Management Challenges at the Departments of Labor,  
Health and Human Services, and Education and the Social Security Administration:   
Views from the Inspectors General 
 
 
Testimony of  
Daniel R. Levinson 
Inspector General 
U.S. Department of Health and Human Services 
 
Before the United States House Committee on Appropriations 
Subcommittee on Labor, Health and Human Services, Education, and Related Agencies 
March 9, 2017 
____________________________________________________________________________________ 
 
 
The Office of Inspector General (OIG) is charged with overseeing the Department of Health and 
Human Services (the Department) more than $1 trillion investment in health and human services 
programs that touch the lives of virtually all Americans.  Ensuring that programs operate free from 
fraud, waste, and abuse is a top priority and a goal we share with the Department.  This effort requires 
sustained focus on prevention, detection, and enforcement.  It also requires close attention to promoting 
economy, efficiency, and effectiveness of programs so that they work well for taxpayers, patients, 
providers, and others they affect.  Sound stewardship depends on strong partnerships within the 
Department, as well as with external organizations, including other Federal, State, and local government 
agencies, and with the private sector, including, for example, through the Healthcare Fraud Prevention 
Partnership.    
  Today, I focus on management challenges related to (1) strengthening the use and security of 
data and technology; (2) effectively administering grants and contracts; and (3) maintaining focus on 
safety and quality of care.1  
   
                                                           
1  For 2016, OIG identified 10 top management and performance challenges.  OIGs 2016 Top Management and Performance 
Challenges Facing HHS is at https://oig.hhs.gov/reports-and-publications/top-challenges/2016/. 
House Committee on Appropriations 
Subcommittee on Labor, Health and Human Services,  
Education, and Related Agencies 
Hearing  March 9, 2017  STRENGTHENING THE USE AND SECURITY OF DATA AND TECHNOLOGY 
In support of its mission and operations, the Department maintains and uses expanding amounts of 
sensitive information.  The right data, managed and used effectively, can inform and help ensure 
efficient operations of the Department and its programs, as well as support data analytics and other 
proactive program oversight.  Similarly, the American health care system increasingly relies on health 
information technology (health IT) and the electronic exchange and use of health information.  To 
capitalize on growing amounts of data in health care, complete, accurate, and timely data must be 
available, where and when needed, subject to applicable security and privacy protections. 
Several factors may impede the Departments ability to enable and encourage the flow of 
information.  These include technical barriers (e.g., lack of interoperability), the complex nature of 
privacy and security laws, financial considerations (e.g., the cost of health IT acquisition), and other 
issuessuch as information blocking and consumer confidencethat relate to a willingness to share 
information.  The Department must continue to find ways to leverage data to enhance decision-making, 
including streamlining and accelerating internal data exchange.  Similarly, it is critical that the 
Department ensure that the systems on which it relies are able to promptly detect problems to help 
prevent inappropriate payments, protect people, and reduce time-consuming and expensive pay and 
chase activities.  Notably, OIG has long raised concerns that neither the Department nor the States have 
complete and accurate national data needed for effective oversight of Medicaid, including for purposes 
of ensuring that only trustworthy providers enter the system.   
  Equally important is ensuring that data are appropriately protected, both within Department 
systems and in the larger health and human services community.  Threats to the confidentiality, 
integrity, and availability of data can result in a range of harms, including financial and physical patient 
harm.  We are active in this area.  For example, OIG annually assesses information security controls in 
 
House Committee on Appropriations 
Subcommittee on Labor, Health and Human Services,  
Education, and Related Agencies 
Hearing  March 9, 2017    2 
  various Department networks and systems.  OIG has recommended fixes for specific security problems, 
as well as a greater management focus on strengthening information security across the Department. 
    EFFECTIVELY ADMINISTERING GRANTS AND CONTRACTS 
  The Department awarded approximately $100 billion in discretionary grants in Fiscal Year (FY) 
2016.  OIG has identified vulnerabilities in the Departments oversight of grant programs and grantees 
that could be mitigated by improved Department oversight.  These include deficiencies in grantees 
internal controls, financial stability, organizational structures, and policies and procedures.   
Ineffective grants administration puts Federal funds and people at risk.  For example, OIGs 
work shows that the Departments awarding agencies lack effective mechanisms to share with each 
other information about problematic grantees, thereby impairing the Departments ability to assess risks 
posed by new grant applicants.  We have also identified opportunities for the Department to work with 
States to strengthen oversight of Federal grant funds.  For example, audits of child care providers funded 
by the Child Care and Development Fund (CCDF) block grant program revealed the need to strengthen 
compliance with requirements for background screenings of individuals caring for children.  Additional 
OIG work found that States receiving CCDF grants sometimes failed to perform important program 
integrity activities, such as reviewing provider records, sharing or matching data from other Government 
programs, and conducting onsite visits.  OIG recommended that the Department work with States to 
examine the effectiveness of program integrity activities and share best practices.   
  In addition to grants, the Department awarded $24 billion in contracts in FY 2016.  To prevent 
misspent funds, OIG has recommended improvements to the Departments contracts management 
throughout the life cycle of a contract, from better acquisition planning and contract monitoring to 
timely contract closeouts.   
 
 
House Committee on Appropriations 
Subcommittee on Labor, Health and Human Services,  
Education, and Related Agencies 
Hearing  March 9, 2017    3 
  MAINTAINING FOCUS ON SAFETY AND QUALITY OF CARE  
  As it works to strengthen program operations, the Department must continue to ensure that 
taxpayer funds support the delivery of safe, high-quality services and that it is well prepared to address 
public health emergencies in concert with its partners. 
Indian Health Service (IHS) hospitals face serious, longstanding challenges to providing quality 
care.  Pressing challenges include recruiting and retaining competent clinical staff; aging facilities; 
hospitals unable to render competent emergency or high-level care; and limited resources for referred 
care.  The Department must harness expertise from across its agencies and the stakeholder community to 
address these challenges.  Specifically, IHS should (1) implement a quality-focused compliance 
program, (2) establish standards for local oversight activities, (3) set hospital performance metrics, and 
(4) better train hospital administrators and staff.  In addition, the Centers for Medicare & Medicaid 
Services should conduct more frequent surveys of nonaccredited IHS hospitals. 
OIG has identified opportunities to reduce patient harm through better detection and prevention 
of adverse events occurring in institutional settings.  We have also recommended stronger quality and 
safety protections for people receiving home- and community-based services, including personal care 
services that enable people to stay in their homes and avoid costly, disruptive facility-based care.  
Additionally, we have uncovered problems with hospice care, including inadequate oversight of 
certification surveys and staff licensure requirements; care planning failures; inadequate medical and 
nursing care; and fraudulent enrollments without beneficiary consent.   
OIGs work highlights opportunities to improve the quality and safety of services provided to 
children.  For example, OIG reviews revealed that many children covered by Medicaid, including 
children in foster care, do not receive required medical or dental services.  In addition, our work 
uncovered quality-of-care concerns with second-generation antipsychotic drug use among Medicaid-
 
House Committee on Appropriations 
Subcommittee on Labor, Health and Human Services,  
Education, and Related Agencies 
Hearing  March 9, 2017    4 
  enrolled children, including poor monitoring, children taking too many drugs or wrong doses, and wrong 
treatments for the childs condition.  OIG has recommended that the Department work with State 
Medicaid programs to perform utilization reviews of second-generation antipsychotic drugs prescribed 
to children.   
Addressing the abuse and misuse of opioids and other controlled substances poses a significant, 
ongoing challenge for the Department.  Effectively coordinating Departmental efforts and prioritizing 
initiatives will be key to combating this complex epidemic.  OIGs recommendations include more 
effective use of drug utilization programs to identify excessive, inappropriate prescribing and other steps 
to prevent patient harm and drug diversion schemes.   
CONCLUSION 
OIG management reviews of the Departments implementation of new programs offer lessons 
for the efficient management of large, complex government programs, among them the importance of 
clear project leadership, rigorous contract oversight, close coordination of policy and technical work, 
and effective planning and prioritization to align available resources with the most important and 
achievable goals.  OIG will continue our vigilant oversight and stands ready to assist the Department, as 
appropriate, in addressing the challenges discussed in my testimony and other challenges identified in 
our work.  One key step the Department can take is to redouble its efforts to implement pending OIG 
recommendations.2  I thank this Committee for its commitment to program integrity and look forward to 
continued collaboration with the Department and Congress to safeguard taxpayer dollars and promote 
the welfare of the people served by the Department. 
                                                           
2 OIGs Compendium of Unimplemented Recommendations can be found at https://oig.hhs.gov/reports-and-
publications/compendium/ . 
 
House Committee on Appropriations 
Subcommittee on Labor, Health and Human Services,  
Education, and Related Agencies 
Hearing  March 9, 2017    5