Daniel Levinson has served as inspector general of the U.S. Health and Human Services Department since 2005, working for two presidents, monitoring two of the largest Medicare expansions in U.S. history and keeping watch of an organization that accounted for about $1 trillion in federal spending this year.
Levinson said he’s been accused of sounding like Dwight Eisenhower, or speaking “in a very obtuse way, to make sure that people wouldn’t necessarily know exactly what he was talking about.” Some people accused Federal Reserve Chairman Alan Greenspan of the same thing.
Levinson doesn’t seem that obtuse to us, but he knows how to sidestep the occasional question. You be the judge. Below is a transcript of a recent Federal Eye interview with the inspector general, covering topics that range from Obamacare and Healthcare.gov to Ebola and his most uncomfortable moment on Capitol Hill. We edited the transcript for length.
What is most challenging about monitoring Health and Human Services?
What’s most challenging is both the magnitude and the complexity of what we deal with. It’s very large. It’s by far the largest department in the country financially. About a trillion dollars will run through the department this year, so that’s as big as you get, considerably larger than even the Department of Defense. But it’s also the complexity that comes with it. Health care, health insurance programs and the way they’re financed, public health programs and the way they need to be delivered are relatively complex compared to most other aspects of public policy.
What types of audits and investigations does your office do?
Our audit services look at the way states operate their Medicaid programs to make sure they’re following the federal Medicaid rules. They do a lot of auditing of hospitals around the country to ensure that hospitals are complying with the Medicare rules.
Health care is multifaceted. There’s such an incredible variety of providers, physicians, nurses, pharmacies, pharmaceutical manufacturers. Virtually every aspect of health care is a risk area, and our investigators do a wide variety of investigations in virtually all of those fields.
You’ve done some reports on states that gamed the Medicaid system. What did you find?
We have had issues with some of the states — the state of Pennsylvania on a tax issue and New York using the federal government Medicaid upper-payment limits in ways that we viewed as abusive. So there are a variety of schemes that occur within the Medicaid programs that violate, in our view, the federal rules. And it’s a significant challenge to actually follow the Medicaid dollars, because you’re dealing with 50 programs — since every state has its own program.
Do you think states violate the rules intentionally? What is happening?
It does appear as if these are efforts designed to up the federal share — to alleviate state budgets and to maximize the federal contribution. There are rules of the road here when it comes to Medicaid, and the idea is that the federal government is supposed to share in costs, but at certain understood percentages, so that when the state operations try to game that, our auditors make recommendations to [Center for Medicare and Medicaid Services] to collect those dollars that shouldn’t have been allocated.
What kind of work has your office done with HealthCare.gov, the federal online insurance exchange that malfunctioned after it launched last year?
We have about 30 to 40 audits and evaluations in process to look at the exchanges, to look at the marketplaces. Work was started shortly after it went live last year, and we have gotten requests from both the department as well as from the Hill to do work on payment, on eligibility, on the contracts, on security issues. And the office has issued a couple of reports so far, specifically on the question of controls and the need for better security. And a series of reports we should be issuing, really within the next few weeks, on other aspects of Healthcare.gov. And we’re continuing to monitor in this second phase.
What issues did you find with controls and security?
That there was a need to strengthen those controls.
Were the controls so weak that the public has reason to panic right now, or are these little tweaks that the government needs to make?
These are the kinds of reports that are designed to assist policy makers in understanding what needs to be strengthened.
One of your reports mentioned that HHS hired dozens of contractors and spent $800 million to build the HealthCare.gov site. Should it take that many contractors and that much money to build an insurance exchange?
I don’t believe we’ve gotten into those specific questions.
With the Maryland health exchange, your office issued some subpoenas. Can you tell me where those investigations stand?
I can’t really talk about any specific investigation or audit, but we are looking at some state exchanges as well as federal exchanges. We’re trying to broaden our reach so that we can look in both categories.
Can you tell me what types of issues might warrant an investigation with the creation of exchanges?
I wouldn’t want to speculate.
Everyone is concerned about whether the Affordable Care Act will slow down growth in health-care costs. Are you able to weigh in on that in your role as inspector general?
We really don’t look at that kind of big picture question, but I think the whole notion of coming up with a coordinated-care model is designed to reduce dollars. And the science is so strong for a coordinated-care model that it’s really not a question of whether you go back. It’s a question of whether you make these new models work so that you begin to realize the cost savings that are supposed to come with them. I think that’s going to take some time still to understand. We’re kind of in the middle of that.
Have you had any uncomfortable moments on the Hill?
I think the most uncomfortable moment I had was when [former Sen. Max Baucus (D-Mont.)] repeatedly asked me to explain how much fraud there was in health care, as if there could be any particular dollar figure — as if somehow there is a way of being able to nail down that figure.
What was your response?
I could not give him a dollar figure, and he found it very frustrating. And I found it very frustrating to get the question asked repeatedly of me. Figures vary as they will, and it’s often said in newspapers or magazines that it’s a three- to ten-percent fraud percentage. Again, I think that it’s a fool’s errand to try to nail down a particular dollar figure. Our office over the last year, we have investigated in audit receivables almost $5 billion, much of that as a result of our fraud work. So, we can point to specific dollars, and it’s been estimated by the Institute of Medicine that there’s $75 billion of fraud nationwide in health care. If public-health programs are half of that, then you’re looking at $35 billion to $40 billion.
Is your office doing any work on Ebola issues?
We are in the process of exploring how we can do the right thing in terms of being able to be part of the whole evaluation of how that issue has unfolded here. We have been involved in emergency preparedness work before — work with [Hurricane] Katrina, with Super Storm Sandy, in fact we’re still involved in some of that work. In this context, we’re not first responders, so we haven’t been at the front lines of this, and we don’t want to get in the way of the program people. We have gotten some congressional requests, and we’re working with the Hill, and we’re working with the department to understand how we can do the important kind of program evaluation that we do with [Centers for Disease Control and Prevention].
How do you deal with differences between career professionals who are working on a report?
If there are internal different points of view within the office, they’re actually solved by experts who are sitting at the table. I don’t sit as a supreme court on these reports. We really don’t get to that stage. Because this is a very technical field, and people bring expertise, we really try to operate as flatly as possible, so that people aren’t thinking about a long chain of command. People who have prepared the material are sitting at the same desk as those whose signature is required to actually have the report issued. We expect to resolve these matters in a very collegial way.
But I imagine that people sometimes have irreconcilable differences — they feel that, in their professional minds, they just can’t budge on an issue. What do you want your managers to do in those situations?
The important thing is actually to make sure that everyone gets a chance to be heard around a table and explain what their thinking is. So I think the most important role I play in that context is to ensure the integrity of process, because I can’t be the expert in everything. I’m expert in precious few things, actually. But I do need to be expert in ensuring that there’s good process. The great thing about that is that it becomes exceedingly rare when then somebody feels like they still have a beef about it. If people really are given a fair chance to air their view, and you need to come down to one side or another, if there really has been a fair opportunity to explain your position, I don’t find issues of the kind that you are describing linger.
You were appointed by President George W. Bush, and now you serve under President Obama. What differences have you noticed between the two administrations?
I really don’t think of what we do in terms of personality. I think in terms of the programs — the subject matter, the portfolios. Have they grown? Certainly in this administration, between the Recovery Act and the Affordable Care Act, we’re operating on a much larger playing field. I came in shortly after passage of the law that included [Medicare] Part D.
At the time, that was big and all-consuming. Looking back, it was just a prologue to a really explosive portfolio. A lot of the issues have become so much larger. Even without the Affordable Care Act, the Baby Boomer generation started to enter Medicare in 2011. Creating a larger Medicare population alone would have created a significantly larger field, but when you add the Affordable Care Act, that creates such a larger foot print. I’m just struck with how things have headed north over the last few years.
CORRECTION: An earlier version of this transcript incorrectly indicated that Sen. Spencer Bachus (R-Ala.) had repeatedly asked Levinson to quantify the amount of fraud that occurs within the health-care system. The transcript has been corrected to show that former Sen. Max Baucus (D-Mont.) actually asked him the question.