OIG Work Plan Updates for May 2022: Contracts, Reporting, and Add-On Payments

The OIG has added more items to their Work Plan during May 2022. Let’s take a closer look at the new items.

Audit of Sole-Source Contract

Last year there were multiple media reports (for example here, here, and here) of a government contract worth up to $530 million being awarded to Family Endeavors, Inc. after the organization hired a President Biden transition official. It was a no-bid contract, and the $530 million amount was reported to be more than 12 times the organization’s annual budget. The contract is for work to help manage the influx of migrant children at the U.S. southern border and was awarded through HHS’s Administration for Children and Families (ACF) which manages the Unaccompanied Children Program.

According to the OIG, because of an influx of unaccompanied children arriving at the U.S. southern border which coincided with efforts to control the spread of COVID-19, ACF identified a need to increase the number of shelter beds in its provider network and entered into contracts for shelter and related services for unaccompanied children. ACF awarded a sole source contract to Family Endeavors, Inc., a nonprofit social service agency, to operate as a provider facility known as an emergency intake site (EIS). Congress expressed concerns about the media reports on ACF’s awarding of the sole source contract to Family Endeavors, Inc.

The OIG plans to determine whether ACF awarded this sole source contract in accordance with Federal statutes and regulations, as well as HHS policies and procedures.

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Accuracy of Falls Reporting in Home Health Agencies

CMS built the Care Compare website on Medicare.gov as a tool to help patients choose a home health care provider. It’s designed to be an easy-to-access, convenient official source of information about provider quality.

One of the most important provider quality measures for home health agencies is the reporting of patient falls and resulting injuries. In April 2022, CMS started reporting the percentage of patients in home health care who fell and suffered major injuries for each home health agency (HHA).

HHAs report falls in patient assessments using the standardized Outcome and Assessment Information Set (OASIS), and CMS reports the agency fall rates calculated from these assessments.

OIG plans to study the accuracy of HHAs’ reporting of falls in OASIS. Specifically, they plan to use Medicare claims to identify hospitalizations due to falls with major injuries among Medicare beneficiaries in home health care. Then they will assess the extent to which those falls were reported in OASIS assessments. OIG plans to highlight the characteristics of beneficiaries who did not have their falls reported and they will describe the characteristics of HHAs that have particularly low reporting rates. If you work in an HHA, this is an important OIG Work Plan item to follow.

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Audit of Add-On Payments for COVID-19 Tests

When it comes to COVID-19 testing, the quicker patients know they tested positive, the better they can manage self-isolation and prevention of spreading the disease. The speed at which this occurs depends greatly on how quickly lab tests can be performed and reported.

In October of 2020, CMS announced steps to incentivize prompt COVID-19 test turnaround times by paying more for expedited results. This was done through the amended Administrative Ruling (CMS 2020-1-R2). This ruling established a $25 add-on payment for COVID-19 testing that met certain high-throughput technology.

Specifically, the add-on payment was appropriately made if the laboratory:

    1. completed the test in two (2) calendar days or less
    2. completed most of the test that use high-throughput technology in two (2) calendar days or less for all their patients (not just their Medicare patients) in the previous month.

OIG plans to audit providers’ supporting documentation for the COVID-19 test add-on payments to determine whether the documentation complied with Medicare requirements.

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Follow-up Audit Under the Post-Acute-Care Transfer Policy (PACT)

Under the Inpatient Prospective Payment System, Medicare pays hospitals for inpatient stays based on the Medicare Severity Diagnosis-Related Group (MS-DRG). If a patient is discharged to home, the hospital gets the full reimbursement. But for certain MS-DRGs and under the post-acute-care transfer policy, Medicare pays hospitals a per diem rate when an inpatient beneficiary is transferred to post-acute care. This per diem payment cannot exceed the full payment that would have been made if the beneficiary had been discharged to home.

Past audits performed by the OIG determined overpayments of $267 million and $54 million associated with the post-acute-care transfer policy.

In these past audits OIG found that the CMS Common Working File (CWF) edits that detected inpatient claims under the post-acute care transfer policy were working appropriately. However, some Medicare contractors did not receive automatic notifications of improperly billed claims or did not act to adjust those claims. As a result, OIG recommended that CMS recover the identified overpayments in line with its policies and procedures and ensure that the Medicare contractors are receiving the notifications and are acting to recover the overpayments. CMS concurred with all OIG recommendations and detailed how they were addressed.

OIG is planning this follow-up audit to determine whether CMS’s CWF edits are working properly in detecting inpatient claims under the post-acute-care transfer policy and are automatically recovering overpayments, and whether Medicare contractors are receiving the automatic notifications and acting to recover overpayments.


It is important for compliance professionals to review these work plan items as a part of their continual risk assessment efforts. If your organization provides services in these areas, it might be wise to take a proactive look at these issues yourself.


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