The top 10 management and performance challenges facing the Department of Health and Human Services

If HHS acted on these recommendations, the OIG said the agency would likely generate significant savings and improve the effectiveness of its programs.  

If he’s confirmed as the next secretary of the Department of Health and Human Services, Alex Azar will have his hands full.

The Office of Inspector General has identified 10 management and performance challenges that the HHS faces across all its programs and that cover the agency’s critical responsibilities.

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In its 48 page report (PDF), the OIG listed the top unimplemented recommendations that it has detected in its audits and evaluations of HHS. If the agency acted on these suggestions, the OIG said the HHS would likely generate significant savings and improve the effectiveness of its programs.  

The top challenges are how to:

1. Ensure program integrity in Medicare

The OIG noted that Medicare spending will rise significantly over time due to the increase in the number of beneficiaries and increases in per-capita healthcare costs. Recent reports indicate that the trust fund for Medicare Part A will be depleted by 2029 and spending for Medicare Part B will grow by almost 7% over the next five years, outpacing the U.S. economy. This means HHS must reduce improper payments, combat fraud, foster prudent payment policies and implement healthcare reforms and the promise of health information technology.

2. Ensure program integrity in Medicaid

With almost 69 million enrolled individuals, Medicaid serves more enrollees than any other federal healthcare program and represents one-sixth of the national healthcare economy, the OIG noted. HHS must ensure compliance with fiscal controls, leverage fraud prevention and improve national Medicaid data to support program integrity.

3. Curb the opioid epidemic

Opioid abuse and drug overdoses are a national epidemic and President Donald Trump has recently declared the crisis as a national public health emergency. Despite the increase in the number of people who suffer from opioid use disorder, the OIG noted that only about one-fifth of individuals receive specialty treatment, and even fewer receive medication-assisted treatment. HHS must address inappropriate prescribing of opioids, combat fraud and diversion of prescription opioids, address inadequate access to treatment, address misuse of grant funds and fight fraud by treatment providers of opioid use disorder.

4. Improve care for vulnerable populations

HHS programs provide critical health and human services to many vulnerable populations, including patients who receive nursing home care, group home care, hospice care, or home and community-based services. The report stated that HHS must address substandard nursing home care, reduce problems in hospice care, mitigate risks to individuals receiving home and community-based services and ensure access to safe and appropriate services for children.

5. Ensure integrity in managed care and other programs delivered through private insurers

Millions of enrollees in HHS programs receive healthcare coverage through private insurance companies and sponsors who contract with CMS or states to deliver benefits and services. This means HHS must combat fraud, waste and abuse by healthcare providers billing managed care plans; ensure integrity and compliance by managed care and Part D sponsors; and oversee the health insurance marketplaces.

6. Improve financial and administrative management and reduce improper payments

As Americans continue to live longer and with more chronic medical conditions, the OIG said HHS must ensure that beneficiaries receive high-quality nursing home, hospice, and home- and community-based services, including personal care services. The OIG believes HHS must do more to prioritize quality care for this community to improve internal controls and offer better guidance and training for surveyors to ensure that nursing homes with recorded quality and safety issues correct their deficiencies. This means it must address weaknesses in financial management systems, address Medicare trust fund issues/social insurance, reduce improper payments, address concerns about contracts management, implement the Digital Accountability and Transparency Act.

7. Protect the integrity of public health and human services grants

Last year HHS awarded more grants than any other federal entity: more than $100 billion in grants, excluding Medicaid, according to the OIG. Congress has also authorized HHS to increases expenditures through new grant programs, including billions for cancer prevention, diagnosis and treatment as well as neurological research, precision medicine and opioid prevention and treatment. This means HHS must ensure effective grants management within the department and ensure program integrity and financial capability at the grantee level.

8. Ensure the safety of food, drugs, and medical devices

The FDA has a broad statutory mandate, and its responsibilities continue to grow. This means the agency must ensure food safety; ensure the safety, efficacy, and quality of medical products; and oversee the complex drug and medical device supply chain.

9. Ensure program Integrity and quality in programs serving American Indian and Alaska Native populations

The OIG noted that last year HHS administered 45% of all federal funds that serve American Indian and Alaska Native communities, a total of $7 billion. HHS faces significant challenges to ensure effective delivery of crucial services to these populations and protect funds from fraud, waste, and abuse.

10. Protect HHS data, systems and beneficiaries from cybersecurity threats

Data management, use and security are essential to the effective and efficient operation of HHS and its programs, the OIG noted in the report. Cybersecurity incidents and breaches pose a significant risk to the confidentiality, integrity and availability of sensitive data that HHS manages.

This could cause myriad problems including impeding HHS's ability to offer essential programs and services, threatening major elements of the nation’s critical infrastructure and placing the health and safety of patients at risk. HHS must ensure that it takes appropriate actions to protect all HHS data and systems from cybersecurity threats.