device that can be placed in blood vessels   reference ranges to urinary neurotransmitter test  
Centers for Medicare   to block or reduce blood flow to certain types of tumors   results.  The Defendants agreed to pay $6.1 million to  
& Medicaid Services   and arteriovenous malformations.  However, LC Bead   resolve their liability under the False Claims Act. 
  was never cleared by FDA as a drug-device combination  
Legal and   product or for use as a drug-delivery device.    New Jersey  MedNet, Inc., entered into a settlement  
Investigative Activities   Biocompatibles allegedly loaded the LC Bead with   agreement to resolve allegations that, from March 2006  
  chemotherapy drugs and used it as a drug-delivery   through January 2014, it entered into fee-for-service  
Public Health Agencies   device.  When LC Bead was combined with prescription   or direct-bill agreements with certain hospital and  
 
drugs for use as a drug-eluting bead, it constituted a   physician clinic customers.  Under these agreements,  
Human Services  
new combination drug device product that was not   MedNet allegedly charged a fee to customers for certain  
Agencies  
  approved by the FDA and not covered by Medicare and   services that they performed in connection with two  
Other HHS-Related  Medicaid.  The defendant agreed to pay $25 million to   types of cardiac monitoring.  MedNet allowed the  
Reviews and   resolve its False Claims Act liability.  In addition, as part   customers to bill Medicare directly for these same  
Investigations  
of the criminal resolution, Biocompatibles was ordered   services and permitted the customers to retain the  
 
to pay an $8.75 million criminal fine for the misbranding   reimbursements they received from Medicare.   
Appendixes 
of LC Bead and a criminal forfeiture of $2.25 million.    However, the Medicare reimbursement exceeded the  
fee that MedNet charged the customers.  The United  
States contended that these arrangements resulted in a  
  net profit to MedNets customers who were part of  
HHS OIG Semiannual Report to Congress      |      October 1, 2016  March 31, 2017   18  LEGAL AND   these agreements and provided remuneration to these   optimizations, and other procedures.  SMH is an acute  
INVESTIGATIVE   customers to induce referrals from the customers for   care hospital owned and operated by Baptist Health  
ACTIVITIES   MedNets services.  The defendant agreed to pay $1.3   System of South Florida (Baptist).  SMH agreed to pay  
million to resolve their liability under the False Claims Act.    $12.5 million and enter into a 5-year CIA with OIG to  
RELATED TO  
resolve its liability under the False Claims Act.   
MEDICARE AND  
MEDICAID
Radiology 
Nursing Homes 
New York  Zwanger & Pesiri Radiology Group, LLP,  
Zwanger Radiology, P.C., and Dr. Steven Mendelsohn   Tennessee  Life Care Centers of America (LCCA) and  
Health Care Fraud  
(collectively, Defendants) entered into a settlement   LCCAs owner and sole shareholder, Forrest Preston,  
Prevention  
agreement to resolve allegations that between July   entered into a settlement agreement to resolve  
and Enforcement  
  2009 and February 2014 they billed Medicare and   allegations that, from January 2006 to February 2013,  
Other Criminal and Civil  Medicaid for radiology testing that was not ordered by a   LCCA caused the submission of false claims to Medicare  
Enforcement Activities 
treating physician, and procedures were performed or   and TRICARE for medically unnecessary rehabilitation  
supervised by physicians or at a practice location that   therapy services provided to patients at LCCAs SNFs.   
was/were not enrolled in Medicare and/or Medicaid.    LCCA is the Nations fourth largest chain of SNFs.  The  
Centers for Medicare  
The Defendants agreed to pay $8.1 million and enter   defendants agreed to pay $145 million plus interest to  
& Medicaid Services  
  into a 5-year CIA with OIG to resolve their liability under   resolve their liability under the False Claims Act, along  
Legal and   the False Claims Act.  Contemporaneously with the civil   with a 5-year comprehensive CIA requiring management  
Investigative Activities   settlement, Zwanger-Pesiri pleaded guilty to two counts   certifications from numerous employees at the  
 
of health care fraud for illegally performing and billing   corporate, divisional, regional, and facility level.   
Public Health Agencies  
for procedures that had not been ordered by treating  
 
physicians and agreed to forfeit an additional $2.4  
Human Services  
million.    Physicians 
Agencies  
 
Other HHS-Related  Georgia  Dr. Robert E. Windsor owned and operated  
Reviews and   Hospitals  Georgia Surgical Monitoring, LLC. According to the  
Investigations   investigation, from January 2010 through July 2013,  
 
Florida  South Miami Hospital, Inc. (SMH), entered into   Windsor billed for services that he did not perform.   
Appendixes 
a settlement agreement to resolve its liability for   Specifically, Windsor billed for intra-operative  
submitting claims to Medicare, Medicaid, TRICARE, and   monitoring, a procedure for reducing the risk of  
Federal Employee Health Benefit Programs for medically   neurological deficits during operations that involve the  
unnecessary electro physiology studies, echo   nervous system.  During surgery, a patient is connected  
cardiograms, tilt-table tests, implantable cardiovascular- electronically to a system that allows a physician to  
defibrillators, biventricular pacemakers, atrioventricular   remotely monitor the neurologic system and provide  
HHS OIG Semiannual Report to Congress      |      October 1, 2016  March 31, 2017   19  LEGAL AND   guidance to the operating surgeon to prevent   HEAT Provider Compliance Training 
INVESTIGATIVE   neurological damage.  This complex monitoring requires  
specialized skills and experience and is usually provided   OIG provides free training on our website for health care  
ACTIVITIES  
by a neurologist.  Windsor directed a medical assistant   providers, compliance professionals, and attorneys.   
RELATED TO  
to conduct this monitoring on his behalf with no   OIGs Provider Compliance Training was an initiative  
MEDICARE AND  
supervision.  Windsor was sentenced to 3 years and 2   developed as part of HEAT in 2011 that continues to  
MEDICAID
months in prison and ordered to pay $1.1 million in   reach the health care community with OIGs message of  
restitution after his guilty plea to health care fraud.  compliance and prevention via free, downloadable,  
comprehensive training materials and podcasts.  OIGs  
New York  Hudson Valley Hematology-Oncology   provider compliance training resources can be accessed  
Health Care Fraud  
Prevention   Associates, R.L.L.P.  (Hudson), entered into a settlement   at:  https://oig.hhs.gov/compliance/compliance-
and Enforcement   agreement to resolve Hudsons liability for improperly   guidance/index.asp.   
  submitting claims to Medicare and Medicaid.  From June  
Other Criminal and Civil  2010 through June 2015, Hudson allegedly routinely  
Enforcement Activities  waived co-payments without an individualized   Health Care Fraud Strike Force Activities 
determination of financial hardship or exhaustion of  
reasonable collection efforts and billed Medicare and   In 2007, Health Care Fraud Strike Force teams began an  
Centers for Medicare  
Medicaid for evaluation and management services, even   effort to combine resources of Federal, State, and local  
& Medicaid Services  
  though Hudson did not provide any significant,   law enforcement entities to prevent and combat health  
Legal and   separately identifiable services to the beneficiaries.  The   care fraud, waste, and abuse.  These partnerships  
Investigative Activities   defendant agreed to pay $5.5 million and enter into a   between OIG and HHS, DOJ, U.S.  Attorneys Offices,  
  5-year CIA with OIG to resolve its liability.   FBI, and State and local law enforcement have a  
Public Health Agencies   common goal: successfully analyze health care fraud  
 
data and investigative intelligence to quickly identify  
Human Services  
Health Care Fraud Prevention   fraud and bring prosecutions.  Strike Force teams  
Agencies  
operate in nine areas: Miami, Florida; Los Angeles,  
  and Enforcement 
Other HHS-Related  California; Detroit, Michigan; Houston, Texas; Brooklyn,  
Reviews and   New York; southern Louisiana; Tampa, Florida; Chicago,  
On  May 20, 2009, the Secretary of HHS and the Attorney  
Investigations  
Illinois; and Dallas, Texas. 
  General announced the creation of the Health Care  
Appendixes  Fraud Prevention and Enforcement Action Team (HEAT),   During the first half of FY 2017, Strike Force efforts  
an interagency effort focused specifically on combating   resulted in the filing of charges against 49 individuals or  
health care fraud.  HEAT includes senior officials from   entities, 152 criminal actions, and more than $266.8  
DOJ and HHS who are strengthening programs and   million in investigative receivables. 
investing in new resources and technologies to prevent  
and combat fraud, waste, and abuse. 
HHS OIG Semiannual Report to Congress      |      October 1, 2016  March 31, 2017   20  LEGAL AND   Below are examples of Strike Force cases:  Other Criminal and Civil  
INVESTIGATIVE   Michigan  Four defendants in a home health care and  
Enforcement Activities 
ACTIVITIES   hospice Medicare fraud scheme pleaded guilty to  
RELATED TO   conspiracy to commit health care fraud and wire fraud.   
Special Assistant U.S. Attorney Program 
MEDICARE AND   They were sentenced to a combined 35 years and 2  
MEDICAID months in prison and ordered to pay $33 million in   During this reporting period, DOJ and OIG continued  
restitution, joint and several.  Three of the defendants,  
their participation in a program in which OIG attorneys,  
Shahid Tahir, Manawar Javed, and Muhammad Tariq,  
some of whom are Special Agents, serve as Special  
owned home health care and hospice companies, while  
Assistant U.S. Attorneys.  These OIG attorneys are  
Health Care Fraud   the fourth, Hatem Ataya, was a physician who conspired  
detailed full time to DOJs Criminal Division, Fraud  
Prevention   with the other defendants.  From January 2006 through  
Section, for temporary assignments, including  
and Enforcement  
June 2015, Tahir, Javed, and Tariq paid kickbacks, bribes,  
  assignments to the Health Care Fraud Strike Force.   
and other inducements to Ataya and other physicians,  
Other Criminal and Civil  Other attorneys prosecute matters on a case-by-case  
as well as to marketers and patient recruiters, for  
Enforcement Activities  basis.  Both arrangements offer excellent litigation  
beneficiary referrals to companies they owned.  The  
training for OIG attorneys and enhance collaboration  
co-defendants admitted that they then billed Medicare  
between the departments in their efforts to fight fraud.   
Centers for Medicare   for home health care and hospice services that were  
Under this program, OIG attorneys have successfully  
& Medicaid Services   often medically unnecessary and/or not provided. 
  litigated important criminal cases relating to the  
Legal and   New York  Olga Novogordosky co-owned Cropsey   fraudulent billing of medical equipment and supplies,  
Investigative Activities   Medical Care.  According to the investigation,    infusion therapy, and physical therapy, as well as other  
  Novogordosky and her co-conspirators, from November   types of Medicare and Medicaid fraud. 
Public Health Agencies  
2009 through October 2012, executed a scheme to  
 
defraud Medicare and Medicaid by billing for services  
Human Services   Below is a related case example: 
Agencies   not rendered, billing for services that were not medically  
Texas  Oakey Chikere was the owner and operator of  
  necessary, and providing cash kickbacks to beneficiaries.   
Other HHS-Related  Novogordosky also helped to create a fake shell   Direct Care medical clinic in the Houston area.   
Reviews and   According to the investigation, the defendant led a  
company name for the purpose of money laundering to  
Investigations   scheme from about March 2011 through February 2013  
pay kickbacks to patients.  Novogordosky was sentenced  
 
to bill Medicare for services that were not medically  
to 1 year and 1 day in prison and ordered to pay $6.5  
Appendixes 
necessary and were not provided.  Specifically, Chikere  
million in restitution, joint and several, after her guilty  
recruited doctors to work for him, representing that  
plea to conspiracy to commit money laundering and  
conspiracy to commit health care fraud.  Ten defendants   they would be paid for certifying and recertifying  
involved in the scheme were previously sentenced to a   patients for home health care, regardless of whether  
combined 17 years and 1 day in prison and ordered to   the home health services were medically necessary.   
pay $13.5 million in restitution, joint and several.  Chikere marketed to home health agencies that, for a  
HHS OIG Semiannual Report to Congress      |      October 1, 2016  March 31, 2017   21  LEGAL AND   fee, his doctors would fraudulently certify Medicare   order to submit false claims to Medicare.  Investigators  
INVESTIGATIVE   beneficiaries for home health services.  Chikere would   believe that Martinez, through Magnifique, was paid  
ACTIVITIES   then refer the patient to a home health agency he had   over $4.7 million for services Magnifique did not render.   
an arrangement with, and he would be paid a kickback.    Martinez was detained while trying to enter the United  
RELATED TO  
A jury convicted Chikere of conspiracy to commit health   States from an inbound flight originating in Cuba.  He is  
MEDICARE AND  
care fraud and health care fraud, and he was sentenced   currently in custody and will face charges stemming  
MEDICAID
to 5 years and 10 months in prison and ordered to pay   from his indictment. 
$258,738 in restitution. 
Because of the success of OIGs Most Wanted Fugitives  
website, OIG launched its Most Wanted Deadbeat  
Health Care Fraud  
Most Wanted Fugitives Listed on OIGs Website  Parents website at https://oig.hhs.gov/fraud/child-
Prevention  
and Enforcement   support-enforcement/index.asp. The site identifies  
  The OIG Most Wanted Fugitives website continues to   parents who fail to pay court-ordered child support for  
Other Criminal and Civil  garner national and international attention and has   their children; as a result, an unnecessary strain is  
Enforcement Activities 
greatly assisted in helping to capture fugitives charged   placed on the custodial parents and the children as well  
with defrauding Federal health care programs and   as on agencies that enforce these matters.  The Human  
stealing millions of taxpayer dollars.  The Most Wanted   Services Reviews section of this Semiannual Report  
Centers for Medicare  
Fugitives website is continually updated and features a   provides examples. 
& Medicaid Services  
  profile for each fugitive as well as an online tip form and  
Legal and   a hotline number for individuals to report fugitive-
Investigative Activities   related information to OIG, in English or Spanish, 24   HHS OIG Hotline 
 
hours a day, 365 days a year.  The Most Wanted  
Public Health Agencies   The mission of the HHS OIG Hotline is to support OIGs  
Fugitives list can be accessed at https://oig.hhs.gov/ 
  oversight responsibilities in safeguarding the integrity of  
fraud/fugitives/. 
Human Services  
all programs and personnel under purview of HHS and  
Agencies  
One of OIGs Most Wanted Fugitives, Ariel Martinez   protect them from fraud, waste, and abuse.  We achieve  
 
Other HHS-Related  Ruiz, was captured during this reporting period.    our mission through our dedication to timely intake and  
Reviews and   Martinez was indicted on charges of health care fraud in   analysis of information received from various sources,  
Investigations   June 2016 and fled the United States.  Martinez was the   such as the Report Fraud link on the HHS OIG Internet  
 
owner operator of Magnifique Home Health in Miami,   website.  Strategically located within the Office of  
Appendixes 
Florida.  According to the indictment, from July 2014   Investigations, the Hotline is the public-facing division  
through February 2015, Martinez conspired to defraud   for OIGs intake and evaluation of fraud tips.  During this  
Medicare by submitting false claims.  Specifically,   semiannual reporting period, the OIG Hotline reported  
Martinez and others obtained the names and Medicare   expected recoveries of $9.6 million as a direct result of  
identification numbers of Medicare beneficiaries, along   cases originating from Hotline complaints.   
with the names and provider numbers of physicians, in  
HHS OIG Semiannual Report to Congress      |      October 1, 2016  March 31, 2017   22  LEGAL AND   OIG Hotline Activity (10/1/163/31/17):	  MFCUs employed 1,965 individuals.  Collectively, in FY  
INVESTIGATIVE   2016, MFCUs reported 18,730 investigations, of which  
  	 Contacts to 1-800-HHS-TIPS phone line, including   15,509 were related to Medicaid fraud and 3,221 were  
ACTIVITIES  
callers seeking information:  66,891  related to patient abuse and neglect, including  
RELATED TO  
  	 Total Tips Evaluated :  14,562  misappropriation of patients private funds.  The cases  
MEDICARE AND  
resulted in criminal charges or indictments involving  
MEDICAID   	 Tips Referred for Action:  9,970 
1,721 individuals, including 1,249 for fraud and 472 for  
  	 Closed, no basis provided for further action:  4,222  patient abuse and neglect.  In total, 1,564 convictions  
  	 Closed, no HHS violation:  370  were reported in FY 2016, of which 1,160 were related  
to Medicaid fraud and 404 were related to patient  
Health Care Fraud  
Prevention   Source Types of TIPS referred for action:  abuse and neglect.  Civil judgments and settlements for  
and Enforcement   FY 2016 totaled 998, and monetary recoveries in civil  
    	 Phone:  5,127  cases totaled over $1.5 billion.  (See Medicaid Fraud  
Other Criminal and Civil 
Control Units 2016 Expenditures and Statistics  
Enforcement Activities    	 Internet:  3,768 
contained in an  Interactive Map and  Chart). 
  	 Letters/Faxes:  1,075 
Centers for Medicare  
OIG Onsite Reviews of MFCUs  
& Medicaid Services   State Medicaid Fraud Control Units 
  In addition to an annual recertification review of each  
Legal and   MFCU, OIG conducts periodic in-depth reviews of a  
OIG Oversight of State Medicaid Fraud Control Units 
Investigative Activities   sample of MFCUs.  OIG evaluates MFCU operations in  
  MFCUs are key partners with OIG in the fight against  
accordance with 12 performance standards and  
Public Health Agencies   fraud, waste, and abuse in State Medicaid programs.   
assesses compliance with laws, regulations, and OIG  
  OIG has oversight responsibility for MFCUs and  
policy guidance.  OIG issued a report of an onsite review  
Human Services  
administers grants that provide Federal funding for Unit  
of the following MFCU during the reporting period:  
Agencies  
operations.  The Federal Government reimburses 75  
 
Other HHS-Related  percent of the costs of operating a Unit; the States     	 Oregon State Medicaid Fraud Control Unit: 2016  
Reviews and   contribute the remaining 25 percent.  MFCUs   Onsite Review (OEI-09-16-00200, December 2016). 
Investigations   investigate and prosecute Medicaid provider fraud and  
 
patient abuse and neglect in health care facilities or   The following is a case example of joint efforts 
Appendixes 
board and care facilities.    with MFCUs: 
Texas  Jocelyn Pyles Elo was a physician working for  
MFCU Funding and Accomplishments in FY 2016  Elite P. Medical Clinic in Houston, Texas.  According to  
the investigation, from May 2009 to September 2011,  
In FY 2016, combined Federal and State expenditures  
Pyles conspired with others to bill for services she did  
for the operation of the 50 MFCUs (in 49 States and the  
not provide.  In actuality, an unlicensed foreign medical  
District of Columbia) totaled almost $259 million.  The  
HHS OIG Semiannual Report to Congress      |      October 1, 2016  March 31, 2017   23  LEGAL AND   graduate saw all the patients at the clinic alone and was   the exclusion of individuals and entities from Federal  
INVESTIGATIVE   instructed not to sign patient progress notes at those   health care programs and the imposition of CMPs for  
visits. Pyles would arrive at the clinic after hours and   submitting false and fraudulent claims to a Federal  
ACTIVITIES  
sign the treatment notes to make it appear as if she saw   health care program or for violating the anti-kickback  
RELATED TO  
the patients when in actuality she did not.  A jury found   statute, the Stark law, or the Emergency Medical  
MEDICARE AND  
Pyles guilty of 14 counts of health care fraud, and she   Treatment and Labor Act (EMTALA), also known as the  
MEDICAID
was sentenced to 1 year and 1 day in prison and   patient dumping statute.   
ordered to pay $560,718 in restitution. 
During this semiannual reporting period, OIG imposed  
1,504 administrative sanctions in the form of program  
Health Care Fraud  
Advisory Opinions and Other Industry Guidance  exclusions or administrative actions for alleged fraud or  
Prevention  
abuse or other activities that posed a risk to Federal  
and Enforcement  
As part of OIGs continuing efforts to promote the  health care programs and their beneficiaries.  Exclusion  
 
Other Criminal and Civil  highest level of ethical and lawful conduct by the  and penalty authorities are described in Appendix D and  
Enforcement Activities  health care industry, we issue advisory opinions and  on our website at http://oig.hhs.gov/fraud/ 
other guidance to educate industry and other  enforcement/cmp/index.asp. 
stakeholders on how to avoid fraud, waste, and abuse.  
Centers for Medicare  
Advisory opinions, which are developed in consultation 
& Medicaid Services  
with DOJ, are issued to requesting parties regarding  Program Exclusions 
 
the interpretation and applicability of certain statutes 
Legal and  
During this semiannual reporting period, OIG excluded  
Investigative Activities   relating to Federal health care programs.  HIPAA,  
1,422 individuals and entities from Medicare, Medicaid,  
  205, allows OIG to provide case-specific formal 
and other Federal health care programs.  Most of the  
Public Health Agencies   guidance on the application of the anti-kickback 
  statute and safe harbor provisions and other OIG  exclusions resulted from convictions for crimes relating  
Human Services   to Medicare or Medicaid, for patient abuse or neglect,  
health care fraud and abuse sanctions.  During the first 
Agencies   or as a result of license revocation.  OIG is also  
half of FY 2017, OIG received 22 requests for advisory 
 
responsible for reinstating providers who apply and have  
opinions and issued 5 advisory opinions and 1 
Other HHS-Related 
met the requirements of their exclusions.  For a list of  
Reviews and   modification of an advisory opinion. 
excluded individuals and entities, see https://exclusions. 
Investigations  
  oig.hhs.gov/. 
Appendixes  Sanction Authorities and Other  
Administrative Actions  The following are examples of program 
exclusions: 
Various Federal laws provide authorities the ability to  
District of Columbia    Florence Bikundi was an owner of  
impose administrative sanctions for fraud and abuse as  
Global Healthcare, Inc.  According to court documents,  
well as other activities that pose a risk to Federal health  
Bikundi fraudulently gained approval as a provider in the  
care programs and their beneficiaries.  Sanctions include  
HHS OIG Semiannual Report to Congress      |      October 1, 2016  March 31, 2017   24  LEGAL AND   Medicaid program.  From August 2009 through February   OIG refers individuals and entities that have potentially  
INVESTIGATIVE   2014, Bikundi led a scheme to bill Medicaid for services   engaged in grant or contract fraud or misconduct to the  
that were not provided, creating phony time sheets,   HHS Suspension and Debarment Official, who is  
ACTIVITIES  
patient files, and employment files.  Bikundi was   responsible for determining whether to impose a  
RELATED TO  
convicted of health care fraud, money laundering, and   suspension or debarment.  OIG continues to develop a  
MEDICARE AND  
other charges stemming from this scheme, and was   robust Suspension and Debarment program and uses  
MEDICAID
sentenced to 10 years in prison and ordered to pay $80.6   this tool to protect Government programs against fraud,  
million in restitution, joint and several.  In April of 2000,   waste, poor performance, and noncompliance with  
Bikundi was excluded based on the loss of her license to   contract provisions or applicable law. 
practice as a licensed practical nurse in the State of  
Health Care Fraud  
Prevention   Virginia, and this exclusion remains in place.  OIG  
The following are debarment examples: 
and Enforcement   excluded Bikundi for a minimum period of 55 years. 
  Florida  Ana Luz Marcano, through her employment at  
Other Criminal and Civil  Virginia    Martin Matthews Martin was licensed as a   the Childrens Home Society, engaged in a scheme to  
Enforcement Activities 
nurse aide.  According to court documents, while working   falsify and expedite applications to the Florida School  
as a nurse aide in a nursing home, Martin sexually   Readiness Program.  According to the investigation,  
assaulted an 84-year old patient.  The patient was not   Marcano charged an illegal fee to low-income parents  
Centers for Medicare  
& Medicaid Services   alert, nonverbal, and suffered from dementia.  Martin   for subsidized daycare benefits that parents were not  
  was sentenced to 22 years in prison based on his   entitled to receive.  The referral forms Marcano  
Legal and   conviction for rape.  In addition, the Virginia State Board   completed designated the children as at-risk and  
Investigative Activities   of Nursing revoked his license to practice as a nurse aide.    eligible to receive immediate placement ahead of  
 
OIG excluded Martin for a minimum period of 30 years.    families already on a waiting list for these services.  The  
Public Health Agencies  
defendant was convicted of an organized scheme to  
 
defraud and was debarred based on an OIG referral to  
Human Services  
Suspensions and Debarments 
Agencies   the Department for a 3-year period.  
 
Other HHS-Related  Suspensions and debarments are administrative tools   Nevada  Belinda Thompson was the executive director  
Reviews and   used by HHS and other Federal agencies to protect the   of Goshen Community Development.  Goshen was  
Investigations   Government from individuals and entities that have   funded in excess of $6 million, primarily with SAMHSA  
 
engaged in contract fraud, misused grant funds, or are   grant funds.  The funds were intended to fund sub-
Appendixes 
otherwise not presently responsible.  Because these are   grantees to perform community services such as drug  
Government-wide sanctions, an individual or entity that   abuse prevention services and HIV and TB services, law  
has been suspended or debarred by HHS or any other   enforcement checkpoints, and community services  
agency is ineligible from participating in any future   training.  According to the investigation, Thompson  
funding opportunities across the Federal Government   knowingly embezzled  Goshens Federal grant funds.  The  
for a specified period of time.  defendant was convicted of theft of Government  
HHS OIG Semiannual Report to Congress      |      October 1, 2016  March 31, 2017   25  LEGAL AND   property, ordered to repay $399,000, and subsequently   company and its predecessors failed to implement  
INVESTIGATIVE   debarred based on an OIG referral to the Department   policies and procedures required by the CIA, and that  
for a 3-year period.  poor claims submission practices led to significant error  
ACTIVITIES  
rates and overpayments by Medicare.  
RELATED TO  
MEDICARE AND  
Corporate Integrity Agreements 
MEDICAID
Civil Monetary Penalties Law 
Many health care providers elect to settle their cases  
before litigation.  As part of the settlements, providers   The Civil Monetary Penalties Law (CMPL) authorizes OIG  
often agree to enter into CIAs with OIG to avoid   to impose administrative penalties on and assessments  
Health Care Fraud  
exclusions from Medicare, Medicaid, and other Federal   against a person who, among other things, submits, or  
Prevention  
health care programs.  Under a CIA, a provider commits   causes to be submitted, claims to a Federal health care  
and Enforcement  
  to establishing a program and taking other specified   program that the person knows, or should know, are  
Other Criminal and Civil  steps to ensure future compliance with Medicare and   false or fraudulent.  In addition to administrative  
Enforcement Activities  Medicaid rules.  The compliance programs are designed,   penalties and assessments, OIG can also exclude  
in part, to prevent future fraud.  OIG monitors providers   individuals for engaging in conduct prohibited by the  
compliance with these agreements and may impose   CMPL. During this semiannual reporting period, OIG  
Centers for Medicare  
penalties on entities that fail to comply with the   concluded cases involving more than $26.3 million in  
& Medicaid Services  
  requirements of their CIAs.   CMPs and assessments.  
Legal and  
Investigative Activities  
The following is a CIA enforcement example:  The following is a CMP example: 
 
Public Health Agencies   Kentucky  Kindred Healthcare, Inc., the Nations largest   New Jersey  Roben Brookhim agreed to pay $1.1  
  provider of post-acute care, including hospice and home   million in assessments and penalties and be excluded  
Human Services  
health services, paid a penalty of more than $3 million   from participation in all Federal health care programs  
Agencies  
for failing to comply with a CIA.  The CIA was the result   for a period of 50 years pursuant to 42 U.S.C.   
 
Other HHS-Related  of allegations involving claims for hospice services that   1320a-7(b)(7) (fraud, kickbacks, and other prohibited  
Reviews and   were medically unnecessary and claims for continuous   activities).  Brookhim is a New Jersey dentist who was  
Investigations   or crisis care services when the patients were not   previously excluded due to the suspension of his license  
 
experiencing a crisis.  The penalty for violating the CIA   to practice dentistry in 1999.  OIG alleged that Brookhim  
Appendixes 
resulted from Kindreds failure to correct improper   knowingly presented or caused to be presented to  
billing practices in the fourth year of the 5-year   Medicaid claims for items or services he knew or should  
agreement.  OIG made several unannounced site visits   have known were false or fraudulent or otherwise not  
to Kindred facilities and found ongoing violations.    provided as claimed; knowingly presented or caused to  
Specifically, CIA-required audits performed by Kindreds   be presented to Medicaid claims for items or services  
internal auditors in 2013, 2014, and 2015 found that the   furnished by an excluded person; and was the owner  
HHS OIG Semiannual Report to Congress      |      October 1, 2016  March 31, 2017   26  LEGAL AND   and managing employee of an entity that was   Tennessee  Metro Knoxville HMA, LLC agreed to pay  
INVESTIGATIVE   participating while he was excluded from participating in   $45,000 to resolve its potential liability under EMTALA.   
Federal health care programs.  OIG alleged that Metro Knoxville violated EMTALA when  
ACTIVITIES  
it discharged a patient without having provided an  
RELATED TO  
adequate medical screening examination or treatment  
MEDICARE AND  
Patient Dumping  sufficient to stabilize the patient.  OIGs investigation  
MEDICAID
revealed that blood test results indicated the presence  
Some of the CMPL cases that OIG resolved during this  
of an emergency medical condition; however, Metro  
semiannual reporting period were pursued under the  
Knoxville discharged the patient without confirming that  
Emergency Medical Treatment and Labor Act (EMTALA), a  
such blood levels had stabilized.  
Health Care Fraud  
statute designed to prevent hospitals from denying  
Prevention  
emergency care to patients and to ensure patient access to  
and Enforcement  
  appropriate emergency medical services.    Self-Disclosure Programs 
Other Criminal and Civil 
Enforcement Activities 
Health care providers, suppliers, or other individuals or  
The following are EMTALA case examples: 
entities subject to CMPs can apply for acceptance into  
Missouri  Research Medical Center (RMC) agreed to   the Provider Self-Disclosure Protocol, a program created  
Centers for Medicare  
pay $360,000 to resolve its potential liability under  
in 1998, to voluntarily disclose self-discovered evidence  
& Medicaid Services  
EMTALA.  OIG alleged that RMC failed to provide an  
  of potential fraud.  The self-disclosure program may give  
adequate medical screening examination and  
Legal and   providers the opportunity to potentially avoid costs or  
Investigative Activities   improperly transferred a patient.  The patient arrived at   possible disruptions associated with Government-
  RMCs emergency room (ER) with a psychiatric   directed investigations and civil or administrative  
Public Health Agencies   emergency medical condition.  Without providing  
litigation.  Application processes for two additional  
  stabilizing treatment, RMC transferred the patient to a  
self-disclosure programs were recently added to the OIG  
Human Services  
nearby facility by private vehicle.  During the transfer,  
website for HHS contractors and grantees.  The OIG  
Agencies  
the patient exited the vehicle and was struck by another  
  contractor self-disclosure program enables contractors  
Other HHS-Related  vehicle.  During its investigation, OIG found 17 occasions   the opportunity to self-disclose when they have  
Reviews and   where RMC failed to provide adequate medical  
potentially violated the False Claims Act or other Federal  
Investigations   screening examinations and improperly transferred or  
criminal laws prohibiting fraud, conflict of interest,  
 
discharged patients, without providing stabilizing  
bribery, or gratuity.  This self-disclosure process is  
Appendixes 
treatment, who arrived at its ER with psychiatric  
available only to those with a Federal Acquisition  
emergency medical conditions.  At the time each patient  
Regulation-based contract with HHS.  The OIG Grant  
arrived, RMC had the capacity to treat, stabilize, or  
Self-Disclosure program is available for application by  
admit each patient.   
HHS grantees or HHS grant sub-recipients and provides  
the opportunity for voluntarily disclosure to OIG of  
HHS OIG Semiannual Report to Congress      |      October 1, 2016  March 31, 2017   27  LEGAL AND   potential fraud.  OIG evaluates the reported results of  
INVESTIGATIVE   each internal investigation under the provider self-
disclosure protocol to determine the appropriate course  
ACTIVITIES  
of action. The self-disclosure guidelines are available on  
RELATED TO  
the OIG website at https://oig.hhs.gov/compliance/ 
MEDICARE AND  
self-disclosure-info/index.asp. During this semiannual  
MEDICAID
reporting period, self-disclosure cases resulted in more  
than $23 million in HHS receivables.   
Health Care Fraud   The following are examples of provider  
Prevention  
self-disclosure settlements: 
and Enforcement  
  Texas  Memorial Hermann Health System agreed to  
Other Criminal and Civil  pay $5.6 million to resolve its liability under the CMPL  
Enforcement Activities 
for conduct it disclosed to OIG.  Specifically, OIG alleged  
that, between September 1, 2009, and October 20,  
2015, it improperly submitted claims to Medicare,  
Centers for Medicare  
& Medicaid Services   Medicaid, and TRICARE for certain outpatient services  
  by automatically appending modifiers 59 or 91 to  
Legal and   Current Procedural Terminology (CPT) codes without  
Investigative Activities   regard for clinical appropriateness.  
 
Public Health Agencies   Oklahoma  Muscogee Creek Nation Department of  
 
Health, acting on behalf of its subsidiary Creek Nation  
Human Services  
Hospital and Clinics d/b/a Creek Nation EMS, agreed to  
Agencies  
pay $171,767 to resolve its liability under the CMPL for  
 
Other HHS-Related  conduct it disclosed to OIG.  Specifically, OIG alleged  
Reviews and   that, from July 4, 2011, through January 24, 2015, Creek  
Investigations  
Nation EMS improperly billed for ambulance transport  
 
services provided by an unlicensed emergency medical  
Appendixes 
technician. 
HHS OIG Semiannual Report to Congress      |      October 1, 2016  March 31, 2017   28      
ss Public-Health-Related Legal   of PSC referral of their cases to OIG.  Individuals who  
we have been excluded because of default may enter into  
Actions and Investigations 
i settlement agreements, whereby the exclusions are  
et
ii stayed while they pay specified amounts each month to  
vv Health Education Assistance Loan Program  satisfy their debts.  If they default on these settlement  
ei agreements, they may be excluded until the entire debt  
t
OIG excludes individuals who have defaulted on Health  
Rc is repaid and they may not appeal the exclusions. 
Education Assistance Loan (HEAL) loans from  
A
 
s participation in Federal health care programs.  Under   After being excluded for nonpayment of their HEAL  
 
et the HEAL program, which stopped making loans in 1998,   debts, 2,649 individuals chose to enter into settlement  
in HRSA guaranteed commercial loans to students seeking   agreements or completely repay their debts.  That figure  
c
e education in health-related fields.1   The students are   includes 12 individuals who entered into such  
n
m allowed to defer repayment of the loans until after they   settlement agreements or completely repaid their debts  
e graduate and begin to earn income.  Although HHSs   during this semiannual reporting period.  More than  
ge
Program Support Center (PSC) takes steps to ensure   $210 million is being repaid through settlement  
Ac repayment, some loan recipients do not resolve their   agreements or through complete repayment.  Of that  
r
  indebtedness.  After PSC has exhausted efforts to secure   amount, more than $984,000 is attributable to this  
o
h repayment of a debt, it declares an individual in default.    semiannual reporting period. 
f
t The Social Security Act permits exclusion thereafter of  
n
l The following are settlement agreement examples.   
aE such individuals from Medicare, Medicaid, and all other  
These practitioners entered into settlement agreements  
e Federal health care programs for nonpayment of the  
  to repay the amounts indicated: 
Hd loans. 
 n Exclusion means that the individual may not receive      Florida Chiropractor - $132,333 
ca
reimbursement under these programs for professional      Iowa  Optometrist - $72,9835 
i
l services rendered, nor may any other provider receive  
b
reimbursement for services ordered or prescribed by  
u Indian Health Service 
the excluded individual.  OIG is responsible for excluding  
P individuals who have defaulted on HEAL loans from  
Indian Health Service Hospitals: More Monitoring Needed to 
participation in Federal health care programs. 
Ensure Quality Care  
HEAL Exclusions  We found that IHS may be missing opportunities to  
identify and remediate quality problems in its hospi-
During this semiannual reporting period, nine   tals because it performed limited oversight activities  
individuals and related entities were excluded as a result   regarding quality care and compliance with the Con-
1 The HEAL Program, noted in previous Semiannual Reports, was permanently transferred from HHS to the U.S.  Department of Education as required by the  
Consolidated Appropriations Act, 2014 (Pub. L. 113-76).  The transfer was completed on July 1, 2014. 
HHS OIG Semiannual Report to Congress      |     October 1, 2016  March 31, 2017   29  PUBLIC HEALTH  ditions of  Participation.  IHS relies on its Area Offices   interrelated challenges affecting their ability to provide  
to monitor hospitals.  However, Area Office staff have   quality care and maintain compliance.  IHS hospitals face  
AGENCIES  
few sources of information about hospital quality, and   continual increases in the number of American Indian/ 
REVIEWS AND  
most limit reviews of that information to infrequent   Alaskan Natives using their services, yet they provide a  
ENFORCEMENT  
meetings of each hospitals Governing Board.  Further,   small scope of medical services and limited options for  
ACTIVITIES
Condition-of-Participation compliance surveys are not   specialists and community support (e.g., nursing homes  
conducted by CMS with the frequency needed to make   and home health).  IHS hospitals particularly struggle to  
them a useful tool.  Staffing shortages in Area Offices   maintain the skills necessary to treat complex inpatient  
also limit the clinical support and guidance that they are   cases.  Another significant concern among IHS hospital  
able to provide, and the most promising efforts to im- administrators is the inability to recruit and retain  
prove hospital quality lack dedicated funding.  Addition- needed staff.  The dependence on acting personnel  
ally, hospitals struggle to implement data-driven quality   and contracted providers to fill vacancies sometimes  
Public-Health-Related  improvement methods as a result of limited information   creates instability in IHS hospitals and weakens the  
Legal Actions and   technology knowledge, a lack of resources, and difficul- continuity of care provided to patients.  Further, hospital  
Investigations 
ties with the electronic health record systems.    administrators reported that limited resources for  
maintaining old hospital structures and outdated  
We recommended that IHS: (1) implement a quality-
Centers for Medicare   equipment sometimes result in service interruptions  
focused compliance program; (2) establish standards  
& Medicaid Services    and raise concerns about patient safety. 
and expectations for Area Office/Governing Board  
 
Legal and   oversight activities; (3) work to identify new  and more   We recommended that the Office of the Secretary of  
Investigative Activities   meaningful  hospital performance metrics; and (4)   HHS lead an examination of the quality of care delivered  
  continue to invest in training for hospital administration   in IHS hospitals as part of its newly formed executive  
Public Health Agencies   and staff.  Additionally, we recommended that CMS   council and use the findings to identify and implement  
  assist IHS in its oversight efforts by conducting more   innovative strategies to mitigate IHSs longstanding  
Human Services   frequent surveys of non-accredited hospitals, informing   challenges.  We also recommended that IHS conduct a  
Agencies  
IHS leadership when hospitals are cited with   needs assessment and develop an agency-wide strategic  
 
deficiencies, and continuing to provide technical   plan with actionable initiatives and target dates to build  
Other HHS-Related 
Reviews and   assistance and training.   a unified vision of IHS priorities and how to achieve  
Investigations   them.  The Office of the Secretary, IHS, and CMS  
  OEI-06-14-00010     October 2016  provided a joint response to this report and its  
Appendixes 
companion report.  Collectively, these HHS agencies  
concurred with all recommendations in both reports.  
Indian Health Service Hospitals: Longstanding Challenges 
Warrant Focused Attention to Support Quality Care  OEI-06-14-00011     October 2016 
IHS hospital administrators reported a range of  
HHS OIG Semiannual Report to Congress      |      October 1, 2016  March 31, 2017   30      
ss Administration for Children   Puerto Rico concurred with our recommendation to  
we improve its controls for provider and client eligibility  
and Families 
i determinations and for processing claims to ensure that  
et
ii payments for the CCDF program are made only for  
vv Childcare and Head Start Programs  eligible clients and to eligible providers.  Puerto Rico also  
ei concurred with our recommendations to return $83,000  
t
ACF provides Federal grants through several programs,  
Rc to the Federal Government for unallowable obligations  
including Head Start and the Child Care and  
A and establish policies and procedures to ensure that  
 
s Development Fund (CCDF).  CCDF (authorized by the   child care funds are identified and assigned to voucher  
 
et Child Care and Development Block Grant Act and the   payments in compliance with obligation requirements.  
in Social Security Act  418) assists low-income families  
c
e receiving temporary public assistance, and families   A-02-13-02005     January 2017 
n
m transitioning from public assistance to obtain child care  
e so that they may work or obtain training or education. 
ge
Newark Preschool Council, Inc., Did Not Always Comply With 
Ac
Puerto Ricos Controls for Its Child Care and Development  Head Start Requirements 
r
 
so Program Claims Were Not Effective  Our review of Newark Preschool Council, Inc. (Newark),  
ef We conducted this review to determine whether Puerto   which operated throughout Newark, New Jersey, found  
n
c Ricos Department of the Familys controls for provider   that Newark did not always comply with Head Start  
iE and client eligibility determinations and for processing   program requirements.  As a result, Newark received  
v
  approximately $10 million in excess Head Start funds  
CCDF program claims were effective.  We found that all  
rd
during a 17-month period.  In addition, it did not  
of the provider eligibility controls we tested for provider  
en
monitor its partner agencies operations to ensure that  
background checks, required provider forms, and  
Sa
children at these facilities received Head Start services. 
provider rate agreements were not effective.  Of the  
 
n client eligibility controls we tested, Puerto Ricos  
ACF generally concurred with our recommendations  
a controls for family income and need-for-service   that it ask Newark to refund $10 million to the Federal  
m eligibility were not effective.  Although Puerto Ricos   Government for unallowable costs applicable to under-
controls for verifying clients citizenship were effective,  
enrollment, general and administrative expenses,  
u Puerto Rico was not implementing Federal law  
unauthorized purposes, and salary payments; complete  
H regarding client eligibility.  Puerto Rico lacked sufficient  
the closeout process for Newarks Head Start grant; if  
written policies and procedures and sufficient staff to  
Newark is awarded a Head Start grant in the future,  
effectively oversee licensed providers, and it lacked  
ensure that Newark maintains its funded enrollment  
adequate procedures to monitor non-licensed providers  
level, properly monitor partner agencies, and follow its  
in relation to its CCDF Program.   
policies and procedures relating to salary payments and  
HHS OIG Semiannual Report to Congress      |     October 1, 2016  March 31, 2017   31  HUMAN   cash management for any future grant awards; and   years of probation and ordered to pay restitution of  
SERVICES   retain information related to Federal funds used to   $101,804 after pleading guilty to felony failure to pay  
acquire, construct, or renovate its grantees properties   legal child support.  
AGENCIES  
in accordance with departmental requirements.   
REVIEWS AND  
Newark, which did not provide comments to the report,   Engaging the Public in Capturing  
ENFORCEMENT 
has filed for bankruptcy.    Deadbeat Parents  
ACTIVITIES
A-02-14-02024     February 2017  Because of the success of OIGs Most Wanted Fugitives  
website, OIG launched its Most Wanted Deadbeat  
Parents website.  The site identifies parents who fail to  
Child Support Enforcement   pay court-ordered child support for their children and  
Administration for  
thereby put an unnecessary strain on the custodial  
Children and Families  
Activities 
  parents and the children as well as on agencies that  
Child Support   enforce these matters.  The site, which is updated  
Enforcement Activities  OIG Investigations   frequently, includes information on OIGs role in  
pursuing parents who fail to pay court-ordered child  
OIG investigates noncustodial parents who violate 18  
Centers for Medicare   support.  OIGs Most Wanted Deadbeat Parents website  
U.S.C.  228 by failing to pay court-ordered child  
& Medicaid Services   can be found at https://oig.hhs.gov/fraud/child-
  support.  OIG works with ACFs Office of Child Support   support-enforcement/index.asp. 
Legal and   Enforcement; DOJ; U.S.  Attorneys Offices; the U.S.   
Investigative Activities   Marshals Service; and Federal, State, and local partners  
  to address egregious child support enforcement cases  
Public Health Agencies   with appropriate law enforcement and prosecutorial  
  action.  During this semiannual reporting period, OIG  
Human Services  
investigations of child support enforcement cases  
Agencies  
nationwide resulted in 13 criminal actions and court-
 
ordered restitution and settlements of $2 million. 
Other HHS-Related 
Reviews and  
Investigations  
The following is an example of a child support 
 
Appendixes  enforcement case: 
South Dakota  In January 2001, Cory T.  Carter was  
ordered to pay $375 per month for the support of his  
two children.  Carter rarely made payments to the  
custodial parent of his children and had not made a  
payment in many months.  Carter was sentenced to 5  
HHS OIG Semiannual Report to Congress      |      October 1, 2016  March 31, 2017   32    
ds Grants and Contracts  previously sentenced to a combined 17 years and 11  
en months in prison and ordered to pay $272,830 in  
to HHS is the largest grant-making organization and one of   restitution, joint and several.   
a the largest contracting agencies in the Federal  
i
lt Government.  In FY 2016, HHS awarded more than   Kentucky  Jerome Hahn was the owner, chief executive  
ea
$463.5 billion in grants and over $21.1 billion in   officer, and president of Telehealth Holdings, LLC.  Hahn,  
Rg
contracts across all program areas.  OIGs direct annual   on behalf of Telehealth, allegedly made false statements  
i
-t discretionary appropriation funding is used to conduct   and false certifications in applications submitted to NIH  
Ss program integrity and enforcement activities with   to obtain Small Business Innovation Research grants to  
He regard to the more than 100 public health and human   fund the development of various medical devices,  
Hv services programs carried out by more than 70,000   including a sleep apnea monitoring system and an  
n employees around the world.  The size and scope of   electronic pillbox.  The Government alleged that Hahn  
 
rI departmental awards make their operating effectiveness   created phony invoices that grossly overstated expenses  
 
ed crucial to the success of programs designed to improve   and manufactured products in China when all products  
hn the health and well-being of the public.   were supposed to be produced domestically.  As a result  
t of these false claims, NIH paid Federal grant funds to  
a
O Telehealth Holdings, LLC, for which the company was  
 
s Grant Fraud Investigations  not entitled.  Hahn and Telehealth agreed to pay $1.9  
w million, joint and several, to resolve their liability under  
the False Claims Act.   
e The following are case examples related to misuse 
i of grant funds: 
v
e Alabama  Jonathan Dunning was the CEO of   Small Business Innovative Research Program 
R Birmingham Health Center, a federally funded health  
The National Defense Authorization Act for Fiscal Year  
care center.  The investigation disclosed that Dunning  
2012,  5143, requires OIG to annually report on the  
engaged in a fraudulent scheme in which approximately  
number of cases that were referred with relation to  
$17 million in Federal grant funds was embezzled from  
fraud, waste, or abuse in the Small Business Innovative  
HRSA.  The funds were meant to provide quality health  
Research/Small Business Technology Transfer (SBIR/ 
care for the homeless and low-income individuals in the  
STTR) program.  OIG must also report on the actions  
Birmingham, Alabama, area.  Instead, funds were  
taken in each case; justification for not taking action on  
diverted by fraud to the defendants multiple  
a case; and an accounting of funds used to address  
corporations for personal use.  Dunning was found guilty  
waste, fraud, and abuse in this program.  In our  
on 98 counts of conspiracy, wire fraud, bank fraud, and  
December 2016 report delivered to the three  
money laundering and was sentenced to 18 years in  
congressional oversight committees, we reported that  
prison and ordered to pay $13.5 million in restitution.   
OIG spent approximately $151,182 in salaries on  
Three defendants involved in the scheme were  
HHS OIG Semiannual Report to Congress      |     October 1, 2016  March 31, 2017   33  OTHER   oversight related to the SBIR/STTR program.  HHS   OIG Reviews of Non-Federal Audits 
HHS-RELATED  referred two new SBIR/STTR cases to OIG in FY 2016.  
OIG reviews audits conducted by non-Federal auditors  
REVIEWS AND  
of entities receiving Federal awards.  During this  
INVESTIGATIONS 
Recovery Act Retaliation Complaint Investigations  semiannual period, OIGs National External Audit Review  
Center reviewed 740 reports covering $578 billion in  
The American Recovery and Reinvestment Act (Recovery   audited costs.  Federal dollars covered by these audits  
Other Reporting   Act),  1553, prohibits non-Federal employers that have   totaled $139.3 billion, of which about $84.8 billion were  
Requirements and  received Recovery Act funding from retaliating against   HHS funds. 
Reviews   
employees who disclose evidence of mismanagement of  
 
Recovery Act funds or any violation of law related to   Office of Management and  Budget (OMB) Circular A-133  
Implementation of 
Recovery Act funds.  OIGs are required to include in   and the more recent uniform guidance at 2 CFR  200,  
Health Insurance  
Marketplaces   their Semiannual Report to Congress the retaliation   Subpart F establishes audit requirements for State and  
  complaint investigations that they decided not to   local governments, colleges and universities, and  
Public Summary Reports  conduct or continue during the reporting period.    nonprofit organizations receiving Federal awards.  Under  
During this reporting period, OIG did not close any   this circular and uniform guidance, covered entities  
investigations.  must conduct annual organization-wide single audits  
Centers for Medicare  
of all Federal money they receive.  These audits are  
& Medicaid Services   
conducted by non-Federal auditors, such as public  
 
Contract Audits  accounting firms and State auditors.  OIG reviews the  
Legal and  
Investigative Activities   quality of these audits and assesses the adequacy of the  
  Pursuant to the National Defense Authorization Act for   entities management of Federal funds.   
Public Health Agencies   FY 2008,  845, OIGs appointed under the Inspector  
  General Act of 1978 are required to submit, as part of   OIGs oversight of non-Federal audit activity informs  
Human Services   their Semiannual Report to Congress pursuant to   Federal managers about the soundness of management  
Agencies   section 5 of such Act, information on final completed   of Federal programs and identifies any significant areas  
  contract audit reports issued during the period to the   of internal control weakness, noncompliance, and  
Other HHS-Related 
contracting activity containing significant audit findings.    questioned costs for resolution or follow-up.  We  
Reviews and  
Investigations   OIG issued no final reports meeting  845 criteria during   identify entities for high-risk monitoring, alert program  
  this semiannual period.   officials to any trends that could indicate problems in  
Appendixes  HHS programs, and profile non-Federal audit findings of  
a particular program or activity over time to identify  
HHS OIG Semiannual Report to Congress      |      October 1, 2016  March 31, 2017   34  OTHER   systemic problems.  We also provide training and   economy and efficiency or the prevention and detection  
HHS-RELATED  technical assistance to grantees and members of the   of fraud and abuse.  Most audits and other reviews that  
REVIEWS AND   auditing profession.  OIG maintains a process to assess   we conduct are designed to test compliance with and/or  
the quality of the non-Federal reports received and the   assess the administration and oversight of existing laws  
INVESTIGATIONS 
audit work that supports the selected reports.   and regulations.  Our reports of such reviews describe  
findings, which include questioned costs, inefficiencies,  
OIGs reports on  non-Federal audits reviewed during this  
vulnerabilities to fraud, inconsistencies, errors in  
Other Reporting   reporting period are categorized in the following table. 
application, or weaknesses in oversight or supporting  
Requirements and 
systems.  Our corresponding recommendations tell HHS  
Reviews   
  Non-Federal Audits, October 1, 2016,   and its operating or staff divisions what administrative,  
Implementation of  through March 31, 2017 regulatory, or legislative actions we believe are needed  
Health Insurance   to effectively respond to the findings.  Our regularly  
Marketplaces         Number of Non-Federal Audits   published core publications reflect the relationship  
  Not requiring changes or having minor changes   696  between our work and laws and regulations. 
Public Summary Reports 
  Requiring major changes   39 
  	 Our Semiannual Report to Congress describes 
 
  Having significant technical inadequacies   5  findings and recommendations from recently	
 
Centers for Medicare  
& Medicaid Services      Total   740  completed reviews, many of which focus on	
 
  existing laws and regulations.	
  
Legal and   The 740 reports included 1,414 recommendations for     	 Our Compendium of Priority Recommendations  
Investigative Activities   improving management operations.  In addition, these  
describes priority findings and recommendations  
  audit reports provided information for 23 OIG special  
from past periods that remain to be implemented.   
Public Health Agencies   memorandums that identified concerns for increased  
  monitoring by management.    	 Our Work Plan provides citations to laws and 	

Human Services   regulations that are the subject of ongoing or	
 
Agencies   future reviews.	

 
Other Reporting  
Other HHS-Related  We also review proposed legislation and regulations  
Reviews and   related to HHS programs and operations.  HHS routinely  
Requirements and Reviews 
Investigations   involves OIG and its operating and other staff divisions  
 
in the review and development of HHS regulations  
Appendixes  Legislative and Regulatory Reviews 
through a well-established HHS process.  Our audits,  
evaluations, and investigations are sometimes cited in  
Pursuant to the Inspector General Act,  4(a)(2), OIG is  
regulatory preambles as influencing HHS regulations.  In  
required to review existing and proposed legislation and  
addition, we provide independent, objective technical  
regulations relating to HHSs programs and operations  
assistance on a bipartisan, bicameral basis to  
and make recommendations concerning their impact on  
congressional committees and members who request it.  
HHS OIG Semiannual Report to Congress      |      October 1, 2016  March 31, 2017   35  OTHER   Implementation of Health   grant funds, Colorado did not expend $9.7 million of  
HHS-RELATED  Federal establishment grant funds in accordance with  
Insurance Marketplaces 
REVIEWS AND   Federal requirements, and Kentucky misallocated $49.1  
million in establishment costs. 
INVESTIGATIONS 
OIG continues to review programs implemented  
pursuant to the Patient Protection and Affordable Care   We found that New York did not have adequate internal  
Act (ACA).  OIGs ACA oversight strategy focuses on the   controls to ensure that it properly allocated costs,  
Other Reporting   health insurance marketplaces, reforms in the Medicare   Minnesota did not have adequate policies and  
Requirements and  and Medicaid programs, and public health programs.    procedures to follow Federal requirements, Colorado  
Reviews   
Key focus areas for our marketplace oversight include   lacked adequate stewardship of Federal funds, and  
 
payment accuracy, eligibility, management and   Kentucky used an incorrect cost-allocation methodology. 
Implementation of 
administration, and security.  In developing our work  
Health Insurance  
New York disagreed with our recommendations to  
Marketplaces   plan, we coordinate with GAO and other Federal and  
refund $148.7 million to the Federal Government for  
  State oversight agencies.  
the misallocated funds and improve its allocation  
Public Summary Reports 
procedures.  Minnesota generally disagreed with our  
State-Based Marketplaces  recommendations to refund $1.3 million and improve  
Centers for Medicare  
its procedures.  Colorado disagreed with our  
& Medicaid Services   
New York Misallocated Costs to Establishment Grants for a   recommendation to refund $9.7 million but agreed with  
 
Legal and   Health Insurance Marketplace; The Minnesota Marketplace   our recommendation to improve its policies and  
procedures.  Kentucky disagreed with our  
Investigative Activities   Misallocated Federal Funds and  Claimed Unallowable Costs;  
  recommendations to refund $49.1 million and agreed to  
Colorado Did Not Correctly Expend Establishment Grant Funds  
Public Health Agencies   improve its allocation procedures and develop a written  
for Establishing a Health Insurance Marketplace; and Kentucky  
  policy.  
Human Services   Misallocated Millions to Establishment Grants for a Health  
Agencies  
Insurance Marketplace  
  A-02-14-02017     November 2016 
Other HHS-Related  We conducted these audits to determine whether the  
Reviews and   State agencies allocated costs to their establishment  
Investigations   A-05-14-00045     November 2016 
grants for establishing a health insurance marketplace in  
 
accordance with Federal requirements.  We found that  
Appendixes 
New York, Colorado, Kentucky, and Minnesota did not   A-07-14-02801     December 2016 
always follow Federal requirements in implementing a  
health insurance marketplace.  New York misallocated  
A-04-14-07050    February 2017 
$148.7 million in establishment costs, Minnesota  
misallocated or misspent $1.3 million in establishment  
HHS OIG Semiannual Report to Congress      |      October 1, 2016  March 31, 2017   36  OTHER   Federal Marketplace  Information Security 
HHS-RELATED 
Data Inadequacies Undermine CMSs Oversight of the   The University of California at Riversides Pilot Payroll 
REVIEWS AND  
INVESTIGATIONS  Inconsistency Resolution Process for the Federal Marketplace   Certification System Did Not Provide Accountability Over 
Ensuring that only eligible applicants can enroll in   Payroll Charges to Federal Awards 
qualified health plans (QHPs) and insurance affordability  
We estimated that the University of California at  
programs depends on the integrity of the enrollment  
Other Reporting   Riverside (the University) put at risk $11.7 million in  
process.  A key part of that process involves resolving  
Requirements and  salaries and $5.9 million in associated facilities and  
Reviews    inconsistencies between self-attested information  
administrative costs claimed against NIH awards.  The  
  submitted by applicants and data received through  
Universitys prior effort-reporting system did not always  
Implementation of  Federal and other data sources.  We found that the  
provide the information needed to confirm that payroll  
Health Insurance  
Federal marketplace was unable to calculate the total  
costs had been appropriately allocated to Federal  
Marketplaces  
number of applicants with inconsistencies between  
awards, and its current payroll certification system pilot  
 
self-attested information submitted by applicants and  
Public Summary Reports  (pilot PCS) provided less accountability over payroll  
data received through Federal or other data sources  
charges to Federal awards than its prior effort-reporting  
during the first open enrollment period.  Our findings  
system.  Effort reporting is a person-based methodology  
Centers for Medicare   demonstrate that CMS could not readily answer basic  
that allocates each employees reasonable estimate of  
& Medicaid Services   
questions about inconsistencies, and these data  
time worked on all awards and other activities.   
 
limitations preclude CMS from accurately counting and  
Legal and  
tracking inconsistencies by applicants seeking to enroll   Furthermore, the Universitys IT controls for systems  
Investigative Activities  
in a qualified health plan.    used to support the pilot PCS did not always ensure the  
 
  security of data used to support labor charges.  General  
Public Health Agencies  
CMS concurred with our recommendation to improve   IT control weaknesses included unrestricted remote  
 
Human Services   its management of the inconsistency resolution process   access, inadequate password settings, poor patch  
Agencies   to ensure that it can readily identify all applicants with   management, and expired vendor support.   
  inconsistencies.  CMS should refine its data  
Other HHS-Related  The University generally disagreed with our procedural  
management system so that it can track individuals and  
Reviews and   recommendations that it increase its accountability over  
readily count the number of each type of inconsistency  
Investigations  
payroll charges to Federal awards and that it strengthen  
  and whether those inconsistencies are unresolved,  
its general IT controls for systems it used to support the  
Appendixes  resolved, or expired. 
pilot PCS. 
OEI-01-14-00620     March 2017 
A-04-13-01026     February 2017 
HHS OIG Semiannual Report to Congress      |      October 1, 2016  March 31, 2017   37  OTHER   Public Summary Reports  findings that we identified related to security  
HHS-RELATED  management, configuration management, system  
REVIEWS AND   State agencies are required to establish appropriate   software controls, and website and database  
computer system security requirements and conduct   vulnerability scans.  However, it described corrective  
INVESTIGATIONS 
biennial reviews of computer system security used in   actions that it had taken  or planned  to take to remediate  
the administration of State plans for Medicaid and other   all the vulnerabilities. 
 
Federal entitlement benefits (45 CFR  95.621).  OIG  
Other Reporting   A-06-15-00057     March 2017 
conducts reviews of States computer systems used to  
Requirements and 
administer HHS-funded programs.  
Reviews   
   
Public Summary Report: Information Technology Control 
Implementation of 
Public Summary Report: New York Implemented Security 
Health Insurance   Weaknesses Found at the Commonwealth of Massachusetts 
Controls Over Its Health Insurance Exchange Website and 
Marketplaces  
Medicaid Management Information System 
  Database but Could Improve Security Controls 
The Massachusetts Medicaid program (MassHealth) did  
Public Summary Reports 
The New York marketplace had implemented security  
not safeguard Medicaid Management Information  
controls, including policies and procedures, to protect  
System (MMIS) data and supporting systems in  
Centers for Medicare   personally identifiable information (PII) on its website  
accordance with Federal requirements.  Specifically,  
& Medicaid Services    and database.  However, it did not always comply with  
MassHealth had vulnerabilities related to security  
  Federal requirements.  As a result, the website had  
management, configuration management, system  
Legal and  
vulnerabilities that, if exploited, could have resulted in  
software controls, and website and database  
Investigative Activities  
the disclosure of participant PII.    
  vulnerability scans.  
Public Health Agencies     Although we did not identify evidence that the  
  Although we did not identify evidence that the   vulnerabilities that we identified in the New York  
Human Services   vulnerabilities had been exploited, exploitation could  
marketplaces website had been exploited, exploitation  
Agencies   result in unauthorized access to, and disclosure of,  
could have resulted in unauthorized access to and  
 
sensitive information, as well as disruption of operations  
Other HHS-Related  disclosure of PII, as well as disruption of critical  
critical to MassHealth.  As a result, the vulnerabilities  
Reviews and   marketplace operations.  As a result, the vulnerabilities  
Investigations   were collectively and, in some cases, individually   were collectively and, in some cases, individually  
  significant and could have compromised the  
significant and could have compromised the  
Appendixes  confidentiality, integrity, and availability of MassHealths  
confidentiality, integrity, and availability of the  
MMIS. These vulnerabilities existed because  
marketplace.  In addition, without proper safeguards,  
MassHealth did not implement sufficient controls over  
systems were not protected from those with malicious  
its Medicaid data and information systems.   
intent to obtain access to commit fraud, waste, or abuse  
 
or launch attacks against other computer systems and  
MassHealth did not indicate concurrence or non-
networks. 
concurrence with our recommendations to address the  
HHS OIG Semiannual Report to Congress      |      October 1, 2016  March 31, 2017   38  OTHER   The New York marketplace did not indicate concurrence   Colorado concurred with our detailed recommendations  
HHS-RELATED  or non-concurrence with our recommendation that it   to address the vulnerabilities that we identified related  
REVIEWS AND   improve the protection of PII on its website.  to its risk assessment policies and procedures, database  
  administration and security, website security, and USB  
INVESTIGATIONS 
A-02-15-03001     November 2016  port and device security for its Medicaid eligibility  
determination and claim processing information  
  systems.  
Other Reporting    
Requirements and  Public Summary Report: The State of Colorado Did Not Meet 
A-07-15-00463     October 2016 
Reviews    Federal Information System Security Requirements for 
 
Safeguarding Its Medicaid Systems and Data 
Implementation of 
Health Insurance   Colorado had not implemented adequate information  
Marketplaces   system general controls over the Colorado Medicaid    
  eligibility determination and claims processing systems  
Public Summary Reports 
to fully comply with Federal requirements.  The  
vulnerabilities that we identified increased the risk to  
Centers for Medicare   the confidentiality, integrity, and availability of  
& Medicaid Services    Colorados Medicaid data.  In evaluating Colorados risk  
  assessment, database security, website security, and  
Legal and  
universal serial bus (USB) device security for its  
Investigative Activities  
Medicaid eligibility determination and claim processing  
 
information systems, we identified vulnerabilities  
Public Health Agencies  
related to inadequate risk assessment policies and  
 
procedures, improper administration of the Medicaid  
Human Services  
Agencies   claims database, inadequate security of Medicaid  
  databases, inadequate website security, and improper  
Other HHS-Related  management of USB ports and devices.  
Reviews and  
 
Investigations  
 
Appendixes 
HHS OIG Semiannual Report to Congress      |      October 1, 2016  March 31, 2017   39   
s
 Appendix A 
e
c Questioned Costs and Funds Put to Better Use 
i
d
The following tables summarize OIGs monetary recommendations and HHS responses to them.  This information is  
n
provided in accordance with the Inspector General Act,  5(a)(8) and (a)(9) (5 U.S.C. App.  5(a)(8) and (a)(9)), and the  
e
Supplemental Appropriations and Rescissions Act of 1980.   
p
p Audit Reports With Questioned Costs 
A Questioned costs are those questioned by OIG audits because of an alleged violation of a provision of a law, regulation,  
contract, grant, or other agreement governing the expenditure of funds.  Costs are questioned because the expenditure  
was not supported by adequate documentation or because the expenditure was unnecessary or unreasonable.  OIG  
includes those questioned costs that HHS program officials, in management decisions, have agreed should not be  
Appendix A  
charged to the Federal Government, commonly referred to as disallowed costs, as part of the expected recoveries in the  
Questioned Costs and 
Executive Summary section at the beginning of the Semiannual Report.  Superscripts indicate end notes that follow the  
Funds Put to Better Use  
tables below. 
 
Appendix B  
Peer-Review Results   Table 1  Audit Reports with Questioned Costs 
 
Reports  Dollar Value Questioned  Dollar Value Unsupported 
Appendix C  
Summary of Sanction  Section 1 
Authorities    Reports for which no management decisions had been   175  $438,171,000  $18,200,000 
  made by the beginning of the reporting period1 
Appendix D   Reports issued during the reporting period  54  $471,830,000  $50,000 
Reporting  
Total Section 1  229  $910,001,000  $18,250,000 
Requirements in the  
Inspector General Act  
of 1978   Section 2 
  Reports for which management decisions were made during the reporting period2, 3 
Appendix E   Disallowed costs  134  *$357,870,000  $0 
Reporting   Costs not disallowed  3  $4,146,000   $55,000 
Requirements in the  
Total Section 2  137  $362,016,000  $55,000 
Inspector General  
*Audit receivables (expected recoveries). 
Empowerment Act  
of 2016 
HHS OIG Semiannual Report to Congress      |     October 1, 2016  March 31, 2017   40  APPENDIXES
Reports  Dollar Value Questioned  Dollar Value Unsupported 
Section 3 
Reports for which no management decisions had    92  $547,985,000  $18,195,000 
been made by the end of the reporting period   
(Sec. 1 minus Sec. 2) 
Section 4 
Appendix A  
Reports for which no management decisions were    47  $174,772,000  $18,145,000 
Appendix B   made within 6 months of issuance4 
Appendix C  
Appendix D  
Audit Reports With Funds Recommended To Be Put to Better Use 
Appendix E 
The phrase recommendations that funds be put to better use means that funds could be used more efficiently if  
management took action to implement an OIG recommendation through reductions in outlays, deobligation of funds,  
Centers for Medicare  
and/or avoidance of unnecessary expenditures.  Table 2 reports HHS program officials decisions to take action on these  
& Medicaid Services   
audit recommendations. 
 
Legal and  
Investigative Activities   Table 2  Audit Reports with Funds To Be Put to Better Use 
 
Public Health Agencies   Reports  Dollar Values 
 
Section 1 
Human Services  
Agencies   Reports for which no management decisions had been    6  $15,051,289,000 
  made by the beginning of the reporting period1 
Other HHS-Related 
Reports issued during the reporting period  4  $366,487,000 
Reviews and  
Investigations   Total Section 1  10  $15,417,776,000 
 
Appendixes 
Section 2 
Reports for which management decisions were made during the reporting period 
Value of recommendations agreed to by management 
Based on proposed management action  1  $12,776,000 
Based on proposed legislative action  $0 
HHS OIG Semiannual Report to Congress      |     October 1, 2016  March 31, 2017   41  APPENDIXES
Reports  Dollar Values 
Value of recommendations not agreed to by management  0  $0 
Total Section 2  1  $12,776,000 
Section 3 
Reports for which no management decisions had been made   9 
Appendix A   $15,405,000,000 
by the end of the reporting period2 (Sec. 1 minus Sec. 2) 
Appendix B  
Appendix C  
End Notes 
Appendix D  
Table 1 End Notes 
Appendix E 
1 T  he opening balance was adjusted upward by $75.4 million because of a reevaluation of previously issued  
recommendations. 
Centers for Medicare  
& Medicaid Services   
2   Revisions to previously reported management decisions: 
 
Legal and  
  	 A-01-11-02500 Review of Massachusetts Title IV-E Adoption Assistance Costs for Federal Fiscal Years 2006 thru  
Investigative Activities  
2008. Subsequent review by ACF determined that additional costs totaling $1,695,066 was unallowable and issued  
 
a disallowance letter to recover cost. 
Public Health Agencies  
    	 A-06-15-00014 Medicare Contractor Payments to Providers for Hospital Outpatient Dental Services in Jurisdiction H  
Human Services   Generally Did Not Comply With Medicare Requirements Subsequent review of claims by CMS determined that the  
Agencies   final amount of over payment for the questioned period was $10,582,929, resulting in additional overpayment  
 
totaling $8,815,823. 
Other HHS-Related 
Reviews and     	 A--10-14-22271 State of Washington   
Investigations   In consideration of additional supporting documentation provided by the State of Washington, ACF reduced the  
 
disallowance in this finding by $17,950,349. 
Appendixes 
  	 A-06-12-00053 Texas Did Not Always Comply With Federal and State Requirements for Claims Submitted for the  
Nonemergency Medical Transportation Program. Based on revised appraisal of the statistical sample, it was  
determined that some claims were allowable.  Disallowed cost for $30,385,925 was reduced by $5,877,059. 
  	 Not detailed are net reductions to previously disallowed management decisions totaling $3,609,297. 
HHS OIG Semiannual Report to Congress      |     October 1, 2016  March 31, 2017 	  42  APPENDIXES 3   Included are management decisions to disallow $85 million in questioned costs that were identified by non-Federal  
auditors in audits of State and local governments, colleges and universities, and nonprofit organizations receiving  
Federal awards conducted in accordance with OMB Circular A-133.  OIG is currently ensuring that work performed by  
these non-Federal auditors complies with Federal audit standards; accordingly, OIG tracks, resolves, and reports on  
recommendations in these audits. 
4 B  ecause of administrative delays, some of which were beyond management control, resolution of the following 47  
audits were not completed within 6 months of issuance of the reports; however, agency management has informed us  
Appendix A   that the agency is working to resolve the outstanding recommendations before the end of the next semiannual  
reporting period:  
Appendix B  
CIN: A-01-02-00006   REVIEW OF RATE SETTING METHODOLOGY MEDICAID SCHOOL-BASED CHILD HEALTH    
Appendix C  
      PROGRAM COSTS CLAIMED BY THE CONNECTICUT DEPARTMENT OF SOCIAL SERVICES JULY   
Appendix D         1997 THROUGH JUNE 2001, MAY 2003, $32,780,146 
Appendix E 
CIN: A-01-14-02503   MARYLAND MISALLOCATED MILLIONS TO ESTABLISHMENT GRANTS FOR A HEALTH INSURANCE   
      MARKETPLACE, MAR 2015, $28,400,000 
Centers for Medicare  
& Medicaid Services    CIN: A-07-13-01125   MEDICARE IMPROPERLY PAID MEDICARE ADVANTAGE ORGANIZATIONS MILLIONS OF DOLLARS   
        FOR UNLAWFULLY PRESENT BENEFICIARIES FOR 2010 THROUGH 2012, APR 2014, $26,150,043 
Legal and  
CIN: A-02-12-02016   PUERTO RICO IMPROPERLY CLAIMED SOME CHILD CARE AND DEVELOPMENT TARGETED   
Investigative Activities  
        FUNDS, JAN 2016, $12,471,385 
Public Health Agencies  
CIN: A-01-15-02500   VERMONT DID NOT PROPERLY ALLOCATE MILLIONS TO ESTABLISHMENT GRANTS FOR A   
 
      HEALTH INSURANCE MARKETPLACE, SEP 2016, $11,243,006 
Human Services  
Agencies  
CIN: A-07-15-01159   MEDICARE IMPROPERLY PAID MILLIONS OF DOLLARS FOR UNLAWFULLY PRESENT   
 
Other HHS-Related        BENEFICIARIES FOR 2013 AND 2014, SEP 2016, $9,267,392 
Reviews and  
Investigations   CIN: A-01-13-00518   MEDICARE COMPLIANCE REVIEW OF HOME HEALTH VNA FOR 2011 AND 2012, AUG 2016,   
        $6,348,971 
Appendixes 
CIN: A-03-12-00004   REVIEW OF HORIZONS 2009 AND 2010 BONA FIDE SERVICE FEES, MAR 2013, $4,344,417 
CIN: A-02-12-02012   NEW YORK IMPROPERLY CLAIMED SOME CHILD CARE AND DEVELOPMENT TARGETED FUNDS,   
      JUL 2015, $3,827,836 
 
HHS OIG Semiannual Report to Congress      |      October 1, 2016  March 31, 2017   43  APPENDIXES CIN: A-05-13-00014   OHIO EXCEEDED THE 5-PERCENT LIMIT FOR CLAIMING CHILD CARE DEVELOPMENT FUND   
      ADMINISTRATIVE EXPENDITURES, NOV 2013, $3,164,630 
CIN: A-03-13-00024   REVIEW OF NEW ORLEANS REGIONAL PHYSICIAN HOSPITAL ORGANIZATION, INC.S 2009, 2010,   
      AND 2011 BONA FIDE SERVICE FEES, APR 2014, $2,880,698 
CIN: A-03-13-00025   REVIEW OF UAB HEALTH SYSTEMS 2009, 2010, AND 2011 BONA FIDE SERVICE FEES, JAN 2014,   
      $2,812,109 
Appendix A  
CIN: A-03-13-00026   REVIEW OF USABLE MUTUALS   (ARKANSAS BLUE CROSS BLUE SHIELD) 2009, 2010, AND 2011   
Appendix B         BONA FIDA SERVICE FEES, JAN 2014, $2,763,821 
Appendix C   CIN: A-03-11-00002   REVIEW OF NEW ENGLAND JOINT ENTERPRISE 2009 DIR REPORTS, APR 2012, $2,710,732 
Appendix D   CIN: A-03-12-00006   REVIEW OF TAHMOS 2009 AND 2010 BONA FIDE SERVICE FEES, MAR 2013, $2,355,532 
Appendix E 
CIN: A-03-13-00020   REVIEW OF CAPITAL DISTRICT PHYSICIANS HEALTH PLAN, INC.S 2009, 2010, AND 2011 BONA   
      FIDE SERVICE FEES, JAN 2014, $2,070,605 
Centers for Medicare  
CIN: A-03-12-00007   REVIEW OF ARCADIANS 2009 AND 2010 BONA FIDE SERVICE FEES, FEB 2013, $2,048,967 
& Medicaid Services   
 
CIN: A-03-12-00005   REVIEW OF WINDSORS 2009 AND 2010 BONA FIDE SERVICE FEES, JAN 2013, $1,948,737 
Legal and  
Investigative Activities  
CIN: A-03-13-00018   REVIEW OF AMERIGROUP CORPORATIONS 2009, 2010, AND 2011 BONA FIDE SERVICE FEES,   
 
      JAN 2014, $1,943,251 
Public Health Agencies  
  CIN: A-03-13-00019   REVIEW OF BLUECROSS BLUESHIELD OF SOUTH CAROLINAS 2009, 2010, AND 2011 BONA FIDE   
Human Services  
      SERVICE FEES, DEC 2013, $1,799,096 
Agencies  
 
CIN: A-09-14-02041   MEDICARE IMPROPERLY PAID HOSPITALS FOR BENEFICIARIES WHO HAD NOT RECEIVED 96 OR   
Other HHS-Related 
      MORE CONSECUTIVE HOURS OF MECHANICAL VENTILATION, JUN 2016, $1,488,165 
Reviews and  
Investigations  
CIN: A-07-11-06013   THE UNIVERSITY OF COLORADO DENVER DID NOT ALWAYS CLAIM SELECTED COSTS CHARGED   
 
      DIRECTLY TO DEPARTMENT OF HEALTH AND HUMAN SERVICES AWARDS IN ACCORDANCE WITH   
Appendixes 
      FEDERAL REGULATIONS, JUN 2013, $1,419,524 
CIN: A-03-12-00008   REVIEW OF XL HEALTH DIR, JAN 2013, $1,410,342 
CIN: A-03-13-00021   REVIEW OF FALLON COMMUNITY HEALTH PLANS 2009, 2010, AND 2011 BONA FIDE SERVICE   
      FEES, JAN 2014, $1,079,578 
HHS OIG Semiannual Report to Congress      |     October 1, 2016  March 31, 2017   44  APPENDIXES CIN: A-05-12-00089   THE COUNCIL ON RURAL SERVICE PROGRAMS, INC., CLAIMED UNALLOWABLE HEAD START   
      COSTS, NOV 2013, $1,074,352 
CIN: A-03-13-00022   REVIEW OF MD CARE, INC.S 2009, 2010, AND 2011 BONA FIDE SERVICE FEES, JAN 2014,   
      $1,040,501 
CIN: A-03-13-00023   REVIEW OF NATIONAL RURAL ELECTRIC COOPERATIVE ASSOCIATIONS 2009, 2010, AND 2011   
      BONA FIDE SERVICE FEES, JAN 2014, $957,921 
Appendix A  
CIN: A-09-14-01007   NEVADA MISALLOCATED COSTS FOR ESTABLISHING A HEALTH INSURANCE MARKETPLACE TO ITS   
Appendix B         ESTABLISHMENT GRANTS, FEB 2016, $893,464 
Appendix C   CIN: A-04-15-04040   MEDICAL ACCESS UGANDA LIMITED GENERALLY MANAGED THE PRESIDENTS EMERGENCY   
      PLAN FOR AIDS RELIEF FUNDS IN ACCORDANCE WITH AWARD REQUIREMENTS, JUN 2016,   
Appendix D  
      $751,399 
Appendix E 
CIN: A-09-11-01007   HAWAII CLAIMED UNALLOWABLE COMMUNITY SERVICES BLOCK GRANT COSTS FOR HONOLULU   
      COMMUNITY ACTION PROGRAM, INC.S EXPENDITURES UNDER THE RECOVERY ACT, FEB 2013,   
Centers for Medicare         $513,649 
& Medicaid Services   
  CIN: A-04-13-01024   THE UNIVERSITY OF NORTH CAROLINA AT CHAPEL HILL DID NOT ALWAYS CLAIM SELECTED   
Legal and         COSTS CHARGED DIRECTLY TO DEPARTMENT OF HEALTH AND HUMAN SERVICES AWARDS IN   
Investigative Activities         ACCORDANCE WITH FEDERAL REQUIREMENTS, JUN 2014, $352,843 
 
Public Health Agencies   CIN: A-01-10-02505   RESULTS OF LIMITED SCOPE REVIEW OF CTE, INC., MAY 2011, $293,870 
 
CIN: A-02-11-02015   PUERTO RICO CLAIMED UNALLOWABLE COMMUNITY SERVICES BLOCK GRANT RECOVERY ACT   
Human Services  
Agencies         COSTS FOR INSTITUTO SOCIO-ECONOMICO, INC., APR 2013, $285,412 
 
Other HHS-Related  CIN: A-02-11-02017   NEW JERSEY CLAIMED UNALLOWABLE COMMUNITY SERVICES BLOCK GRANT COSTS INCURRED   
Reviews and         BY CHECK-MATE INC., UNDER THE RECOVERY ACT, AUG 2014, $246,359 
Investigations  
  CIN: A-09-09-00045   RISK ADJUSTMENT DATA VALIDATION OF PAYMENTS MADE TO PACIFICARE OF CALIFORNIA FOR   
Appendixes        CALENDAR YEAR 2007 (CONTRACT H0543), NOV 2012, $224,388 
CIN: A-05-12-00012   ROCKFORD HUMAN SERVICES DID NOT ALWAYS CHARGE ALLOWABLE COSTS TO THE   
      COMMUNITY SERVICES BLOCK GRANT - RECOVERY ACT PROGRAM, JUL 2013, $205,296  
 
CIN: A-06-09-00012   RISK ADJUSTMENT DATA VALIDATION OF PAYMENTS MADE TO PACIFICARE OF TEXAS FOR   
      CALENDAR YEAR 2007 (CONTRACT NUMBER H4590), MAY 2012, $183,247 
HHS OIG Semiannual Report to Congress      |      October 1, 2016  March 31, 2017   45  APPENDIXES CIN: A-04-11-01004   NORTHEAST FLORIDA COMMUNITY ACTION AGENCY, INC., DID NOT ALWAYS CHARGE   
      ALLOWABLE COSTS TO THE COMMUNITY SERVICES BLOCK GRANT - RECOVERY ACT PROGRAM,   
      SEP 2012, $165,795 
CIN: A-04-11-01008   CENTRAL FLORIDA COMMUNITY ACTION AGENCY, INC., DID NOT ALWAYS CHARGE ALLOWABLE   
      COSTS TO THE COMMUNITY SERVICES BLOCK GRANT - RECOVERY ACT PROGRAM, APR 2013,   
      $160,404 
CIN: A-05-14-00017	 
 OHIO DID NOT ALWAYS MAKE CORRECT MEDICAID CLAIM ADJUSTMENTS, SEP 2016, $151,313 
Appendix A  
Appendix B   CIN: A-07-11-02766	 
 NOT ALL COMMUNITY SERVICES BLOCK GRANT COSTS CLAIMED ON BEHALF OF THE CARBON   
      COUNTY COMMUNITY ACTION COMMITTEE FOR THE PERIOD OCTOBER 1, 2008, THROUGH   
Appendix C  
      SEPTEMBER 30, 2010, WERE ALLOWABLE, AUG 2013, $143,588 
Appendix D  
CIN: A-09-11-01013	 
 OREGON CLAIMED SOME POTENTIALLY UNALLOWABLE COMMUNITY SERVICES BLOCK GRANT   
Appendix E        COSTS FOR MULTNOMAH COUNTYS EXPENDITURES UNDER THE RECOVERY ACT, APR 2013,   
      $115,911 
Centers for Medicare  
CIN: A-06-11-00058	 
 CROWLEYS RIDGE DEVELOPMENT COUNCIL, INC., CLAIMED UNALLOWABLE COSTS UNDER A   
& Medicaid Services   
      RECOVERY ACT GRANT, AUG 2012, $115,420 
 
Legal and   CIN: A-07-12-02779	 
 NOT ALL COMMUNITY SERVICES BLOCK GRANT RECOVERY ACT COSTS CLAIMED ON BEHALF OF   
Investigative Activities  
      THE COMMUNITY ACTION PARTNERSHIP OF NATRONA COUNTY FOR THE PERIOD JULY 1, 2009,   
 
      THROUGH SEPTEMBER 30, 2010, WERE ALLOWABLE, JUN 2013, $104,971 
Public Health Agencies  
  CIN: A-02-11-02000	 
 REVIEW OF SELECT EXPENDITURES CLAIMED BY THE RESEARCH FOUNDATION OF THE STATE   
Human Services         UNIVERSITY OF NEW YORK, STATE UNIVERSITY OF NEW YORK AT ALBANY, OCT 2011, $27,384 
Agencies  
  CIN: A-09-11-01014	 
 HAWAII CLAIMED UNALLOWABLE COMMUNITY SERVICES BLOCK GRANT COSTS FOR HAWAII   
Other HHS-Related 
      COUNTY ECONOMIC OPPORTUNITY COUNCILS EXPENDITURES UNDER THE RECOVERY ACT, JUL   
Reviews and  
      2012, $22,602 
Investigations  
 
CIN: A-05-11-00053   THE COLUMBUS URBAN LEAGUE CLAIMED SOME UNALLOWABLE COSTS TO HEAD START,   
Appendixes 
      SEP 2012, $13,102 
  TOTAL CINS:    47
       TOTAL AMOUNT:   $174,772,000 
HHS OIG Semiannual Report to Congress      |     October 1, 2016  March 31, 2017   46  Table 2 End Notes 
APPENDIXES
1 The opening balance had no prior period adjustments of previously issued recommendations.  
2  B  ecause of administrative delays, some of which were beyond management control, 6 of the 9 audits open at end of the  
period were not resolved within 6 months of issuance of reports.  OIG is working with management to reach resolution  
on these recommendations before the end of the next semiannual reporting period: 
CIN: A-05-12-00020   MEDICARE AND BENEFICIARIES COULD SAVE BILLIONS IF CMS REDUCES HOSPITAL OUTPATIENT   
Appendix A         DEPARTMENT PAYMENT RATES FOR AMBULATORY SURGICAL CENTER-APPROVED PROCEDURES   
      TO AMBULATORY SURGICAL CENTER PAYMENT RATES, APR 2014, $15,000,000,000 
Appendix B  
CIN: A-09-14-02041   MEDICARE IMPROPERLY PAID HOSPITALS FOR BENEFICIARIES WHO HAD NOT RECEIVED 96 OR   
Appendix C  
      MORE CONSECUTIVE HOURS OF MECHANICAL VENTILATION, JUN 2016, $19,562,498 
Appendix D  
CIN: A-07-13-02795   PALMETTO GOVERNMENT BENEFITS ADMINISTRATOR DID NOT ALWAYS REFER MEDICARE COST   
Appendix E        REPORTS AND RECONCILE OUTLIER PAYMENTS IN JURISDICTION 1, JUL 2015, $15,792,301 
CIN: A-09-14-02037   MEDICARE DID NOT PAY SELECTED INPATIENT CLAIMS FOR BONE MARROW AND STEM CELL   
Centers for Medicare  
      TRANSPLANT PROCEDURES IN ACCORDANCE WITH MEDICARE REQUIREMENTS, FEB 2016,   
& Medicaid Services   
      $2,054,306 
 
Legal and  
CIN: A-04-14-04028   NORTH CAROLINA DEPARTMENT OF HEALTH AND HUMAN SERVICES DID NOT ALWAYS CLAIM   
Investigative Activities  
      COSTS UNDER CDC PREVENTION AND PUBLIC HEALTH FUND AWARDS IN ACCORDANCE WITH   
 
      FEDERAL REQUIREMENTS, JAN 2016, $493,401 
Public Health Agencies  
 
CIN: A-03-14-00406   WEST VIRGINIA MADE INCORRECT MEDICAID ELECTRONIC HEALTH RECORD INCENTIVE   
Human Services  
      PAYMENTS TO HOSPITALS, AUG 2016, $208,117 
Agencies  
 
Other HHS-Related 
Reviews and  
  TOTAL CINs:   6
Investigations  
 
      TOTAL AMOUNT:   $15,038,111,000 
Appendixes 
HHS OIG Semiannual Report to Congress      |      October 1, 2016  March 31, 2017   47  APPENDIXES Appendix B 
Peer-Review Results 
The Inspector General Act of 1978, as amended, requires OIGs to report the results of peer reviews of their operations  
conducted by other OIGs, the date of the last peer review, outstanding recommendations from peer reviews, and peer  
reviews conducted by the OIG of other OIGs in the semiannual period.  Peer reviews are conducted by member  
Appendix A  
organizations of the Council of the Inspectors General on Integrity and Efficiency (CIGIE).  Recently CIGIE approved a new  
Appendix B   peer-review process for Inspection and Evaluation units within OIGs across the Federal Government, including at HHS OIG,  
the implementation of which will begin in 2018. 
Appendix C  
Appendix D  
Office of Audit Services 
Appendix E  During this semiannual reporting period, no peer reviews involving the Office of Audit Services (OAS) were completed.   
Listed below is information concerning OASs peer-review activities during prior reporting periods. 
Centers for Medicare  
& Medicaid Services    Date  Reviewing Office  Office Reviewed 
  OAS 
May 2015  Department of Transportation  HHS OIG, OAS 
Legal and  
Investigative Activities  
The system of quality control for the audit organization of HHS OIG in effect for the year ending September 30, 2014, has  
 
been suitably designed and complied with to provide HHS OIG with reasonable assurance of performing and reporting in  
Public Health Agencies  
conformity with applicable professional standards in all material respects.  Federal audit organizations can receive a rating  
 
Human Services   of pass, pass with deficiencies, or fail.  HHS OIG received a peer-review rating of pass. 
Agencies  
 
Other HHS-Related  Date  Reviewing Office  Office Reviewed 
Reviews and   OAS 
December 2015  HHS OIG, OAS  U.S. Department of Agriculture 
Investigations  
(USDA) 
 
Appendixes 
The system of quality control for the audit organization of USDA OIG in effect for the year ending March 31, 2015, has  
been suitably designed and complied with to provide USDA OIG with reasonable assurance of performing and reporting  
in conformity with applicable professional standards in all material respects.  Federal audit organizations can receive a  
rating of pass, pass with deficiencies, or fail.  USDA OIG received a peer-review rating of pass. 
HHS OIG Semiannual Report to Congress      |     October 1, 2016  March 31, 2017   48  APPENDIXES Office of Investigations 
During this semiannual reporting period, no peer reviews involving Office of Investigations (OI) were completed.  Listed  
below is information concerning OIs peer-review activities during prior reporting periods. 
Date  Reviewing Office  Office Reviewed 
OI 
August 2015  DOL-OIG  HHS OIG, OI 
Appendix A   The system of internal safeguards and management procedures for the investigative function of HHS OIG in effect for the  
year ending September 30, 2015, were in full compliance with the quality standards established by CIGIE and the  
Appendix B  
Attorney Generals guidelines. 
Appendix C  
Appendix D   Date  Reviewing Office  Office Reviewed 
OI 
Appendix E  June 2014  HHS OIG, OI  TIGTA 
Centers for Medicare   The system of internal safeguards and management procedures for the investigative function of TIGTA, in effect through	
 
& Medicaid Services    June 2014, were in full compliance with the quality standards established by CIGIE and the Attorney Generals guidelines.	

 
Legal and  
Investigative Activities  
 
Public Health Agencies  
 
Human Services  
Agencies  
 
Other HHS-Related 
Reviews and  
Investigations  
 
Appendixes 
HHS OIG Semiannual Report to Congress      |     October 1, 2016  March 31, 2017   49  APPENDIXES Appendix C 
Summary of Sanction Authorities 
The Inspector General Act of 1978, as amended, specifies requirements for semiannual reports to be made to the  
Secretary for transmittal to Congress.  A list of authorities provided under other statutes appears below. 
Appendix A  
Program Exclusions 
Appendix B  
The Social Security Act,  1128 (42 U.S.C.  1320a-7), provides several grounds for excluding individuals and entities from  
Appendix C   participation in Medicare, Medicaid, and other Federal health care programs.  Exclusions are required for individuals and  
entities convicted of the following types of criminal offenses:  (1) Medicare or Medicaid fraud; (2) patient abuse or  
Appendix D  
neglect; (3) felonies for other health care fraud; and (4) felonies for illegal manufacture, distribution, prescription, or  
Appendix E  dispensing of controlled substances.   
OIG is authorized to exclude individuals and entities on several other grounds, including misdemeanors for other health  
Centers for Medicare  
care fraud (other than Medicare or Medicaid) or for illegal manufacture, distribution, prescription, or dispensing of  
& Medicaid Services   
controlled substances; suspension or revocation of a license to provide health care for reasons bearing on professional  
 
competence, professional performance, or financial integrity; provision of unnecessary or substandard services;  
Legal and  
Investigative Activities   submission  of false or fraudulent claims to a Federal health  care program; or engaging in unlawful kickback arrangements. 
 
The ACA added another basis for imposing a permissive exclusion, that is, knowingly making, or causing to be made, any  
Public Health Agencies  
false statements or omissions in any application, bid, or contract to participate as a provider in a Federal health care  
 
Human Services   program, including managed care programs under Medicare and Medicaid, as well as Medicares prescription drug  
Agencies   program. 
 
Other HHS-Related  Providers subject to exclusion are granted due process rights.  These include a hearing before an administrative law judge  
Reviews and   and appeals to the HHS Departmental Appeals Board and Federal district and appellate courts regarding the basis for and  
Investigations  
the length of the exclusion. 
 
Appendixes 
Civil Monetary Penalties Law 
The CMPL of the Social Security Act, 1128A (42 U.S.C.  1320a 7a), imposes penalties, assessments, and exclusion from  
participation in Federal health care programs for engaging in certain activities.  For example, a person who submits, or  
causes to be submitted, to a Federal health care program a claim for items and services that the person knows, or should  
know, is false or fraudulent is subject to a penalty of up to $15,270 for each item or service falsely or fraudulently  
HHS OIG Semiannual Report to Congress      |     October 1, 2016  March 31, 2017   50  APPENDIXES claimed, an assessment of up to three times the amount falsely or fraudulently claimed, and exclusion. 
For the purposes of the CMPL, should know is defined to mean that the person acted in reckless disregard or  
deliberate ignorance of the truth or falsity of the claim.  The law and its implementing regulations also authorize actions  
for a variety of other violations, including submission of claims for items or services furnished by an excluded person;  
requests for payment in violation of an assignment agreement; violations of rules regarding the possession, use, and  
transfer of biological agents and toxins; and payment or receipt of remuneration in violation of the anti-kickback statute  
(42 U.S.C.  1320a 7b(b)).   
Appendix A  
The ACA added more grounds for imposing CMPs.  These include, among other types of conduct, knowingly making, or  
Appendix B  
causing to be made, any false statements or omissions in any application, bid, or contract to participate as a provider in a  
Federal health care program (including Medicare and Medicaid managed care programs and Medicare Part D); the ACA  
Appendix C  
authorizes a penalty of up to $55,262 for each false statement, as well as activities relating to fraudulent marketing by  
Appendix D  
MCOs, their employees, or their agents.   
Appendix E 
The 21st Century Cures Act (enacted on December 13, 2016) added more grounds for imposing CMPs, assessments, and  
exclusion from Federal health care programs for fraudulent conduct in an HHS grant, contract, or other agreement.  OIG  
Centers for Medicare   may assess CMPs of up to $10,000 per claim and assessments of up to 3 times the amount claimed for knowingly  
& Medicaid Services    presenting a false or fraudulent claim.  In addition, OIG may impose a penalty of up to $50,000 and assessments of up to  
 
3 times the amount of funds at issue (1) for each instance of knowingly making a false statement in a document required  
Legal and  
to be submitted in order to receive funds under an HHS contract, grant, or other agreement; (2) for knowingly making or  
Investigative Activities  
using a false record or statement that is material to a false or fraudulent claim; and (3) for knowingly making or using a  
 
false record or statement material to an obligation to pay or transmit funds or property owed to HHS.  OIG may impose a  
Public Health Agencies  
penalty of up to $10,000 per day and assessments of up to 3 times the amount at issue for knowingly concealing, or  
 
knowingly and improperly avoiding or decreasing, an obligation owed to HHS with respect to an HHS grant, contract, or  
Human Services  
Agencies   other agreement.  Finally, HS OIG may impose a penalty of up to $15,000 per day for failing to grant timely access to OIG  
  upon reasonable request for audits or to carry out other statutory functions in matters involving an HHS grant, contract,  
Other HHS-Related 
or other agreement.  
Reviews and  
Investigations  
  Patient Dumping 
Appendixes 
The Social Security Act, 1867 (42 U.S.C.  1395dd), provides that when an individual goes to the emergency room of a  
Medicare-participating hospital, the hospital must provide an appropriate medical screening examination to determine  
whether that individual has an emergency medical condition.  If an individual has such a condition, the hospital must  
provide either treatment to stabilize the condition or an appropriate transfer to another medical facility.  
If a transfer is ordered, the transferring hospital must provide stabilizing treatment to minimize the risks of transfer and  
HHS OIG Semiannual Report to Congress      |      October 1, 2016  March 31, 2017   51  APPENDIXES must ensure that the receiving hospital agrees to the transfer and has available space and qualified personnel to treat the  
individual.  In addition, the transferring hospital must effect the transfer through qualified personnel and transportation  
equipment.  Further, a participating hospital with specialized capabilities or facilities may not refuse to accept an  
appropriate transfer of an individual who needs services if the hospital has the capacity to treat the individual.   
OIG is authorized to collect CMPs of up to $52,414 against small hospitals (fewer than 100 beds) and up to $104,826  
against larger hospitals (100 beds or more) for each instance in which the hospital negligently violated any of the  
section 1867 requirements.  In addition, OIG may collect a penalty of up to $104,826 from a responsible physician for  
Appendix A   each negligent violation of any of the section 1867 requirements and, in some circumstances, may exclude a  
responsible physician. 
Appendix B  
Appendix C  
Anti-Kickback Statute and Civil False Claims Act Enforcement Authorities 
Appendix D  
The Anti-Kickback Statute  The anti-kickback statute authorizes penalties against anyone who knowingly and willfully  
solicits, receives, offers, or pays remuneration, in cash or in kind, to induce or in return for (1) referring an individual to a  
Appendix E 
person or an entity for the furnishing, or arranging for the furnishing, of any item or service payable under the Federal  
health care programs or (2) purchasing, leasing, or ordering, or arranging for or recommending the purchasing, leasing,  
Centers for Medicare  
or ordering, of any good, facility, service, or item payable under the Federal health care programs.  Social Security Act,   
& Medicaid Services   
1128B(b) (42 U.S.C.  1320a-7b(b)). 
 
Legal and  
Individuals and entities that engage in unlawful referral or kickback schemes may be subject to criminal penalties under  
Investigative Activities  
the general criminal anti-kickback statute; a CMP under OIGs authority pursuant to the Social Security Act,  1127(a)(7)  
 
(42 U.S.C.  1320a-7a); and/or program exclusion under OIGs permissive exclusion authority under the Social Security  
Public Health Agencies  
Act,  1128(b)(7) (42 U.S.C.  1320a-7(b)(7)). 
 
Human Services  
The False Claims Act  Under the False Claims Act (FCA), as amended by the False Claims Amendments Act of 1986 (FCA)  
Agencies  
  (31 U.S.C.  37293733), a person or an entity is liable for up to treble damages and a penalty between $10,957 and  
Other HHS-Related  $21,916 for each false claim it knowingly submits, or causes to be submitted, to a Federal program.  Similarly, a person or  
Reviews and   an entity is liable under the FCA if it knowingly makes or uses, or causes to be made or used, a false record or statement  
Investigations  
to have a false claim paid.  The FCA defines knowing to include not only the traditional definition but also instances in  
 
which the person acted in deliberate ignorance or reckless disregard of the truth or falsity of the information.  Under the  
Appendixes 
FCA, no specific intent to defraud is required.  Further, the FCA contains a qui tam, or whistle blower, provision that allows  
a private individual to file a lawsuit on behalf of the United States and entitles that whistle blower to a percentage of any  
fraud recoveries.  The FCA was again amended in 2009 in response to recent Federal court decisions that narrowed the  
laws applicability.  Among other things, these amendments clarify the reach of the FCA to false claims submitted to  
contractors or grantees of the Federal Government. 
HHS OIG Semiannual Report to Congress      |     October 1, 2016  March 31, 2017   52  APPENDIXES Appendix D 
Reporting Requirements in the Inspector General Act of 1978  
The reporting requirements of the Inspector General Act of 1978, as amended, are listed in the following table along with  
the location of the required information. 
Appendix A  
Section  Requirement  Location 
Appendix B  
Section 4 
Appendix C  
(a)(2)  Review of legislation and regulations  Other HHS-Related Reviews and Investigations  
section   
Appendix D  
Appendix E 
Section 5 
(a)(1)  Significant problems, abuses, and deficiencies  Throughout this report 
Centers for Medicare  
(a)(2)  Recommendations with respect to significant problems, abuses, and   Throughout this report 
& Medicaid Services   
deficiencies 
 
(a)(3)  Prior significant recommendations on which corrective action has not   OIG Compendium of Unimplemented  
Legal and  
been completed  Recommendations 
Investigative Activities  
  (a)(4)  Matters referred to prosecutive authorities  Legal and Investigative Activities section 
Public Health Agencies   (a)(5)  Summary of instances in which information requested by OIG was   None for this reporting period 
  refused 
Human Services   (a)(6)  List of audit reports  Submitted to the Secretary under separate cover 
Agencies  
(a)(7)  Summary of significant reports  Throughout this report 
 
Other HHS-Related  (a)(8)  Statistical Table 1  Reports With Questioned Costs  Appendix A 
Reviews and  
(a)(9)  Statistical Table 2  Funds Recommended To Be Put to Better Use  Appendix A 
Investigations  
(a)(10)  Summary of previous audit reports without management decisions, in   Appendix A 
 
which no establishment comment was returned within 60 days, and in  
Appendixes 
which there are any outstanding unimplemented recommendations 
(a)(11)  Description and explanation of revised management decisions  Appendix A 
(a)(12)  Management decisions with which the Inspector General disagrees  None for this reporting period 
(a)(13)  Information required by the FISMA  Reported annually in the spring Semiannual Report  
to Congress, Other HHS-Related Reviews and  
Investigations section 
HHS OIG Semiannual Report to Congress      |     October 1, 2016  March 31, 2017   53  APPENDIXES
Section  Requirement  Location 
(a)  Results of peer reviews of HHS OIG conducted by other OIGs or the   Appendix B 
(14)-(16)  date of the last peer review, outstanding recommendations from peer  
reviews, and peer reviews conducted by HHS OIG of other OIGs 
(a)(17)  Investigative statistical tables  Appendix E 
(a)(18)  Metrics description for statistical tables  Appendix E 
(a)(19)  Investigations on Senior Government Employees  Appendix E 
Appendix A  
(a)(20)  Description of whistle blower retaliation instances  Appendix E 
Appendix B  
(a)(21)  Description of attempts to interfere with OIG independence  Appendix E 
Appendix C   (a)(22)  Description of closed and non-disclosed reports and investigations   Appendix E 
regarding Senior Government Employees 
Appendix D  
Other reporting requirements 
Appendix E  845  Significant contract audits required to be reported pursuant to the   "Other HHS-Related Reviews and Investigations  
National Defense Authorization Act for FY 2008 (P.L.  No. 110-181),    section 
845. 
Centers for Medicare  
205  Pursuant to HIPAA (P.L.  No. 104-191),  205, the Inspector General is   Reported annually in the fall Semiannual Report,   
& Medicaid Services   
required to solicit proposals annually via a Federal Register notice for   Appendix F  
 
developing new and modifying existing safe harbors to the anti-
Legal and  
kickback statute of the Social Security Act,  1128(b) and for  
Investigative Activities   developing special fraud alerts.  The Inspector General is also required  
  to report annually to Congress on the status of the proposals received  
Public Health Agencies   related to new or modified safe harbors. 
  1553  Pursuant to the American Recovery and Reinvestment Act of 2009,    "Other HHS-Related Issues" section 
Human Services   1553, OIG reports to Congress the retaliation complaint investigations  
Agencies   it decided not to conduct or continue during the period. 
 
Other HHS-Related 
Reviews and  
Investigations  
 
Appendixes 
HHS OIG Semiannual Report to Congress      |     October 1, 2016  March 31, 2017   54  APPENDIXES Appendix E 
Reporting Requirements in the Inspector General Empowerment Act of 2016 
The Inspector General Empowerment Act of 2016 (IGEA) establishes new reporting requirements for the Semiannual  
Reports to Congress.  These requirements amend portions of  5 of the IG Act.  The requirements are below in italics,  
followed by OIGs responses.  
Appendix A  
Each Inspector General shall, not later than April 30 and October 31 of each year, prepare semiannual reports  
Appendix B  
summarizing the activities of the Office during the immediately preceding six-month periods ending March 31 and  
Appendix C   September 30.  Such reports shall include, but need not be limited to-
Appendix D  
  (10) a summary of each audit report, inspection reports, and evaluation reports issued before the   
Appendix E    commencement of the reporting period- 
    (a) for which no management decision has been made by the end of the reporting period (including the   
    date and title of each such report), an explanation of the reasons such management decision has not   
Centers for Medicare  
    been made, and a statement concerning the desired timetable for achieving a management decision on   
& Medicaid Services   
    each such report; 
 
Legal and  
For audit, inspection, and evaluation reports issued before the commencement of the reporting period, OIG had 204  
Investigative Activities  
reports for which no management decision has been made.* 
 
Public Health Agencies  
*This includes information compiled from OIGs Office of Audit Services (OAS) and Office of Evaluation and Inspections  
 
(OEI) databases.  The OAS database began tracking management decisions in FY 1990.  The OEI database began tracking  
Human Services  
management decisions in FY 2011.  These 204 reports reflect situations in which the agency failed to provide a  
Agencies  
  management decision for at least one of the recommendations we made in a given report.  Due to the volume of reports  
Other HHS-Related  with recommendations for which no management decision has been made, OIG is working to reconfigure its databases  
Reviews and   to provide information in this section in a table format, similar to 10c, in future Semiannual Reports. 
Investigations  
      (b) for which no establishment comment was returned within 60 days of providing the report to the   
Appendixes 
    establishment; and 
Currently, OIG tracks this measure on a 30-day time frame.  In connection with draft reports that include  
recommendations, OIG typically requests establishment comments within 30 days.  In some instances, OIG grants  
extensions when requested and appropriate.  When OIG does not receive establishment comments or a request for  
extension within the 30-day time frame, OIG issues the report and typically notes the lack of establishment comments.  
HHS OIG Semiannual Report to Congress      |      October 1, 2016  March 31, 2017   55  APPENDIXES For the period October 1, 2016, through March 31, 2017, we received establishment comments during our 30-day time  
frame for all OIG reports.  We are exploring ways to modify our reporting inputs to capture this new 60-day requirement.   
    (c) for which there are any outstanding unimplemented recommendations, including the aggregate   
    potential cost savings of those recommendations. 
OIG is actively tracking 1,223 unimplemented or open recommendations made in reports issued since FY 2011.  Given  
the volume of recommendations OIG makes on an annual basis, the table below reflects only the data that are  
Appendix A   immediately accessible within OIGs automated tracking system: 
Appendix B   Number of Reports  
Number of Unimplemented  Dollar Value of Aggregate 
Fiscal Year (2011-2017)  with Unimplemented 
Appendix C   Recommendations  Potential Cost Savings 
Recommendations 
Appendix D  
2011  28  66  $475,140,370 
Appendix E  2012  46  78  $416,404,187 
2013  59  139  $1,004,149,575 
Centers for Medicare   2014  67  140  $15,288,185,803 
& Medicaid Services   
2015  64  155  $640,366,375 
 
Legal and   2016  134  383  $516,922,675 
Investigative Activities   2017 (partial year)  73  262  $831,782,190 
 
Totals  471  1,223  $19,172,951,175 
Public Health Agencies  
   
Human Services   OIG annually produces a Compendium of Unimplemented Recommendations (Compendium), which constitutes OIGs  
Agencies  
response to a specific requirement of the IG Act, as amended ( 5(a)(3)).  It identifies significant recommendations with  
 
respect to problems, abuses, or deficiencies for which corrective actions have not been completed.  The Compendiums  
Other HHS-Related 
Reviews and   Appendix includes a list of OIGs significant unimplemented recommendations.  These recommendations represent  
Investigations   opportunities to achieve expected impact through cost savings, improvements in program effectiveness and efficiency,  
  and increasing quality of care and safety of beneficiaries.  In OIGs view, these recommendations would most positively  
Appendixes 
impact HHS programs in terms of cost savings and/or quality improvements and should therefore be prioritized for  
implementation. 
  (17) statistical tables showing-
    (A) the total number of investigative reports issued during the reporting period; 
HHS OIG Semiannual Report to Congress      |     October 1, 2016  March 31, 2017   56  APPENDIXES     (B) the total number of persons referred to the Department of Justice for criminal prosecution during   
    the reporting period; 
    (C) the total number of persons referred to State and local prosecuting authorities for criminal   
    prosecution during the reporting period; and 
    (D) the total number of indictments and criminal informations during the reporting period that resulted   
    from any prior referral to prosecuting authorities; 
Appendix A  
Total number of investigative reports issued during the reporting period  1 
Appendix B  
Total number of persons referred to DOJ/State and local prosecuting authorities for criminal prosecution during the   1,086 
Appendix C   reporting period2 
Total number of indictments and criminal informations during the reporting period that resulted from any prior   327 
Appendix D  
referral to prosecuting authorities 
Appendix E 
  (18) a description of the metrics used for developing the data for the statistical tables under paragraph (17); 
Centers for Medicare  
& Medicaid Services    Regarding (17)(A), OIG considers Investigative Reports as Management Implication Reports (MIR) and Investigative  
  Advisories.  A MIR is a document that identifies systemic weaknesses or vulnerabilities within HHS programs, which are  
Legal and   generally identified during the course of an OIG investigation and could lead to fraud, waste, or abuse.  It provides  
Investigative Activities  
recommendations to correct or minimize the problem.  Corrective actions may require administrative, procedural, policy,  
 
regulatory, or legislative change.  When a MIR is issued to an HHS Operating or Staff division, it is generally signed by the  
Public Health Agencies  
Inspector General.  Investigative Advisories are similar documents, emphasizing an identified HHS issue, which are  
 
generally signed by the Deputy Inspector General for Investigations.  
Human Services  
 
Agencies  
  Regarding (17)(B) and (C), OIG is reporting on referrals to both Federal and State/local prosecuting jurisdictions.  When  
Other HHS-Related  OIG opens an investigation, it evaluates the complaint and makes a decision whether to refer the matter for prosecution.   
Reviews and  
Generally, if the case has prosecutorial merit, and is accepted for Federal prosecution, OIG works with DOJ as the primary  
Investigations  
investigative agency.  In addition to DOJ, OIG works with State and local prosecutorial authorities. 
 
Appendixes 
Presently, OIGs case management system does not have the capability to distinguish between a Federal and State  
referral.  Consequently, the information provided in the table represents combined totals of Federal and State/local  
referrals.  OIG is currently addressing these database programming challenges. 
Regarding (17)(D), the table provides the number of indictments/criminal informations during the semiannual reporting  
2OIG counts persons as both individuals and entities.   
HHS OIG Semiannual Report to Congress      |     October 1, 2016  March 31, 2017   57  APPENDIXES period, including sealed indictments/criminal informations.3   However, the information cannot be limited to only those  
that occurred as a result of a referral in a previous period.  In certain situations, the referral and charging dates are in the  
same reporting period.  OIGs case management system is currently unable to separate Federal from State/local  
indictments/criminal informations.   
  (19) a report on each investigation conducted by the Office involving a senior Government employee where   
  allegations of misconduct were substantiated, including a detailed description of-
Appendix A       (A) the facts and circumstances of the investigation; and 
Appendix B       (B) the status and disposition of the matter, including-
Appendix C         (i) if the matter was referred to the Department of Justice, the date of the referral; and 
Appendix D  
      (ii) if the Department of Justice declined the referral, the date of the declination; 
Appendix E 
To respond fully to this subparagraph, OIG would need to make a finding of misconduct.  However, OIG does not make  
findings with regard to its investigations relating to substantiated allegations of Departmental employee misconduct.  Our  
Centers for Medicare   reports relay the facts obtained during the investigations (e.g., parties involved, dates of events) related to any  
& Medicaid Services   
substantiated allegations.  At the conclusion of an OIG investigation related to substantiated allegations concerning  
 
possible employee misconduct, OIG provides a report to management in the employing agency.  The agency  
Legal and  
management makes determinations of employee misconduct.  The disposition of the matter and any resulting  
Investigative Activities  
administrative actions are taken by the agency.   
 
Public Health Agencies  
However, we request from the agency a copy of an SF-50 documenting a personnel action, if one is taken.  To the extent  
 
that we have information regarding subsequent administrative action, OIG is able to provide that information. However,  
Human Services  
after taking an administrative action as a result of an OIG investigation, the Department may enter into a settlement  
Agencies  
  agreement with the employee in order to resolve any potential litigation risk as a result of the administrative action.  Such  
Other HHS-Related  agreements sometimes change the nature of the administrative action (e.g., a termination might be replaced by a  
Reviews and   voluntary resignation). If this were to happen, OIG may not have a complete record of the disposition of the investigation.   
Investigations  
Accordingly, such information might be more efficiently and effectively provided directly from the employing agency.   
 
Appendixes 
For this section, OIG describes investigations during this reporting period, both criminal and administrative, involving  
senior Government employees where allegations of misconduct were substantiated.  The descriptions below include a  
level of detail appropriate for each investigation, depending on whether the case details were available in public  
documents.  During this reporting period, OIG investigated five senior Government employees for misconduct, and OIG  
determined the allegations to be substantiated, but no prosecution resulted.  Descriptions of the investigations follow:  
 
3An information is a formal criminal charge that begins a criminal proceeding in the courts. 
HHS OIG Semiannual Report to Congress      |     October 1, 2016  March 31, 2017   58  APPENDIXES
DOJ  
DOJ   DOJ  
Description of Investigation  Status  Disposition  Referral  
Referral  Declination 
Date 
A senior Government employee was  
Admonishment/ 
alleged to have improperly shared  
Closed  Reminder of Policy   No  N/A  No 
information regarding an HHS Quality  
(Oral/Written) 
Data Online Program.    
Appendix A   A senior Government employee was  
alleged to have been involved in a policy   Admonishment/ 
Appendix B   violation involving the use of an HHS   Closed  Reminder of Policy   No  N/A  No 
purchase card while purchasing official/  (Oral/Written) 
Appendix C   approved property for Government use. 
HHS employees, including a senior HHS  
Appendix D  
official, inappropriately participated in a   Agency Policy Change  
Closed  No  N/A  No 
Appendix E  private consortium, giving the   Issued 
appearance of a conflict of interest. 
HHS senior Government employees   Admonishment/ 
Centers for Medicare  
were accused of Standard of Conduct/  Closed  Reminder of Policy   No  N/A  No 
& Medicaid Services   
Behavior Unbecoming.  (Oral/Written) 
 
A senior HHS Government employee  
Legal and   Employee Suspended  
was accused of sharing information in   Closed  No  N/A  No 
Investigative Activities   and Transferred 
advance of public release. 
 
Public Health Agencies      
    (20) a detailed description of any instance of whistle blower retaliation, including information about the official   
Human Services  
  found to have engaged in retaliation and what, if any, consequences the establishment imposed to hold that   
Agencies  
  official accountable; 
 
Other HHS-Related 
For departmental agencies, OIG conducts investigations and gathers facts related to whistleblower complaints.  In the  
Reviews and  
Investigations   past, OIG has not made determinations as to whether retaliatory action had been taken.  However, to better facilitate the  
  report review process, OIG changed its process in 2015 to include findings in its reports as to whether it was more likely  
Appendixes  than not that whistle blowerretaliation had occurred.  While OIG now includes these findings in its reports, it does not  
make recommendations as to what, if any, corrective action(s) should be taken.   
Under this system, OIG submitted two reports that included findings of retaliation to the HHS Secretarys Office prior to  
October 1, 2016 (both prior to the semiannual reporting period).  The Department issued findings and recommendations  
with respect to both of the OIG reports at issue.    
HHS OIG Semiannual Report to Congress      |     October 1, 2016  March 31, 2017   59  APPENDIXES When determining the level of detail to provide for a description of any instance of whistleblower retaliation, OIG is always  
mindful of balancing the risk that a detailed description of the allegation could inadvertently reveal the whistleblowers  
identity, thus having a chilling effect on future whistleblowers. The following information is provided with this in mind.  
The first report:  The whistleblower in this matter filed numerous incident reports with IHS management at an IHS  
medical facility raising concerns about quality of care, confidentiality of patient and staff information, property incidents,  
and mismanagement.  The whistleblower also raised allegations that he/she suffered reprisal and that management was  
creating a hostile work environment. 
Appendix A  
OIG found that it was more likely than not that the whistleblower was subjected to reprisal for whistle blowing activities  
Appendix B  
in this matter for the following reasons. First, the whistleblower made numerous protected communications.  Second,  
Appendix C   management was aware of those communications (because many of the communications were sent to management).   
Third, multiple adverse personnel actions were taken against the whistleblower during the relevant time period.  Fourth,  
Appendix D  
a causal connection existed between the protected communications and the adverse personnel actions because the  
personnel actions referenced the fact that the whistleblower went outside of the chain of command to raise his/her  
Appendix E 
concerns and instructed the whistleblower not to do so in the future.  
Centers for Medicare   By memo dated January 12, 2017, the Deputy Secretary agreed with the proposed findings and recommendations and  
& Medicaid Services    found that the whistleblower had been subjected to reprisal for his/her protected communications and agreed with the  
 
following proposed corrective action: 1) supervisors were to be sent to training on employee supervision, performance  
Legal and  
management, and dispute resolution; 2) the whistleblower along with supervisors were to be sent to training on  
Investigative Activities  
communication and email etiquette; 3) the whistleblower was to be returned to a duty status in a position equivalent to  
 
the one the whistleblower was removed from; 4) the letters of reprimand were to be removed from the whistleblowers  
Public Health Agencies  
personnel file; and 5) supervisors were to be sent to training concerning quality of care improvements.  
 
Human Services  
The second report:  The whistleblower in this matter alleged that a senior government official attempted to intimidate  
Agencies  
  the whistleblower into accepting responsibility for the failure of a project for which the whistleblower was not  
Other HHS-Related  responsible. The whistleblower made this disclosure to the Departments Labor and Employee Relations (LER) Division, to  
Reviews and   the Departments Equal Employment Opportunity Compliance and Operations (EEOCO) Division, and to OIG.  The  
Investigations  
whistleblower alleged that he/she suffered reprisal for the disclosures when his/her security clearance was suspended  
 
and later revoked.  
Appendixes 
OIG found that it was more likely than not that the whistleblower was subjected to reprisal for whistleblowing activities in  
this matter for the following reasons. First, the whistleblower made several protected communications. Second, the  
whistleblowers management was aware of those communications. Third, the whistleblowers security clearance was  
suspended and then revoked. Fourth, we found that the whistleblowers protected disclosures were a contributing factor  
in the decision to suspend and revoke his/her eligibility for access to classified information for several reasons, including:  
HHS OIG Semiannual Report to Congress      |     October 1, 2016  March 31, 2017   60  APPENDIXES the close proximity in time between the protected disclosures and the decision to suspend and revoke the  
whistleblowers clearance; the lack of evidence to support the stated basis for the revocation of the clearance; and the  
fact that the manager responsible for revoking the whistleblowers clearance had expressed animus towards the  
whistleblower as a result of his/her disclosures.  Fifth, OIG concluded that there was no clear and convincing evidence  
that the same action would have been taken against the whistleblower in the absence of the protected disclosures  
because similarly situated employees who engaged in conduct similar to that of the whistleblower did not have their  
clearances revoked.  
 
Appendix A   By way of an undated memo from the Acting Deputy Secretary to the whistleblower, the Department issued its findings  
and recommendations with respect to this matter. The Department concurred in the OIGs finding that the  
Appendix B  
whistleblower was subjected to retaliation in this matter and ordered the following corrective action: 1) senior  
Appendix C   government official was ordered to take training on whistleblowers rights, employee supervision, performance  
management and conduct, dispute resolution and communication; 2) all employees in the relevant Office were ordered  
Appendix D  
to take training on whistleblowers rights; 3) the Department said it would review the record to determine whether other  
Appendix E  remedies were necessary related to restoration of the whistleblowers security clearance; and 4) the Department noted  
that it was conducting a further review of the management of the Office at issue and would determine if disciplinary or  
Centers for Medicare   other corrective action was necessary at the conclusion of that review.   
& Medicaid Services   
Subsequently, the Department entered into a settlement agreement with the senior government official accused of  
 
Legal and   whistleblower reprisal in this matter. The senior government official no longer works for the Department. OIG has not  
Investigative Activities   received a copy of the settlement agreement entered into by the Department and the senior government official;  
  therefore, OIG does not know what corrective action the Department ultimately took in this matter. 
Public Health Agencies  
   (21) a detailed description of any attempt by the establishment to interfere with the independence of the Office,   
 
Human Services     including-
Agencies  
      (A) with budget constraints designed to limit the capabilities of the Office; and 
Other HHS-Related 
Reviews and       (B) incidents where the establishment has resisted or objected to oversight activities of the Office or   
Investigations       restricted or significantly delayed access to information, including the justification of the establishment   
      for such action; and 
Appendixes 
Although there have been instances in which HHS agencies have questioned OIG oversight activities or have not provided  
all information in the precise content, format, and timeline as requested, OIG has not identified any instances in which  
the Department interfered with the independence of OIG during this reporting period.  OIG would immediately notify  
Congress if it were unable to resolve these issues within the Department.   
HHS OIG Semiannual Report to Congress      |      October 1, 2016  March 31, 2017   61  APPENDIXES   (22) detailed descriptions of the particular circumstances of each-
    (A) inspection, evaluation, and audit conducted by the Office that is closed and was not disclosed to the   
    public; and 
The table below lists evaluation and audit reports for this semiannual reporting period that did not result in public  
reports.  However, in some circumstances, a public summary of these nonpublic reports was published.  
 
Appendix A   Nonpublic Reports by Category, October 1, 2016, to March 31, 2017 
Appendix B  
Category/Description  Number of Reports 
Appendix C  
Information technology security reviews (involve information technology systems, e.g., Federal Information   5 
Security Management Act audits) 
Appendix D  
Homeland security issues (involve particularly sensitive topics, e.g., bioterrorism, emergency preparedness,   0 
Appendix E  and classified or potentially classified information) 
Recipient Capability Audits (primarily in Head Start/Early Head Start programs)  0 
Centers for Medicare   Reimbursable audits performed for other Federal agencies (primarily contract audits)  5 
& Medicaid Services   
Confidential or proprietary information (e.g., Medicare Part B drug claims/imaging services, Medicare   2 
 
investment income) 
Legal and  
Medicare Adverse Event Reviews (required by law not to disclose)  0 
Investigative Activities  
  Medicare Prescription Drug Event Reviews  0 
Public Health Agencies   Other  1 
 
Departmental technical assistance reports4   1 
Human Services  
Agencies   Finance-related attestation reviews  2 
  Total  16 
Other HHS-Related 
Reviews and    
Investigations  
  (B) investigation conducted by the Office involving a senior Government employee that is closed and was not  
 
  disclosed to the public. 
Appendixes 
In section 5(a)(19), we detail senior Government employee investigations where allegations were substantiated.  Those  
investigations are all closed and none have been disclosed to the public.  OIG interprets Section 5(a)(22)(B) as requiring  
reporting on investigations with either substantiated or unsubstantiated allegations.  As such, we refer to our section 5(a) 
 
4OIG routinely provides technical assistance to the Department.  Generally, that technical assistance is not part of a formal report and is not formally tracked.  However,  
in some limited circumstances, OIG does provide technical assistance in a formal report, and only this category of technical assistance is reflected in this table.  
HHS OIG Semiannual Report to Congress      |     October 1, 2016  March 31, 2017   62  APPENDIXES (19) response to address senior Government employee investigations with substantiated allegations that were closed and  
not disclosed to the public.  Our section 5(a)(22)(B) response describes investigations during this reporting period, both  
criminal and administrative, involving a senior Government employee where allegations of misconduct were  
unsubstantiated by OIG. 
When determining the level of detail to provide for the investigations described above, OIG is mindful of balancing the  
risk that a detailed description of the investigation could inadvertently reveal the subjects identity.  During this reporting  
period, OIG investigated five senior Government employees for misconduct, but OIG determined the allegations to be  
Appendix A   unsubstantiated.  Descriptions of the investigations are below.  
Appendix B  
DOJ  
DOJ   DOJ  
Appendix C   Description of Investigation  Status  Disposition  Referral  
Referral  Declination 
Date 
Appendix D  
A senior Government employee was  
Appendix E  alleged to have submitted false claims   Closed  No evidence to   No  N/A  No 
support allegations. 
and misused his/her position. 
Centers for Medicare   A senior Government employee was  
No evidence to  
& Medicaid Services    alleged to have accessed an HHS   Closed  support allegations.  No  N/A  No 
network for an unauthorized purpose. 
 
Legal and   A senior Government employee was  
No evidence to  
Investigative Activities   alleged to have accessed an HHS   Closed  No  N/A  No 
support allegations. 
  network for an unauthorized purpose. 
Public Health Agencies   A senior Government employee was  
No evidence to  
  alleged to have accessed an HHS   Closed   No  N/A  No 
support allegations. 
Human Services   network for an unauthorized purpose.  
Agencies   A senior Government employee was  
 No evidence to  
  alleged to have accessed inappropriate   Closed  No  N/A  No 
support allegations. 
Other HHS-Related  material. 
Reviews and  
Investigations  
 
Appendixes 
HHS OIG Semiannual Report to Congress      |     October 1, 2016  March 31, 2017   63  U.S. Department of Health & Human Services 
Office of Inspector General 
https://oig.hhs.gov