OIG fraud recoveries dropped $1.2B this year. That might not be a bad thing

Court judgement money
OIG fraud recoveries dipped 30% in 2017, but more effective corporate integrity agreements may be the driver. (Getty/LIgorko)

The federal government brought in 30% less in fraud recoveries in 2018 than it did the previous year, thanks to far fewer large settlements.

But that could be a net benefit, according to the agency.

The Office of the Inspector General recovered $2.9 billion from fraud investigations during fiscal year 2018, according to a semiannual report (PDF) to Congress released this week. That’s a $1.2 billion decline from last year, when the agency pulled in $4.13 billion.

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The year prior, the agency hauled in a historic $5.6 billion.

But lower recoveries are not indicative of lighter enforcement, according to OIG spokesperson Don White. Fraud recoveries fluctuate from year to year, based primarily on the volume of large settlements. In 2017, for example, the OIG inked a $155 million settlement with EHR vendor eClinicalWorks and Mylan paid $465 million in an EpiPen settlement. The prior year, Tenet Healthcare forked over more than $500 million.

RELATED: DOJ charges more than 600 in historic fraud takedown involving $2B in false claims

“Some years there are large settlements, and some years there are not,” White said, adding that some focus areas—like opioids—don’t generate huge eight-figure payouts.

Criminal actions have also dipped. OIG charged 764 individuals engaged in fraud in 2018, down from 881 last year. Exclusions also dropped from 3,244 to 2,712.

But White says there may be a reason those larger settlements have declined. He says corporate integrity agreements (CIAs), which have been around for decades, have grown more teeth in recent years, requiring companies to submit compliance reports and audits. Those onerous agreements have acted as a deterrent to high-profile fraud schemes.

RELATED: OIG fines eClinicalWorks $132,500 for patient safety reporting failures

“CIAs are really changing the behavior of the really big players in the healthcare industry" he said, calling the agreements “a great untold story.”

Part of that is subsequent actions that companies face if they don’t adhere to the agreement. Earlier this year, eClinicalWorks paid an additional $132,500 for failing to report patient safety failures as required in its CIA.

And for those that refuse to sign CIAs, the OIG has initiated a public shaming of sorts, listing the entity as “high risk” on its website. As of Oct. 31, two dental offices have been added to the list.

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