Recommendation: The Secretary of Defense should ensure that the DOD Chief Management Officer direct the task force, in consultation with the resale organizations, to reassess its methodology for estimating IT costs of consolidation, and make any necessary adjustments to its range of IT cost estimates and provide that updated information to Congress. (Recommendation 2)

Agency: Department of Defense
Status: Open

Comments: DOD concurred with this recommendation. In August 2020, DOD stated that it had intended to convene an IT working group to reassess the methodology and begin detailed IT consolidation planning, but the COVID-19 pandemic delayed this plan. DOD also said that the working group will form as soon as conditions allow and estimated that the working group will complete its work by October 31, 2020. When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

Recommendation: The Secretary of Defense should ensure that the DOD Chief Management Officer provide additional written information to Congress on the comments and concerns from the military departments and resale organizations on the task force's November 2018 business case analysis, as well as the task force's response to those comments and concerns. (Recommendation 4)

Agency: Department of Defense
Status: Open

Comments: DOD did not concur with this recommendation. In its written comments on our report, DOD stated that all the submitted comments were considered in the department's decision-making process; that all of the military department secretariats agreed with above-store consolidation, despite their comments on the business case analysis; and that the military department comments regarding the business case analysis were shared with congressional committee professional staff, even though the comments were not included in DOD's report to Congress so as to protect the department's deliberative process. In an August 2020 memorandum to GAO, DOD provided similar comments, stating that it considered all comments in its decision-making process and did not attach the comments to its report to Congress in order to protect DOD's internal deliberations. If DOD takes action to respond to this recommendation, we will provide updated information.

Recommendation: The Secretary of Agriculture should direct the Office of Property and Fleet Management to consistently monitor property provided to non-federal recipients within 1 year of receipt, and to ensure property is being used for its intended purpose 1 year after initial monitoring. (Recommendation 1)

Agency: Department of Agriculture
Status: Open

Comments: USDA concurred with this recommendation. As of April 2020, USDA's 180-day letter has not been received.

Recommendation: The Secretary of Energy should direct the Office of Asset Management to resume monitoring the Economic Development Property program, including property provided to non-federal recipients. (Recommendation 2)

Agency: Department of Energy: Office of the Secretary
Status: Open

Comments: As of March 2020, DOE indicated in its 180-day letter that the agency concurred with the recommendation, and will update their annual personal property reporting requirements. DOE anticipates having this recommendation implemented by September 30, 2020. GAO will continue to monitor DOE's efforts to implement this recommendation.

Recommendation: The Secretary of Labor should direct the Employment and Training Administration to take steps, such as reconciling data between Job Corps centers and the Job Corps National Office, to ensure that the entities responsible for overseeing and monitoring the Job Corps Program have accurate data on the excess property provided to non-federal recipients. (Recommendation 3)

Agency: Department of Labor: Office of the Secretary
Status: Open

Comments: As of February 2020, DOL indicated in its 180-day letter that they concurred with the recommendation, and have taken steps to improve the monitoring and oversight of Job Corps Property. This includes modifying the GSAXcess approval process by elevating review of all GSAXcess requests made by Job Corps Centers to DOL's Employment Training Administration's (ETA) national office. ETA is also working with DOL's Office of the Assistant Secretary for Administration and Management (OASAM) to develop a process for GSAXcess review that includes identifying approval levels for each category of property, identifying categories of property requiring additional review and approvals, and coordinating and streamlining access request procedures. These changes will be reflected in DOL's Office of Job Corps standard operating procedures (SOP), which is expected to be issued at the end of fiscal year 2020. DOL expects to provide training to Job Corps staff and Job Corps Centers in support of the SOP that will be provided annually. GAO will continue to monitor DOL's efforts to implement this recommendation.

Recommendation: The Secretary of Agriculture should direct the Office of Property and Fleet Management to establish clear processes to oversee property programs, including excess property provided to non-federal recipients across the agency. (Recommendation 4)

Agency: Department of Agriculture
Status: Open

Comments: USDA concurred with this recommendation. As of April 2020, USDA's 180-day letter has not been received.

Recommendation: The Secretary of Energy should direct the Office of Asset Management to update its regulations and guidance on programs that provide property to non-federal recipients to ensure regulations are current and establish a process to regularly communicate information about non-federal recipient programs to DOE program offices. (Recommendation 5)

Agency: Department of Energy: Office of the Secretary
Status: Open

Comments: As of March 2020, DOE indicated in its 180-day letter that the agency concurred with the recommendation, and will update internal policies, and provide personal property information on DOE's internal informational website known as Powerpedia. DOE anticipates implementing this recommendation by September 30, 2020. GAO will continue to monitor DOE's efforts to implement this recommendation.

Recommendation: The GSA Administrator should direct the Office of Government-wide Policy to revise the Personal Property Reporting Tool by updating the authorities agencies can select. (Recommendation 6)

Agency: General Services Administration: Office of the Administrator
Status: Open

Comments: As of February 2020, GSA indicated in its 180-day letter that it concurred with the recommendation, and has taken steps to revise the Personal Property Reporting Tool (tool). GSA has added relevant authorities to the tool as recently as July 2019, and will continue to contact agencies to ensure relevant authorities are included in the tool. GSA is also evaluating technical updates to the tool to ensure that reporting agencies select an appropriate authority when reporting personal property. GSA plans to complete these actions by July 31, 2020, and inform agencies of these changes in their guidance by the end of fiscal year 2020. GAO will continue to monitor GSA's efforts to implement the recommendation.

Recommendation: The GSA Administrator should direct the Office of Government-wide Policy to document in what circumstances excess property loaned to non-federal recipients should be reported and what property GSA is reporting on behalf of agencies, for example, by updating GSA guidance. (Recommendation 7)

Agency: General Services Administration: Office of the Administrator
Status: Open

Comments: As of February 2020, GSA indicated in its 180-day letter that it concurred with the recommendation. GSA will better communicate with agencies to better understand the confusion of reporting on loaned excess property, as reporting requirements are in statute, regulations, and guidance. GSA also plans to review and update by July 31, 2020, relevant regulations and guidance in this area including Federal Management Regulation Bulletin B-27, "Annual Executive Agency Reports on Excess and Exchange/Sale Personal Property." GAO will continue to monitor GSA's efforts to implement this recommendation.

Recommendation: The Director of the DOE Office of Acquisition Management should clearly define—in guidance or other documents—which subcontracts should be audited, how an audit is defined, and how to meet subcontract audit requirements if Defense Contract Audit Agency is unable to conduct the audit.(Recommendation 1)

Agency: Department of Energy
Status: Open

Comments: In its comments on a draft of the report, DOE partially concurred with the recommendation, but stated that there is no government-wide requirement that defines an audit or prescribes the auditing of subcontracts. According to officials, DOE reviewed existing regulations, guidance, and contract provisions on audit requirements and determined that a need exists for additional guidance or contract provisions on audits for major contracts. As of June 2020, DOE was working with the Civilian Agency Acquisition Council to recommend a government-wide requirement to define audit and prescribe when to obtain audits of subcontracts. Additionally, DOE included in its Acquisition Guide information on audit options when the Defense Contract Audit Agency is unable to conduct an audit.

Recommendation: The Director of the DOE Office of Acquisition Management should require local officials to independently review subcontractor ownership information as part of DOE consent reviews and assess potential conflicts of interest to ensure contractors are mitigating them. (Recommendation 4)

Agency: Department of Energy
Status: Open
Priority recommendation

Comments: DOE did not concur with our recommendation; instead, they plan to issue guidance emphasizing the importance of contracting officers reviewing contractors' disclosing and dealing with issues created by close working relationships, conflicts of interest, or ownership affiliations between prime and subcontractor. We have identified complex relationships among DOE contractors and subcontractors that were not documented by DOE, as well as incidents involving subcontractors related to conflicts of interest that were not disclosed to DOE. We noted that DOE officials--including those in local offices--have access to several databases and other sources of information that would allow them to independently verify ownership information that could allow the local offices to identify potential conflicts of interest that were not disclosed. In July 2020, DOE issued guidance summarizing and reiterating existing regulations, policy and procedures that require DOE contracting officers to perform independent analyses when reviewing subcontract consent packages, contractor purchasing systems, and potential organizational conflicts of interest. However, this is the same as previous guidance and it does not include direction to review subcontractor ownership information.

Recommendation: The Director of the DOE Office of Acquisition Management should require contracting officers to include assessments of the contractors' management of subcontractors as part of annual Performance Evaluation and Measurement Plans, as appropriate. (Recommendation 6)

Agency: Department of Energy
Status: Open

Comments: DOE partially concurred with the recommendation and agreed to review existing guidance and determine if additional guidance is needed to conduct an assessment of the contractors' management of subcontractors in annual Performance Evaluation and Measurement Plans. As of June 2020, DOE officials said they have reviewed existing federal and departmental policies, procedures, and available tools and determined sufficient guidance exists for contracting officers to make informed decisions on whether to include contractor management of subcontractors in annual Performance Evaluation and Measurement Plans based on the characteristics, circumstances, and requirements of a specific contract. DOE's Performance Evaluation and Measurement Plan template provides a subcontractor management evaluation factor for use by contracting officers who have determined it is appropriate for their contracts. Although we recognize the value in deferring to contracting officers to determine whether the factor is appropriate based on the characteristics, circumstances, and requirements of the contract, we continue to believe that DOE should place additional emphasis on the contractors' oversight of subcontracts by assessing the contractors on this factor.

Recommendation: We recommend that the Director, DCMA, in collaboration with the Director, DCAA, develop a mechanism to monitor and assess whether contractor business systems reviews are being completed in a timely manner. (Recommendation 1)

Agency: Department of Defense: Defense Contract Management Agency
Status: Open

Comments: DCMA concurred with our recommendation and the department notified us in March 2019 that collaboration between DCMA and DCAA to develop a mechanism to increase oversight and improve management of contractor business system audits and determinations had begun. In September 2019, DCMA and DCAA provided lists of the business system reviews planned to be conducted during fiscal year 2020, showing that the data needed for oversight of all CBS reviews is available between the two agencies. Further, an April 2019 DCMA memorandum indicated that DCAA data on planned reviews for fiscal years 2019 and 2020 had been transferred to DCMA and that administrate contracting officers were to conduct risk assessments to identify additional reviews for DCAA to complete in the future. In August 2020, DCMA and DCAA specified the sources of the data provided earlier; DCAA data is collected through its strategic workload and resource initiative and inputted into the DCAA Management Information System while DCMA business system review data continues to be maintained by the functional offices responsible for those reviews. Both agencies stated that progress against planned reviews is tracked and status is reported to management at regular intervals. DCMA also noted a series of new tools designed to enhance surveillance of contractor business systems and implementation of corrective actions. These steps indicate progress towards increased insight into both the completion CBS review and the follow-up that occurs afterward. However It remains unclear to what extent data sharing between DCAA and DCMA to support CBS review planning has been formalized and will continue or the extent to which DCMA headquarters uses this data to assess implementation of its policies for the conduct of CBS reviews.

Recommendation: To ensure that the HVBP program accomplishes its goal to balance quality and efficiency and to ensure that it minimizes the payment of bonuses to hospitals with lower quality scores, the Administrator of CMS should revise the formula for the calculation of hospitals' total performance score or take other actions so that the efficiency score does not have a disproportionate effect on the total performance score.

Agency: Department of Health and Human Services: Centers for Medicare and Medicaid Services
Status: Open

Comments: HHS indicated that it would examine the formula used for calculating hospitals' total performance scores and consider revisions, which would be subject to notice and comment rulemaking. In September 2018, HHS indicated that it had been examining alternatives and considering revising the formula for the calculation of hospitals' total performance scores (TPS) consistent with relevant statutory guidance, and in a way to reduce the effect of the efficiency domain on the TPS. In the Fiscal Year 2019 Inpatient Prospective Payment System proposed rule, CMS proposed to remove the safety domain weighted at 25 percent of the TPS and, in connection, increase the weight of the clinical care domain from 25 percent to 50 percent, which was estimated to reduce the effect of the efficiency domain on the TPS. According to CMS, stakeholders were concerned about the safety domain removal and adverse impacts to rural and smaller hospitals due to increasing outcome measure relative weights. CMS indicated that it analyzed current data in the fall of 2018 and found a similar trend, where rural and small hospitals' payment would be adversely impacted from increasing outcome measure weights. CMS decided to keep measure weights to avoid adversely impacting rural and small hospitals. However, CMS did not take actions so that the efficiency score would not have a disproportionate effect on the total performance score and bonus payments to hospitals with lower quality scores. As of January 2020, the recommendation remains open.

Recommendation: To ensure that the HVBP program accomplishes its goal to balance quality and efficiency and to ensure that it minimizes the payment of bonuses to hospitals with lower quality scores, the Administrator of CMS should revise the practice of proportional redistribution used to correct for missing domain scores so that it no longer facilitates the awarding of bonuses to hospitals with lower quality scores.

Agency: Department of Health and Human Services: Centers for Medicare and Medicaid Services
Status: Open

Comments: HHS indicated that it would explore alternatives to the practice of proportional redistribution, and any changes to the distribution of weights for missing domains would be evaluated for potential negative impacts and would be subject to notice and comment rulemaking. In September 2018, HHS indicated that it was exploring alternatives and considering revising the practice of proportional redistribution used to correct for missing domain scores while also being mindful of any potential unintended consequences. In the Fiscal Year 2019 Inpatient Prospective Payment System proposed rule, CMS proposed to remove the safety domain and, in connection, to require scores for the remaining three domains in order to calculate the total performance score, but CMS did not finalize the weighting revision. CMS reported that stakeholders were concerned about the safety domain removal and any adverse impact to rural and smaller hospitals due to increasing outcome measure relative weights. CMS reported that it analyzed data and found that rural and small hospitals' payment would be adversely impacted from changing proportional redistribution to assign greater relative weight to outcomes. As a result, CMS decided to keep proportional redistribution. However, CMS's actions did not revise the practice of proportional redistribution, and, as a result, the practice may continue to facilitate the awarding of bonuses to hospitals with lower quality scores. As of January 2020, the recommendation remains open.