October 2017 OIG Work Plan Update

Five New Items Added to Current Work Plan

This year, the OIG is updating its annual Work Plan during the year, rather than annually. Its Work Plan sets forth various audits and evaluations that are underway or planned during the fiscal year and beyond. The updates will include the addition of newly initiated Work Plan items and removal of completed items. In conducting its work, the OIG assesses relative risks in HHS programs and operations to identify those areas most in need of attention. In evaluating potential projects to undertake, the OIG considers a number of factors including mandates set forth in laws, regulations, or other directives; requests by Congress, HHS management, or the Office of Management and Budget; top management and performance challenges facing HHS; work performed by other oversight entities (e.g., the Government Accountability Office); actions to implement OIG recommendations from previous reviews; and the potential for positive impact. In addition to working on projects that often result in audits, reviews, and reports, the OIG also engages in a number of legal and investigative activities that are reported separately.

5 New Projects Added

1. Secretary Price’s Use of Chartered Aircraft for Federal Travel. Federal travel regulations provide limited instances in which chartered aircraft can be used for official Government business. The OIG initiated a review of HHS Secretary Price’s use of chartered aircraft for federal travel. He subsequently resigned and agreed to payback funds improperly expended.
2. Specialty Drug Coverage and Reimbursement in Medicaid. Medicaid spending on specialty drugs has rapidly increased. There is no standard definition for specialty drugs. They may be expensive; be difficult to handle, monitor or administer; or treat rare, complex, or chronic conditions. The OIG plans to determine states’ definitions of, and payment methodologies for, Medicaid specialty drugs and determine how much states paid for specialty drugs; and review strategies that states use to manage specialty drug costs such as formularies, cost sharing, step therapy, and prior authorization.
3. FDA Oversight of Risk Evaluation and Mitigation Strategies to Address Prescription Opioid Abuse. Opioid abuse and overdose deaths are at epidemic levels in the United States. The FDA has been provided legal authority to require pharmaceutical companies to develop Risk Evaluation and Mitigation Strategies (REMS) when the FDA determines that the risk of using a drug outweighs its benefit. Through the REMS program, the FDA intends to “increase the number of prescribers who receive training on pain management and safe prescribing of opioid drugs in order to decrease inappropriate opioid prescribing.” The OIG will conduct an evaluation on how the FDA determined the need for opioid REMS and determine the extent to which it has held pharmaceutical companies with required opioid REMS accountable for REMS assessments. The OIG also plans to determine the extent to which the FDA has held opioid REMS sponsors accountable for REMS goals to mitigate risks of misuse, abuse, addiction, overdose, and serious complications because of medication errors.
4. Drug Traceability Test. Potentially dangerous drugs including diverted, counterfeit, and imported unapproved drugs, can enter the supply chain and pose a threat to public health and safety. The Drug Supply Chain Security Act (DSCSA) provides the FDA and others with new tools to prevent the introduction of harmful drugs into the supply chain and to identify and remove them. DSCSA requires trading partners to exchange drug product tracing information when they take ownership of drugs, resulting in a tracing record that the FDA and others can use to investigate suspect and illegitimate drugs. Ensuring that DSCSA’s drug product tracing requirements function as intended will help the FDA to respond effectively to potentially harmful drugs in the supply chain. The OIG plans to determine the extent to which selected drugs can be traced from the dispenser back to the manufacturer. This study – part of the OIG’s body of work in this area – builds on previous examinations of trading partners’ early experiences exchanging drug product tracing information by testing the accuracy of those tracing records.
5. Review of Medicare Payments for Bariatric Surgeries. Bariatric surgery is performed to treat comorbid conditions associated with morbid obesity. Medicare Parts A and B cover certain bariatric procedures if the beneficiary has (1) a body mass index of 35 or higher, (2) at least one comorbidity related to obesity, and (3) been previously unsuccessful with medical treatment for obesity (CMS, Medicare National Coverage Determinations Manual, Pub. No. 100-03, chapter 1, part 2, § 100.1). Treatments for obesity alone are not covered. The Comprehensive Error Rate Testing program’s special study of certain Healthcare Common Procedure Coding System codes for bariatric surgical procedures found that approximately 98 percent of improper payments lacked sufficient documentation to support the procedures (CMS, Medicare Quarterly Provider Compliance Newsletter, “Guidance to Address Billing Errors,” volume 4, issue 4, July 2014). OIG auditors will review supporting documentation to determine whether the bariatric services performed met the conditions for coverage and were supported in accordance with federal requirements (Social Security Act, §§ 1815(a) and 1833(e)).

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