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HHS FY2015 Budget in Brief

Department of Health and Human Services
Office of the Secretary, Office of Inspector General (OIG)

The Office of Inspector General’s mission is to protect the integrity of Department of Health and Human Services programs as well as the health and welfare of the people they serve.

OIG Budget Overview

(Dollars in millions)






Discretionary Appropriation





Disaster Relief Appropriations Act of 2013





HCFAC Collections





Discretionary HCFAC





Mandatory HCFAC





Total Funding, All Sources






Full Time Equivalents

2013: 1,660

2014: 1,577

2015: 1,861

2015 +/- 2014: +284

OIG Activities

The FY 2015 Budget request for the Office of Inspector General (OIG) is $400 million, an increase of $105 million above the FY 2014 enacted level. The request includes $75 million for OIG oversight of HHS’s more than 300 non-Medicare/Medicaid programs, some of which are new or have grown in scope and complexity during the last decade. These funds will enable OIG to target oversight efforts of HHS public health and human services programs and the Health Insurance Marketplaces (Marketplaces).

Moreover, OIG is a key partner in the joint HHS and Department of Justice Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, and the President’s Budget includes $325 million in support of HEAT and other program integrity efforts aimed at reducing fraud, waste and abuse in the Medicare and Medicaid programs. In addition to maintaining the efforts and success of the Medicare Fraud Strike Forces, HEAT activities in FY 2015 include protecting the integrity of the expanding Medicaid program and recommending solutions to reduce improper payments in Medicare and Medicaid.

While specific oversight activities in FY 2015 will be determined through OIG’s work planning process, the following are OIG’s focus areas based on its assessment of the top management and performance challenges facing HHS.

Integrity of the Marketplaces

The Marketplaces add a substantial new dimension to the Department's landscape. They include state, federal, and partnership marketplaces, each of which must implement and successfully operate a complex set of program requirements. Individuals use the Marketplaces to get information about their health insurance options, be assessed for eligibility (for, among other things, qualified health plans, premium tax credits, and cost sharing reductions), and enroll in the health plan of their choice.

OIG’s oversight of the Marketplaces focuses on payment accuracy, eligibility systems, contractor oversight, and data security and consumer protection. By focusing on these key areas OIG hopes to ensure that taxpayer dollars are spent for their intended purposes in a system that operates efficiently and is secure.

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Integrity of the Department’s Public Health and Human Services Programs

Grants Management and Administration of Contract Funds: HHS is the largest grant-making organization in the federal government, awarding over $345 billion in grants in FY 2013, of which approximately $88 billion were for Public Health and Human Services programs. HHS is also the third largest contracting agency in the federal government; in FY 2013, HHS awarded over $19 billion in contracts across all program areas. The size and scope of departmental awards make operating effectiveness crucial to their success. In FY 2015, OIG will continue to examine the Department’s grants management and contracting practices and its oversight of grantees and contractors. OIG will also identify misused grant and contract funds for recovery and investigate suspected grant fraud. OIG will provide the Department with vital information that will help hold accountable grantees and contractors that manage large grant awards and contracts, and ensure the integrity of these significant expenditures.

Protecting Consumers of Food, Drugs, and Medical Devices: HHS is responsible for protecting public health by ensuring the safety, efficacy, and security of drugs, medical devices, biologicals, and much of our nation's food supply. Additionally, HHS must ensure that once a drug, biologic, or device has been approved for use, it is marketed appropriately. Furthermore, during a food emergency, HHS must find the contamination source and oversee the removal by manufacturers of these products from the market. In FY 2015, OIG will continue to evaluate the Department’s management of food, drug, and device safety issues. Furthermore, OIG continues to work closely with Food and Drug Administration and the Justice Department to investigate illegal marketing practices by drug and device manufacturers.

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Integrity of Medicare and Medicaid

Expansion of Medicaid:Beginning in 2014, states have the option to expand Medicaid eligibility to qualifying adults earning up to 133 percent of the federal poverty level. Because of this and other factors, it is anticipated that the population covered under Medicaid will grow significantly over the next few years. In addition to the challenges in implementing this expansion, increases in the Medicaid population and spending also heighten the urgency of addressing existing program integrity challenges.

OIG’s work in this area will focus on ensuring that the federal government pays the appropriate share of costs; improper payments are identified and collected; eligibility is correctly determined; managed care programs, in which approximately a third of all Medicaid beneficiaries are enrolled, maintain sufficient program integrity efforts; and payment rates to health care providers are economical.

Fighting Fraud and Waste in Medicare Parts A & B: Fraud and waste in Medicare Fee-for-Service programs continue to be significant challenges. Improper payments and payment inefficiencies waste Medicare dollars and divert finite resources away from beneficiary care and services. In FY 2013, CMS reported an error rate of 10.1 percent for Medicare Fee-for-Service. OIG investigations continue to uncover durable medical equipment suppliers, home health agencies, community mental health centers, ambulance operators, and outpatient therapy providers that are defrauding the Medicare program. In national assessments, OIG has identified questionable billing patterns by home health agencies and community mental health centers and is conducting similar analysis of questionable billing by ambulance providers. Additionally, OIG work spotlights various types of waste including hospital billing error, improper payments to Skilled Nursing Facilities and misaligned payment rates. OIG will continue its work in these areas in FY 2015.

Ensuring Patient Safety and Quality of Care in Nursing Facilities and Home- and Community-Based settings: As the median age of Americans trends upward and as more Americans live with chronic medical conditions, there are challenges in ensuring that beneficiaries who require nursing facility services receive high quality care. It is also critical to ensure that appropriate home and communitybased care is available, allowing beneficiaries whose needs and preferences are better served by remaining in their own homes or other communitybased settings to avoid institutionalization.

OIG continues to assess quality of care and patient safety across a variety of health care settings, including nursing facilities and home and community-based settings, and recommends improvements to oversight and safeguards. Additionally, OIG continues to pursue enforcement actions against nursing homes that render substandard care, while working with the Centers for Medicare and Medicaid Services and law enforcement partners at the Department of Justice to promote better care for elderly persons and to prosecute providers that subject them to abuse or neglect.

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Content created by Office of Budget (OB)
Content last reviewed on June 4, 2014