Recommendation: To further ensure the effective screening of work reports, SSA should monitor its process for handling work reports to determine whether staff are taking action on work reports in accordance with proper procedures, and provide feedback to staff as needed.

Agency: Social Security Administration
Status: Open

Comments: SSA continues to disagree with this recommendation as of December 2019. As we reported, when SSA accepts a beneficiary's return to work allegation (work report), staff have 30 days to determine whether additional action is needed, such as a continuing disability review (CDR) to assess continued eligibility and determine whether benefits should be adjusted. However, not all work reports result in a CDR, and GAO reported that SSA lacks an oversight process to help determine whether work reports are not resulting in CDRs when they should. SSA continues to maintain that its staff carefully review work reports and make independent determinations on the need for a CDR. Absent an oversight process to ensure that work reports are properly screened, SSA may be missing opportunities to prevent overpayments for unreported work. SSA further reported that it may decide to complete a CDR through alternative approaches, such as its Continuing Disability Review Enforcement Operation process using Internal Revenue Service data, its Quarterly Earnings Project using Office of Child Support Enforcement data, or its analysis of electronically reported wages. However, SSA did not indicate whether these alternative avenues for conducting CDRs could identify errors made by its staff handling work reports and result in feedback. Implementing this recommendation will help ensure that SSA staff appropriately take action on work reports.

Recommendation: To enhance beneficiary understanding of work reporting requirements, SSA should: (a) Clarify work reporting requirements provided to beneficiaries. (b) Explore options for increasing the frequency of reporting reminders to DI beneficiaries, similar to those currently available to SSI recipients.

Agency: Social Security Administration
Status: Open

Comments: As of December 2019, SSA reported taking several steps to clarify work reporting requirements. For instance, SSA reported it has developed outreach materials to share information with beneficiaries and advocacy groups. However, SSA has not provided sufficient documentation for GAO to determine if it has clarified issues identified in GAO's 2015 report, such as how and when to report work, and that beneficiaries may have to repay overpayments that occur even when they report work. Finally, SSA has not indicated whether it has assessed options for increasing the frequency of reporting reminders to DI beneficiaries. Until SSA can demonstrate that it has improved the clarity of its work reporting requirements and frequency of its work reporting reminders, DI beneficiaries may continue to incur overpayments, or be required to repay overpayments that occurred even though they reported work.

Recommendation: To improve the transparency of the process for reviewing and approving spending limits for comprehensive section 1115 demonstrations, the Secretary of Health and Human Services should reconsider adjustments and costs used in setting the spending limits for the Arizona and Texas demonstrations, and make appropriate adjustments to spending limits for the remaining years of each demonstration.

Agency: Department of Health and Human Services
Status: Open

Comments: As of January 2020, the Department of Health and Human Services (HHS) has taken steps to address GAO's 2013 recommendation, but more actions are needed for GAO to consider this recommendation implemented. Beginning in May 2016, the Centers for Medicare & Medicaid Services (CMS) began implementing a new budget neutrality policy. The new policy was outlined in a Letter to State Medicaid Directors in 2018, and it addressed certain problems GAO identified regarding states' allowed methods for determining budget neutrality of their demonstrations. CMS has begun phasing in the methods established under this new policy for all states, including the two states (Arizona and Texas) for which GAO recommended adjustments. One portion of the policy--under which spending limits will be updated to reflect more recent spending data--will be implemented beginning in 2021 and will address concerns GAO identified in Arizona's spending limit once its demonstration is renewed. In January 2019, CMS officials told GAO that the agency continues to allow states to include hypothetical costs when determining demonstration spending limits, an action GAO identified as a concern in Texas' demonstration. While CMS officials provided documentation on changes the agency made in the spending limit approved for Texas' new demonstration period beginning in January 2018, GAO reviewed these changes and found that further adjustments are needed to remove additional hypothetical costs from the Texas' spending limit.

Recommendation: To help states identify and address quality-of-care concerns among individuals with developmental disabilities receiving Medicaid HCBS waiver services, the Administrator of CMS should encourage states to (1) include death as a critical incident and conduct mortality reviews if they do not already do so and (2) broaden their mortality review processes if they already include death as a critical incident and conduct mortality reviews.

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

Comments: As of August 2020, CMS had taken some steps to address this recommendation but additional actions are needed to fully implement it. In June 2018 CMS issued a Medicaid update to states explaining that CMS strongly encourages them to include unexpected deaths in their definition of reportable critical incidents. CMS also stated in the update that states should conduct a preliminary review of all beneficiary deaths and investigations should focus on those deaths determined to be unexpected. Further, CMS has shared with states best practices for state mortality reviews that include, for example, the use of an interdisciplinary review committee and taking actions to address identified quality of care problems. CMS also developed a webinar training (Incident Management 101) to help states improve their incident management systems for the Medicaid HCBS waiver. The webinar outlines the key elements of building a comprehensive incident management system (e.g., establishing a process for conducting investigations of incidents, tracking and trending incidents to help prevent and mitigate incidents from occurring) and reiterates CMS's expectation that states identify and address unexplained deaths on an ongoing basis in order to meet the waiver's health and welfare assurance. In late 2018, CMS planned to include in its revised waiver application questions to determine practices regarding states' review and evaluation of unexpected deaths. In September 2019, CMS officials notified us that it will provide an updated status report on this recommendation in November 2019. As of August 2020, CMS officials have not provided us information regarding its revised waiver application and technical guide. We will update the status of this recommendation when we receive this information.

Recommendation: Congress may wish to consider requiring increased attention to fiscal responsibility in the approval of section 1115 Medicaid demonstrations by requiring the Secretary of HHS to improve the demonstration review process through steps such as (1) clarifying criteria for reviewing and approving states' proposed spending limits, (2) better ensuring that valid methods are used to demonstrate budget neutrality, and (3) documenting and making public material explaining the basis for any approvals.

Agency: Congress
Status: Open

Comments: As of April 2020, there had been no legislation introduced to require HHS to improve the Medicaid demonstration review process. However, HHS has taken some action to address some aspects of GAO's recommendation. CMS established new policies that addressed certain problems GAO had identified and issued written guidance on the process and criteria used to approved states' proposed spending limits. Not all problems identified by GAO were addressed by the new CMS policy, thus legislation to require HHS to improve the Medicaid demonstration review process, as GAO recommended in January 2008, continues to be a viable matter for consideration.

Recommendation: Congress may wish to consider addressing whether demonstrations that allow states to operate public managed care organizations and retain excess revenue to support programs previously funded by the state--including the Vermont demonstration--are within the scope of the Secretary of HHS's authority under section 1115 of the Social Security Act.

Agency: Congress
Status: Open

Comments: As of April 2020, Congress had not passed legislation in response to our matter for congressional consideration.

Recommendation: To meet its fiduciary responsibility of ensuring that section 1115 waivers are budget neutral, the Secretary of Health and Human services should better ensure that valid methods are used to demonstrate budget neutrality, by developing and implementing consistent criteria for consideration of section 1115 demonstration waiver proposals.

Agency: Department of Health and Human Services
Status: Open
Priority recommendation

Comments: As of January 2020, the Department of Health and Human Services (HHS) had taken some action to address GAO's 2002 recommendation. In August 2018, HHS issued written guidance through a State Medicaid Directors Letter documenting four key changes it made in 2016 to its budget neutrality policy. These changes addressed some, but not all of the questionable methods GAO identified in its reports. To fully address this recommendation, HHS should also address these other questionable methods, such as setting demonstration spending limits based on hypothetical costs-what the state could have paid-rather than payments actually made by the state. GAO has found that the use of hypothetical costs has the potential to inflate spending limits and thus threatens budget neutrality of demonstrations