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OIG Report Finds Indian Health Services Did Not Ensure Appropriate Use of COVID-19 Testing Funds

NEW YORK – The US Department of Health and Human Services' Office of the Inspector General released a report on Thursday that found the Indian Health Service did not ensure funds allocated for COVID-19 were used appropriately.

The audit intended to determine whether the funds were allocated to meet community needs and were used by IHS programs for testing and testing-related services in accordance with federal requirements, the OIG report said. The agency looked at the use of $29.8 million in testing funds allocated from March 27, 2020, to Dec. 31, 2020, to 10 direct, tribal, and Urban Indian Organization programs within the Great Plains Area Office's geographical region. 

According to the OIG report, the IHS ensured that funds were allocated using the existing recurring base formulas, which considered programs' populations and healthcare needs. The IHS did not, however, ensure that funds were always used by these programs for testing and testing-related services. Five of the 10 samples programs used a combined $480,437 on expenses that didn't support testing or related services, OIG found. 

The agency also found that one tribal program didn't spend $86,261 in funding because officials weren't aware that the funds expired on Sept. 30, 2022, and that three programs didn't track testing funds in accordance with federal requirements.

OIG said that the errors occurred because IHS did not provide sufficient guidance to the programs about the appropriate uses of allocated testing funds and the proper tracking and accounting for these funds. It also did not perform oversight specific to testing funds, leading to confusion over how the money could be used, OIG said.

OIG recommended that IHS correct $19,912 in funds not used appropriately by one direct program and recover the other $460,525 not used from other tribal and UIO programs. It also recommended that IHS recover any unused and expired funding from all locations within the Great Plains Area Office's region, strengthen its review and oversight processes, and provide adequate guidance to programs on the proper use and tracking of testing funds. 

IHS concurred with five OIG recommendations, partially concurred or did not concur with four recommendations, and provided additional documentation for two of the draft report's findings. OIG removed two of those findings and reduced the dollar amount of its recommended recovery but otherwise confirmed that its findings and recommendations were valid.

IHS said that it would conduct an internal review of purchases made by IHS-operated health facilities that used the funds, use existing audit practices to identify misuse of funds, and work with the relevant tribes to implement corrective actions. It also said that it was developing a strategy to improve review processes.

However, IHS said that it provided adequate guidance on how to properly use, track, and account for COVID-19 funding.