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HHS FY 2017 Budget in Brief - OIG

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)

  2015 2016 2017 2017
+/- 2016
Discretionary Appropriation 73 77 85 +9
HCFAC Collections 9 11 12 +1
Discretionary HCFAC 67 67 122 +55
Mandatory HCFAC 186 188 200 +13
Total Funding, All Sources   335 343 419 +77
Full-Time Equivalents 1,524 1,616 1,830 +214

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.

The FY 2017 Budget request for the Office of Inspector General (OIG) is $419 million, an increase of $77 million above FY 2016.  The request includes $85 million for OIG oversight of the Department’s more than 100 public health and human services 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 Department Public Health and Human Services programs and Health Insurance Marketplaces. 
Moreover, OIG is a key partner in the joint Department of Health and Human Services and Department of Justice Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, and the Budget includes $334 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 2017 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 2017 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 the Department.

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

Protecting Department Grants and Contract Funds from Fraud, Waste, and Abuse
The Department is the largest grant-making organization in the federal government, awarding over 81,000 grants totaling approximately $410 billion in FY 2015.  HHS is also the third largest contracting agency in the federal government, awarding more than $21 billion in contracts in FY 2015.  The size and scope of departmental awards make vigilant oversight crucial to the success of programs designed to improve the health and well-being of the public.  In FY 2017, 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 responsible stewardship of these program dollars.

Overseeing the Health Insurance Marketplaces
The Marketplaces add a substantial new dimension to the Department’s landscape.  The Centers for Medicare & Medicaid Services and the states that established Health Insurance Marketplaces must implement and operate complex program requirements.  Individuals use the Marketplaces to get information about their health insurance options, be assessed for eligibility (for 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 payments, eligibility, management and administration, and information security. By focusing on these key areas, OIG will help to ensure that taxpayer dollars are spent for their intended purposes in a secure system that operates efficiently, effectively, and securely.

Recent OIG work has addressed vulnerabilities in verification procedures for Marketplaces, the security of insurance data, and the status of Consumer Operated and Oriented Plans.

Integrity of Medicare and Medicaid

Addressing Prescription Drug Vulnerabilities on a National Scale
In both the Medicare Part D and Medicaid programs, OIG has uncovered improper and potentially harmful prescribing practices, pharmacies billing for drugs not dispensed, and diversion of prescription drugs.  OIG has also identified waste related to payments for prescription drugs under Department programs, increasing costs to taxpayers and beneficiaries. The need to invest additional resources in this area is clear, and additional FY 2017 funding would support the integrity of these two programs and ensure patient safety.

Overseeing Changes in Medicaid
The Congressional Budget Office projects that the number of individuals covered by Medicaid will grow approximately 37 percent by 2024.  As enrollment and spending increase, there is heightened urgency to address the program integrity challenges that Medicaid already faces.  These include improving the effectiveness of Medicaid data, avoiding or recovering Medicaid improper payments and payments for which a third party is liable, preventing waste and fraud in Medicaid managed care programs, and reducing waste associated with excessive payment rates to public providers.

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

Ensuring Patient Safety and Quality of Care
The FY 2017 request continues to support critical oversight for nursing home, hospice, and home- and community-based services (HCBS) programs.  As the median age of Americans continues to rise, and as more Americans live with chronic medical conditions, HHS faces challenges in ensuring that beneficiaries who require services for such conditions receive high‑quality care.  High‑quality nursing home and HCBS programs are important for the continued well-being of people who need ongoing assistance with daily living, as well as those who need additional help recuperating from hospital stays or other acute care.  Hospice care provides comfort for terminally ill beneficiaries by reducing pain and addressing physical and other needs.  High‑quality nursing home, hospice, and HCBS personal care services can often prevent the need for disruptive and costly hospitalizations.

Delivery System Reform and Payment Accuracy
OIG will heighten its focus on delivery system reform, including accountable care organizations, bundled payment initiatives, and other innovative reforms designed to improve results and foster smarter spending.  Significant reforms to payment systems in 2017, such as those included in the Medicare Access and CHIP Reauthorization Act, should create new oversight needs from a data, security, and payment perspective.

Content created by Office of Budget (OB)
Content last reviewed on February 16, 2016