Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
A MESSAGE FROM  
THE INSPECTOR GENERAL  
I am pleased to present the enclosed Semiannual Report to 
Congress summarizing significant work of the Office of 
Inspector General (OIG), Department of Health and Human 
Services (HHS or the Department), for the reporting period 
October 1, 2018, to March 31, 2019.  This is my final 
Semiannual Report submission as Inspector General of HHS. 
For the past decade and a half, I have had the great privilege 
to serve alongside the most dedicated professionals in 
Federal service, who every day fight fraud, waste, and abuse 
in HHSs $1.2 trillion portfolio of programs; promote the 
health and safety of beneficiaries; and leverage data and 
technology to provide modern oversight in a rapidly 
changing program environment.  The public servants at OIG 
have been instrumental in delivering positive results and 
pioneering innovative methods of oversight that will continue 
serving the public interest for years to come.   
Since fiscal year 2004, OIG has reported over $53 billion in 
expected investigative recoveries.  OIG has undertaken 
substantial enforcement actions, including 50,877 exclusions of individuals and entities from participation 
in Federal healthcare programs; 11,149 criminal actions against individuals or entities that engaged in 
crimes against HHS programs; and 7,280 civil actions, which included false claims and unjust-enrichment 
lawsuits filed in Federal district court, civil monetary penalties settlements, and administrative recoveries 
related to provider self-disclosure matters.   
OIG has continued to innovate to meet pressing oversight challenges.  For example, beginning in 2007, 
OIG worked with its Government partners to create the Medicare Fraud Strike Force and later the Health 
Care Fraud Prevention and Enforcement Action Team, which have proven extraordinarily effective at 
analyzing data and investigative intelligence to identify fraud and prosecute cases quickly.  Further, OIG 
auditors and evaluators have crafted groundbreaking methodologies for collecting and analyzing data to 
identify patients at risk of harm, including from opioid misuse, abuse and neglect in group home settings, 
and preventable harm in hospitals.  Today, OIG has a new Affirmative Litigation Branch devoted solely to 
enforcing OIGs civil monetary penalties and exclusions authorities, and a new Cyber Information 
Technology Audit Division focused on growing cyber threats to Department programs.  
OIG is at the forefront of the Nations efforts to fight fraud in HHS programs and hold wrongdoers 
accountable.  During this semiannual reporting period, OIG conducted a series of investigations nation-
wide to support two important law enforcement takedowns in April 2019.  In Operation Brace Yourself, OIG 
and law enforcement partners dismantled one of the largest healthcare fraud schemes ever investigated, 
  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
involving allegations of almost $1 billion paid for medically unnecessary orthopedic braces furnished 
through a telemarketing scam to seniors.  OIG agents and investigators also partnered with the 
Department of Justice, Federal Bureau of Investigation, the Drug Enforcement Administration, Medicaid 
Fraud Control Units, the Centers for Disease Control and Prevention, State public health officials, and U.S. 
Attorneys Offices in five States to execute the largest-ever law enforcement operation involving 
prescription opioids.   
During this reporting period, OIG continued to provide independent, objective oversight to identify key 
program vulnerabilities and recommend actions the Department can take to protect HHS beneficiaries 
from harm and ensure they receive high quality care.  For example, OIG determined that more than 4 in 10 
Medicare patients in long-term-care hospitals (LTCHs) experienced some type of harm from their care and 
more than half of these harm events were preventable with better care.  OIG recommended that the 
Centers for Medicare & Medicaid Services and Agency for Healthcare Research and Quality collaborate to 
help LTCHs reduce the incidence of patient harm.  The agencies agreed to create and disseminate a list of 
potential adverse events in LTCHs to improve patient safety.  OIG has continued its comprehensive work 
examining the Office of Refugee Resettlement (ORR) program for unaccompanied children and has 
continued to encourage Department efforts to improve communication, transparency, and accountability 
for the identification, care, and placement of children separated from their parents.  A notable OIG review 
during this reporting period found that the total number of unaccompanied children in ORR care who had 
been separated from a parent or guardian by immigration authorities is unknown.   
OIG continues building its capabilities to harness emerging technologies in its oversight of Department 
programs.  For example, OIGs multidisciplinary cybersecurity team helps the Department prevent and 
combat cyber threats by fostering enhancements in information technology controls, risk management, 
and resiliency.  OIG work in this semiannual report identified opportunities for the National Institutes of 
Health to strengthen controls over sensitive data and also recommended that the Food and Drug 
Administration better address cybersecurity risks to medical devices.  Moving forward, OIG will continue to 
modernize technology infrastructure, develop new data analytic tools, and explore emerging areas such as 
artificial intelligence and machine learning.   
Since our establishment in 1976, OIG has worked collaboratively with our partners to oversee and protect 
the integrity of the Departments programs and the beneficiaries they serve.  OIG appreciates the 
continued recognition, commitment, and support of Congress and the Department for our vital work.  I am 
optimistic about the future of HHS-OIG and have full confidence in the organization to advance OIGs 
important mission and make a positive difference in the lives of our fellow Americans. 
   
  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
TABLE OF CONTENTS 
 
OIGs Approach to Driving Positive Change  1 
Highlights of OIG Accomplishments  4 
Selected Acronyms and Abbreviations   12 
Centers for Medicare & Medicaid Services  13 
Legal and Investigative Activities Related to Medicare and Medicaid   27 
Public Health Agencies  43 
Other HHS-Related Reviews and Investigations  51 
Appendix A: Questioned Costs and Funds To Be Put To Better Use  54 
Appendix B: Peer-Review Results  59 
Appendix C: Summary of Sanction Authorities  61 
Appendix D: Reporting Requirements in the Inspector General Act of 1978  64 
Appendix E: Reporting Requirements in the Inspector General Empowerment Act of 2016  66 
Appendix F: Anti-Kickback StatuteSafe Harbors  73 
 
  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
OIGs Approach to Driving Positive Change 
 
THE U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES (HHS or Department), Office of Inspector General 
(OIG), provides 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 established by the Government Accountability 
Office (GAO), the U.S. Department of Justice (DOJ), and the Inspector General community.  Through a nation-wide 
network of audits, investigations, and evaluations, OIG carries out its mission to protect the integrity of HHS 
programs and the health and welfare of the people served by those programs.  OIGs work is conducted by three 
operating componentsthe Office of Audit Services, the Office of Evaluation and Inspections, and the Office of 
Investigationswith assistance from the Office of Counsel to the Inspector General and Executive Management. 
 
OIG Organization 
 
The Office of Audit Services (OAS).  OAS conducts audits of HHS programs and operations through its own 
resources or by overseeing audit work done by others.  Audits examine the performance of HHS programs and its 
grantees and contractors in carrying out their respective responsibilities and provide independent assessments of 
HHS programs and operations.  These assessments help reduce waste, abuse, and mismanagement and promote 
the economy, efficiency, and effectiveness of programs and operations throughout HHS.  
 
The Office of Evaluation and Inspections (OEI).  OEI conducts national evaluations to provide HHS, Congress, 
and the public with timely, useful, and reliable information on significant issues.  These evaluations focus on 
preventing fraud, waste, and abuse and promoting economy, efficiency, and effectiveness in HHS programs.  OEI 
reports also present practical recommendations for improving program operations.   
 
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).   
 
The Office of Counsel to the Inspector General (OCIG).  OCIG provides 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 (FCA), 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 healthcare industry 
about the anti-kickback statute and other OIG enforcement authorities.   
 
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  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
Mission Support and Infrastructure (MSI).  MSI is composed of the Immediate Office of the Inspector General 
and the Office of Management and Policy.  MSI is responsible for coordinating OIG activities and providing 
mission support, including setting vision and direction for OIGs priorities and strategic planning; ensuring effective 
management of budget, finance, human resource management, and other operations; and serving as a liaison 
with HHS, Congress, and other stakeholders.  MSI plans, conducts, and participates in a variety of cooperative 
projects within HHS and with other Government agencies.  MSI provides critical data analytics, data management, 
and information technology (IT) infrastructure that enables OIG components to conduct their work efficiently and 
effectively.  
 
 
OIG Strategic Publications
 
   
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
HHS-OIG Strategic Plan 
As delineated in OIGs Strategic Plan for 20142018, OIGs approach to protecting the integrity of HHS 
programs has four key goals: (1) to fight fraud, waste, and abuse; (2) to promote quality, safety, and value; 
(3) to secure HHS programs future; and (4) to advance excellence and innovation.  These goals drive OIGs 
work planning for audits and evaluations as well as OIGs approach to enforcement.  These goals also 
serve as a starting point for OIGs own assessment of its effectiveness. 
 
OIG Work Plan 
OIGs Work Plan sets forth various projects that OIG plans to undertake during the fiscal year (FY) and 
beyond.  Projects listed in the Work Plan span HHSs operating divisions, which include the Centers for 
Medicare & Medicaid Services (CMS); public health agencies such as the Centers for Disease Control and 
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  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
Prevention (CDC) and the National Institutes of Health (NIH); and human services agencies such as the 
Administration for Children and Families (ACF) and the Administration for Community Living (ACL).  The 
Work Plan also includes oversight of State and local governments use of Federal funds as well as the 
administration of HHS.  Some of the projects described in the Work Plan are statutorily required. 
 
OIGs Top Unimplemented Recommendations 
OIG drives positive change not only by identifying risks, problems, abuses, and deficiencies, but also by 
recommending solutions to address them.  OIG maintains a list of recommendations it has made to 
address vulnerabilities detected in its reviews, and it keeps track of whether these recommendations have 
been implemented.  OIG systematically follows up on its recommendations with the relevant HHS 
programs.  From among the recommendations that have not been implemented, OIG identifies the top 
recommendations that, if implemented, are likely to garner significant savings and improvements in 
quality, efficiency, and effectiveness.  OIG compiles these recommendations in the Solutions to Reduce 
Fraud, Waste, and Abuse in HHS Programs: Top Unimplemented Recommendations (previously known as 
the Compendium of Unimplemented Recommendations). 
 
OIGs Semiannual Report to Congress  
OIGs Semiannual Report(s) to Congress (Semiannual Reports) describe OIGs work on identifying significant 
problems, abuses, deficiencies, remedies, and investigative outcomes relating to the administration of HHS 
programs and operations that were disclosed during the reporting period.  In the report below, we present 
OIG expected recoveries, criminal and civil actions, and other statistics as a result of our work for the 
semiannual reporting period of October 1, 2018, through March 31, 2019.  We also highlight some of our 
work completed during this semiannual reporting period.  
 
Top Management and Performance Challenges Facing HHS 
To focus HHSs attention on the most pressing issues, each year OIG identifies the Top Management and 
Performance Challenges facing HHS.  These top challenges arise across HHS programs, and they cover 
critical HHS responsibilities that include delivering quality services and benefits; exercising sound fiscal 
management; safeguarding public health and safety; and enhancing cybersecurity. 
 
 
 
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  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
Highlights of OIG Accomplishments 
   
HHS-OIGS SEMIANNUAL REPORT TO CONGRESS (Semiannual Report) describes OIGs work identifying significant 
risks, problems, abuses, deficiencies, remedies, and investigative outcomes relating to the administration of HHS 
programs and operations that were disclosed during the semiannual reporting period, October 1, 2018, through 
March 31, 2019.   
 
During this semiannual reporting period, OIG issued 71 audits and 10 evaluations, resulting in 212 
recommendations issued to HHS operating divisions.  Additionally, OIG remains at the forefront of the Nations 
efforts to fight fraud in HHS programs and hold wrongdoers accountable.  Along with our partners DOJ, State 
Medicaid Fraud Control Units (MFCUs or Units), and other Federal, State, and local law enforcement agencies, we 
detect, investigate, and prosecute healthcare fraud through a coordinated and data-driven approach.   
 
OIG oversight of HHS programs ensures integrity, effectiveness, and efficiency.  During this reporting period, our 
audit work identified $496 million in expected recoveries.  We also identified $247 million in questioned costs 
(costs questioned by OIG because of an alleged violation, costs not supported by adequate documentation, or the 
expenditure of funds where the intended purpose is unnecessary or unreasonable).  Our audit work also identified 
$777 million in potential savings for HHS.  These are funds that could potentially be saved if HHS programs 
implemented all of OIGs audit recommendations. 
 
OIG also remains at the forefront of the Nations efforts to fight fraud in HHS programs and hold wrongdoers 
accountable.  OIG investigative work led to $2.3 billion in expected investigative recoveries and 421 criminal 
actions during this reporting period.  OIG also excluded 1,293 individuals and entities from Federal healthcare 
programs and took civil actions, such as assessing monetary penalties against 331 individuals or entities.   
 
Audit and evaluation recommendations are crucial to encourage positive change in HHS programs.  OIG made 212 
new audit and evaluation recommendations during this reporting period.  Meanwhile, HHS operating divisions 
implemented 186 prior recommendations leading to positive impact for HHS programs and beneficiaries.   
 
 
 
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  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
                                                         
 
 
 
 
OIG continued to focus on the most significant and high-risk issues in healthcare.  Our mission is to protect the 
health and welfare of beneficiaries and to protect the integrity of HHS programs and grants.  Work during this 
semiannual reporting period focused on the opioid crisis, children cared for in Office of Refugee Resettlement 
facilities, quality of care, and cybersecurity.  Below we highlight our work from the semiannual reporting period 
October 1, 2018, through March 31, 2019, organized by subject area.  Appendices AF provide a comprehensive list 
of OIG work during this reporting period and provide data to meet the reporting requirements in the Inspector 
General Act of 1978 (IG Act).   
 
   
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  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
Preventing and Treating Opioid Misuse 
OIG uses data analytics and other investigative tools to combat the opioid crisis and to detect fraud and abuse.  
We use our criminal, civil, and administrative enforcement authorities to prevent fraud.  Significant results of OIG 
work related to the opioid crisis during this semiannual reporting period include the following: 
 
A California physician assistant was found guilty of conducting a scheme to unlawfully distribute 
prescription drugs.  The physician assistant intentionally prescribed drugs knowing that the prescriptions 
were outside the usual course of professional practice and without a legitimate medical purpose.  A jury 
found the physician assistant guilty of 39 counts of unlawful distribution of controlled substances, and the 
person was sentenced to 10 years in prison. 
 
OIG found that New York did not provide adequate stewardship of substance abuse prevention and 
treatment block grant funds.  New York failed to trace funds to a level of expenditure adequate to establish 
that the funds were used for the programs intended purpose.  We made recommendations to SAMHSA 
and the New York State agency to improve its oversight of substance abuse prevention and treatment 
block grant funds.  (See report A-02-17-02009.)   
 
Protecting Children in the Departments Care 
HHS, through the Administration for Children and Families (ACF) Office of Refugee Resettlement (ORR), is 
responsible for ensuring the shelter and care of thousands of unaccompanied alien children who enter the United 
States without legal status.  Most of these children were transferred into ORRs custody after initially being taken 
into custody at the border by the Department of Homeland Security.  ORR provides temporary shelter, care, and 
other related services to children before they are released to sponsors (most often, family members).  Significant 
OIG work during this semiannual reporting period related to ORR includes the following:   
  
OIG found that the total number of children separated from a parent or guardian by immigration authorities is 
unknown.  OIG encourages continued efforts to improve communication, transparency, and accountability for the 
identification, care, and placement of separated children.  Pursuant to a June 2018 Federal District Court order, 
HHS has thus far identified 2,737 children in its care at that time who were separated from their parents.  However, 
thousands of children may have been separated during an influx that began in 2017, before the accounting 
required by the Court.  OIG testified before the United States House Committee on Energy and Commerce 
Subcommittee on Oversight and Investigations on this work and the fact that the number of separated children in 
ORR care is unknown.  (See report OEI-BL-18-00511.) 
OIG identified two significant vulnerabilities at the now-closed Tornillo influx UAC facility that warranted 
immediate attention.  OIG found that the facility was not conducting required fingerprint background checks for 
staff, and that it did not employ a sufficient number of staff clinicians to provide adequate mental health care for 
UAC.  (See report A-12-19-20000.) 
OIG found that one UAC facility did not properly document the care and release of 13 percent of all children 
released to sponsors in FY 2015.  The facility concurred with our recommendations that it comply with ORR 
regulations pertaining to safety of children.  (See report A-06-17-07007.)  
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  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
 
Ensuring Quality of Care and Protecting Patients From Harm 
OIG has long prioritized oversight and enforcement work to protect Medicare and Medicaid patients from harm 
and to help ensure that patients receive high quality care.  This work ranges from assessing the safeguards in 
place to ensure quality and safety, examining the incidence and preventability of patient harm, and investigating 
and holding accountable healthcare providers who commit fraud that results in patient harm.  Significant OIG 
work during this reporting period includes the following: 
 
OIG investigation resulted in conviction of a doctor who implanted unnecessary pacemakers.  A physician was 
found guilty of healthcare fraud after an OIG investigation showed that he implanted medically unnecessary 
pacemakers into his patients to bill for these unnecessary procedures and follow-up care.  At trial, several patients 
testified that the physician had pressured them into the procedures and gave them misleading information about 
their health conditions. 
 
OIG recommended improvements to better ensure that nursing homes correct deficiencies.  In a series of audits, 
OIG found that seven of nine State agencies did not always verify that nursing homes corrected deficiencies, as 
required.  Nursing home deficiencies can include quality and safety concerns.  We recommended that CMS 
improve its guidance to State agencies on verifying nursing homes corrections and improve its related forms and 
systems.  (See report A-09-18-02000.)  
 
OIG determined that more than 4 in 10 Medicare patients in long-term-care hospitals (LTCHs) experienced some 
type of harm from their care.  Based on medical expert review, we estimated that 25 percent of Medicare patients 
in LTCHs experienced temporary harm events from their care and an additional 21 percent experience more 
serious adverse events.  This rate of patient harm is higher than OIG found in other settings and may be due, in 
part, to longer stays and high patient acuity in LTCHs.  Medical reviewers determined that more than half of these 
harm events were preventable with better care.  OIG made recommendations to CMS and the Agency for 
Healthcare Research and Quality (AHRQ) to help LTCHs reduce patient harm.  (See report OEI-06-14-00530.)     
 
 
Ensuring Program Integrity and Effective Administration of the Medicare Program 
Reducing improper payments and ensuring that Medicare funds are spent efficiently, effectively, and economically 
is crucial.  In FY 2017, Medicare spent nearly $700 billion, representing more than 15 percent of all Federal 
spending, and provided health coverage to 58.4 million beneficiaries.  The 2018 Annual Report of the Board of 
Trustees estimates that the Trust Fund for Medicare Part A will be depleted by 2026.  It also projects that spending 
for Medicare Part B will grow at an annual rate of about 8.2 percent over the next 5 years, outpacing the U.S. 
economy, which is projected to grow at a 4.7 percent annual rate during that time.  Significant results from OIG 
work to identify improper payments or foster more prudent payment policies during this reporting period include 
the following: 
  
A drug wholesale company entered into a False Claims Act settlement agreement and agreed to pay $625 
million to resolve a liability associated with a pre-filled syringe program.  The company improperly 
repackaged oncology-supportive injectable drugs into pre-filled syringes and improperly distributed the 
syringes to physicians treating cancer patients.  
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  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
 
A clinic owner and physician were convicted of charges resulting from their involvement in a scheme to 
defraud Medicare.  They falsely certified information about patients medical condition and their need for 
home health services.  They then used the false paperwork to bill to, and receive payment from, Medicare 
for home health services that were not medically necessary or not provided.  They were sentenced to a 
combined 55 years in prison and were ordered to pay up to $26.7 million in restitution, jointly and 
severally.   
 
OIG recommended steps to reduce improper Medicare payments to skilled nursing facilities (SNFs).  An OIG audit 
identified $86 million in improper Medicare payments to SNFs for beneficiaries not meeting the 3-day rule (i.e., 
the requirement that a beneficiary must be an inpatient in a hospital for at least 3 days to be eligible for coverage 
of SNF care following their hospital discharge).  OIG recommended improvements to a claims processing edit, 
education for hospitals and SNFs, and new notifications from hospitals to beneficiaries and to SNFs regarding 
whether the beneficiarys hospital stay qualifies him or her for SNF care coverage.  (See report A-05-16-00043.) 
 
OIG identified duplicate payments for transportation services and payments for unallowable non-emergency 
transportation services.  Medicare requirements for consolidated billing prohibit Part B payments to ambulance 
suppliers for transportation services that were also included in Medicare Part A payments to SNFs.  However, OIG 
found that Medicares edits were not designed to prevent or detect inappropriate payments to ambulance 
suppliers for transportation services for beneficiaries during SNF stays.  We estimated that Medicare overpaid 
$19.9 million and beneficiaries incurred an estimated $5.2 million in coinsurance and deductible liabilities related 
to these incorrect payments.  In related work, OIG found that a particular ambulance supplier incorrectly billed 
Medicare for 89 out of 100 sampled claims for non-emergency transport services.  For these 89 claims, the 
beneficiaries conditions did not meet medical necessity requirements, the services did not meet documentation 
requirements, or both.  (See reports A-01-17-00506 and A-02-16-01021.) 
 
OIG highlighted vulnerabilities associated with Medicares hospital wage index system and recommended reform.  
CMS collects wage data from hospitals annually through their Medicare cost reports and uses these data in several 
ways, including to reflect local labor prices by deriving local wage indexes.  CMS then uses these wage indexes 
to adjust inpatient payments to hospitals depending on their location.  Inaccuracies in the wage data that hospitals 
submit can result in substantial overpayments to some hospitals and underpayments to other hospitals.  Based on 
41 OIG reviews of hospitals wage data over the past 15 years, we identified significant vulnerabilities in the wage 
index system and recommended that CMS and HHS consider comprehensive reform to this system.  (See report 
A-01-17-00500.) 
 
Ensuring Program Integrity and Effective Administration of the Medicaid Program 
Protecting the integrity of Medicaid is a key focus in OIGs goal to fight fraud, waste, and abuse.  We make 
recommendations to CMS and States to correct problems and mitigate program risks, and we work closely with 
State MFCUs to combat Medicaid fraud.  Below are examples of significant OIG work during this semiannual 
reporting period. 
 
 
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  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
OIG recommended that CMS recover $1.6 billion due the Federal Government in Medicaid overpayments.  CMS 
has not recovered all of the overpayments identified in OIG audit reports in accordance with Federal requirements.  
CMS concurred with our recommendations to recover the overpayments and to improve the timeliness of 
recovering overpayments in the future.  (See report A-05-17-00013.) 
California made Medicaid payments on behalf of non-eligible beneficiaries.  On the basis of our sample results, 
OIG estimated that California made Medicaid payments of $959.3 million ($536 million Federal share) on behalf of 
802,742 ineligible beneficiaries and $4.5 billion ($2.6 billion Federal share) on behalf of 3.1 million potentially 
ineligible beneficiaries.  We recommended that California redetermine, if necessary, the current Medicaid eligibility 
of the sampled beneficiaries and make procedural changes related to determining Medicaid eligibility.  (See report 
A-09-17-02002.) 
OIG examined States use of hospital tax programs to fund States shares of Medicaid expenditures.  An OIG audit 
of seven States hospital tax programs showed that these tax programs raised more than $38 billion in revenue to 
draw down almost $55 billion in Federal Medicaid funds over 5 years.  At the same time, the hospitals tax 
payments to the States were largely offset by supplemental payments to hospitals.  These State tax programs 
complied with Federal requirements because they fell under a legal provision (a safe harbor) that enabled them 
to mitigate the tax impacts on hospitals more than would have been allowed outside that safe harbor.  OIG 
recommended that CMS re-evaluate the impacts of the safe harbor and consider changing it.  (See report A-03-
16-00202.) 
 
 
Protecting HHS Data, Systems, and Beneficiaries From Cybersecurity Threats 
The security of HHS IT systems and the personal information and data collected and maintained by HHS programs 
is critically important to the health and well-being of the American people.  Furthermore, FDA is charged with 
regulating the safety, effectiveness, and securityincluding cybersecurityof medical devices.  OIG has 
developed a robust portfolio of oversight work focused on these issues, including the following: 
 
OIG identified opportunities for NIH to strengthen controls over sensitive data.  OIG found that NIH had not 
assessed risks to national security when permitting foreign principal investigators to access U.S. genomic data.  We 
recommended, among other actions, that NIH develop a security framework, conduct a risk assessment, and 
implement additional security controls over genomic data.  (See report A-18-18-09350.) 
 
OIG recommended that FDA better address cybersecurity risks to medical devices on the market. OIG found that 
FDAs policies and procedures were insufficient for addressing cybersecurity risks and events involving medical 
devices that it had already approved (known as postmarket).  We recommended that FDA strengthen its policies 
and procedures so as to enhance its ability to manage and respond to postmarket medical device compromises 
resulting from cybersecurity vulnerabilities, exploitations, and threats.  (See report A-18-16-30530.) 
 
OIG examined States responses to breaches of Medicaid data.  OIG found that most breaches of Medicaid data in 
2016 disclosed information about a single individual and often resulted from misdirected mail or faxes; large 
breaches from hacking were rare.  States follow a common framework for responding to breaches of Medicaid 
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  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
data; however, States do not routinely notify CMS of breaches despite CMS guidance that they do so.  (See report 
OEI-09-16-00210.) 
 
Protecting the Integrity of HHS Grants and Contracts 
In FY 2018, HHS awarded $109 billion in grants.  OIGs oversight work reviews the appropriate and effective use of 
HHS grant and contract funds, effective grants and contracts management at the Department level, and program 
integrity and financial capability at the grantee or contractor level.  Significant OIG work during this reporting 
period includes the following: 
 
OIG identified continuing vulnerabilities in the HHS oversight of the Small Business Innovation Research (SBIR) 
program.  OIG found that HHS has taken minimal steps to address known program integrity vulnerabilities.  These 
vulnerabilities may allow ineligible awardees to receive SBIR funds and may result in duplicative funding.  We 
recommended a number of actions to address these weaknesses.  (See report OEI-04-18-00230.)  
 
OIG found that CDC reimbursed contractors for some World Trade Center Health Program administrative costs 
that did not comply with Federal requirements.  We estimated that these improper reimbursements totaled $8 
million.  We also determined that CDC did comply with Federal requirements for all eight of the selected fixed-
price contract invoices that we reviewed.  (See report A-02-16-02012.) 
 
 
   
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  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
OIG Participation in Congressional Hearings 
 
Date  Witness  Testimony/Committee 
02/07/2019  Ann Maxwell, Assistant Inspector  Examining the Failures of the Trump 
General for Evaluation and  Administrations Inhumane Family Separation 
Inspections  Policy, House Committee on Energy and 
Commerce, Subcommittee on Oversight and 
Investigations 
     
     
     
     
     
     
 
 
   
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  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
Selected Acronyms and Abbreviations 
 
 
ACA  Patient Protection and Affordable Care Act 
ACF  Administration for Children and Families 
ACL  Administration for Community Living 
CDC  Centers for Disease Control and Prevention 
CIA  corporate integrity agreement 
CMP  civil monetary penalty 
CMS  Centers for Medicare & Medicaid Services 
DHS  Department of Homeland Security 
DOJ  Department of Justice 
EHR  electronic health records 
EMTALA  Emergency Medical Treatment and Labor Act 
FCA  False Claims Act 
FDA  Food and Drug Administration 
FY  fiscal year 
HHS  Department of Health and Human Services 
HIPAA  Health Insurance Portability and Accountability Act of 1996 
HRSA  Health Resources and Service Administration 
IHS  Indian Health Service 
MAC  Medicare Administrative Contractor 
MCO  managed care organization 
MFCU  Medicaid Fraud Control Unit 
NIH  National Institutes of Health 
OAS  Office of Audit Services 
OCIG  Office of Counsel to the Inspector General 
OEI  Office of Evaluation and Inspections 
OI  Office of Investigations 
OIG  Office of Inspector General 
ORR  Office of Refugee Resettlement 
PCS  personal care services 
SAMHSA   Substance Abuse and Mental Health Services Administration 
SNF  skilled nursing facility 
UAC  unaccompanied alien children 
   
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  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
Centers for Medicare & Medicaid Services  
Although the Centers for Medicare & Medicaid Services Has Made Progress, It Did Not Always Resolve Audit 
Recommendations in Accordance With Federal Requirements (A-07-18-03228), January 2019 
Although CMS has made significant progress in the timely resolution of audit recommendations since our 
previous review (of Federal FYs 2006 and 2007), it did not always resolve audit recommendations in a 
timely manner during FYs 2015 and 2016.  Specifically, CMS resolved 1,231 of the 1,371 recommendations 
that were outstanding during FYs 2015 and 2016.  However, it did not resolve 405 of the 1,231 
recommendations (32.9 percent) within the required 6-month resolution period.  In addition, as of 
September 30, 2016, CMS had not resolved 140 audit recommendations that were past due for resolution.  
Some of the past-due recommendations had associated dollar amounts that totaled $138.6 million; others 
were procedural in nature. 
CMS had policies and procedures in place to ensure that audit recommendations were resolved in 
compliance with Federal requirements.  Although CMS did not always issue management decisions and 
submit the related clearance documents within the required 6-month resolution period, CMS did make 
progress in this respect (compared with the findings of our previous review) by significantly increasing the 
percentage of audit recommendations that were resolved in a timely manner and by significantly reducing 
both the total number and associated dollar amounts of unresolved audit recommendations that were 
past due for resolution. 
CMS concurred with our recommendations that it continue to follow its policies and procedures related to 
the audit resolution process, and enhance them where possible, and promptly resolve the 140 outstanding 
audit recommendations that were past due as of September 30, 2016. 
Medicare Program Reports and Reviews 
Financial Management and Improper Payments 
CMS Did Not Always Ensure Hospitals Complied With Medicare Reimbursement Requirements for Graduate 
Medical Education (A-02-17-01017), November 2018 
CMS generally ensured that hospitals in selected MAC jurisdictions claimed Medicare graduate medical 
education (GME) reimbursement in accordance with Federal requirements.  However, in seven of our eight 
audits, we identified some instances in which teaching hospitals did not always comply with Federal 
requirements when claiming Medicare GME reimbursement for residents.  Specifically, we found that 
hospitals in the six MAC jurisdictions we reviewed claimed GME reimbursement for residents who were 
claimed by more than one hospital for the same period and whose total full-time equivalent (FTE) count 
exceeded one, totaling almost $4 million in excess Medicare GME reimbursement. 
The overstated FTE counts and excess reimbursement occurred because CMS did not have adequate 
procedures to ensure that hospitals do not count residents as more than one FTE.  For example, CMS did 
not review resident data submitted by hospitals to detect whether a resident had overlapping rotational 
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  Department of Health and Human Services Office of Inspector General 
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assignments (i.e., working at more than one hospital during the same period) or require the MACs to 
perform this work. 
CMS agreed with our recommendation that it take steps to ensure that no resident is counted as more 
than one FTE. 
Payments Made by Novitas Solutions, Inc., to Hospitals for Certain Advanced Radiation Therapy Services Did 
Not Fully Comply With Medicare Requirements (A-02-16-01006), November 2018, and 
Payments Made by National Government Services, Inc., to Hospitals for Certain Advanced Radiation Therapy 
Services Did Not Fully Comply With Medicare Requirements (A-02-16-01007), December 2018 
Intensity-modulated radiation therapy (IMRT) is an advanced type of radiation procedure used to treat 
difficult-to-reach tumors.  Novitas Solutions, Inc. (Novitas), the MAC responsible for processing Medicare 
payments for outpatient services in Jurisdictions H and L, and National Government Services, Inc. (NGS), 
the MAC responsible for processing Medicare payments for outpatient services in Jurisdictions 6 and K, 
incorrectly paid hospitals for IMRT services provided to nearly all of the beneficiaries associated with our 
review.  
Based on our sample results, we estimated that hospitals in Jurisdictions H and L received Medicare 
overpayments of at least $7.2 million for unallowable IMRT services during our audit period.  We estimated 
that hospitals in Jurisdictions 6 and K received Medicare overpayments of at least $5.7 million for 
unallowable IMRT services during our audit period. 
Novitas generally agreed with our recommendations that it (1) recover from hospitals the portion of the 
estimated $7.2 million in identified overpayments for claims incorrectly billed that are within the reopening 
period, (2) notify the hospitals responsible for the remaining portion of the estimated $7.2 million in 
potential overpayments so that those hospitals can investigate and return any identified overpayments, 
and (3) identify and recover any additional similar overpayments for IMRT services made after the audit 
period.  Novitas agreed with two procedural recommendations to implement payment edits and to 
educate hospitals on properly billing for IMRT services. 
NGS partially agreed with our recommendations that it (1) recover from hospitals the portion of the 
estimated $5.7 million in identified overpayments for claims incorrectly billed that are within the reopening 
period and (2) notify the hospitals responsible for the remaining portion of the estimated $5.7 million in 
potential overpayments so that those hospitals can investigate and return any identified overpayments.  
NGS disagreed with our recommendation that it identify and recover any additional similar overpayments 
for IMRT services made after the audit period and agreed with two procedural recommendations to 
implement payment edits and to educate hospitals on properly billing for IMRT services. 
Medicare Improperly Paid Suppliers for Durable Medical Equipment, Prosthetics, Orthotics, and Supplies 
Provided to Beneficiaries During Inpatient Stays (A-09-17-03035), November 2018 
For our audit period (January 1, 2015, through December 31, 2017), Medicare should not have paid 
suppliers for any of the $34 million for durable medical equipment, prosthetics, orthotics, and supplies 
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  Department of Health and Human Services Office of Inspector General 
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(DMEPOS) that were provided during inpatient stays.  In addition, beneficiaries were held responsible for 
unnecessary deductibles and coinsurance of $8.7 million paid to the suppliers for the DMEPOS items. 
Medicare overpaid the suppliers because the system edits that should have prevented or detected the 
overpayments were not adequate.  If the system edits had been designed properly since 2008, Medicare 
could have saved $223.1 million, and beneficiaries could have saved $56.3 million in deductibles and 
coinsurance that may have been incorrectly collected from them or from someone on their behalf. 
CMS concurred with our recommendations that it direct the Medicare contractors to (1) recover the 
$34 million in identified improper payments to suppliers in accordance with CMSs policies and 
procedures, (2) recommend that the suppliers refund to beneficiaries up to $8.7 million in deductible and 
coinsurance amounts that may have been incorrectly collected from them or from someone on their 
behalf, (3) identify and recover any improper payments to suppliers after our audit period, and (4) correct 
the system edits to fully prevent or detect overpayments to suppliers for DMEPOS items provided during 
inpatient stays.  CMS did not concur with our recommendation that it seek legislative authority to require 
suppliers to refund to beneficiaries incorrectly collected Medicare Part B deductible and coinsurance 
amounts. 
Midwood Ambulance & Oxygen Service, Inc., Billed for Nonemergency Ambulance Transport Services That 
Did Not Comply With Medicare Requirements (A-02-16-01021), December 2018 
Midwood Ambulance & Oxygen Service, Inc. (Midwood), did not comply with Medicare requirements for 
billing nonemergency ambulance transport services for 89 of the 100 claims we reviewed.  Specifically, 
Midwood incorrectly billed Medicare for beneficiaries whose conditions did not meet medical necessity 
requirements and billed for services that did not meet documentation requirements.  These errors 
occurred because Midwood did not have adequate controls to prevent the incorrect billing of 
nonemergency ambulance transport claims.  On the basis of our sample results, we estimated that 
Midwood received overpayments of at least $19.2 million for the audit period.  This amount includes claims 
with payment dates outside of the Medicare 4-year claim-reopening period. 
Midwood partially agreed with our recommendation to strengthen its procedures for billing 
nonemergency ambulance transport services.  Midwood disagreed with our recommendations that it 
(1) refund to the Medicare program the portion of the estimated $19.2 million overpayment for claims 
incorrectly billed that are within the Medicare reopening period and (2) for the remaining portion of the 
estimated $19.2 million in overpayments for claims that are outside of the Medicare reopening period, 
exercise reasonable diligence to identify and return additional overpayments.  Midwood did not agree or 
disagree with our recommendation that it identify and return any additional similar improper payments 
made after our audit period. 
   
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  Department of Health and Human Services Office of Inspector General 
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First Coast Service Options, Inc., Paid Providers for Hyperbaric Oxygen Therapy Services That Did Not 
Comply With Medicare Requirements (A-04-16-06196), December 2018 
Of the 120 sampled outpatient claims totaling $415,513, First Coast Service Options, Inc. (First Coast), made 
payments for hyperbaric oxygen (HBO) therapy that did not comply with Medicare requirements for 110 
claims (92 percent), resulting in overpayments for HBO therapy totaling $351,970. 
First Coast made payments for HBO therapy that did not always comply with Medicare requirements 
because it had limited policies and procedures in place to ensure that it made correct payments.  Based on 
our sample results, we estimated that First Coast overpaid providers in Jurisdiction N $39.7 million during 
the audit period for HBO therapy that did not comply with Medicare requirements. 
First Coast concurred with our recommendations that it (1) recover the portion of the $351,970 in Medicare 
overpayments, (2) notify the 70 providers responsible for the remaining 46,737 nonsampled claims with 
potential overpayments estimated at $39.3 million so that those providers can investigate and return any 
identified overpayments, and (3) identify and recover any improper payments for HBO therapy services 
made after the audit period.  First Coast partially concurred with our recommendation that it work with 
CMS to the extent possible in developing more effective automated HBO therapy prepayment edits in the 
claim processing system, which would result in millions of dollars in future cost savings. 
Medicare Paid Twice for Ambulance Services Subject to Skilled Nursing Facility Consolidated Billing 
Requirements (A-01-17-00506), February 2019 
Medicare made Part B payments to ambulance suppliers for transportation services that were also 
included in Medicare Part A payments to skilled nursing facilities (SNFs) as part of consolidated billing 
requirements.  For 78 of the 100 beneficiary days we sampled with dates of service from July 1, 2014, to 
June 30, 2016, Medicare made Part B payments that were incorrect.  Medicare overpaid the ambulance 
suppliers because the Common Working File (CWF) edits were not designed to prevent or detect Part B 
overpayments for all transportation subject to consolidated billing.  In addition, ambulance suppliers did 
not have the necessary controls to prevent incorrect billing to Medicare Part B. 
On the basis of our sample results, we estimated that Medicare made a total of $19.9 million in Part B 
overpayments to ambulance suppliers for transportation services for beneficiaries in Part A SNF stays. In 
addition, we estimated that beneficiaries incurred an estimated $5.2 million in coinsurance and deductible 
liabilities related to these incorrect payments. 
CMS concurred with our recommendation that it redesign the CWF edits to prevent Part B overpayments 
to ambulance suppliers for transportation services provided to beneficiaries in Part A SNF stays.  CMS also 
concurred with our six procedural recommendations.  
CMS Improperly Paid Millions of Dollars for Skilled Nursing Facility Services When the Medicare 3-Day 
Inpatient Hospital Stay Requirement Was Not Met (A-05-16-00043), February 2019 
To be eligible for coverage of posthospital extended care services, a Medicare beneficiary must be an 
inpatient in a hospital for not less than 3 consecutive calendar days (3-day rule) before being discharged 
from the hospital.  CMS improperly paid 65 of the 99 SNF claims we sampled when the  
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  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
3-day rule was not met.  Improper payments associated with these 65 claims totaled $481,034.  On the 
basis of our sample results, we estimated that CMS improperly paid $84 million for SNF services that did 
not meet the 3-day rule during 2013 through 2015.  These problems will not be corrected until CMS 
requires a consistent documentation standard for SNFs that provides verifiable evidence of a qualifying 
hospital stay, which CMS can use to either certify allowable SNF reimbursements or detect and recover 
improper SNF reimbursements. 
CMS agreed with our recommendations that it (1) ensure that the CWF qualifying inpatient hospital stay 
edit for SNF claims is enabled when SNF claims are processed for payment and (2) educate both hospitals 
and SNFs about verifying and documenting the 3-day inpatient hospital stay relative to supporting a 
Medicare claim for SNF reimbursement.  CMS disagreed with our recommendations that it (1) require 
hospitals to provide beneficiaries a written notification of the number of inpatient days of care provided 
during the hospital stay and whether the hospital stay qualifies subsequent SNF care for Medicare 
reimbursement so that beneficiaries are aware of their potential financial responsibility before consenting 
to receive SNF services and (2) require SNFs to obtain a written notification from the hospital and retain it 
as a condition of payment for their claims. 
Medicare Market Shares of Mail Order Diabetes Test Strips From April Through June 2018 
(OEI-04-18-00440), January 2019 
We found that from April through June 2018, sampled suppliers provided 17 types of diabetes test strips 
(DTS) via Medicares National Mail-Order Program.  The top 2 strip types accounted for 53 percent of the 
Medicare mail-order market, and the top 10 strip types accounted for 98 percent of the market.  The 
Medicare Improvements for Patients and Providers Act of 2008 prohibits CMS from awarding a contract to 
a DTS supplier in the National Mail-Order Program if the suppliers bid does not cover at least 50 percent, 
by volume, of all types of DTS provided to Medicare beneficiaries.  The results from this report will help 
CMS to oversee future bids for suppliers to furnish DTS in the National Mail-Order Program. 
Medicare Market Shares of Non-Mail Order Diabetes Test Strips From April Through June 2018 
(OEI-04-18-00441), March 2019 
We found that from April through June 2018, sampled suppliers provided 34 types of diabetes test strips to 
Medicare beneficiaries via non-mail order.  The top 3 strip types accounted for 53 percent of the Medicare 
mail-order market, and the top 10 strip types accounted for 93 percent of the market.  The Medicare 
Improvements for Patients and Providers Act of 2008 (MIPPA) prohibits CMS from awarding a Competitive 
Bidding Program contract to a supplier of diabetes test strips if the suppliers bid does not cover at least 50 
percent, by volume, of the types of diabetes test strips provided to Medicare beneficiaries.  This is known 
as the 50-percent rule.  MIPPA requires OIG to determine the market shares of the types of diabetes test 
strips before each round of competitive bidding to assist CMS in ensuring that bidding suppliers meet the 
50-percent rule.  Initially, compliance with this rule was based on mail order claims only. The Bipartisan 
Budget Act of 2018 amended the 50-percent rule by requiring that, for bids on or after January 1, 2019, 
CMS must use data from the non-mail-order Medicare market as well as the mail-order one.  The results 
from this report will help CMS to oversee future bids for suppliers to furnish diabetes test strips in the 
National Mail-Order Program. 
   
17 
  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
Quality of Care, Safety, and Access 
CMS Guidance to State Survey Agencies on Verifying Correction of Deficiencies Needs To Be Improved To 
Help Ensure the Health and Safety of Nursing Home Residents (A-09-18-02000), February 2019 
State agencies must verify that nursing homes corrected identified deficiencies, such as the failure to 
provide necessary care and services, before certifying whether the nursing homes are in substantial 
compliance with Federal participation requirements for Medicare and Medicaid. 
Of the nine selected State agencies in our previous reviews, seven did not always verify nursing homes 
correction of deficiencies as required.  Specifically, for 326 of the 700 sampled deficiencies, these State 
agencies did not obtain evidence of nursing homes correction of deficiencies or maintain sufficient 
evidence that they had verified correction of deficiencies.  If State agencies certify that nursing homes are 
in substantial compliance without properly verifying the correction of deficiencies and maintaining 
sufficient documentation to support the verification of deficiency correction, the health and safety of 
nursing home residents may be placed at risk.  
In addition to summarizing the issues identified during our previous reviews, we determined that CMSs 
guidance to State agencies on verifying nursing homes correction of deficiencies and maintaining 
documentation to support verification needed to be improved. 
CMS concurred with our recommendations that it take specific actions to (1) improve its guidance to State 
agencies on verifying nursing homes correction of deficiencies and maintaining documentation to support 
verification, (2) consider improving its forms related to the survey and certification process, and (3) work 
with State agencies to address technical issues with the system for maintaining supporting documentation.  
Hospitals Reported Improved Preparedness for Emerging Infectious Diseases After the Ebola Outbreak 
(OEI-06-15-00230), October 2018 
We found that most hospitals in the United States were not prepared for the domestic outbreak of Ebola 
virus disease (Ebola) in 2014, with 71 percent of hospital administrators reporting that their facilities were 
unprepared to receive patients with Ebola.  By 2017, administrators from only 14 percent of hospitals 
reported their facilities were still unprepared for emerging infectious disease (EID) threats such as Ebola.  
Hospital actions to improve preparedness included updating emergency plans, training staff to care for 
patients with EIDs, purchasing additional supplies, and conducting EID-focused drills.  Although hospital 
administrators believe their hospitals are ready to respond to a future EID threat, they cited challenges to 
maintaining that preparedness, given competing priorities for hospital resources and staff time.  
Administrators also cited the need to focus efforts on more common hazards, such as natural disasters, 
and difficulty in using government guidance to prepare for EIDs.  We also found that administrators from 
one-third of hospitals did not know their hospitals role in a tiered hospital framework designed by the 
CDC to guide hospitals in receiving and treating cases of Ebola. 
We recommend that to improve hospital preparedness and HHS assistance and oversight, the Office of the 
Assistant Secretary for Preparedness and Response (ASPR), CDC, and CMS continue to support hospital 
preparedness for potential EIDs by coordinating guidance and providing practical advice for all hospitals.  
We also recommended that CDC clarify and promote the details and ongoing status of its tiered 
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  Department of Health and Human Services Office of Inspector General 
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framework for hospitals, so that hospitals are clear regarding their responsibilities during an EID outbreak.  
Further, we recommended that CMS add EIDs to the definition of all hazards in the State Operations 
Manual to promote inclusion of EIDs in hospital emergency planning.  ASPR, CDC, and CMS concurred 
with our recommendations. 
Adverse Events in Long-Term-Care Hospitals: National Incidence Among Medicare Beneficiaries 
(OEI-06-14-00530), November 2018 
We estimate that 21 percent of Medicare patients in long-term-care hospitals (LTCHs) experienced adverse 
events as a result of medical care; an additional 25 percent of patients experienced temporary harm 
events.  This rate of patient harm is higher than OIG found in other settings and may be due, in part, to 
longer stays and high patient acuity.  Nevertheless, these events endanger patient health and reviewers 
determined over half to be preventable.  CMS and AHRQ concurred with all of our recommendations, 
which were: 
  AHRQ and CMS should collaborate to create and disseminate a list of potential adverse events in 
LTCHs, and 
  CMS should include information about potential events and patient harm in its quality outreach to 
LTCHs.  
Payment Policy and Trends 
Significant Vulnerabilities Exist in the Hospital Wage Index System for Medicare Payments (A-01-17-00500), 
November 2018 
CMS uses area wage indexes to adjust hospital payments annually to reflect local labor prices.  The area 
wage indexes applied to urban hospitals in a State cannot be lower than the wage index for the rural 
hospitals in that State.  This provision is called the rural floor.  Hold-harmless provisions protect 
hospitals from having their wage indexes lowered because of the geographic reclassification of other 
hospitals. 
We identified these significant vulnerabilities in the wage index system: (1) CMS lacks the authority to 
penalize hospitals that submit inaccurate or incomplete wage data, (2) MAC limited reviews do not always 
identify inaccurate wage data, (3) the rural floor decreases wage index accuracy, and (4) hold-harmless 
provisions decrease wage index accuracy.  
CMS agreed with our recommendation that it work with the MACs to focus on hospitals whose wage data 
have high levels of influence on the wage index of their area.  CMS disagreed with our recommendation 
that it rescind its hold-harmless policy.  CMS stated that it will consider whether to recommend for 
inclusion in the Presidents next budget our recommendations that (1) CMS and the Secretary of Health 
and Human Services revisit the possibility of comprehensive reform, (2) CMS seek legislative authority to 
penalize hospitals that submit inaccurate or incomplete wage data, (3) CMS seek legislation to repeal the 
law creating the rural floor, and (4) CMS seek legislation to repeal the hold-harmless provisions in Federal 
law. 
   
19 
  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
Drug Pricing and Reimbursement 
CMSs Enhanced Controls Did Not Always Prevent Terminated Drug Utilization in Medicare Part D 
(A-07-16-06068), November 2018 
The steps CMS has taken to address terminated drug utilization in Medicare Part D were not entirely 
effective and, as a result, CMS continued to accept some prescription drug event (PDE) data for terminated 
drugs in CYs 2014 and 2015.  Terminated drugs are discontinued drugs that have passed their shelf life or 
been withdrawn from the market.  Although CMS has made improvements to prevent terminated drug 
utilization in Part D, it accepted PDE data totaling $31.9 million in gross drug costs for 3,705 terminated 
drugs in CYs 2014 and 2015.  CMS did not compare the information on termination dates in its quarterly 
Medicaid drug rebate files with the FDA file, did not investigate the discrepancies that existed between 
these two data sources, and did not update its system edits in a timely manner. 
CMS agreed with our recommendation that it update its system edits with a new version of FDAs file on a 
more timely basis.  CMS disagreed with our recommendation that it continue to strengthen its internal 
controls to ensure that all PDE data for terminated drugs are rejected by working with FDA to verify the 
accuracy of drug termination dates, to include comparing the information on termination dates in its two 
data sources, investigating discrepancies between the data sources, and verifying termination dates with 
the manufacturers.  Although CMS remains committed to strengthening its controls to ensure that PDE 
data for terminated drugs are rejected, it regards FDA as the expert authority and source for national drug 
code listing information. 
Medicaid Program Reports and Reviews 
Financial Management and Improper Payments 
Ohio Medicaid Managed Care Organizations Received Capitation Payments After Beneficiaries Deaths 
(A-05-17-00008), October 2018 
Ohio made capitation payments totaling $90.5 million on behalf of deceased beneficiaries.  We confirmed 
that all beneficiaries associated with the 100 capitation payments in our stratified random sample were 
deceased.  Ohio properly recovered 37 of these capitation payments.  However, Ohio did not recover the 
remaining 63 capitation payments totaling $74,495 ($51,431 Federal share).  On the basis of our sample 
results, we estimated that Ohio did not recover unallowable payments to Medicaid Managed Care 
Organizations (MCOs) totaling at least $51.3 million ($38 million Federal share) during our audit period. 
Ohio did not always identify and process Medicaid beneficiaries death information.  Although Ohios 
eligibility systems regularly interfaced with Federal data exchanges that identify dates of death, county 
caseworkers did not always receive notification that beneficiaries had died.  
Ohio did not indicate concurrence or nonconcurrence with our recommendations that it (1) refund 
$38 million to the Federal Government; (2) identify and recover unallowable payments made to MCOs 
during our audit period on behalf of deceased beneficiaries, which we estimate to be at least $51.3 million; 
(3) identify capitation payments made on behalf of deceased beneficiaries before and after our audit 
period and repay the Federal share of amounts recovered; and (4) ensure that the eligibility system Ohio 
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  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
Benefits alerts county caseworkers of the beneficiaries dates of death and that dates of death are recorded 
in a timely manner to prevent unallowable payments. 
New York Claimed Federal Reimbursement for Some Assertive Community Treatment Services That Did Not 
Meet Medicaid Requirements (A-02-17-01008), October 2018 
New York claimed Federal Medicaid reimbursement for some Assertive Community Treatment (ACT) 
services that did not comply with Medicaid requirements.  Of the 100 claims in our random sample, 13 
claims did not comply with Medicaid requirements. 
Providers did not always ensure that ACT services were provided in accordance with a beneficiarys 
treatment plan and did not always verify that the required number of contacts needed to claim the ACT 
full payment rate was provided.  Further, certain providers failed to maintain or provide documentation to 
support ACT services claims.  Finally, although New York monitors ACT providers for compliance with 
Medicaid requirements, it did not ensure that its oversight was effective in preventing the errors identified 
in our review. 
New York agreed with our recommendation that it ensure that ACT program guidance on claiming 
Medicaid reimbursement for services is reinforced with providers and continue to improve its monitoring 
of the ACT program but disagreed with our recommendation that it refund $4.4 million to the Federal 
Government. 
The Centers for Medicare & Medicaid Services Had Not Recovered More Than a Billion Dollars in Medicaid 
Overpayments Identified by OIG Audits (A-05-17-00013), December 2018 
We reviewed CMSs efforts to collect overpayments identified in 313 audits issued in FYs 2010 through 2015 
(the current period) that recommended recovering overpayment amounts totaling $2.7 billion and 10 
audits issued for FYs 2004 through 2009 (the prior period) that recommended recovering overpayment 
amounts totaling $225.6 million. 
CMS did not collect $1.6 billion in overpayments identified in 77 current-period audits and $188.6 million in 
overpayments identified in 7 prior-period audits.  In addition, CMS did not ensure that States correctly 
reported Medicaid overpayments on the Quarterly Medicaid Statement of Expenditures for the Medical 
Assistance Program Form CMS-64 (CMS-64).  Finally, we could not verify the accuracy of $2.7 million that 
CMS told us was reported by States because before our review CMS disposed of documents supporting 
that overpayments were recovered. 
CMS concurred with our recommendations that it (1) recover the remaining $1.6 billion due the Federal 
Government from the current period and $188.6 million due the Federal Government from the prior 
period; (2) improve the timeliness of recovering overpayments by setting guidelines about the time CMS 
has to work with States to obtain documentation and issue disallowance letters to States; and (3) verify 
that States report overpayments correctly, require States to resubmit corrected CMS-64s when they do 
not, and continue to educate States about their responsibility to report overpayments correctly. 
 
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  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
California Made Medicaid Payments on Behalf of Non-Newly Eligible Beneficiaries Who Did Not Meet Federal 
and State Requirements (A-09-17-02002), December 2018 
Historically, only certain groups of individuals who had incomes and assets below certain thresholds were 
eligible for Medicaid (traditional coverage groups).  After the passage of the Patient Protection and 
Affordable Care Act (ACA), many beneficiaries remained eligible under these traditional coverage groups. 
We refer to these beneficiaries as non-newly eligible beneficiaries. 
We reviewed a stratified random sample of 125 non-newly eligible beneficiaries for whom California made 
Medicaid payments for services provided from October 2014 through March 2015.  On the basis of our 
sample results, we estimated that California made Medicaid payments of $959.3 million ($536 million 
Federal share) on behalf of 802,742 ineligible beneficiaries and $4.5 billion ($2.6 billion Federal share) on 
behalf of 3.1 million potentially ineligible beneficiaries. 
California did not explicitly agree or disagree with our recommendations that it redetermine, if necessary, 
the current Medicaid eligibility of the sampled beneficiaries and ensure that (1) all eligibility requirements 
are verified properly and annual redeterminations are performed as required and (2) eligibility 
determinations are performed only for individuals who apply for Medicaid.  California partly agreed with 
our recommendations that it maintain information in its case files to support eligibility determinations. 
Wisconsin Did Not Report and Refund the Full Federal Share of Medicaid-Related Settlements and a 
Judgment (A-05-17-00041), December 2018 
Wisconsin did not report and return $27.6 million (Federal share) of Medicaid-related settlements and a 
judgment for the period October 2008 through September 2016.  It (1) underreported $18.7 million 
(Federal share) for six settlements and one judgment by computing the Federal share only on the net 
proceeds received after fees and interest were removed and (2) failed to report any of the $9 million 
(Federal share) for two settlements. 
Wisconsin did not properly report the settlements and a judgment because it lacked policies that 
addressed the reporting of recoveries from State actions taken because of harm to its Medicaid program 
and did not have procedures to help ensure that it reported recoveries on the Form CMS-64. 
Wisconsin agreed with our recommendations that it (1) determine whether settlements and judgments 
received after September 30, 2016, were reported and refund the Federal share of any recoveries not 
reported in their entirety and (2) implement policies to ensure that all settlements and judgments are 
reported properly.  Wisconsin disagreed with our recommendation that it refund $27.6 million to the 
Federal Government. 
Louisiana Did Not Comply With Federal and State Requirements Prohibiting Medicaid Payments for Inpatient 
Hospital Services Related to Provider-Preventable Conditions (A-06-16-02003), December 2018 
Louisiana did not comply with Federal and State requirements prohibiting Medicaid payments for inpatient 
hospital services related to treating certain provider-preventable conditions (PPCs) because it did not have 
controls to identify claims with PPCs that would have required a reduction in claim payment.  We identified 
inpatient hospital claims totaling $55.4 million ($34.9 million Federal share) that contained a diagnosis 
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  Department of Health and Human Services Office of Inspector General 
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code identified as a PPC and certain present-on-admission (POA) codes or the claims were missing POA 
codes. 
Louisiana agreed with our recommendations that it (1) work with CMS to determine what portion of the 
$34.9 million Federal share claimed was unallowable for Federal Medicaid reimbursement and refund to 
the Federal Government the unallowable amount; (2) review all claims before our audit period (with dates 
of admission from July 1, 2012, and paid through December 31, 2012) and all claims paid after our audit 
period (June 30, 2017) to determine whether payments should be reduced for any claims that contained 
PPCs, refunding to the Federal Government its share of any unallowable amounts; and (3) strengthen its 
internal controls to ensure hospitals submit services related to PPCs as noncovered days, postpayment 
reviews are conducted, and POA codes are submitted on claims. 
States Follow a Common Framework in Responding to Breaches of Medicaid Data (OEI-09-16-00210), 
October 2018 
We found that most of the 1,260 breaches that State Medicaid agencies and their contractors identified in 
2016 disclosed information about a single individual, and often resulted from misdirected letters or faxes; 
large breaches from hacking were rare.  States follow a common framework for responding to breaches of 
Medicaid data.  However, although CMS has issued guidance that advises States to notify CMS of 
breaches, most States do not routinely do so.  CMS concurred with our recommendation to reissue 
guidance to States about reporting Medicaid breaches to CMS. 
Virginia Received Millions in Unallowable Bonus Payments (A-04-17-08060), January 2019 
Some of the Childrens Health Insurance Program Reauthorization Act of 2009 bonus payments that 
Virginia received for FYs 2011 through 2013 were not allowable in accordance with Federal requirements.  
Most of the data used in Virginias bonus payment calculations were in accordance with Federal 
requirements.  However, Virginia overstated its current enrollments in its bonus requests to CMS for FYs 
2011 through 2013 because it improperly inflated its current enrollment by a fixed percentage estimate to 
account for potential retroactive enrollment, instead of using actual enrollment and the adjustment 
process to account for actual retroactive enrollment.  CMS guidance instructed Virginia to calculate current 
enrollment based on actual enrollment. 
As a result of the overstated current enrollment numbers, CMS overpaid Virginia approximately 
$13.8 million in bonus payments. 
Virginia disagreed with our recommendation that it refund approximately $13.8 million to the Federal 
Government. 
New Jersey Did Not Provide Adequate Oversight of Its Medicaid Delivery System Reform Incentive Payment 
Program (A-02-17-01007), March 2019 
We could not determine whether New Jersey appropriately claimed Medicaid reimbursement for pay-for-
performance incentive payments to five selected hospitals.  Specifically, we could not determine whether 
the hospitals met performance goals calculated from Medicaid claim data.  In addition, the hospitals did 
not report patients health records information consistent with performance measure criteria.  As a result, 
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  Department of Health and Human Services Office of Inspector General 
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we could not determine what portion of pay-for-performance incentive payments, totaling approximately 
$51 million ($25 million Federal share), that New Jersey made to the five selected hospitals based on 
determinations from New Jerseys Delivery System Reform Incentive Payment (DSRIP) program contractor 
was appropriate. 
This occurred because New Jersey did not ensure that the DSRIP program contractor maintained Medicaid 
claim data to support the achievement of performance goals and did not provide adequate guidance to 
the hospitals regarding how they should report patients health records information. 
New Jersey disagreed with our findings and did not indicate concurrence or nonconcurrence with our 
recommendations that it work with its DSRIP manager and program contractor and the five selected 
hospitals to determine whether the approximately $51 million ($25 million Federal share) in pay-for-
performance incentive payments to the hospitals was appropriate.  New Jersey should also work with its 
DSRIP manager and program contractor and the 44 hospitals not selected for review to determine 
whether the approximately $132 million ($66 million Federal share) in remaining pay-for-performance 
incentive payments was appropriate.  We also recommended that New Jersey improve its oversight of the 
DSRIP program to ensure compliance with Medicaid requirements. 
Quality of Care, Safety, and Access 
Wisconsin Did Not Comply With Federal Waiver and State Requirements at All 20 Adult Day Care Centers 
Reviewed (A-05-17-00030), October 2018 
Wisconsin did not comply with Federal waiver and State requirements in overseeing centers that serve 
vulnerable adults who receive services through the Family Care program.  All 20 of the centers we 
reviewed did not comply with State certification requirements.  In total, we found 208 instances of 
noncompliance with health and safety and administrative requirements. 
Wisconsin said that instances of noncompliance occurred partly because of low staffing levels that did not 
allow State surveyors to make recertification visits every 2 years.  Additionally, Wisconsin officials 
confirmed that the certification checklist was outdated and lacked clarity on certain requirements, and 
certification requirements were not in the Wisconsin Administrative Rules.  Wisconsin also said that there 
was minimal attendance by center personnel at State- or trade association-sponsored voluntary training 
programs.  Finally, center personnel indicated the need for improved State agency communication and 
more guidance related to the specific center certification requirements. 
Wisconsin concurred with our recommendations that it update the certification checklist and promulgate 
rules as required by Wisconsin Statutes, identify and address reasons for low attendance by center 
personnel at training programs, and increase State agency guidance related to center requirements.  
Wisconsin partially concurred with our recommendations that it ensure that the 208 instances of 
noncompliance with health and safety and administrative requirements identified in this report are 
corrected and consider revising staffing standards and caseload thresholds for State surveyors. 
   
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  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
Program Integrity 
Vulnerabilities Exist in State Agencies Use of Random Moment Sampling To Allocate Costs for Medicaid 
School-Based Administrative and Health Services Expenditures (A-07-18-04107), December 2018 
Inadequate oversight at both CMS and the State Medicaid agency (State agency) level created 
vulnerabilities in State agencies use of random moment time studies (RMTS) as a basis to allocate and 
claim Federal Medicaid reimbursement for costs associated with school-based administrative activities and 
health services. 
Of the 10 State agencies, 5 claimed unallowable school district administrative claiming (SDAC) and school-
based health services (SBHS) costs, 3 claimed SDAC costs without having properly submitted cost 
allocation plans that described their RMTS methodologies, and all 10 did not correctly develop the RMTS 
methodologies used to allocate costs.  Furthermore, some of the annual cost settlements performed by 
three State agencies did not take all interim payments into account.  In addition, three State agencies 
could not provide medical record documentation to support the responses provided by RMTS participants; 
therefore, we could not determine whether services for which the State agencies had claimed SBHS costs 
had actually been performed.  Finally, we could not determine which portions of an additional $325.1 
million of SDAC and SBHS costs were allowable in two States whose RMTS methodologies used sample 
universes that were or may have been inaccurate. 
CMS concurred with our recommendations that it distribute formal guidance for the use of RMTS to 
allocate SBHS costs or consider no longer permitting States to use RMTS methodologies to allocate and 
claim SBHS costs and with our procedural recommendations for instructions to all State agencies 
regarding their SDAC and SBHS programs and their RMTS methodologies. 
Payment Policy and Trends 
Although Hospital Tax Programs in Seven States Complied With Hold-Harmless Requirements, the Tax 
Burden on Hospitals Was Significantly Mitigated (A-03-16-00202), November 2018 
The healthcare-related hospital tax programs in the seven States we reviewed (California, Illinois, Indiana, 
Michigan, Missouri, Ohio, and Pennsylvania) complied with hold-harmless requirements.  The States 
collected $38.4 billion in tax revenue from their hospitals during State FYs 2011 through 2015.  The $38.4 
billion was used as the State share of Medicaid payments and resulted in a drawdown of $54.6 billion in 
Federal matching funds for a total of $93 billion.  From the $93 billion, $60.2 billion was used for 
supplemental payments for non-disproportionate share hospitals (non-DSHs) to mitigate most of the 
hospital tax payments, and $32.7 billion was used mostly for additional hospital services. 
In the States reviewed, we found that non-DSH supplemental payments exceeded 75 percent of hospital 
tax payments in each year for all States, except for 2 years in Pennsylvania and 1 year for Ohio.  However, 
because the tax rate was less than the 6 percent safe-harbor threshold, the tax programs could return 
more than 75 percent of the tax payments to more than 75 percent of the taxpayers without violating the 
hold-harmless requirement (75/75 requirement).  Had the tax rates exceeded 6 percent, CMS could have 
deemed those hospital tax programs as impermissible, which would disqualify the use of the tax revenue 
for drawing down Federal matching funds. 
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  Department of Health and Human Services Office of Inspector General 
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CMS concurred with our recommendation that it re-evaluate the effects of the healthcare-related tax safe-
harbor threshold and the associated 75/75 requirement to determine whether modifications are needed, 
such as the reduction or elimination of the safe harbor threshold or adjusting the 75/75 requirement.   
26 
  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
Legal and Investigative Activities Related to 
Medicare and Medicaid  
OIG investigates allegations of fraud, waste, and abuse in all HHS programs.  Our largest body of work involves 
investigating matters related to Medicare and Medicaid, such as patient harm; billing for services not rendered, 
medically unnecessary services, or upcoded services (i.e., services billed for at a level higher than warranted); illegal 
billing, sale, and diversion of prescription drugs; marketing of off-label uses for prescription drugs; and solicitation 
and receipt of kickbacks, including illegal payments to patients for involvement in fraud schemes and illegal 
referral arrangements between physicians and medical companies. 
Specific case types include fraud schemes related to: 
  controlled and noncontrolled prescription drugs,  
  home health agencies and personal care services,  
  ambulance transportation,  
  durable medical equipment, and  
  diagnostic radiology and laboratory testing.   
OIG also conducts investigations regarding organized criminal activity, including medical identity theft and 
fraudulent medical schemes established for the sole purpose of stealing Medicare and Medicaid dollars.  
Investigators are opening an increasing number of cases against healthcare providers and patients who engage in 
these healthcare fraud schemes.  Those who participate in the schemes may face heavy fines, jail time, and 
exclusion from participation in Federal healthcare programs. 
In addition to investigating Medicare and Medicaid fraud, OIG investigates fraud, waste, and abuseincluding the 
potential misuse of grants and contracts fundsin other HHS programs, including ACF, IHS, HRSA, ACL, CDC, NIH, 
SAMHSA, and other HHS agencies.  Under certain circumstances, OIG investigates noncustodial parents who fail to 
pay court-ordered child support.  OIG also investigates allegations of employee misconduct, whistleblower 
reprisals, and wrongdoing by HHS agency officials. 
One of the most common types of fraud perpetrated against Medicare, Medicaid, and other Federal healthcare 
programs involves filing false claims for reimbursement.  False claims may be pursued under Federal and State 
criminal statutes and, when appropriate, under the FCA.  Depending on the types of fraud or other violations 
involved, OIG investigations may culminate in criminal or civil court judgments and decisions, administrative 
sanctions and decisions, and/or negotiated settlement agreements.  Investigative outcomes take many forms, 
including incarceration, restitution, fines, penalties, forfeitures, assessments, and exclusion of individuals or entities 
from participation in all Federal healthcare programs.  Frequently used exclusion and penalty authorities are 
described on our website at http://oig.hhs.gov/fraud/enforcement/cmp/. 
During this semiannual reporting period, we reported 394 criminal and 327 civil actions against individuals or 
entities that engaged in offenses related to healthcare.  We also reported more than $2.05 billion in investigative 
receivables due to HHS and more than $246.6 million in non-HHS investigative receivables, including civil and 
administrative settlements or civil judgments related to Medicare, Medicaid, and other Federal, State, and private 
healthcare programs. 
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  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
The following are recently completed actions and settlements organized by subject area.  
Prescription Drugs 
The following case example involves prescription drugs: 
  CaliforniaPhysician Assistant David Lague was found guilty of conducting a scheme to unlawfully 
distribute prescription drugs.  During the trial, evidence showed that Lague intentionally prescribed 
drugs to five different patients, knowing that the prescriptions were outside the usual course of 
professional practice and without a legitimate medical purpose.  On two occasions, a patient asked 
Lague to double his prescriptions for powerful opioids so that the patient could sell the drugs.  
Lague not only doubled the prescriptions, he also discussed with the patient how to do it in a way 
to avoid scrutiny by pharmacies or law enforcement.  Lague admitted at trial that he wrote false 
medical records of those visits in order to cover up what he was doing.  The evidence at trial also 
showed that Lague falsified records as to other patients as well, detailing exams that never took 
place and indicating that he had reviewed lab work that he never reviewed.  An expert who 
reviewed four of Lagues patient files found that his handling of those patients was an extreme 
departure from the standard of care.  A jury found Lague guilty of 39 counts of unlawful 
distribution of controlled substances, and he was sentenced to 10 years in prison. 
Pharmacies 
The following case example involves a pharmacy: 
  MissouriThe United States entered into False Claims Act settlement agreements (Agreements) 
with Howard Stark Professional Pharmacy, Inc., Steven Baraban, Gary Gray, and Steven Schafer 
(collectively, Stark Pharmacy).  The Agreements resolve allegations that from March 1, 2013, 
through December 31, 2015, Stark Pharmacy, which had two locationsone in Kansas and one in 
Missouri, (1) submitted claims to Medicaid for payment of compounded pain creams with formulas 
that were different from the formulas in the pain creams provided to Medicaid beneficiaries; (2) 
manipulated compounds without physician authorizations; (3) submitted claims for payment of 
prescriptions that were returned to the manufacturer or for prescriptions that were not actually 
provided to Medicaid beneficiaries; and (4) created documentation that falsely represented pain 
creams were compounded in Missouri and that falsely represented the base creams used in the 
compounds.  OIG entered into a 3-year Integrity Agreement with Howard Stark Professional 
Pharmacy, Gary Gray, and Steven Schafer. 
Quality of Care 
The following case example involves quality of care: 
  KentuckyDr. Anis Chalhoub defrauded Medicare, Medicaid, and other insurers by implanting 
medically unnecessary pacemakers in his patients and causing the unnecessary procedures and 
follow-up care to be billed to health insurance programs.  Specifically, between 2007 and 2011, Dr. 
Chalhoub implanted approximately 234 pacemakers in patients at St. Joseph London hospital.  The 
evidence at trial showed that dozens of those patients pacemakers were medically unnecessary, 
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  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
under well-established national guidelines and Medicare coverage rules.  Several patients testified 
at trial that Dr. Chalhoub pressured them into getting the procedures and told them misleading 
information about their health conditions.  For instance, several patients recalled Dr. Chalhoub 
telling them that they might die without a pacemaker.  Sinus node dysfunction, the diagnosis Dr. 
Chalhoub gave the patients, is a non-fatal heart rate.  A Holter monitor would indicate a heart rate 
that was slightly slow in the middle of the night, and Chalhoub would cite this as a reason to place 
a pacemaker.  This would then be followed by years of additional testing and check-ups.  Patients 
receiving a pacemaker were as young as 28 years old.  Several patients had their pacemaker 
removed or turned off and testified that they felt better after having done so.  Dr. Chalhoub was 
found guilty of healthcare fraud and sentenced to 3 years and 6 months in prison and ordered to 
pay $257,515 in restitution. 
Pharmaceutical Companies 
The following case example involves a pharmaceutical company: 
  New YorkAmerisourceBergen Corporation (ABC) entered into a False Claims Act settlement 
agreement and agreed to pay $625 million to resolve liability associated with a pre-filled syringe 
program operated by certain ABC subsidiaries between 2001 and January 2014.  More specifically, 
the United States alleged that the ABC subsidiaries improperly repackaged oncology-supportive 
injectable drugs into pre-filled syringes and improperly distributed the syringes to physicians 
treating cancer patients.  The government also alleged that, in connection with the pre-filled 
syringe program, ABC and its subsidiaries caused the submission of false claims to Federal 
healthcare programs.  ABC agreed to enter into a 5-year Corporate Integrity Agreement (CIA) with 
OIG.  The CIA covers a wide array of ABC business units and makes executives accountable for 
compliance across a broad spectrum of operations. 
Home Health 
The following case example involves home health: 
  MichiganTwo Detroit-area home health agency owners were sentenced to a total of 16 years in 
prison for their roles in a scheme to defraud Medicare by billing for home health services that were 
never provided.  Hafiz and Tasneem Tahir were ordered to pay restitution of $9.6 million and $4.4 
million, respectively, jointly and severally with their co-conspirators.  The defendants each pleaded 
guilty to conspiracy to commit healthcare fraud and wire fraud and conspiracy to pay and receive 
healthcare kickbacks.  As part of their guilty pleas, they admitted that they paid illegal kickbacks in 
exchange for the referral of Medicare beneficiaries to home health agencies that they owned.  The 
defendants further admitted that between 2009 and 2017, they submitted false claims to Medicare 
for home health services that were never provided.  Hafiz and Tasneem Tahir were charged along 
with Hoda Sabbagh, Emma King, and Antonio Kho.  King and Kho pleaded guilty and are pending 
sentencing.  Sabbagh remains a fugitive. 
   
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  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
Transportation 
The following case examples involve transportation: 
  TexasAnthony Chukwudi Nwosah was convicted of charges resulting from his involvement in a 
scheme to defraud Medicare.  Nwosah, the owner of Tonieann EMS and Rosenberg EMS, admitted 
to submitting false claims to Medicare for ambulance transport services that were not provided 
and not medically necessary.  Nwosah admitted he submitted the ambulance claims for Medicare 
beneficiaries transported by vans, not ambulances, to routine psychotherapy appointments and for 
at least one other beneficiary who did not require ambulance transportation.  Nwosah also 
admitted he instructed a licensed emergency medical technician (EMT) to create fake ambulance 
transport records which included fake vital signs, patient narratives and transport mileage.  
Additionally, he admitted that more than 2,000 fake ambulance transport records contained the 
name of another EMT who never worked for him.  Nwosah pleaded guilty to conspiracy to commit 
healthcare fraud and was sentenced to 4 years in prison and ordered to pay $1.09 million in 
restitution. 
  TexasFort Bend County (Fort Bend) made a submission pursuant to OIGs Self-Disclosure 
Protocol (Protocol), and OIG accepted Fort Bend into the Protocol.  On January 9, 2019, Fort Bend 
entered into a settlement agreement with the OIG wherein Fort Bend agreed to pay $4,526,740.26 
to resolve the OIGs allegations that Fort Bend knowingly presented to Medicare, TriCare, the 
Department of Veterans Affairs/Champus, and the Railroad Retirement Board claims for items or 
services that Fort Bend knew or should have known were not provided as claimed and were false 
or fraudulent.  Specifically, the OIG contends that during the period from October 1, 2009, to 
January 31, 2016, Fort Bend submitted claims for ambulance transportation services provided to 
beneficiaries which were improper because Fort Bend failed to obtain the necessary beneficiary 
authorization for the ambulance transports. 
Durable Medical Equipment 
The following case example involves durable medical equipment: 
  CaliforniaCovidien LP entered into a civil settlement with the United States relating to its 
Solitaire device, a mechanical thrombectomy device.  Through the settlement, Covidien 
resolved False Claims Act liability for allegedly paying kickbacks to induce the use of the 
device.  The Solitaire device is intended to restore blood flow and retrieve blood clots in 
certain stroke patients.  The alleged kickbacks took the form of payments made in connection 
with a registry study that collected data about experiences using the Solitaire device to treat 
stroke patients.  The United States alleged that Covidien paid hospitals and institutions that 
participated in the registry a fee each time they used a new Solitaire device and reported 
certain data about their practices in treating stroke patients. 
 
 
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  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
Laboratories 
The following case example involves laboratories: 
  CaliforniaGenomeDx Biosciences Corp. (GenomeDx) entered into a settlement agreement to 
resolve allegations that it improperly billed Medicare for genetic testing services from September 1, 
2015, through June 30, 2017.  Specifically, the United States alleged that GenomeDx submitted 
claims for Decipher Prostate tests (its "flagship" service) that were not medically necessary.  
GenomeDx agreed to pay over $1.9 million to resolve its alleged liability. 
Clinics 
The following case example involves a clinic: 
  Virginia1st Class Sleep Diagnostic Center and 1st Class Medical owner, Young Yi, and manager, 
Dannie Ahn, conspired to defraud Medicare, TRICARE, private insurance, and the IRS of more than 
$10 million.  According to evidence presented at trial and court documents, Yi formed the primary 
entities used to commit the crimes.  The defendants directed their employees to solicit patients 
who had been referred to the clinics for legitimate sleep studies for supplemental but medically 
unnecessary studies.  To conceal the scheme, Yi instructed employees not to send the results of the 
fraudulent studies to the patients doctors, lied to patients by telling them they did not have to pay 
copays or coinsurance, and cross-billed using different entities to conceal the repetition from the 
insurance companies and to get out-of-network payments for in-network services.  The defendants 
also used the original referring doctors names and identifying information on health insurance 
claims without their permission.  Yi and Ahn were sentenced to a combined 9 years and 11 months 
in prison and were ordered to pay $10.6 million in restitution, jointly and severally. 
Hospices 
The following case example involves hospice: 
  PennsylvaniaSouthernCare, Inc., (SouthernCare) entered into a False Claims Act settlement 
agreement to resolve allegations that between January 1, 2009, and December 31, 2014, 
SouthernCare submitted false claims to Medicare for certain patients at SouthernCares 
Pennsylvania offices when the patients did not meet the applicable Medicare eligibility 
requirements or documentation for the hospice benefit was not satisfied.  SouthernCare agreed to 
pay over $5.8 million to resolve its alleged liability. 
Kickbacks 
The following case example involves kickbacks: 
  VermontGreenway Health, LLC (Greenway), a Health Information Technology (Health IT) 
software company, entered into a False Claims Act (FCA) settlement agreement wherein they 
agreed to pay $57.25 million and enter into a 5-year Corporate Integrity Agreement with OIG 
covering the companys Health IT software.  This settlement agreement resolves Greenways FCA 
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  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
liability for the following alleged conduct: (1) falsely representing during the HHS Office of 
National Coordinator for Health Information Technology (ONC) certification process that its 
electronic health record software product known as Prime Suite complied with all applicable 
requirements under the ONC Health IT Certification Program, when, in fact, Greenway knew that 
Prime Suite would not satisfy all such requirements, which consequently caused healthcare 
providers, who used Prime Suite, to falsely attest to compliance with CMS requirements necessary 
to receive incentive payments for the use of certified software under CMSs EHR Incentive Program 
(aka Meaningful Use Program); (2) knowingly causing Prime Suite users/healthcare providers to 
report inaccurate information regarding Meaningful Use objectives and measures in attestations to 
CMS and state Medicaid agencies for purposes of obtaining Meaningful Use Program incentive 
payments; and (3) providing improper remuneration to certain healthcare providers to continue 
using Prime Suite and/or to recommend Prime Suite to other users, in violation of the Anti-
Kickback Statute, 42 U.S.C. 1320a-7b. 
Hospitals 
The following case example involves hospitals: 
  TennesseeA Health Management Associates, Inc. (HMA) subsidiary, Carlisle HMA, LLC (Carlisle), 
formerly doing business as Carlisle Regional Medical Center, pled guilty to conspiracy to commit 
healthcare fraud.  Up until 2017, Carlisle operated an acute care hospital in Carlisle, Pennsylvania.  
In September 2018, HMA entered into a 3-year Non-Prosecution Agreement (NPA) with the 
Department of Justices criminal division in connection with a corporate-driven scheme to defraud 
Federal healthcare programs by unlawfully pressuring and inducing physicians serving HMA 
hospitals to increase the number of emergency department patient admissions without regard to 
whether the admissions were medically necessary.  The scheme involved HMA hospitals billing and 
obtaining reimbursement for higher-paying inpatient hospital care, as opposed to observation or 
outpatient care, from Federal healthcare programs, increasing HMAs revenue.  Under the terms of 
the NPA, HMA will pay a $35 million monetary penalty and a criminal fine of $2.5 million.  Under 
the terms of the NPA, HMA and Community Health Systems, Inc. (CHSI), HMAs parent company, 
agreed to cooperate with the investigation, report allegations of evidence of violations of Federal 
healthcare offenses, and ensure that their compliance and ethics program satisfies the 
requirements of an amended and extended Corporate Integrity Agreement between CHSI and 
OIG.  This is part of a global resolution, including eight False Claims Act cases filed against HMA, 
and included a civil resolution where HMA agreed to pay a total of over $261 million to resolve 
these FCA matters. 
Physicians  
The following case example involves physicians: 
  PennsylvaniaThe United States entered into a False Claims Act settlement agreement 
(Agreement) with Coordinated Health Holding Company, LLC together with its direct and indirect 
subsidiaries, including but not limited to CHS Professional Practice, P.C. and CH Hospital of 
Allentown, LLC (collectively, Coordinated Health) and its owner, Emil DiIorio, M.D. (Dr. DiIorio).  
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  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
The Agreement resolves allegations that (1) from January 1, 2007 through May 31, 2014, 
Coordinated Health submitted claims to Medicare, Medicaid, TRICARE and FEHBP for orthopedic 
surgical procedures that were improperly unbundled using Modifier 59; and (2) from April 1, 2009 
through December 31, 2009, Dr. DiIorio submitted claims to Medicare, Medicaid, TRICARE and 
FEHBP for orthopedic surgical procedures that were improperly unbundled using Modifier 59.  
Coordinated Health agreed to pay $12.5 million and entered into a 5-year Corporate Integrity 
Agreement. 
Healthcare Fraud Prevention and Enforcement 
In May 2009, the Secretary of HHS and the U.S. Attorney General announced the creation of the Health Care Fraud 
Prevention and Enforcement Action Team (HEAT), an interagency effort focused on combating healthcare fraud.  
HEAT includes senior officials from DOJ and HHS who are strengthening programs and investing in new resources 
and technologies to prevent and combat fraud, waste, and abuse. 
HEAT Provider Compliance Training 
OIG provides free training on our website for healthcare providers, compliance professionals, and 
attorneys.  OIGs Provider Compliance Training was an initiative developed as part of HEAT in 2011 that 
continues to reach the healthcare community with OIGs message of compliance and prevention via free 
downloadable comprehensive training materials and podcasts.  OIGs provider compliance training 
resources can be accessed at https://oig.hhs.gov/compliance/compliance-guidance/index.asp. 
Indian Health and Human Services Compliance Training 
In addition to the May 2018 compliance and quality training held in Oklahoma for more than 
200 individuals representing IHS, Tribes, and Tribal healthcare and human services organizations, OIG 
participated throughout this semiannual reporting period in various HHS-sponsored conferences, 
providing training on fraud prevention, internal controls, and compliance.  OIG Indian health and human 
services compliance training resources can be accessed at https://oig.hhs.gov/AIAN. 
Medicare Fraud Strike Force Activities 
In 2007, Medicare Fraud Strike Force teams began an effort to combine resources of Federal, 
State, and local law enforcement entities to prevent and combat healthcare fraud, waste, and 
abuse.  These partnerships among OIG and HHS, DOJ, U.S. Attorneys Offices, the Federal 
Bureau of Investigation (FBI), and State and local law enforcement have a common goal: to 
successfully analyze healthcare fraud data and investigative intelligence to quickly identify 
fraud and bring prosecutions.  Strike Force teams operate in 11 areas: Miami and 
Tampa/Orlando, Florida; Dallas and Houston, Texas; Los Angeles, California; Detroit, Michigan; 
Brooklyn, New York; Baton Rouge and New Orleans, Louisiana; Chicago, Illinois; and Newark, 
New Jersey/Philadelphia, Pennsylvania; along with a Corporate Strike Force located in 
Washington, D.C. 
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  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
During this semiannual reporting period, Strike Force efforts resulted in the filing of charges 
against 47 individuals or entities, 139 criminal actions, and more than $146.6 million in 
investigative receivables. 
In October 2018, the Department of Justice announced the creation of a new initiative to 
combat the nations opioid epidemic.  The Appalachian Regional Prescription Opioid (ARPO) 
Strike Force covers 10 Federal judicial districts in Alabama, Kentucky, Ohio, Tennessee, Virginia 
and West Virginia.  The Office of Investigations is working closely with its law enforcement 
partners at DEA, FBI and the state Medicaid Fraud Control Units to provide investigative 
support.  Cases involve physicians and pharmacies that are responsible for medically 
unnecessary opioid prescriptions and dangerous drug combinations that are being paid for by 
Medicare and Medicaid.  In many instances, there are other allegations of wrongdoing relating 
to kickbacks, healthcare fraud and quality of care, including patient overdoses and deaths. 
The following case examples involve Strike Force cases: 
  TexasAnn Shepherd, owner and operator of Amex Medical Clinic (Amex), and Dr. John 
Ramirez were convicted of charges resulting from their involvement in a scheme to defraud 
Medicare.  According to evidence presented at trial, from about December 2011 through 
about August 2015, Shepherd and Ramirez conspired to defraud Medicare out of payments 
for medical services.  Shepherd sold medical orders and other documents signed by 
Ramirez to home health agencies in and around Houston.  In these medical orders, Ramirez 
falsely certified information about the patients medical condition and need for home 
health services.  Co-conspirators at home health agencies then used the false paperwork to 
bill to, and receive payment from, Medicare for home health services that were not 
medically necessary or not provided.  Shepherd also caused Amex to bill Medicare for 
purported physician services that were actually provided by an unlicensed practitioner, if at 
all.  Shepherd and Ramirez were sentenced to a combined 55 years in prison and were 
ordered to pay up to $26.7 million in restitution, jointly and severally. 
  FloridaPharmacy owner Antonio Perez Jr. engaged in an $8.4 million Medicare fraud 
scheme in the Miami area.  According to admissions made in connection with his guilty 
plea, Perez Jr. owned a pharmacy called A.R.A Medical Services Inc., which did business 
under the name Valles Pharmacy Discount (Valles).  Between January 2011 and August 2017, 
Perez Jr. allegedly engaged in a conspiracy to defraud Part D of the Medicare program.  
Specifically, Perez Jr. agreed to pay illegal healthcare kickbacks to Medicare beneficiaries in 
exchange for a promise from the beneficiaries to fill their prescriptions at Valles, and to 
allow Valles to submit claims to Medicare for prescription drugs that were not provided to 
the beneficiaries.  According to admissions made in connection with Perez Jr.s plea, during 
the course of the scheme, Valles submitted over $32 million in claims to Medicare for 
prescription drugs, of which approximately $8.4 million was for medically unnecessary 
prescription drugs that Valles never purchased and were never provided to Medicare 
beneficiaries.  Perez Jr. was sentenced to 7 years and 3 months in prison and ordered to 
pay $8.4 million in restitution. 
   
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  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
Other Criminal and Civil Enforcement Activities 
Most Wanted Fugitives Listed on OIGs Website 
The OIG Most Wanted Fugitives website continues to garner national and international attention and has 
greatly assisted in helping to capture fugitives charged with defrauding Federal healthcare programs and 
stealing millions of taxpayer dollars.  The Most Wanted Fugitives website is continually updated and 
features a profile for each fugitive as well as an online tip form and a hotline number for individuals to 
report fugitive-related information to OIG, in English or Spanish, 24 hours a day, 365 days a year.  The 
Most Wanted Fugitives list can be accessed at https://oig.hhs.gov/fraud/fugitives/.  During this semiannual 
reporting period, one fugitive was captured, as described below: 
One of OIGs Most Wanted Fugitives, David Kim, was captured during this reporting period.  Kim was 
involved in a scheme to fraudulently bill Medicare approximately $15.2 million for physical therapy 
services that were either not reimbursable or were not fully provided.  Kim has been a fugitive since 
2015 and was recently found to be residing in Ho Chi Minh City, Vietnam.  He is currently in U.S. 
custody and will face charges stemming from his indictment. 
In October 2015, Kim was indicted on charges of healthcare fraud, illegal remunerations, and 
aggravated identity theft.  Kim was a licensed chiropractor and owner of New Hope Clinic (New Hope) 
in Los Angeles. 
According to the indictment, Kim was recruited by co-conspirators to solicit Medicare beneficiaries to 
receive purported physical therapy services, which would then be fraudulently billed to Medicare. Kim 
recruited Medicare beneficiaries to his clinics, obtained their unique Medicare identification numbers 
and patient information, and supplied the information to his co-conspirators, Joseff Sales, a physical 
therapist, and Danniel Goyena, a physical therapy assistant. 
Sales and Goyena hired physical therapists to evaluate clients and created physical therapy treatment 
plans.  Ultimately, clients received services that were not reimbursable through Medicare, such as 
acupuncture or massage, and some clients never received any follow-up physical therapy services.  Kim 
was aware that his partners submitted claims using clients names and unique identification numbers 
to Medicare for reimbursement for physical therapy services, despite the clients having received other 
non-reimbursable services. 
Between March 2012 and January 2014, Kim received $379,785 in kickback payments from companies 
owned by Sales and Goyena for the patients who were referred by Kim and purportedly received 
physical therapy services at New Hope.  Goyena and Sales both pleaded guilty to healthcare fraud and 
illegal remunerations and were each sentenced to 4 years and 3 months in prison and held jointly 
liable for $7,896,007 in restitution.  
HHS-OIG Hotline 
Part of OIGs Office of Investigations, the hotline is the public-facing division for OIGs intake and 
evaluation of fraud tips.  The mission of the HHS-OIG Hotline is to support OIGs oversight 
responsibilities in safeguarding the integrity of all programs and personnel under HHSs purview and 
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  Department of Health and Human Services Office of Inspector General 
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protecting them from fraud, waste, and abuse.  The hotline achieves its mission through its staffs 
dedication to timely intake and analysis of information received from various sources, such as the 
Report Fraud link on the HHS-OIG website.  During this semiannual reporting period, the OIG 
Hotline reported expected recoveries of $28 million as a direct result of cases originating from hotline 
complaints. 
OIG Hotline Activity (10/01/1803/31/19) 
Contacts to 1-800-HHS-TIPS phone line, including  59,956 
callers seeking information  
Total tips evaluated   79,398 
Tips referred for action   9,632 
Closed; no basis provided for further action   5,027 
Closed; no HHS violation   2,192 
 
Sources of Tips Referred for Action   
Phone   4,310 
OIG website   4,135 
Letters/faxes   998 
Other  188 
 
State Medicaid Fraud Control Units 
OIG Oversight of State MFCUs 
MFCUs are key partners with OIG in the fight against fraud, waste, and abuse in State Medicaid programs.  
OIG has oversight responsibility for MFCUs and administers grants that provide Federal funding for Unit 
operations.  MFCUs operate in 49 States and the District of Columbia, and in this reporting period OIG 
certified two new MFCUs in the U.S. territories of Puerto Rico and the U.S. Virgin Islands.  The Federal 
Government reimburses 90 percent of Units total expenditures during their first 3 years of operation and 
75 percent thereafter.  MFCUs investigate and prosecute Medicaid provider fraud and patient abuse and 
neglect in healthcare facilities or board and care facilities. 
Medicaid Fraud Control Units Fiscal Year 2018 Annual Report (OEI-09-19-00230), March 2019 
This annual report highlights statistics on the accomplishments of the 50 MFCUs in operation during 
FY 2018.  OIG found that the number of convictions in FY 2018 remained similar to those in recent years.  
Forty-five percent of the 1,109 MFCU fraud convictions involved personal care services attendants and 
agencies.  Fraud cases accounted for 74 percent of the MFCU convictions, while 26 percent involved 
patient abuse or neglect.  MFCUs were responsible for 810 civil settlements and judgments, 27 percent of 
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  Department of Health and Human Services Office of Inspector General 
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which involved pharmaceutical manufacturers.  MFCUs reported $859 million in criminal and civil 
recoveries. 
In an appendix to the report, OIG summarizes beneficial practices identified by OIG in its onsite reports 
that may be useful to other MFCUs. 
OIG Onsite Reviews of MFCUs 
In addition to an annual recertification review of each MFCU, OIG conducts periodic onsite reviews of a 
sample of MFCUs.  OIG evaluates MFCU operations based on 12 performance standards and assesses 
compliance with laws, regulations, and OIG policy guidance.  OIG may also make observations of Unit 
operations and practices, including identifying beneficial practices useful to other Units.  In addition, OIG 
provides training and technical assistance to Units while onsite and on an ongoing basis.  
OIG Joint Casework with MFCUs 
The following case is an example of OIGs many joint efforts with MFCUs: 
  TennesseeDr. Robert Maughon used his staff and popularity in the community to engage 
in a scheme to defraud Medicare, Medicaid, and commercial insurance plans for over $3.5 
million.  According to court documents, from July 2013 through October 2015, Maughon 
and his staff ran a mobile allergy clinic where they tested people at carnivals, car shows, 
employee benefit fairs, and other gatherings, for allergies.  Maughon offered bonuses to 
the employees that worked his mobile allergy clinicsthe more people tested, the higher 
the bonus.  Maughon provided free allergy testing to anyone with insurance, then 
ordered allergy drops for them to use at home.  The allergy drops were ordered for people 
that tested negative, for infants, and even for people who specifically instructed Maughons 
employees that they did not want anything ordered.  Maughon then fraudulently billed 
Medicare, Medicaid, and private insurance for non-FDA approved oral allergy treatment 
that was not covered by insurance.  Maughon was sentenced to 5 years and 3 months in 
prison and ordered to pay over $3.5 million in restitution. 
Advisory Opinions and Other Industry Guidance 
Advisory opinions, which are developed in consultation with DOJ, are issued to requesting parties 
regarding the interpretation and applicability of certain statutes relating to Federal healthcare 
programs.  The Health Insurance Portability and Accountability Act of 1996 (HIPAA),  205, allows OIG 
to provide case-specific formal guidance on the application of the anti-kickback statute and safe 
harbor provisions and other OIG healthcare fraud and abuse sanctions.  During this semiannual 
reporting period, OIG received 24 requests for advisory opinions and issued 7 advisory opinions. 
Sanction Authorities and Other Administrative Actions 
Various Federal laws provide authorities the ability to impose administrative sanctions for fraud and abuse as well 
as other activities that pose a risk to Federal healthcare programs and their beneficiaries.  Sanctions include the 
exclusion of individuals and entities from Federal healthcare programs and the imposition of CMPs for submitting 
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false and fraudulent claims to a Federal healthcare program or for violating the anti-kickback statute, the physician 
self-referral law (commonly referred to as the Stark Law), or EMTALA, also known as the patient dumping 
statute.  Sanctions also include referrals for suspension and debarment in cases of grant and contract fraud. 
During this semiannual reporting period, OIG imposed 1,377 administrative sanctions in the form of program 
exclusions or administrative actions for alleged fraud or abuse or other activities that posed a risk to Federal 
healthcare programs and their beneficiaries. 
Exclusion and penalty authorities are described in Appendix D and on our website at 
http://oig.hhs.gov/fraud/enforcement/cmp/index.asp. 
Program Exclusions 
During this semiannual reporting period, OIG excluded 1,293 individuals and entities from 
Medicare, Medicaid, and other Federal healthcare programs.  Most of the exclusions resulted 
from convictions for crimes relating to Medicare or Medicaid, patient abuse or neglect, 
financial misconduct, controlled substances, or as a result of license revocation.  OIG 
completed the deployment of a new service for MFCUs to report convictions through a central 
web-based portal for exclusion.  OIG is also responsible for reinstating providers who apply 
and have met the requirements of their exclusions.  For a list of excluded individuals and 
entities, see https://exclusions.oig.hhs.gov/. 
The following are examples of program exclusions: 
  MarylandTormarco Harris, the owner of a pain management clinic, was excluded for a 
minimum of 50 years based on his conviction for conspiracy to distribute controlled 
substances, violation of the drug kingpin statute, and conspiracy to keep a common 
nuisance.  Harris and his co-conspirators ran a pill mill, dispensing controlled substances 
without a legitimate medical purpose.  From about January 2013 to about April 2017, Harris 
was responsible for issuing prescriptions signed by a co-conspirator for oxycodone, 
morphine, and Tramadol that were not medically necessary.  Patients would pay Harris cash 
to receive these prescriptions.  Harris was sentenced to 20 year in prison based on his 
conviction. 
  KansasThomas James Tholstrup, a certified nursing assistant, was excluded for a 
minimum of 20 years based on his conviction for attempted aggravated criminal sodomy 
and mistreatment of a dependent adult.  While working in a skilled nursing home, 
Tholstrup sexually abused patients in the facility.  Tholstrup was sentenced to 7 years and 7 
months in prison. 
Suspension and Debarments 
Suspensions and debarments are administrative tools used by HHS and other Federal agencies to protect 
the Government from individuals and entities that have engaged in contract fraud, have misused grant 
funds, or are otherwise not presently responsible.  Because these are Government-wide sanctions, an 
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  Department of Health and Human Services Office of Inspector General 
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individual or entity that has been suspended or debarred by HHS or any other agency is ineligible to 
participate in any future funding opportunities across the Federal Government for a specified period. 
OIG refers individuals and entities that have potentially engaged in grant or contract fraud or misconduct 
to the HHS Suspension and Debarment Official, who is responsible for determining whether to impose a 
suspension or debarment.  OIG continues to develop a robust Suspension and Debarment program and 
uses this tool to protect Government programs against fraud, waste, poor performance, and 
noncompliance with contract provisions or applicable law. 
The following case examples involve debarment: 
  OhioRobert Roche served as Executive Director of the American Indian Education Center, 
a not-for-profit agency which was awarded Federal grant funds from the Substance Abuse 
and Mental Health Services Administration, an operating division of HHS.  The grant 
application identified an individual who was supposed to have served as the Project 
Coordinator.  Instead of this individual, Roche named himself as the Project Coordinator 
and paid himself the salary for the position.  This was a conflict of interest, as the Project 
Coordinator was supposed to have reported to the Executive Director. Because of Roches 
false statements on the grant application, he embezzled Federal grant funds that were 
intended to support tribal mental health and wellness for children, youth and families.  He 
was sentenced to serve 4 months in prison and ordered to pay $77,097 in restitution.  
Roche was debarred for a 3-year period based on an OIG referral to the Department. 
  South DakotaWehnona Stabler was the Chief Executive Officer of the Indian Health 
Services (IHS) Pine Ridge Hospital.  IHS is an operating division of HHS.  Stabler failed to 
report, as required, a gift of $5,000 on her Office of Government Ethics (OGE) Form-450, 
Confidential Financial Disclosure Report.  Stabler was convicted of making a false statement 
on the aforementioned report and was subsequently sentenced to 1 year of unsupervised 
probation.  Stabler was debarred for 3 years on the basis of an OIG referral to the 
Department. 
Civil Monetary Penalties Law (CMPL) 
The CMPL authorizes OIG to impose administrative penalties, assessments, and exclusions against a person 
who, among other things, submits, or causes to be submitted, claims to a Federal healthcare program that 
the person knows, or should know, are false or fraudulent.  The exclusions statute also authorizes OIG to 
exclude a person who violates the CMPL.  During this semiannual reporting period, OIG concluded cases 
involving more than $38.3 million in CMPs and assessments. 
Affirmative Litigation 
The CMPL authorizes OIG to use its administrative remedies to affirmatively pursue cases.  OIG may also 
exclude under the exclusions statute for engaging in conduct that violates the CMPL.  When OIG excludes 
under the exclusions statute for engaging in conduct that violates the CMPL, it is known as an affirmative 
exclusion. 
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The following case examples involve affirmative litigation cases under the CMPL: 
  MichiganIn 2015, Millennium Health, LLC f/k/a Millennium Laboratories, Inc. (Millennium) 
entered into a False Claims Act settlement to resolve, in part, allegations that Millennium 
provided free point of care urine drug testing cups (POCT cups) to physiciansexpressly 
conditioned on the physicians agreement to return the urine specimens to Millennium for 
additional testing provided by and billed to Federal healthcare programs by Millennium, in 
violation of the Anti-Kickback Statute and the Prohibition on Certain Physician 
Referrals.  Since September 2017, more than $2 million has been recovered from OIG-
initiated affirmative litigation actions against physicians, physician practices, and other 
providers based on their alleged unlawful receipt of free POCT cups from Millennium 
during the relevant timeframe.  A recent example of this is OIGs settlement with Recovery 
Pathways, LLC (Recovery), a drug and alcohol rehabilitation center, which resolved its 
alleged liability for soliciting and receiving remuneration in the form of POCT cups from 
Millennium.  Recovery agreed to pay $64,555 to resolve its alleged liability under the CMPL. 
  OklahomaComanche County Hospital Authority d/b/a Comanche County Memorial 
Hospital (CCHA), agreed to pay $566,806 to resolve its potential liability under the CMPL 
related to allegations that CCHA submitted claims to Medicare for emergency ambulance 
transportation to destinations such as skilled nursing facilities and patient residences that 
should have been billed at the lower non-emergency rate.  Additionally, during the course 
of OIGs investigation, CCHA discovered and disclosed that it submitted claims to Medicare 
for emergency ambulance transportation that were not medically reasonable or necessary.  
CCHA also disclosed that it submitted claims to Medicare for transports where the 
documentation for the transport was not consistent with the patients condition, and 
therefore did not support the documented medical necessity for the transport.  This 
settlement resulted from OCIGs collaboration with OIGs Consolidated Data Analysis 
Center.  OCIG has settled eight affirmative CMPL cases based on this conduct since 
September 2016. 
Patient Dumping 
Some of the CMPL cases that OIG resolved during this semiannual reporting period were pursued under 
EMTALA, a statute designed to prevent hospitals from denying emergency care to patients and to ensure 
patient access to appropriate emergency medical services. 
The following case examples relate to the EMTALA statute: 
  IowaEffective April 30, 2018, Covenant Medical Center (Covenant) entered into a $90,000 
settlement agreement with OIG to resolve allegations that it violated EMTALA when it failed 
to provide an adequate medical screening examination and stabilizing treatment for a 
patient and then inappropriately transferred him to another hospital.  The patient, a 54-
year-old man, arrived by ambulance to Covenants Emergency Department (ED) 
complaining of shortness of breath, chest pain, and diaphoresis.  The ED physician 
screened the patient and consulted the on-call cardiologist.  The patients condition 
worsened, and he was intubated.  On advice of the on-call cardiologist, the ED physician 
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  Department of Health and Human Services Office of Inspector General 
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began transcutaneous pacing.  The ED physician did not request the on-call cardiologist 
present to the ED nor did the on-call cardiologist present to the ED to examine and treat 
the patient.  The ED physician requested transfer to a nearby hospital for placement of a 
transvenous pacemaker.  The patient was transferred to the receiving hospital nearly three 
hours after he presented to Covenants ED.  The receiving hospital placed a transvenous 
pacemaker on the patient, but he expired shortly after.  OIG alleged that Covenants on-call 
cardiologist was capable of providing a transvenous pacemaker. 
  North CarolinaWashington County Hospital (WCH) agreed to pay $52,414 to resolve its 
potential liability under EMTALA.  OIG alleged that WCH violated EMTALA when it failed to 
provide an appropriate medical screening examination and stabilizing treatment for a 
patient.  Specifically, OIG alleged that an ambulance was called to provide assistance to a 
patient, who was suffering from a worsening of shortness of breath that she had been 
experiencing for two weeks.  The emergency medical technicians (EMTs) arrived at the 
patients house, found that she was experiencing uncontrolled hypertension and increased 
shortness of breath with dyspnea on exertion, and drove her to WCHs ED, two minutes 
away from the patients house.  En route, the EMTs notified WCHs ED that they were 
bringing the patient, but when the ambulance was on WCHs property, WCHs ED informed 
the ambulance that WCH was on diversion and could not see the patient.  However, WCH 
was not on diversion and, while WCH knew the ambulance was on their property, WCH 
directed the ambulance to take the patient to another hospital about 22 miles away. 
Self-Disclosure Programs 
Healthcare providers, suppliers, or other individuals or entities subject to CMPs can apply for acceptance 
into the Provider Self-Disclosure Protocol, a program created in 1998 for voluntary disclosure of self-
discovered evidence of potential fraud.  The self-disclosure program may give providers the opportunity to 
avoid costs or disruptions associated with Government-directed investigations and civil or administrative 
litigation. 
Application processes for two additional self-disclosure programs were recently added to the OIG website 
for HHS contractors and grantees.  The OIG contractor self-disclosure program provides contractors the 
opportunity to self-disclose when they have potentially violated the FCA or other Federal criminal laws 
prohibiting fraud, conflict of interest, bribery, or gratuity.  This self-disclosure process is available only to 
those with a Federal Acquisition Regulation-based contract with HHS.  The OIG Grant Self-Disclosure 
program is available for application by HHS grantees or HHS grant subrecipients and provides the 
opportunity for voluntary disclosure to OIG of potential fraud.  OIG evaluates the reported results of each 
internal investigation under the provider self-disclosure protocol to determine the appropriate course of 
action.  The self-disclosure guidelines are available on the OIG website at 
https://oig.hhs.gov/compliance/self-disclosure-info/index.asp.  During this semiannual reporting period, 
provider self-disclosure cases resulted in more than $33 million in HHS receivables. 
The following examples pertain to provider self-disclosure settlements: 
  TennesseeAfter self-disclosing conduct to OIG, BenchMark Rehabilitation Partners, LLC, 
BenchMark Growth Partners, LLC, BenchMark Premier Partners, LLC, BenchMark East 
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  Department of Health and Human Services Office of Inspector General 
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Partners, LLC, BenchMark Development Partners, LLC, and BenchMark West Partners, LLC 
(collectively, BenchMark), agreed to pay more than $3.1 million to resolve its alleged liability 
under the CMPL.  Specifically, OIG alleged that BenchMark submitted claims to Medicare 
and TRICARE for time-based outpatient rehabilitation therapy services provided to 
Medicare and TRICARE beneficiaries when BenchMarks therapists did not provide constant 
attendance or direct one-on-one contact because the therapy services were provided 
concurrently with another Medicare or TRICARE beneficiary. 
  TexasAfter self-disclosing conduct to OIG, HVHC LLC, Visionworks of America, Inc., 
Visionary Properties, Inc., Visionworks, Inc., Empire Vision Center, Inc. (collectively, 
Visionworks), agreed to pay more than $3.6 million to resolve its alleged liability under the 
CMPL.  Specifically, OIG alleged that Visionworks paid excess remuneration to certain 
optometrists in the form of space and equipment leases that were below fair market value 
and/or by failing to collect one or more rental amounts under space and equipment leases, 
in violation of the Anti-Kickback Statute. 
Corporate Integrity Agreements 
Many healthcare providers elect to settle their cases before litigation.  As part of the settlements, providers 
often agree to enter into CIAs with OIG to avoid exclusions from Medicare, Medicaid, and other Federal 
healthcare programs.  Under a CIA, a provider commits to establishing a program and taking other 
specified steps to ensure future compliance with Medicare and Medicaid rules.  The compliance programs 
are designed, in part, to prevent future fraud.  OIG monitors providers compliance with these agreements 
and may impose penalties on entities that fail to comply with the requirements of their CIAs. 
The following case example involves CIA enforcement: 
  MassachusettsIn May 2017, eClinicalWorks, LLC (ECW), one of the nations largest 
vendors of electronic health records (EHR) software, agreed to pay $155 million and 
entered into a CIA to resolve ECWs alleged False Claims Act liability when ECW concealed 
from its customers that its software did not comply with the requirements for meaningful 
use certification.  Among other obligations, the CIA requires ECW to retain an Independent 
Software Quality Oversight Organization, which evaluates ECWs software quality control 
systems, to provide notice to its customers of any safety related issues, and to maintain on 
its customer portal a comprehensive list of such issues and any steps users should take to 
mitigate potential patient safety risks.  Pursuant to its authority under the CIA, the OIG 
issued a $132,500 stipulated penalty on July 5, 2018, for ECWs failure to timely report 
patient safety issues to OIG as reportable events. 
 
 
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  Department of Health and Human Services Office of Inspector General 
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Public Health Agencies  
Public Health Agencies Reports and Reviews 
Centers for Disease Control and Prevention 
The Centers for Disease Control and Prevention Has Controls and Strategies To Mitigate Hurricane 
Preparedness and Response Risk (A-04-18-02014), November 2018 
Within the 4 risk areas related to CDCs hurricane preparedness and response activities, we identified 22 
sub-risk areas and rated 19 as low risk and 3 as moderate risk.  Even though we rated three sub-risk areas 
as moderate, CDC had developed various controls and strategies that are designed to mitigate the risks we 
identified for preparing for and responding to hurricanes and other natural disasters.  
This report contains no recommendations. 
CDC Reimbursed Contractors for Some Unallowable World Trade Center Health Program Administrative 
Costs (A-02-16-02012), February 2019 
CDC reimbursed contractors for some World Trade Center Health Program (WTCHP) administrative costs 
that did not comply with Federal requirements.  CDC improperly reimbursed contractors for 43 of the 234 
invoice line items that we sampled, totaling more than $1 million.  On the basis of our sample results, we 
estimated that CDC improperly reimbursed contractors for WTCHP administrative costs totaling $8 million 
that did not comply with Federal requirements.  In addition, CDC paid contractors for claims management 
services at different rates.  Our review quantified the impact of this payment differential and determined 
that CDC could have saved $360,000 if contractors were reimbursed at the lowest negotiated rate.  Finally, 
we determined that CDC complied with Federal requirements for all eight of the non-statistically selected 
fixed-price contract invoices.  
CDC agreed with our recommendation to recover the $1 million associated with the 43 unallowable 
sampled items and generally agreed with our recommendations to improve its monitoring of WTCHP 
contractors invoices and review contractor costs for claims management services for reasonableness, 
which could result in cost savings totaling $360,000.  CDC generally disagreed with our recommendation 
to work with WTCHP contractors to identify and recover the remaining unallowable payments made 
during the audit period, which are estimated to be $7 million, because it disagreed with some of our 
findings. 
Presidents Emergency Plan for AIDS Relief 
The Presidents Emergency Plan for AIDS Relief (PEPFAR) was authorized to receive $48 billion in funding for the 
5-year period beginning October 1, 2008, to assist foreign countries in combating HIV/AIDS, tuberculosis, and 
malaria.  CDC awards PEPFAR funds to and works with ministries of health and other partners in 60 countries to 
combat HIV/AIDS globally.  Additional funds were authorized to be appropriated through 2018. 
 
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During the semiannual reporting period, OIG issued one report related to PEPFAR funding: 
The Centers for Disease Control and Preventions Namibia Office Implemented Our Prior Audit 
Recommendations (A-04-18-01008), October 2018 
Congress authorized the Presidents Emergency Plan for AIDS Relief (PEPFAR) to receive $48 billion in 
funding for the 5-year period beginning October 1, 2008, to assist foreign countries in combating 
HIV/AIDS, tuberculosis, and malaria.  Congress authorized additional funds to be appropriated through 
2018. 
We have conducted a series of audits of organizations receiving PEPFAR funds from CDC.  We selected 
CDCs Namibia office (CDC-Namibia) for review because a prior OIG audit determined that CDC-Namibia 
did not always properly monitor recipients use of PEPFAR funds. 
CDC-Namibia implemented corrective actions for all three of the recommendations from our prior audit 
report.  Accordingly, this report contains no recommendations. 
Food and Drug Administration 
The Food and Drug Administrations Policies and Procedures Should Better Address Postmarket Cybersecurity 
Risk to Medical Devices (A-18-16-30530), October 2018 
FDAs policies and procedures were insufficient for handling postmarket medical device cybersecurity 
events; FDA had not adequately tested its ability to respond to emergencies resulting from cybersecurity 
events in medical devices; and, in 2 of 19 district offices, FDA had not established written standard 
operating procedures to address recalls of medical devices vulnerable to cyber threats.  These weaknesses 
existed because, at the time of our fieldwork, FDA had not sufficiently assessed medical device 
cybersecurity, an emerging risk to public health and to FDAs mission. 
FDA agreed with our recommendations that it (1) continually assess the cybersecurity risks to medical 
devices and update, as appropriate, its plans and strategies; (2) establish written procedures and practices 
for securely sharing sensitive information about cybersecurity events with key stakeholders who have a 
need to know; (3) enter into a formal agreement with Federal agency partners, including the Department 
of Homeland Securitys Industrial Control Systems Cyber Emergency Response Team, establishing roles 
and responsibilities as well as the support those agencies will provide to further FDAs mission related to 
medical device cybersecurity; and (4) ensure the establishment and maintenance of procedures for 
handling recalls of medical devices vulnerable to cybersecurity threats. 
 
National Institutes of Health 
The National Institutes of Health Generally Complied With Federal Requirements for the Preparation and 
Receipt of Select Agent Shipments (A-03-15-00354), December 2018 
Generally, NIH has designed and put in place controls to ensure that select agent shipments are prepared 
and received in accordance with Federal regulations and related supporting laboratory guidance and 
instruction.  However, two NIH registered entities security plans did not include certain procedures for 
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  Department of Health and Human Services Office of Inspector General 
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notifying the Federal Select Agent Program (FSAP) if (1) a select agent shipment is not received within 48 
hours after the expected delivery time, (2) a select agent shipment receives damage to the extent that a 
select agent release may have occurred, or (3) an authorization for a select agent transfer expires or 
becomes void before the shipment is completed.  In addition, NIHs third registered entity had not 
updated its policies and procedures to ensure compliance with new requirements for shipping select 
agents that have undergone inactivation. 
NIH concurred with our recommendations to update two registered entities security plans to include 
procedures for notifying FSAP when required and that it work with its third registered entity to implement 
a policy to ensure compliance with new requirements for shipping inactive select agents. 
Office of the Assistant Secretary for Financial Resources 
Recommendation Followup: Vulnerabilities Continue To Exist in the HHS Small Business Innovation Research 
Program (OEI-04-18-00230), March 2019 
Created by the Small Business Innovation Development Act of 1982, the Small Business Innovation 
Research (SBIR) program is a competitive awards program that provides Federal funding to small 
businesses that pursue research for potential commercialization that meets the priorities of the Federal 
Government.  Within HHS, four operating divisions participate in the SBIR program: NIH; CDC; FDA; and 
ACL. 
In 2014, we reported vulnerabilities with HHSs SBIR program and made four recommendations to improve 
HHSs oversight.  Since that report, HHS had not formally notified OIG of any actions to implement the two 
outstanding recommendationswith which HHS had concurredregarding awardee eligibility and 
duplicative funding.  For this recommendation followup report, we assessed HHSs progress in 
implementing those two outstanding recommendations.  We found that HHS has not implemented OIGs 
recommendations to ensure the eligibility of awardees for the SBIR program and to prevent duplicative 
funding.  As a result, HHSs SBIR program continues to have weaknesses in these two areas. 
Substance Abuse and Mental Health Services Administration 
New York Did Not Provide Adequate Stewardship of Substance Abuse Prevention and Treatment Block Grant 
Funds (A-02-17-02009), March 2019 
New York failed to trace funds to a level of expenditure adequate to establish that the funds were used for 
the Substance Abuse Prevention and Treatment Block Grant (SABG) programs intended purpose.  By not 
implementing procedures for reporting actual expenditures and tracing payments, New York may have 
retained unexpended funds and hindered its ability to ensure that substance abuse prevention and 
treatment programs received necessary funds.  New York is responsible for implementing effective 
accounting procedures; however, a lack of guidance from SAMHSA contributed to its inadequate 
stewardship of the SABG funds. 
In addition, New York does not have procedures in place to determine whether providers are accurately 
reporting Medicaid revenues.  Specifically, one opioid treatment provider received excess SABG funding 
from New York totaling more than $1.8 million because the provider underreported Medicaid revenue on 
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  Department of Health and Human Services Office of Inspector General 
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its fiscal report.  This occurred because State agency staff who reconciled providers fiscal reports did not 
have access to necessary data. 
SAMHSA did not concur with our recommendation that it provide formal guidance to New York on 
accounting for and reporting SABG expenditures and unexpended funds but agreed to recover $1.8 million 
from New York.  New York generally agreed with our recommendations that it (1) review the revenues 
reported on the fiscal reports of providers not reviewed in this audit and recover any excess unexpended 
funds and (2) develop and implement procedures to ensure that the necessary staff have access to 
Medicaid revenue data and reconcile the data with the revenue reported on the providers fiscal reports. 
The Substance Abuse and Mental Health Services Administration Followed Grant Regulations and Program-
Specific Requirements When Awarding State Targeted Response to the Opioid Crisis Grants 
(A-03-17-03302), March 2019 
SAMHSA followed HHS grant regulations and program-specific requirements when awarding State 
Targeted Response to the Opioid Crisis grants authorized under the 21st Century Cures Act.  Specifically, 
SAMHSA performed an adequate review of all 57 grant applications and adequately followed up with 
applicants to address their concerns.  As part of the pre-award process, SAMHSA created teams of expert 
staff members to review the applications and evaluate the information. 
We also determined that SAMHSAs funding formula elements (unmet need for opioid use disorder and 
drug poisoning deaths) were based on the 21st Century Cures Act.  According to SAMHSA, these funding 
elements provided the most comparable and uniform data on a national scale to assess the prevalence of 
the opioid crisis.  Lastly, we found that the 2018 State Opioid Response grant legislation provides an 
additional 15-percent set-aside for the 10 States with the highest mortality rates related to drug poisoning 
deaths. 
This report contains no recommendations. 
Legal Actions and Investigations Related to Public Health Agencies 
Health Education Assistance Loan Program 
OIG excludes from Federal healthcare programs individuals who have defaulted on Health Education 
Assistance Loan (HEAL) loans.  Under the HEAL program, which stopped making loans in 1998, HRSA 
guaranteed commercial loans to students seeking education in health-related fields.  The students can 
defer repayment of the loans until after they graduate and begin to earn income.  Although HHSs 
Program Support Center (PSC) takes steps to ensure repayment, some loan recipients do not resolve their 
debt.  After PSC has exhausted efforts to secure repayment of a debt, it declares an individual in default.  
The Social Security Act permits that thereafter, such individuals may not receive reimbursement under 
Medicare, Medicaid, and all other Federal healthcare programs for nonpayment of the loans. 
   
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HEAL Exclusions   
During this semiannual reporting period, 32 individuals and related entities were excluded because of a 
PSC referral of their cases to OIG.  Individuals who have been excluded because of default may enter into 
settlement agreements whereby the exclusions are stayed while they pay specified amounts each month to 
satisfy their debts.  If they default on these settlement agreements, they may be excluded until the entire 
debt is repaid, and they may not appeal the exclusions.  Of that amount, six were as a result of a default on 
a settlement agreement. 
After being excluded for nonpayment of their HEAL debts, 2,779 individuals chose to enter into settlement 
agreements or completely repay their debts.  That figure includes 34 individuals who entered into such 
settlement agreements or completely repaid their debts during this semiannual reporting period.  More 
than $221 million is being repaid through settlement agreements or through complete repayment.  Of that 
amount, more than $2.9 million is attributable to this semiannual reporting period. 
The following are examples of settlement agreements.  These practitioners entered into settlement 
agreements to repay the amounts indicated: 
  CaliforniaKaren Yvonne Kirby, Medical Doctor$380,484 
  New YorkAltagracia Rafaela Bueno, Dentist$146,500 
Human Services Agencies Reviews and Enforcement Activities 
Administration for Children and Families 
The Tornillo Influx Care Facility: Concerns About Staff Background Checks and Number of Clinicians on Staff 
(A-12-19-20000), November 2018 
The memorandum was issued in response to two significant vulnerabilities identified by OIG during a site 
visit to the influx care facility in Tornillo, Texas (Tornillo), a grantee of the Unaccompanied Alien Children 
(UAC) Program operated by ORR.  Specifically, OIG found that Tornillo is not conducting required FBI 
fingerprint background checks for staff working at Tornillo, instead using checks conducted by a private 
contractor that has access to less comprehensive data.  Secondly, OIG found that Tornillo does not employ 
a sufficient number of staff clinicians to provide adequate mental healthcare for UAC.  Both issues warrant 
immediate attention because they pose substantial risks to children receiving care at this facility. 
OIG requested that ACF provide a written response as soon as possible, but no later than 30 days of the 
date of the memorandum, apprising OIG of the actions taken to ensure (1) employees at Tornillo are 
receiving FBI fingerprint background checks as required and (2) children's safety and well-being with 
respect to the insufficient clinician-to-child staffing ratios at Tornillo. 
BCFS Health and Human Services Did Not Always Comply With Federal and State Requirements Related to 
the Health and Safety of Unaccompanied Alien Children (A-06-17-07007), December 2018 
On the basis of our UAC case file sample review results, we estimated that BCFS Health and Human 
Services (BCFS HHS) did not properly document the care and release of 13.7 percent of all children 
47 
  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
released to sponsors in FY 2015.  Without adequate documentation in the UAC case files, ORR could not 
be assured that for 501 children, BCFS HHS had followed ORR policies regarding sponsor background 
checks or prompt care or that the Department of Homeland Security (DHS) was notified about the childs 
release to a sponsor.  Finally, we determined that BCFS HHS was unable to support the number of 
reunifications it reported to ORR for FY 2015. 
BCFS HHS concurred with our recommendations that it comply with ORR regulations pertaining to 
(1) video monitoring in common areas, (2) sponsor and other household members background checks, (3) 
admission/intake assessments and medical exams, and (4) discharge notifications to DHS and other 
stakeholders.  BCFS HHS also concurred with our recommendations that it comply with State regulations 
pertaining to (1) minimum bedroom space, (2) health and safety standards for shelters and foster care 
homes, and (3) employee background investigations.  Finally, BCFS HHS concurred with our 
recommendations that it ensure that information reported to ORR is accurate and that it operate its UAC 
program in accordance with Federal and State regulations. 
The Administration for Children and Families Has Controls and Strategies To Mitigate Hurricane 
Preparedness and Response Risk (A-04-18-02013), December 2018 
Within the 4 risk areas related to ACFs hurricane preparedness and response activities, we identified 15 
sub-risk areas and rated 14 as low risk and 1 as moderate risk.  Even though we rated one sub-risk area as 
moderate, ACF had developed various controls and strategies that are designed to mitigate the risks that 
we identified for preparing for and responding to hurricanes and other natural disasters. 
This report contains no recommendations. 
Lincoln Hall Boys Haven, an Administration for Children and Families Grantee, Did Not Always Comply With 
Applicable Federal and State Policies and Requirements (A-02-16-02007), February 2019 
Lincoln Hall Boys Haven (Lincoln Hall) did not meet or properly document that it met certain safety 
requirements for the care and release of children in its custody.  Further, it could not identify actual 
expenditures incurred and charged to the UAC program and did not monitor its subrecipients and 
contractors performance.  In addition, Lincoln Hall could not identify the actual expenditures incurred that 
comprised the $29.8 million charged to the UAC program (the entire amount that Lincoln Hall received in 
FYs 2014 and 2015) and did not ensure that its subrecipients and contractors met the terms and conditions 
of their agreements. 
As a result, Lincoln Hall may have placed the health and safety of children at risk and charged unallowable 
expenditures to the UAC program and the services provided by its subrecipients and contractors could 
have been inadequate. 
Lincoln Hall did not indicate concurrence or nonconcurrence with our recommendations that it (1) adhere 
to policies that meet applicable safety requirements for the care and release of children in its custody and 
maintain supporting documentation, (2) provide documentation to support the $29.8 million of program 
costs or refund the Federal Government, and (3) develop policies and procedures that adhere to 
requirements for monitoring subrecipients and contractors.  Lincoln Hall also did not indicate concurrence 
or nonconcurrence with five procedural recommendations. 
48 
  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
Separated Children Placed in Office of Refugee Resettlement Care (OEI-BL-18-00511), January 2019 
OIG found that the total number of children separated from a parent or guardian by immigration 
authorities is unknown.  Pursuant to a June 2018 Federal District Court order, HHS has thus far identified 
2,737 children in its care at that time who were separated from their parents.  However, thousands of 
children may have been separated during an influx that began in 2017, before the accounting required by 
the Court.  Further, from July 1 through November 7, ORR received at least 118 newly separated children.  
However, the Department of Homeland Security provided ORR with limited information about the reasons 
for these separations, which may impede ORRs ability to determine appropriate placements.  OIG 
encourages continued efforts to improve communication, transparency, and accountability for the 
identification, care, and placement of separated children. 
Health Resources and Services Administration 
The Health Resources and Services Administration Has Controls and Strategies To Mitigate Hurricane 
Preparedness and Response Risk (A-04-18-02015), December 2018 
Within the 4 risk areas related to HRSAs hurricane preparedness and response activities, we identified 13 
sub-risk areas and rated 12 as low risk and 1 as moderate risk.  Even though we rated one sub-risk area as 
moderate, HRSA had developed various strategies and controls that are designed to mitigate the risks we 
identified for preparing for and responding to hurricanes and other natural disasters.  
This report contains no recommendations. 
Child Support Enforcement Activities 
OIG Investigations   
OIG investigates noncustodial parents who violate 18 U.S.C.  228 by failing to pay court-ordered child 
support.  OIG works with ACFs Office of Child Support Enforcement; DOJ; U.S. Attorneys offices; the U.S. 
Marshals Service; and Federal, State, and local partners to address egregious child support enforcement 
cases with appropriate law enforcement and prosecutorial action.  During this semiannual reporting 
period, OIG investigations of child support enforcement cases nation-wide resulted in 4 criminal actions 
and court-ordered restitution and settlements of $334,784. 
The following case examples involve child support enforcement: 
  South DakotaIn September 2014, Daniel Vincent was ordered to pay child support 
payments of $416.33.  Vincent only sporadically made payments to the custodial parent of 
his child, and last made a payment in 2014.  Vincent pleaded guilty to failure to pay child 
support and cyberstalking, was sentenced to 5 years and 11 months in prison and was 
ordered to pay $20,246.50 in restitution. 
  PennsylvaniaIn November 2012, Darryl Thomas Averett Mitchell was ordered to pay child 
support payments of $358 per week.  Mitchell only sporadically made payments to the 
custodial parent of his child, and last made a payment in 2012.  Mitchell pleaded guilty to 
49 
  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
Social Security fraud, passport fraud, willful failure to pay child support, and student loan 
fraud, was sentenced to 2 years and 1 month in prison and ordered to pay $196,278 in 
restitution. 
Engaging the Public in Capturing Deadbeat Parents 
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 pay court-ordered child support for their children 
and thereby put an unnecessary strain on the custodial parents and the children as well as on agencies 
that enforce these matters.  The site, which is updated frequently, includes information on OIGs role in 
pursuing parents who fail to pay court-ordered child support.  OIGs Most Wanted Deadbeat Parents 
website can be found at https://oig.hhs.gov/fraud/child-support-enforcement/index.asp.   
50 
  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
Other HHS-Related Reviews and Investigations 
Grants and Contracts  
HHS is the largest grant-making organization and one of the largest contracting agencies in the Federal 
Government.  In FY 2018, HHS awarded more than $500 billion in grants and over $20 billion in contracts across all 
program areas.  OIGs direct annual discretionary appropriation funding is used to conduct program integrity and 
enforcement activities for the more than 100 public health and human services programs carried out by more than 
80,000 employees around the world.  The size and scope of departmental awards make their operating 
effectiveness crucial to the success of programs designed to improve the health and well-being of the public. 
Reviews 
Grant Fraud Investigations 
The following case example involves misuse of grant funds: 
  TexasThe University of Texas Health Science Center at Houston (UTHSCH) entered into a 
False Claims Act (FCA) settlement agreement, wherein UTHSCH agreed to pay $2.3 million 
to resolve allegations of grant fraud.  UTHSCH was a recipient of National Institutes of 
Health (NIH) Federal research funding.  The United States contends that, from September 1, 
2012, to December 31, 2017, UTHSCH misappropriated funds in the amount of more than 
$1.1 million from the grant.  UTHSCH then misrepresented to the United States the 
unobligated balance of Federal funds remaining under the grant in that amount in its 
written Federal Financial Report (SF-425), which closed out the grant. The United States 
further alleged that this misappropriation of Federal funds deprived the NIH of grant funds 
to which it would have otherwise been entitled. 
Small Business Innovation Research Program  
The National Defense Authorization Act for Fiscal Year 2012,  5143, requires OIG to report annually on the 
number of cases referred to OIG to fraud, waste, or abuse in the Small Business Innovation Research/Small 
Business Technology Transfer (SBIR/STTR) program.  OIG must also report on the actions taken in each 
case; justification for not taking action on a case; and an accounting of funds used to address waste, fraud, 
and abuse in this program.  In our December 2018 report delivered to the three congressional oversight 
committees, we reported that OIG spent approximately $392,837 in salaries on oversight related to the 
SBIR/STTR program.  In FY 2018, four new SBIR/STTR cases were referred to OIG. 
Recovery Act Retaliation Complaint Investigations 
The Recovery Act,  1553, prohibits non-Federal employers that have received Recovery Act 
funding from retaliating against employees who disclose evidence of mismanagement of 
Recovery Act funds or any violation of law related to Recovery Act funds.  OIGs are required to 
include in their Semiannual Report the retaliation complaint investigations that they decided 
51 
  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
not to conduct or continue during the reporting period.  During this semiannual reporting 
period, OIG did not close, decline, or give extensions on any investigations of whistleblower 
retaliation. 
Contract Audits 
Pursuant to the National Defense Authorization Act for FY 2008,  845, OIGs appointed under the IG Act 
are required to submit, as part of their semiannual report, pursuant to section 5 of the IG Act, information 
on final completed contract audit reports issued to the contracting activity during the period.  This 
information must contain significant audit findings.  OIG issued no final reports meeting  845 criteria 
during this semiannual period. 
OIG Reviews of Non-Federal Audits 
OIG reviews audits conducted by non-Federal auditors of entities receiving Federal awards.  In this semiannual 
period, OIGs National External Audit Review Center reviewed 312 reports covering $429.3 billion in audited costs.  
Federal dollars covered by these audits totaled $92.6 billion, of which about $58.6 billion were HHS funds. 
Uniform guidance at 2CFR200 Subpart F, establishes audit requirements for certain State and local governments, 
colleges and universities, and nonprofit organizations receiving HHS awards.  Under the uniform guidance, 
covered entities must conduct annual organization-wide single audits.  These audits are conducted by non-
Federal auditors, such as public accounting firms and State auditors.  OIG reviews the quality of these audits and 
assesses the adequacy of the entities management of Federal funds. 
OIGs oversight of non-Federal audit activity informs Federal managers about the soundness of management of 
Federal programs and identifies any significant areas of internal control weakness, noncompliance, and questioned 
costs for resolution or follow-up.  We identify entities for high-risk monitoring, alert program officials to any trends 
that could indicate problems in HHS programs, and profile non-Federal audit findings of a particular program or 
activity over time to identify systemic problems.  We also provide training and technical assistance to grantees and 
members of the auditing profession.  OIG maintains a process to assess the quality of the non-Federal reports 
received and the audit work that supports the selected reports. 
The following table categorizes OIGs reports on non-Federal audits reviewed during this reporting period: 
Non-Federal Audits, October 1, 2018, Through March 31, 2019 
Not requiring changes or having minor changes   310 
Requiring major changes  2 
Having significant technical inadequacies  0 
 Total Number of Non-Federal Audits  312 
   
   
52 
  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
Other Reporting Requirements and Reviews 
Legislative and Regulatory Reviews 
Pursuant to the IG Act,  4(a)(2), OIG is required to review existing and proposed legislation and 
regulations relating to HHSs programs and operations and make recommendations concerning their 
impact on economy and efficiency or the prevention and detection of fraud and abuse.  Most audits and 
other reviews that we conduct are designed to test compliance with and/or assess the administration and 
oversight of existing laws and regulations.  Our reports of such reviews describe findings, which include 
questioned costs, inefficiencies, vulnerabilities to fraud, inconsistencies, errors in application, or weaknesses 
in oversight or supporting systems.  Our corresponding recommendations tell HHS and its operating or 
staff divisions what administrative, regulatory, or legislative actions we believe are needed to effectively 
respond to the findings.  Our regularly published core publications reflect the relationship between our 
work and laws and regulations. 
  Our Semiannual Report(s) to Congress describes findings and recommendations from recently 
completed reviews, many of which focus on existing laws and regulations. 
  Our Solutions to Reduce Fraud, Waste, and Abuse in HHS Programs: Top Unimplemented 
Recommendations describes priority findings and recommendations from past periods that remain 
to be implemented. 
  Our Work Plan provides citations to laws and regulations that are the subject of ongoing or future 
reviews. 
We also review proposed legislation and regulations related to HHS programs and operations.  HHS 
routinely involves OIG and HHS operating divisions and other staff divisions in the review and 
development of HHS regulations through a well-established HHS process.  Our audits, evaluations, and 
investigations are sometimes cited in regulatory preambles as influencing HHS regulations.  In addition, we 
provide independent, objective technical assistance on a bipartisan, bicameral basis to congressional 
committees and Members who request it. 
 
 
53 
  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
Appendix A: Questioned Costs and Funds To Be 
Put to Better Use 
The following tables summarize OIGs monetary recommendations and HHS responses to them.  This information 
is provided in accordance with the IG Act,  5(a)(8) and (a)(9) (5 U.S.C. App.  5(a)(8) and (a)(9)), and the 
Supplemental Appropriations and Rescissions Act of 1980. 
Audit Reports With Questioned Costs 
As defined by the IG Act, the term questioned cost means a cost that is questioned by the OIG because of (1) an 
alleged violation of a provision of law, regulation, contract, grant, cooperative agreement, or other agreement or 
document governing the expenditure of funds; (2) a cost that is not supported by adequate documentation at the 
time of the audit; or (3) the expenditure of funds for the intended purpose is unnecessary or 
unreasonable.  Questioned costs that HHS program officials have, in a management decision, sustained or agreed 
should not be charged to the Government are disallowed costs. 
Table 1Audit Reports With Questioned Costs 
Number of  Dollar Value  Dollar Value 
Description  Reports  Questioned  Unsupported 
Section 1          
Reports for which no management decisions had 
been made by the beginning of the reporting 
period1  174  $2,034,829,000  $505,724,000 
Issued during the reporting period  27  $246,926,000  $7,020,000 
Total Section 1  201  $2,281,755,000  $512,744,000 
Section 2        
Reports for which management decisions were 
made during the reporting period2, 3       
Disallowed costs  147  *$496,427,000  $9,000 
Costs not disallowed  6  $17,467,000  $243,000 
Total Section 2  153  $513,894,000  $252,000 
*Audit receivables (expected recoveries)       
Section 3        
Reports for which no management decisions had 
been made by the end of the reporting period 
(Section 1 minus Section 2)  48  $1,767,861,000  $512,492,000 
Section 4       
Reports for which no management decisions were 
made within 6 months of issuance4  26  $1,542,660,000  $505,472,000 
 
 
54 
  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
Audit Reports With Funds Recommended To Be Put to Better Use 
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, de-obligation of 
funds, and/or avoidance of unnecessary expenditures.  Table 2 reports HHS program officials decisions to take 
action on these audit recommendations. 
Table 2Audit Reports With Funds Put to Better Use 
Number of 
Description  Reports  Dollar Value 
Section 1       
Reports for which no management decisions had been made by 
the beginning of the reporting period1  5  $15,826,030,000 
Reports issued during the reporting period  4  $263,385,000 
Total Section 1  9  $16,089,415,000 
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  3  $776,585,000 
Based on proposed legislative action    $0 
Value of recommendations not agreed to by management  0  $0 
Total Section 2  3  $776,585,000 
Section 3     
Reports for which no management decisions had been made by 
the end of the reporting period2 (Sec. 1 minus Sec. 2)  6  $15,312,830,000 
 
End Notes 
Table 1 End Notes 
1 The opening balance was adjusted upward by $69.8 million because of a reevaluation of previously issued 
recommendations.  
2 Revisions to previously reported management decisions: 
  A-05-11-00016 National Government Services, Inc., Did Not Always Refer Medicare Cost Reports and 
Reconcile Outlier Payments.  CMS conducted a subsequent review and approved rescinding an outlier 
reconciliation.  As result, CMS reduced the previously sustained amount by $26,293,543. 
  A-01-07-00003 Review of Medicaid Outpatient Drug Expenditures in Connecticut for the Period October 1, 
2003, Through September 30, 2005.  Due to additional documentation provided by the State, CMS reduced 
the sustained amount by $7,395,316. 
55 
  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
  A-05-12-00080 Medicare Compliance Review of University of Cincinnati Medical Center for Calendar Years 
2010 and 2011.  The provider appealed the recommendation and is awaiting adjudication.  As a result, OIG 
and CMS agreed to re-calculate the overpayments estimates based on already known settlement results.  
Therefore, the sustained amount was reduced by $6,149,995 to reflect the adjustment. 
  A-07-10-02774 Noridian Healthcare Solutions, LLC, Did Not Always Refer Medicare Costs Reports and 
Reconcile Outlier Payments.  CMS was able to recoup $2,029,787 that were within the 3-year reopening 
limit.  The remaining $4,890,187 was not recoverable. 
  Not detailed are reductions to previously disallowed management decisions totaling $2.7 million. 
3 Included are management decisions to disallow $37.4 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 Office of Management and Budget 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 Because of administrative delays, some of which were beyond management control, resolution of the following 
26 audits were not completed within 6 months of issuance of the reports; however, agency management has 
informed us that the agency is working to resolve the outstanding recommendations before the end of the next 
semiannual reporting period. 
Audits Not Completed Within 6 Months of Issuance 
Audit CIN  Audit Title 
A-02-15-02013  CMS Did Not Always Accurately Authorize Financial Assistance Payments to Qualified 
Health Plan Issuers in Accordance With Federal Requirements During the 2014 Benefit 
Year, August 2018, $939,287,686 
A-02-15-01010  New Jersey Claimed Hundreds of Millions in Unallowable or Unsupported Medicaid 
School-Based Reimbursement, November 2017, $300,452,930 
A-02-14-02017  New York Misallocated Costs to Establishment Grants for a Health Insurance 
Marketplace, November 2016, $149,654,512 
A-01-14-02503  Maryland Misallocated Millions to Establishment Grants for a Health Insurance 
Marketplace, March 2015, $28,400,000 
A-04-14-07050  Kentucky Misallocated Millions to Establishment Grants for a Health Insurance 
Marketplace, February 2017, $25,530,429 
A-02-15-02008  New York Did Not Comply With Federal Grant Requirements for Allocating and 
Claiming Marketplace Contract Costs, December 2017, $20,415,344 
A-07-15-04226  Not All of Missouri's Child Care Subsidy Program Payments Complied With Federal 
and State Requirements, November 2017, $19,076,167 
A-07-17-00529  Wisconsin Physician Services Insurance Corporation Understated Medicare's Share of 
the Medicare Segment Excess Pension Assets, May 2018, $17,732,694 
A-01-15-02500  Vermont Did Not Properly Allocate Millions to Establishment Grants for a Health 
Insurance Marketplace, September 2016, $11,243,006 
A-02-14-02024  Newark Preschool Council, Inc., Did Not Always Comply With Head Start 
Requirements, February 2017, $9,950,556 
56 
  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
A-09-17-03018  Medicare Improperly Paid Providers for Nonemergency Ambulance Transports to 
Destinations Not Covered by Medicare, July 2018, $8,633,940 
A-07-17-02808  The Colorado Health Insurance Marketplaces Financial Management System Did Not 
Always Comply With Federal Requirements, July 2018, $2,567,604 
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 
Federal Regulations, June 2013, $1,419,524 
A-05-14-00045  The Minnesota Marketplace Misallocated Federal Funds and Claimed Unallowable 
Costs, November 2016, $1,279,677 
A-07-16-04230  The Three Affiliated Tribes Improperly Administered Low-Income Home Energy 
Assistance Program Funds for FYs 2010 through 2014, July 2017, $1,221,425 
A-09-17-03017  Medicare Made Improper and Potentially Improper Payments for Emergency 
Ambulance Transports to Destinations Other Than Hospitals or Skilled Nursing 
Facilities, August 2018, $975,154 
A-09-14-01007  Nevada Misallocated Costs for Establishing a Health Insurance Marketplace to Its 
Establishment Grants, February 2016, $893,464 
A-05-16-00038  Heartland Human Care Services, Inc., Generally Met Safety Standards, but Claimed 
Unallowable Rental Costs, September 2018, $768,460 
A-06-16-07007  BCFS Health and Human Services Did Not Always Comply with Federal Requirements 
Related to Less-Than-Arm's Length Leases, February 2018, $658,248 
A-07-16-04233   The Turtle Mountain Band of Chippewa Indians Improperly Administered Some Low-
Income Home Energy Assistance Program Funds for Fiscal Years 2010 Through 2013, 
September 2017, $587,248 
A-04-16-04044  The Ministry of Health and Social Welfare National AIDS Control Program Did Not 
Always Manage and Expend PEPFAR Funds in Accordance With Award Requirements, 
August 2017, $495,379 
A-07-18-04106  The Fort Peck Assiniboine and Sioux Tribes Improperly Administered Some Low-
Income Home Energy Assistance Program Funds for Fiscal Years 2011 Through 2015, 
August 2018, $436,765 
A-04-13-01024  The University Of North Carolina At Chapel Hill Did Not Always Claim Selected Costs 
Charged Directly to Department of Health and Human Services Awards in 
Accordance With Federal Requirements, June 2014, $352,843 
A-12-17-00002  The Office of the Secretary of Health and Human Services Did Not Comply With 
Federal Regulations for Chartered Aircraft and Other Government Travel Related to 
Former Secretary Price, July 2018, $341,616 
A-04-15-04039  Mildmay Uganda Did Not Always Manage the Presidents Emergency Plan for AIDS 
Relief Funds in Accordance With Award Requirements, March 2017, $170,386 
A-06-11-00058  Crowley's Ridge Development Council, Inc., Claimed Unallowable Costs Under a 
Recovery Act Grant, August 2012, $115,420 
TOTAL CINS:    26  
TOTAL AMOUNT:  $1,542,660,477 
 
Table 2 End Notes 
1 The opening balance had no prior period adjustments of previously issued recommendations. 
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  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
2 Because of administrative delays, some of which were beyond management control, 2 of the 6 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. 
Audits Open at End of the Period 
Audit CIN  Audit Title 
A-05-12-00020  Medicare and Beneficiaries Could Save Billions if CMS Reduces Hospital Outpatient 
Department Payment Rates for Ambulatory Surgical Center-Approved Procedures to 
Ambulatory Surgical Center Payment Rates, April 2014, $15,000,000,000 
A-03-13-03002  HHS Did Not Identify and Report Antideficiency Act Violations, May 2017, 
$49,445,025 
TOTAL CINS:  2  
TOTAL AMOUNT:  $15,049,445,025 
   
58 
  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
Appendix B: Peer-Review Results 
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 an OIG of other OIGs in the semiannual period.  Peer reviews are 
conducted by member organizations of the Council of the Inspectors General on Integrity and Efficiency (CIGIE).  
Recently CIGIE has approved a new 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. 
Office of Audit Services 
During this semiannual reporting period, no peer reviews involving OAS were completed.  Listed below is 
information concerning OASs peer-review activities during prior reporting periods. 
OAS  Date  Reviewing Office  Office Reviewed 
March 2018  U. S. Postal Service OIG  HHS-OIG, OAS 
The system of quality control for the audit organization of HHS-OIG in effect for the year ending 
September 30, 2017, has been suitably designed and complied with to provide HHS-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.  HHS-OIG received a peer-review rating of pass. 
 
OAS  Date  Reviewing Office  Office Reviewed 
December 2015  HHS-OIG, OAS  U.S. Department of Agriculture 
(USDA) OIG 
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. 
 
Office of Investigations 
During this semiannual reporting period, one peer review involving OI was completed.  Listed below is 
information concerning that peer review, as well as OIs peer-review activity during a prior reporting 
period. 
OI  Date  Reviewing Office  Office Reviewed 
  October 2018  SSA OIG  HHS-OIG, OI 
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  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
The system of internal safeguards and management procedures for the investigative function of 
HHS-OIG in effect for the year ending September 30, 2018, was in full compliance with the quality 
standards established by CIGIE and the Attorney Generals guidelines. 
 
OI  Date  Reviewing Office  Office Reviewed 
  August 2017  HHS-OIG, OI  U.S. Postal Service OIG 
The system of internal safeguards and management procedures for the investigative function of 
the U.S. Postal Service OIG in effect for the year ending July 31, 2017, was in full compliance with 
the quality standards established by CIGIE and the Attorney Generals guidelines. 
 
Office of Evaluation and Inspections 
During this semiannual reporting period, no peer reviews involving OEI were completed.  Listed below is 
information concerning OEIs peer-review activities during prior reporting periods. 
OEI  Date  Reviewing Office  Office Reviewed 
September 2018  HHS-OIG, OEI  U.S. Department of Defense (DoD) 
OIG 
The DoD-OIG Inspection and Evaluation components policies and procedures generally met CIGIEs 
Quality Standards for Inspection and Evaluation (Blue Book) standards.  In addition, the 10 reports 
reviewed generally met the applicable Blue Book standards.  Onsite visits for these reviews were 
conducted from October 2 through November 17, 2017. 
 
 
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Appendix C: Summary of Sanction Authorities 
The Inspector General Act of 1978, as amended, specifies requirements for semiannual reports to be made to the 
HHS Secretary for transmittal to Congress.  A selection of other authorities appears below. 
Program Exclusions 
The Social Security Act,  1128 (42 U.S.C.  1320a-7), provides several grounds for excluding individuals and entities 
from participation in Medicare, Medicaid, and other Federal healthcare programs.  Exclusions are required 
(mandatory exclusion) for individuals and entities convicted of the following types of criminal offenses: (1) 
Medicare or Medicaid fraud; (2) patient abuse or neglect; (3) felonies for other healthcare fraud; and (4) felonies 
for illegal manufacture, distribution, prescription, or dispensing of controlled substances. 
OIG is authorized (permissive exclusion) to exclude individuals and entities on several other grounds, including 
misdemeanors for other healthcare fraud (other than Medicare or Medicaid); suspension or revocation of a license 
to provide healthcare for reasons bearing on professional competence, professional performance or financial 
integrity; provision of unnecessary or substandard services; submission of false or fraudulent claims to a Federal 
healthcare 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 false statements or omissions in any application, bid, or contract to participate as a provider in a 
Federal healthcare program, including managed care programs under Medicare and Medicaid, as well as 
Medicares prescription drug program. 
Providers subject to exclusion are granted due process rights.  These include a hearing before an administrative 
law judge and appeals to the HHS Departmental Appeals Board and Federal district and appellate courts 
regarding the basis for and the length of the exclusion. 
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 healthcare programs for engaging in certain activities.  For example, a person who 
submits, or causes to be submitted, to a Federal healthcare 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 claimed, an assessment of up to 3 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)). 
The ACA added more grounds for imposing CMPs.  These include, among other types of conduct, knowingly 
making, or causing to be made, any false statements or omissions in any application, bid, or contract to participate 
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as a provider in a Federal healthcare program (including Medicare and Medicaid managed care programs and 
Medicare Part D); the ACA authorizes a penalty of up to $55,262 for each false statement, as well as activities 
relating to fraudulent marketing by MCOs, their employees, or their agents. 
The 21st Century Cures Act (enacted on December 13, 2016) added more grounds for imposing CMPs, 
assessments, and exclusion from Federal healthcare programs for fraudulent conduct in an HHS grant, contract, or 
other agreement.  OIG may assess CMPs of up to $10,000 per claim and assessments of up to 3 times the amount 
claimed for knowingly 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 to be submitted in order to receive funds under an HHS contract, grant, 
or other agreement; (2) for knowingly making or 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 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 other agreement.  Finally, 
HHS-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, or other 
agreement. 
Patient Dumping 
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 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 each negligent violation of any of the section 1867 requirements and, in some circumstances, may 
exclude a responsible physician. 
Anti-Kickback Statute and Civil False Claims Act Enforcement Authorities 
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 
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person or an entity for the furnishing, or arranging for the furnishing, of any item or service payable under 
the Federal healthcare programs; or (2) purchasing, leasing, or ordering, or arranging for or 
recommending the purchasing, leasing, or ordering, of any good, facility, service, or item payable under 
the Federal healthcare programs (Social Security Act,  1128B(b) (42 U.S.C.  1320a-7b(b)). 
Individuals and entities that engage in unlawful referral or kickback schemes may be subject to criminal 
penalties under 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 Act,  1128(b)(7) (42 U.S.C.  1320a-7(b)(7)). 
The False Claims Act 
Under the FCA, as amended by the False Claims Amendments Act of 1986 (31 U.S.C.  37293733), a 
person or an entity is liable for up to treble damages and a penalty between $10,957 and $21,916 for each 
false claim it knowingly submits, or causes to be submitted, to a Federal program.  Similarly, a person or 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 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 FCA, no specific intent to defraud is required.  Further, the 
FCA contains a qui tam, or whistleblower, provision that allows a private individual to file a lawsuit on 
behalf of the United States and entitles that whistleblower 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. 
   
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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. 
Section  Requirement  Location 
Section 4 
(a)(2)  Review of legislation and regulations  Other HHS-Related Reviews 
and Investigations section   
Section 5 
(a)(1)  Significant problems, abuses, and deficiencies  Throughout this report 
(a)(2)  Recommendations with respect to significant problems, abuses,  Throughout this report 
and deficiencies 
(a)(3)  Prior significant recommendations on which corrective action has  Solutions to Reduce Fraud, 
not been completed  Waste, and Abuse in HHS 
Programs: Top 
Unimplemented 
Recommendations 
(previously known as the 
Compendium of 
Unimplemented 
Recommendations) 
(a)(4)  Matters referred to prosecutive authorities  Legal and Investigative 
Activities Related to the 
Medicare and Medicaid 
Programs section 
(a)(5)  Summary of instances in which information requested by OIG  None for this reporting 
was refused  period 
(a)(6)  List of audit reports  Submitted to the Secretary 
under separate cover 
(a)(7)  Summary of significant reports  Throughout this report 
(a)(8)  Statistical Table 1Reports With Questioned Costs  Appendix A 
(a)(9)  Statistical Table 2Funds Recommended To Be Put to Better  Appendix A 
Use 
(a)(10)  Summary of previous audit reports without management  Appendix A 
decisions, in which no establishment comment was returned 
within 60 days, and in which there are any outstanding 
unimplemented recommendations 
(a)(11)  Description and explanation of revised management decisions  Appendix A 
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Section  Requirement  Location 
(a)(12)  Management decisions with which the Inspector General  None for this reporting 
disagrees  period 
(a)(13)  Information required by the Federal Information Security  Reported annually in the 
Management Act.   spring Semiannual Report, 
Other HHS-Related Reviews 
and Investigations section 
(a)(14)-(16)  Results of peer reviews of HHS-OIG conducted by other OIGs or  Appendix B 
the 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 F 
(a)(18)  Metrics description for statistical tables  Appendix F 
(a)(19)  Investigations on senior Government employees  Appendix F 
(a)(20)  Description of whistleblower retaliation instances  Appendix F 
(a)(21)  Description of attempts to interfere with OIG independence  Appendix F 
(a)(22)  Description of closed and nondisclosed reports and  Appendix F 
investigations regarding senior Government employees 
 
Other Reporting Requirements 
Section  Requirement  Location 
845  Significant contract audits required to be reported pursuant to  Other HHS-Related Reviews 
the National Defense Authorization Act for FY 2008  and Investigations section 
(P.L. No. 110-181),  845. 
205  Pursuant to HIPAA (P.L. No. 104-191),  205, the Inspector  Reported annually in the fall 
General is required to solicit proposals annually via a Federal  Semiannual Report, 
Register notice for developing new and modifying existing safe  Appendix G 
harbors to the anti-kickback statute of the Social Security Act,   
 1128(b) and for developing special fraud alerts.  The Inspector 
General is also required to report annually to Congress on the 
status of the proposals received related to new or modified safe 
harbors. 
1553  Pursuant to the American Recovery and Reinvestment Act of  Other HHS-Related Reviews 
2009, P.L. No. 111-5,  1553, OIG reports to Congress the  and Investigations section 
retaliation complaint investigations it decided not to conduct or 
continue during the period. 
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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.  These requirements amend portions of  5 of the Inspector General Act.  The requirements 
are below in italics, followed by OIGs responses. 
Each Inspector General shall, not later than April 30 and October 31 of each year, prepare semiannual reports 
summarizing the activities of the Office during the immediately preceding six-month periods ending 
March 31 and September 30.  Such reports shall include, but need not be limited to- 
(10) A summary of audit, inspection, and evaluation reports issued before the 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 been made, 
and a statement concerning the desired timetable for achieving a management decision on each such report; 
For audit, inspection, and evaluation reports issued from FY 2011 through FY 2019, OIG had 93 reports with 
overdue final management decisions.1 
OIG is unable to provide reasons and timetables for each of these overdue management decisions, due to 
the volume and that OIG did not historically track this information. 
(B) for which no establishment comment was returned within 60 days of providing the report to the 
establishment; and 
For 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 timeframe, OIG typically 
issues the report and notes the lack of establishment comments. 
For this semiannual reporting period, OIG had no reports with comments exceeding 60 days. 
(C) for which there are any outstanding unimplemented recommendations, including the aggregate potential 
cost savings of those recommendations. 
OIG is actively tracking 1,058 unimplemented open recommendations made in reports issued since FY 2011.  
Given the volume of recommendations OIG makes each year, the table below reflects summary data by FY: 
 
 
1 OIG can track the status of management decisions for all reports back to FY 2011.  OIG can track the status of management decisions for 
audit reports back to FY 1990.  We have identified four additional audit reports with overdue management decisions from FY 1990 through 
FY 2010.   
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Number of Reports  Number of  Dollar Value of 
FY (20112019)  with Unimplemented  Unimplemented  Aggregate Potential 
Recommendations  Recommendations  Cost Savings 
2011  14  25  $434,404,003 
2012  26  32  $397,437,195 
2013  38  71  $261,261,308 
2014  34  62  $15,169,118,140 
2015  37  69  $357,006,677 
2016  42  106  $193,518,252 
2017  52  182  $1,119,345,258 
2018  83  306  $2,485,099,567 
2019 (partial year)  57  205  $509,970,995 
Totals  383  1,058  $20,927,161,395 
 
OIG annually produces a Solutions to Reduce Fraud, Waste, and Abuse in HHS Programs: Top 
Unimplemented Recommendations (previously known as the Compendium of Unimplemented 
Recommendations) which constitutes OIGs response to a specific requirement of the Inspector General 
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.  It also includes an appendix listing 
OIGs significant unimplemented recommendations, which represent opportunities to achieve expected 
impact through cost savings, improvements in program effectiveness and efficiency, or increasing quality 
of care and safety of beneficiaries.  In OIGs view, these recommendations would most positively 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; 
(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 
Total number of investigative reports issued during the reporting  0 
period, including Management Implication Reports and Investigative 
Advisories 
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Total number of persons referred2 to Federal prosecuting authorities  1,186 
for criminal prosecution during the reporting period3 
Total number of persons referred to State and local prosecuting  115 
authorities for criminal prosecutions during the reporting period  
Total number of Federal indictments and criminal informations during  321 
the reporting period that resulted from any prior referral to 
prosecuting authorities 
Total number of State and local indictments and criminal informations  41 
during the reporting period that resulted from any prior referral to 
prosecuting authorities 
 
(18) A description of the metrics used for developing the data for the statistical tables under paragraph (17); 
Regarding (17)(A), OIG considers Investigative Reports as Management Implication Reports and 
Investigative Advisories.  A Management Implication Report identifies systemic weaknesses or 
vulnerabilities within HHS programs, which are generally identified during the course of an OIG 
investigation and could lead to fraud, waste, or abuse.  It provides recommendations to correct or 
minimize the problem.  Corrective actions may require administrative, procedural, policy, regulatory, 
or legislative change.  When a Management Implication Report is issued to an HHS OPDIV or STAFFDIV, 
it is generally signed by the Inspector General.  Investigative Advisories are similar documents that 
bring renewed attention to an identified HHS issue and are generally signed by the Deputy Inspector 
General for Investigations. 
Regarding (17)(B) and (C), OIG defines this measure as the term "presentations" to both Federal and 
State/local prosecuting jurisdictions as the representation of the work we do.  For example, when OIG 
opens an investigation, it evaluates the complaint and decides whether to "present" the matter for 
prosecution.  Generally, if the case has prosecutorial merit, and is accepted for Federal prosecution, OIG 
works with DOJ as the primary investigative agency, as opposed to referring the matter to DOJ 
without further involvement on OIG's part.  OIG works with State and local prosecutorial authorities in 
addition to working with DOJ. 
Regarding (17)(D), the table above provides the number of indictments/criminal informations during 
the semiannual reporting period, including sealed indictments/criminal informations.  However, the 
informations cannot be limited to only those that occurred as a result of a presentation in a previous 
period.  In certain situations, the presentation and charging dates are in the same reporting period. 
(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- 
(A) the facts and circumstances of the investigation; and 
 
 
2 A referral includes OIG presentations to DOJ and/or State/local prosecutorial authorities.   
3  OIG counts persons as both individuals and entities.   
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(B) the status and disposition of the matter, including- 
(i) if the matter was referred to the Department of Justice, the date of the referral; and 
(ii) if the Department of Justice declined the referral, the date of the declination; 
To respond fully to this subparagraph, OIG would need to make a finding of misconduct.  However, OIG 
does not make findings regarding its investigations relating to substantiated allegations of departmental 
employee misconduct.  Our reports relay the facts obtained during the investigations (e.g., parties 
involved, dates of events) related to any 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 management makes determinations of 
employee misconduct.  The disposition of the matter and any resulting administrative actions are taken by 
the agency. 
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 can provide that 
information.  However, because there are sometimes settlement agreements that may impact the final 
action, OIG may not have a complete record of the disposition of the investigation.  Accordingly, such 
information might be more efficiently and effectively provided directly by the employing agency. 
For this section, OIG describes investigations during this reporting period, both criminal and administrative, 
involving senior Government employees for whom 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 two senior 
Government employees for misconduct, and OIG determined the allegations to be substantiated, but no 
prosecution resulted.  Descriptions of the investigations are below. 
DOJ  DOJ 
Description of  DOJ  DOJ 
Status  Disposition  Referral  Declination 
Investigation  Referral  Declination 
Date  Date 
A senior Government 
employee recently retired 
and failed to comply with 
the requirement for OGE-
278 filers to file the Stock 
Act form on notification of  Closed  Case Closed  Yes  9/28/18  Yes  9/28/18 
post-government 
employment or 
compensation negotiation 
of agreement and recusal 
statement. 
It was alleged that a senior 
policy analyst accessed or  Closed  Case Closed  No  N/A  N/A  N/A 
attempted access to 
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  websites known to offer 
sexually explicit and/or 
sexually suggestive images, 
video, and other adult 
content.  Subject retired. 
 
(20) A detailed description of any instance of whistleblower retaliation, including information about the 
official found to have engaged in retaliation and what, if any, consequences the establishment imposed to 
hold that official accountable; 
For departmental agencies, OIG conducts investigations and gathers facts related to whistleblower 
complaints.  Before 2015, OIG made no 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 than not that whistleblower retaliation 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. 
During the time period from October 1, 2018, through March 31, 2019, OIG did not issue any reports that 
included findings of retaliation. 
When determining the level of detail to provide for a description of any instance of whistleblower 
retaliation, OIG is always mindful of the risk that a detailed description of the allegation could inadvertently 
reveal the whistleblowers identity, thus having a chilling effect on future whistleblowers. 
(21) A detailed description of any attempt by the establishment to interfere with the independence of the 
Office, including- 
(A) with budget constraints designed to limit the capabilities of the Office; and 
(B) incidents where the establishment has resisted or objected to oversight activities of the Office or restricted 
or significantly delayed access to information, including the justification of the establishment for such action; 
and 
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 HHS interfered with the independence of OIG during this reporting 
period.  OIG would immediately notify Congress if it were unable to resolve these issues within HHS. 
(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. 
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Nonpublic Reports by Category, October 1, 2018, to March 31, 2019 
 
Number of 
Category/Description 
Reports 
IT security reviews (involve IT systems, e.g., penetration test audits)  1  
Homeland security issues (involve particularly sensitive topics, e.g., bioterrorism, 
  
emergency preparedness, and classified or potentially classified information) 
Recipient Capability Audits (primarily in Head Start/Early Head Start programs)    
Reimbursable audits performed for other Federal agencies (primarily contract 
  
audits) 
Confidential or proprietary information (e.g., Medicare Part B drug 
  
claims/imaging services, Medicare investment income) 
Medicare Adverse Event Reviews (required by law not to disclose)    
Medicare Prescription Drug Event Reviews    
Other    
HHS technical assistance reports4    
Finance-related attestation reviews  1 
   Total  2 
 
(B) Investigation conducted by the Office involving a senior Government employee that is closed and was not 
disclosed to the public. 
In section 5(a)(19), we detail investigations of senior Government employees in which 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)(19) response to address investigations of 
senior Government employees in which allegations were substantiated 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 in which OIG did not substantiate 
allegations of misconduct. 
When determining the level of detail to provide for the investigations described above, OIG is mindful of 
the risk that a detailed description of the investigation could inadvertently reveal the subjects identity.  
During this reporting period, OIG investigated one senior Government employees for misconduct, but OIG 
determined the allegations to be unsubstantiated.  Descriptions of the investigations are below. 
DOJ  DOJ 
Description of  DOJ  DOJ 
Status  Disposition  Referral  Declination 
Investigation  Referral  Declination 
Date  Date 
 
 
4 OIG routinely provides technical assistance to HHS.  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 that category of 
technical assistance is reflected in this table.   
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A personnel security 
specialist made a complaint 
regarding contract fraud.  
No 
The complaint was against a 
evidence to 
senior Government  Closed  No  N/A  N/A  N/A 
support 
employee for improperly 
allegations 
handling a contract and 
allowing unauthorized 
employees access to it. 
 
 
 
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APPENDIX F: Anti-Kickback StatuteSafe Harbors 
Pursuant to HIPAA,  205, the Inspector General is required to solicit proposals annually via a Federal Register 
notice for developing new and modifying existing safe harbors to the anti-kickback statute, section 1128B(b) of the 
Social Security Act, and for developing special fraud alerts.  The Inspector General is also required to report 
annually to Congress on the status of the proposals received related to new or modified safe harbors. 
In crafting safe harbors for a criminal statute, it is incumbent upon the OIG to engage in a complete and careful 
review of the range of factual circumstances that may fall within the proposed safe harbor subject area to uncover 
all potential opportunities for fraud and abuse by unscrupulous providers.  Having done so, OIG must then 
determine, in consultation with DOJ, whether it can develop effective regulatory limitations and controlsnot only 
to foster beneficial or innocuous arrangements but also to protect Federal healthcare programs and their 
beneficiaries from abusive practices. 
Public Proposals for New and Modified Safe Harbors 
In response to the 2017 annual solicitation, OIG received the following proposals related to safe harbors: 
Proposal  OIG Response 
New safe harbors to facilitate  On August 27, 2018, OIG issued an RFI seeking input from the 
coordinated care and promote  public on how to address any regulatory provisions that may 
alternative payment models so physicians  act as barriers to coordinated care or value-based care as well 
can pursue integration options that are  as other related topics, which encompasses the subjects 
not hospital driven.   presented in this proposal.  See 83 Fed. Reg. 43607.  
Comments are due by October 26, 2018, and will be 
considered at that time.  OIG is reviewing the comments 
received.  In the meantime, questions about the application 
of the anti-kickback statute to specific arrangements should 
be addressed on a case-by-case basis, such as under the 
advisory opinion process. 
New or modified safe harbors for  On August 27, 2018, OIG issued an RFI seeking input from 
incentive payment arrangements  the public on how to address any regulatory provisions that 
between hospitals and other providers  may act as barriers to coordinated care or value-based care 
operating under current, proposed, and  as well as other related topics, which encompasses the 
new CMS alternative payment models.  subjects presented in this proposal.  See 83 Fed. Reg. 43607.  
OIG is reviewing the comments received.  In the meantime, 
questions about the application of the anti-kickback statute 
to specific arrangements should be addressed on a case-by-
case basis, such as under the advisory opinion process.  
Modify the existing Cooperative Hospital  OIG is considering modifying this safe harbor to address the 
Services Organization (CHSO) safe  concerns described in this proposal.  
harbor (42 C.F.R.  1001.952(q)) to clarify 
that the safe harbor protects only CHSO 
arrangements that involve the provision 
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Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
of items or services that are components 
of the direct or indirect overhead costs 
associated with the inpatient or 
outpatient hospital services of nonprofit 
patron-hospitals. 
New safe harbors to protect value-based  On August 27, 2018, OIG issued an RFI seeking input from 
purchasing and payment arrangements  the public on how to address any regulatory provisions that 
that bundle products and related  may act as barriers to coordinated care or value-based care 
services, to protect value-based care  as well as other related topics, which encompasses the 
including value-based risk-sharing  subjects presented in this proposal.  See 83 Fed. Reg. 43607.  
network arrangements, and to protect  OIG is reviewing the comments received.  In the meantime, 
value-based price adjustments with  questions about the application of the anti-kickback statute 
clinical or cost-related outcome-based  to specific arrangements should be addressed on a case-by-
assurances.   case basis, such as under the advisory opinion process. 
A new safe harbor to protect  On August 27, 2018, OIG issued an RFI seeking input from 
arrangements that support patient  the public on how to address any regulatory provisions that 
adherence to a prescribed treatment or  may act as barriers to coordinated care or value-based care 
medication regimen.  as well as other related topics, which encompasses the 
subjects presented in this proposal.  See 83 Fed. Reg. 43607.  
OIG is reviewing the comments received.  In the meantime, 
questions about the application of the anti-kickback statute 
to specific arrangements should be addressed on a case-by-
case basis, such as under the advisory opinion process. 
New safe harbors that permit sharing  On August 27, 2018, OIG issued an RFI seeking input from 
and donating items and services related  the public on how to address any regulatory provisions that 
to cybersecurity, with an emphasis on  may act as barriers to coordinated care or value-based care 
training and education services, software,  as well as other related topics, which encompasses the 
and technology.   subjects presented in this proposal.  See 83 Fed. Reg. 43607.  
OIG is reviewing the comments received.  In the meantime, 
questions about the application of the anti-kickback statute 
to specific arrangements should be addressed on a case-by-
case basis, such as under the advisory opinion process. 
Modify the current managed care safe  On August 27, 2018, OIG issued an RFI seeking input from 
harbor (42 C.F.R.  1001.952(t)) to add  the public on how to address any regulatory provisions that 
Medicare Part D Sponsors to the list of  may act as barriers to coordinated care or value-based care 
eligible MCOs and to modify the  as well as other related topics, which encompasses the 
definition of items and services to include  subjects presented in this proposal.  See 83 Fed. Reg. 43607.  
care coordination, case management,  OIG is reviewing the comments received.  In the meantime, 
chronic care and disease management,  questions about the application of the anti-kickback statute 
support for transitioning patients  to specific arrangements should be addressed on a case-by-
between different care settings, and  case basis, such as under the advisory opinion process.  
discharge planning. 
New or modified safe harbors to protect  OIG is not adopting this suggestion. Financial assistance 
donations to independent charitable  programs could vary greatly and should be addressed on a 
foundations and to enable financial 
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  Department of Health and Human Services Office of Inspector General 
Semiannual Report to CongressOctober 1, 2018, through March 31, 2019
 
 
assistance from both charitable entities  case-by-case basis, such as under the advisory opinion 
and directly from drug manufacturers.   process. 
A new safe harbor to protect the  OIG is not adopting the suggestion to protect a health 
infrequent and nominal incentives given  plans gifts to network providers because it does not satisfy 
by a health plan to a network providers  the criteria for modifying or establishing safe harbor 
office or staff, such as a token of nominal  provisions, such as fostering access to healthcare services or 
amount or lunch for the office, as  improving the quality of healthcare services. However, to the 
recognition for efforts associated with  extent efforts associated with encouraging the delivery of 
the delivery of preventative care.    preventive care might be enhanced through safe harbors for 
coordinated care, on August 27, 2018, OIG issued an RFI 
seeking input from the public on how to address any 
regulatory provisions that may act as barriers to coordinated 
care or value-based care as well as other related topics.  See 
83 Fed. Reg. 43607.  OIG is reviewing the comments 
received.  In the meantime, questions about the application 
of the anti-kickback statute to specific arrangements should 
be addressed on a case-by-case basis, such as under the 
advisory opinion process. 
New safe harbors to extend anti-kickback  OIG does not have authority to change the scope of 
statute waivers for Medicare Shared  activities permitted under the MSSP.  Regarding a safe 
Savings Program (MSSP) accountable  harbor to protect activities and initiatives outside of the 
care organizations to additional activities  MSSP, on August 27, 2018, OIG issued an RFI seeking input 
and care initiatives, and to protect all  from the public on how to address any regulatory provisions 
accountable care organizations and other  that may act as barriers to coordinated care or value-based 
organizations implementing alternative  care as well as other related topics, which encompasses the 
payments models, and to protect  subjects presented in this proposal.  See 83 Fed. Reg. 43607.  
clinically and financially integrated  OIG is reviewing the comments received.  In the meantime, 
programs.  questions about the application of the anti-kickback statute 
to specific arrangements should be addressed on a case-by-
case basis, such as under the advisory opinion process. 
Make permanent the regulatory safe  On August 27, 2018, OIG issued an RFI seeking input from 
harbor for donation and financial  the public on how to address any regulatory provisions that 
support of electronic health record  may act as barriers to coordinated care or value-based care 
software (42 C.F.R.  1001.952(y)) and  as well as other related topics, which encompasses the 
expand the scope of covered  subjects presented in this proposal.  See 83 Fed. Reg. 43607.  
technologies under the safe harbor.  OIG is reviewing the comments received.  In the meantime, 
questions about the application of the anti-kickback statute 
to specific arrangements should be addressed on a case-by-
case basis, such as under the advisory opinion process. 
 
 
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