The HHS Office of Inspector General published its semiannual report to Congress June 2, identifying $16.6 billion in actual and potential cost savings from October 2024 through March 2025.
Five things to know:
- The report identified $12.65 billion in potential cost savings, dependent on recommended policy changes. Additionally, OIG identified $3.51 billion in funds paid back to the federal government over the six-month period. Audits have identified another $451 million in receivables that the government has not yet recouped.
- The OIG flagged $7.5 billion in risk-adjusted payments tied to diagnoses reported only through in-home health risk assessments and associated chart reviews, with limited evidence those diagnoses were valid. The watchdog urged CMS to restrict use of these coding practices to reduce excess spending.
- The office published 78 reports, issued 165 recommendations and closed 946 investigations related to fraud and abuse in HHS programs over the six-month period. Its work led to 744 civic and criminal actions, including settlements and exclusions.
- The OIG recommended policy changes it said would yield significant cost savings. In one example, the office found aligning payments for swing-bed services at critical access hospitals with rates paid to skilled nursing facilities could have saved Medicare $7.7 billion. However, such a change would require Congressional action.
- The report aligns with the Trump administration’s broader claims of focusing on rooting out waste, abuse and fraud in government programs. On May 21, CMS said it would begin auditing all Medicare Advantage plans for potential overpayments on an annual basis in what it described as an “aggressive” plan to increase oversight.
