GAO Expands Investigation of HHS Inspector General Rehnquist

The investigation of HHS Inspector General Janet Rehnquist beyond its initial focus on "widespread" personnel changes within the office, the Washington Post reports. In October, the GAO began looking into concerns raised by Sens. Charles Grassley (R-Iowa), Max Baucus (D-Mont.) and John Breaux (D-La.) regarding "the impact of the loss or reassignment of several senior managers on OIG operations" (Walsh, Washington Post, 12/12). The 1,600 staff members in the HHS Office of Inspector General audit, investigate and evaluate the more than $460 billion that the federal government spends each year through HHS, including funds for Medicare and Medicaid. According to Grassley, the loss or reassignment of 19 staff members since Rehnquist was appointed in August 2001 could "cripple the government's ability to root out waste and fraud," the Times reports. Grassley, Baucus and Breaux asked the GAO to investigate whether there has been a change in the "number and intensity of audits" since Rehnquist became inspector general (Pear, New York Times, 12/10).

Now, the GAO also is looking into an OIG audit of a Florida state government pension fund that was supposed to begin in April but did not start until September, "ensuring that any potentially embarrassing results would not be known until well after the Nov. 5 election," the Post reports. During that time, President Bush's brother, Florida Gov. Jeb Bush (R), faced a difficult reelection campaign and eventually won a second term. Rehnquist spokesperson Ben St. John said that Florida officials three times had requested that the audit be delayed, adding that the delays were unrelated to Florida politics. Even if the audit had not been delayed, its results would not have been known until after the election, according to St. John. However, the Post reports that according to internal e-mails released by Rehnquist, the OIG expected a draft report of the audit by Sept. 30. In a letter to Grassley, Rehnquist said that her decision to delay the audit "was based on merits and not motivated by political reasons." GAO investigators also are examining the shredding of documents that occurred after the GAO investigation had begun. According to St. John, document shredding is "routine" at OIG. In her letter to Grassley, Rehnquist added that she ordered a halt to the shredding after GAO officials informed her that they had reports of documents being destroyed. She said, "We do not have any reason to believe that whatever documents that recently may have been shredded have any significance or impact on the GAO review" (Washington Post, 12/12).

In other news, OIG saved HHS $21 billion in fiscal year 2002 through its crackdown on waste, fraud and abuse in federal programs, including Medicare and Medicaid, Rehnquist said yesterday, the AP/Baltimore Sun reports (AP/Baltimore Sun, 12/12). The majority of the savings -- $19.9 billion -- were garnered through the implementation of OIG Medicare recommendations designed to reduce costs and improve operations (OIG release, 12/11). HHS last year adjusted the reimbursement formula for hospitals that provide care for Medicaid beneficiaries and indigent patients to "more accurately reflect the costs of providing services," according to the AP/Baltimore Sun. Rehnquist said that government programs had been overpaying those hospitals (AP/Baltimore Sun, 12/12). Other savings came from investigative receivables and audit disallowances. The money saved in FY 2002 surpassed the savings reported in FY 2001 by $3 billion (OIG release, 12/11).