A letter report issued by the General Accounting Office with an abstract that begins "The armed services have significantly reduced their procurement of new weapons systems and are keeping their existing systems longer than originally anticipated. The Department of Defense (DOD) estimates that it is spending $59 billion a year on logistics support to operate and sustain weapons systems, but DOD believes that better logistics support practices could reduce these costs by as much as 20 percent. To cut costs and improve efficiency, the military services have begun implementing logistics support strategies that rely on the private sector. DOD Regulation 5000.2-R expresses a preference for using long-term contractor logistics support but requires that an analysis be done first to determine how logistics support work is to be allocated to public or private entities. It is impossible to determine whether initial cost-effectiveness estimates for proposed contractor-logistics-support approaches are being achieved because the Army and Navy lack the required data. Consequently, the services may be adopting support approaches without knowing whether expected readiness improvements and cost-reduction goals are being met, where adjustments are needed, or the conditions under which the various support approaches are likely to achieve the most cost-effective results. Comparisons …

A letter report issued by the General Accounting Office with an abstract that begins "The Department of Defense (DOD) awarded contracts to three companies in 1990 to develop and test exoatmospheric kill vehicles. One of the contractors--Boeing North American--subcontracted with TRW to develop software for the kill vehicle. In 1998, Boeing became the Lead System Integrator for the National Missile Defense Program and chose Raytheon as the primary kill vehicle developer. Boeing and TRW reported that the June 1997 flight test achieved its primary objectives but detected some sensor abnormalities. The project office relied on Boeing to oversee the performance of TRW. Boeing and TRW reported that deployed target objects displayed distinguishable features when being observed by an infrared sensor. After considerable debate, the program manager reduced the number of decoys planned for intercept flight tests in response to a recommendation by an independent panel. The Phase One Engineering Team, which was responsible for completing an assessment of TRW's software performance within two months using available data, found that although the software had weaknesses, it was well designed and worked properly, with only some changes needed to increase the robustness of the discrimination function. On the basis of that analysis, …

A letter report issued by the General Accounting Office with an abstract that begins "In 1990, GAO designated the Medicare program to be at high-risk for waste, fraud, and abuse. More than a decade later, Medicare remains on GAO's high-risk list. This report examines Medicare's claims review process, which is designed to detect improper billing or payments. GAO found that most physicians who bill Medicare are largely unaffected by carriers' medical reviews, with 90 percent of physician claims going unreviewed in fiscal year 2001. At the three carriers GAO studied, implementation of the progressive corrective action initiative has reduced medical reviews of claims and has increased carrier education to individual physicians. The carriers in the study generally made appropriate payment determinations in examining physician claims selected for a medical review. By targeting claims that are more likely to have errors, carriers could improve the efficiency of their own operations and reduce administrative demands on the small proportion of physician practices with claims selected for review. The Centers for Medicare and Medicaid Services (CMS) is refocusing its oversight of carrier performance in processing and reviewing claims. The agency intends to hold carriers accountable for the overall level of payment errors in …

A letter report issued by the General Accounting Office with an abstract that begins "The Department of Veterans Affairs (VA) spent $21 billion in fiscal year 2001 to treat 3.8 million veterans--most of whom had service-connected disabilities or low incomes. Since 1997, VA has used the Veterans Equitable Resource Allocation (VERA) system to allocate most of its medical care appropriation. GAO found that VERA has had a substantial impact on network resource allocations and workloads. First, VERA shifted $921 million from networks located primarily in the northeast and midwest to networks located in the south and west in fiscal year 2001. In addition, VERA, along with other VA initiatives, has provided an incentive for networks to serve more veterans. VERA's overall design is a reasonable approach to allocate resources commensurate with workloads. It provides a predetermined dollar amount per veteran served to each of VA's 22 health care networks. This amount varies depending upon the health care needs of the veteran served and local cost differences. This approach is designed to allocate resources commensurate with each network's workload in terms of veterans served and their health care needs. GAO identified weaknesses in VERA's implementation. First, VERA excludes about one fifth …

A letter report issued by the General Accounting Office with an abstract that begins "Identity theft or identity fraud generally involves "stealing" another person's personal identifying information--such as Social Security Number (SSN), date of birth, and mother's maiden name--and then using the information to fraudulently establish credit, run up debt, or take away existing financial accounts. The Identity Theft and Assumption Deterrence Act of 1998 made identity theft a separate crime against the person whose identity was stolen, broadened the scope of the offense to include the misuse of information as well as documents and provided punishment--generally a fine or imprisonment or both. GAO found no comprehensive or centralized data on enforcement results under the federal Identity Theft Act. However, according to a Deputy Assistant Attorney General, federal prosecutors are using the 1998 federal law. As with the federal act, GAO found no centralized or comprehensive data on enforcement results under state identity theft statutes. However, officials in the 10 states selected for study provided examples of actual investigations or prosecutions under these statutes. Generally, the prevalence of identity theft and the frequently multi- or cross-jurisdictional nature of such a crime underscore the importance of promoting cooperation or coordination among …

A letter report issued by the General Accounting Office with an abstract that begins "The Medicaid program spent more than $200 billion in fiscal year 2000 to meet the health care needs of nearly 34 million poor, elderly, blind, and disabled persons. States are responsible for making proper payments to Medicaid providers, recovering misspent funds, and accurately reporting costs for federal reimbursement. At the federal level, the Centers for Medicare and Medicaid Services (CMS) oversee state financial activities and ensure the propriety of expenditures reported for federal reimbursement. GAO found that weak financial oversight by CMS leaves the program vulnerable to improper payments. The Comptroller General's Standards for Internal Control in the Federal Government requires that agency managers perform risk assessment, take steps to mitigate identified risks, and monitor the effectiveness of those actions. The standards also require that authority and responsibility for internal controls be clearly defined. CMS oversight had weaknesses in each of these areas. As a result, CMS did not know if its control efforts were focused on areas of greatest risk. CMS also was not effectively implementing the controls it had in place. Furthermore, managers had not established performance standards for financial oversight activities, particularly their …

A letter report issued by the General Accounting Office with an abstract that begins "The District of Columbia Courts (DC Courts) is acquiring the Integrated Justice Information System (IJIS) to replace many nonintegrated systems. This system is expected to address current deficiencies and provide the courts with necessary information critical to its mission. DC Courts has not yet implemented the disciplined processes necessary to reduce the risks associated with acquiring and managing the IJIS acquisition effort at acceptable levels within established resources and schedule. Most of the DC Courts' requirements, developed in the draft request for proposal, lacked the specificity needed to ensure that requirements had been reduced to acceptable levels and the system would meet users' needs. DC Courts officials want to use the acquisition process to identify the cost, schedule, and performance gaps associated with their effort. DC Courts officials acknowledge that this approach increases risk; however, they believe that accelerating the implementation of a badly needed system justifies those risks. As with any effort, alternative approaches need to be analyzed."

A letter report issued by the General Accounting Office with an abstract that begins "The Department of Defense (DOD) awarded contracts to three companies in 1990 to develop and test exoatmospheric kill vehicles. One of the contractors--Boeing North American--subcontracted with TRW to develop software for the kill vehicle. In 1998, Boeing became the Lead System Integrator for the National Missile Defense Program, and chose Raytheon as the primary kill vehicle developer. Boeing and TRW reported that the June 1997 flight test achieved its primary objectives, but that some sensor abnormalities were detected. The project office relied on Boeing to oversee the performance of TRW. Boeing and TRW reported that deployed target objects displayed distinguishable features when being observed by an infrared sensor. After considerable debate, the program manager reduced the number of decoys planned for intercept flight tests in response to a recommendation by an independent panel. The Phase One Engineering Team, which was responsible for completing an assessment of TRW's software performance within two months using available data, found that although the software had weaknesses, it was well designed and worked properly, with only some changes needed to increase the robustness of the discrimination function. On the basis of …

A letter report issued by the General Accounting Office with an abstract that begins "To improve federal debt collection, the Debt Collection Improvement Act of 1996 established a framework of debt collection tools, including administrative wage garnishment (AWG). This report discusses the extent to which nine agencies use or plan to use AWG to collect delinquent nontax federal debt and provides GAO's perspective on ways to make AWG more widespread and effective. GAO found that none of the nine agencies had yet implemented AWG. Although AWG is not mandatory, by failing to use this tool--more than five years after the act's enactment and more than three years after the Department of the Treasury issued implementing regulations--agencies have missed an opportunity to maximize collection of delinquent debt. Agencies identified various reasons for not yet implementing AWG or for deciding not to do so, including the need to focus their resources on implementing the act's mandatory provisions. Although some agencies or programs may have valid reasons for not implementing wage garnishment, all of the larger programs that deal with individuals and that have a demonstrated risk of financial loss resulting from unpaid debt should have AWG as a viable debt collection option. …

A letter report issued by the General Accounting Office with an abstract that begins "On April 9, 2002, GAO testified on the Internal Revenue Service's (IRS) fiscal year 2003 budget request. Although IRS had adequately justified its $450 million Business Systems Modernization request, it did not develop its $1.63 billion information systems operations and maintenance request in accordance with the best practices of leading private- and public-sector information technology organizations. See GAO-02-580T."

A letter report issued by the General Accounting Office with an abstract that begins "Prescription drug spending increased at an annual rate of 18 percent from 1997 through 2001 and is the fastest growing component of health care spending in the United States. Among the many reasons cited for this increase are growth in the number of patients diagnosed with conditions that can be treated with pharmaceuticals and the development of innovative drugs for some conditions. Spending on direct-to-consumer (DTC) advertising of prescription drugs has tripled in recent years. The Food and Drug Administration (FDA) regulates the promotion of prescription drugs, including the content of DTC advertisements, under the authority of the Federal Food, Drug and Cosmetic Act. The act sets general standards of for FDA's regulation of prescription drug advertising directed to consumers and physicians. Regulations implementing the act require that advertisements present accurate information and fairly represent both the benefits and the risks of the advertised drug. Pharmaceutical companies spend more on research and development initiatives than on all drug promotion activities, including DTC advertising. According to industry estimates, pharmaceutical companies spent $30.3 billion on research and development and $19.1 billion on all promotional activities, which includes $2.7 …

A letter report issued by the General Accounting Office with an abstract that begins "Because of internal control weaknesses, the Department of Education's student financial assistance programs are at high risk for fraud or erroneous payments. GAO discovered fraud in the grant and loan areas and pervasive control breakdowns and improper payments in other areas. Controls over grant and loan disbursements lacked a key edit check or follow-up process that would identify schools improperly disbursing Pell Grants. Significant internal control weaknesses over Education's third party drafts also increased the department's vulnerability. GAO found that individual Education employees could control the entire payment process for third party drafts. Education employees also circumvented a key computerized control designed to prevent duplicate payments. Education eliminated third party drafts in May 2001. Inconsistent and inadequate authorization and review processes for purchase cards, combined with a lack of monitoring, meant that improper purchases were unlikely to be detected. Inadequate control over these expenditures, combined with the inherent risk of fraud and abuse associated with purchase cards, led to fraudulent, improper, and questionable purchases totaling $686,000. Poor internal controls over computers acquired with purchase cards and third party drafts led to 241 missing personal computers and …

A letter report issued by the General Accounting Office with an abstract that begins "GAO reviewed the Internal Revenue Service's (IRS) fifth expenditure plan requesting $391 million from its Business Systems Modernization (BSM) fund. Although IRS's November 2001 expenditure plan satisfied the conditions specified in the appropriations act, IRS must still fully implement the controls and capabilities described in the plan. Since GAO's June 2001 report, IRS has made important progress in implementing modernization management controls and capabilities and addressing GAO's past recommendations. However, IRS's modernization management capacity is still not where it needs to be. Examples of modernization management controls and capabilities that are not yet fully implemented include software acquisition management, configuration management, quality assurance, risk management, enterprise architecture implementation, human capital management, integrated program scheduling, and cost and schedule estimating. The increased risk of IRS's proceeding without these controls and capabilities has contributed to project cost, schedule, and performance shortfalls. IRS acknowledges that it needs to strengthen its modernization management controls. IRS recognizes that these controls become more critical as the size and complexity of the BSM program continue to increase. Although IRS has actions underway to fully implement these controls, IRS plans to compensate for their …

A letter report issued by the General Accounting Office with an abstract that begins "GAO reviewed whether the Office of Federal Housing Enterprise Oversight (OFHEO) should incorporate new business assumptions into the stress test used to establish risk-based capital requirements. The stress test is designed to estimate, for a 10-year period, how much capital the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac) would be required to hold to withstand potential economic shocks, such as sharp movements in interest rates or adverse credit conditions. Incorporating new business assumptions into the stress test would mean specifying details about the types and quality that would be acquired during the 10-year stress period, the types of funding that would be used to acquire such mortgages, and other operating and financial strategies that would be implemented by Fannie Mae's and Freddie Mac's managements. GAO found that data for the enterprises show that new business conducted over a 10-year period accounts for a large share of their on- and off-balance sheet holdings of assets and liabilities at the end of each 10-year period. Because new business represents such a large share of enterprise holdings over time, it would …

A letter report issued by the General Accounting Office with an abstract that begins "In response to concerns about the length of time children were spending in foster care, Congress enacted the Adoption and Safe Families Act of 1997 (ASFA). The act contained two key provisions intended to help states more quickly move the more than 800,000 children estimated to be in foster care each year to safe and permanent homes. One of these provisions, referred to as "fast track," allows states to bypass efforts to reunify families in certain egregious situations. The other provision, informally called "15 of 22," requires states to file a petition to terminate parental rights when a child has been in foster care for 15 of the most recent 22 months. Although the number of adoptions has increased by 57 percent since the act was enacted, changes in other foster care outcomes and the characteristics of children in foster care cannot be identified due to the lack of comparable pre- and post-ASFA data. Although data on states' use of the act's two key performance provisions are limited, some states described circumstances that hinder their use. Survey data suggest that a few states used the fast …

A letter report issued by the General Accounting Office with an abstract that begins "The Debt Collection Improvement Act of 1996 seeks to maximize the collection of billions of dollars of nontax delinquent debt owed to the federal government. The act requires agencies to refer eligible debts delinquent more than 180 days to the Department of the Treasury for payment offset and to Treasury or a Treasury-designated debt collection center for cross-servicing. The Treasury Offset Program, includes the offset of benefit payments, vendor payments, and tax refunds. Cross-servicing involves locating debtors, issuing demand letters, and referring debts to private collection agencies. The Rural Housing Service (RHS) has initiatives to ensure the timely referral of all delinquent debt. However, the agency's failure to make the act a priority has left key provisions of the legislation unimplemented and severely reduced collection opportunities. The agency had referred no direct single-family housing (SFH) loans to the Financial Management Service for cross-servicing. Three major factors delayed implementation. First, RHS's loan-servicing system had not incorporated key features necessary to implement the act's referral provisions. Second, RHS did not refer any debts for cross-servicing while pursuing an exemption from Treasury. Third, amounts reported as delinquent and eligible …

A letter report issued by the General Accounting Office with an abstract that begins "In November 1992, the Department of Defense (DOD) issued a policy requiring systems to be interoperable. In May 2000, the department began to enforce this policy for telecommunications (telecom) switches, requiring them to be tested and certified for interoperability before being installed within the DOD network. DOD does not have a well-defined process, including clear requirements, for certifying and authorizing telecom switches. The process is not fully documented, current, or complete and DOD has not applied its telecom switch certification and authorization process consistently across vendors, and sometimes violated policy. DOD's application of its telecom switch certification and authorization process is influencing vendors' plans for competing for the department's business. One of five vendors GAO interviewed stated that it has stopped doing business with DOD for economic reasons. Within DOD, positions are mixed on the impact of the department's interoperability goal on competition."

A letter report issued by the General Accounting Office with an abstract that begins "Five percent of adults suffer from serious mental disorders. Although health insurance carriers in a few states guarantee coverage for mental health treatment, in most states individuals with mental disorders face restrictions in purchasing private health insurance for themselves and their families. Eleven states require carriers to accept all applicants regardless of health status, but coverage options vary. Eight of these 11 states require all carriers to guarantee access to coverage sold in this market. In three states, laws apply only to some carriers, such as Blue Cross and Blue Shield, or certain periods of the year. Carriers in nine of the 11 states are also required to limit the extent to which premium rates vary between healthy and unhealthy individuals. In states without guaranteed coverage in the individual market, the seven carriers GAO reviewed would likely deny coverage more frequently for applicants with mental disorders than for applicants with other chronic health conditions. Specifically, for six mental disorders of generally moderate severity, carriers said that they would likely decline applicants 52 percent of the time. State-sponsored high-risk pools are the primary coverage option available to …

This report outlines several ways in which dropout rates are measured and reported.

The purpose of this report is to provide detailed information on each of the programs administered by the Corporation. This includes a description of the services provided, individual eligibility requirements, and the FY2002 funding level.

This report provides a summary of the federal agencies’ enforcement of and compliance with the prohibition against sex discrimination mandated by Title IX and Executive Order 13160. Specifically, this report discusses the implementation of regulations and procedures for enforcing the Title IX compliance of grant recipients and for enforcing the compliance of the federal agencies themselves with President Clinton’s Executive Order.

A letter report issued by the General Accounting Office with an abstract that begins "The Export-Import Bank (Ex-Im Bank) uses tied air to support U.S. exporters facing foreign competitors. Tied aid is government-to-government concessional financing of public sector capital projects in developing countries that is linked to the procurement of goods and services from the donor country. Through the Tied Aid Capital projects fund, Ex-Im Bank may provide financing to support the negotiations and policing of the Organization for Economic Cooperation and Development (OECD) tied aid rules and to match foreign aid offers to level the playing field for U.S. exporters. Under the tied aid program legislation, the Department of the Treasury has the authority to direct and control the use of Ex-Im Bank's Tied Aid Capital Projects Fund. This allows Treasury to veto individual tied aid proposals. Ex-Im Bank and Treasury have agreed on a set of broadly stated principles for decisions on the Tied Aid Capital Projects Fund. Although Ex-Im Bank and Treasury both seek to help U.S. exporters, they have different missions and perspectives. Treasury takes a strategic approach to financing tied aid. Ex-Im Bank takes a transactional approach, placing emphasis on helping U.S. exporters by matching …

A letter report issued by the General Accounting Office with an abstract that begins "The U.S. Postal Service (USPS) continues to experience deficits, severe cash-flow problems, rising debt, and liabilities that exceed its assets. USPS also lacks enough income to fund needed investments in safety, maintenance, expansion, and modernization and to cover its liabilities. USPS reported a $1.68 billion deficit in fiscal year 2001, up from $199 million a year earlier. The pressure to increase rates will mount as USPS contends with growing long-term obligations, including employee retirement and health benefits. Although USPS assumes that rising mail volume will cover rising costs and mitigate rate increases, this business model is increasingly problematic because of the potential for declining or stagnating mail volume. USPS has had little success in sustaining productivity increases. USPS' financial viability is also hindered by structural, legal, and practical constraints that make it difficult to close or consolidate postal facilities or realign the postal workforce. USPS must undertake a comprehensive transformation to address its financial, operational, and human capital challenges. USPS also needs to produce more timely and accessible financial information."

A letter report issued by the General Accounting Office with an abstract that begins "The Department of Defense (DOD) has experienced significant increases in the prices it pays for consumable spare parts, which are "consumed" when used or discarded when worn out because they cannot be cost effectively repaired. The Defense Logistics Agency (DLA) manages four million consumable spare parts or 93 percent of all consumable spare parts used by the military services. DOD is required to perform price trend analyses on some categories of commercial spare parts, address unreasonable price escalation, and report the results to Congress for three consecutive years beginning in April 2000. DLA has completed two price trend analyses for DOD. In addition to the price trend analyses, DLA also did a procurement management review in fiscal year 2000 to assess the overall risk of spare parts overpricing. The agency also has three information technology initiatives underway to determine price reasonableness for DLA customers and buyers. These efforts are in various stages of completion, and it is too early to assess their results."