Management and Leadership in the HHS Office of Inspector General

Introduction to the HHS Office of Inspector General

Under the Inspector General Act of 1978, the Executive Branch of the United States government maintains offices of inspectors general within federal agencies to oversee compliance with federal laws, rules, and regulations (Nowalinski 2001). The U.S. Department of Health and Human Services (DHHS) is the largest of all federal agencies, accounting for approximately one quarter of the total annual federal agency administration budget (HHS-OIG 2008).

The DHHS Office of Inspector General (OIG) maintains a headquarters in Washington, DC, under the direction of the Inspector General, and eight regional offices throughout the United States. These regional offices oversee, investigate, and enforce compliance with all federal requirements in connection with DHHS programs in all 50 states and the Commonwealth of Puerto Rico. The primary investigative focus of HHS-OIG is compliance, inspection, and financial monitoring of HHS-administered entities and HHS fund recipients, achieved through audits conducted by federal auditors employed by the OIG.

Within each regional HHS-OIG office, the Office of Audit Services (OAS) initiates audits of facilities and programs under HHS authority. These audits are conducted by audit teams comprising a senior lead auditor and approximately 3 to 10 auditors, depending on the size of the organization or program under scrutiny and the complexity of the audit. Each HHS-OIG-OAS audit team reports to an audit manager within the regional office, all of whom report directly to the Regional Inspector General (RIG), who directs the operations of the regional office and any regional field offices.

Organizational Structure of the OAS

Generally, each regional field office maintains approximately five audit managers, each of whom supervises one to four audit teams, with teams ranging in size from a few auditors to approximately ten (HHS-OIG 2008).

Management and leadership functions are clearly defined within the OAS. Annual audit plans are determined by the eight RIGs pursuant to instructions issued by the Inspector General (IG) in Washington, after incorporating input received from the RIGs and from external sources. Under the annual audit plan, each regional office is responsible for audits planned within the states located in its region, and each audit manager takes responsibility for specific audits. Audit managers, in turn, assign audits to individual audit teams.

Once audit teams receive their planned audit schedule, each team meets with its audit manager, who explains the anticipated audit issues and areas of inquiry. The audit manager may also meet periodically with lead auditors in addition to holding comprehensive team meetings. During audits, the lead auditor assists less senior auditors in performing their assignments and maintains communication with the audit manager to review operational details, preliminary findings, and any difficulties or other issues that arise in the course of the audit.

Differentiating Management and Leadership in the OAS

Upon completion of an audit, the audit team assembles to brief the audit manager on preliminary findings and any issues disclosed. The audit manager then directs the manner in which those findings must be analyzed, confirmed, and reported to the RIG in a formal executive audit report. Each auditor is responsible for drafting the portion of the audit report corresponding to his or her specific areas of inquiry during the audit, and may consult senior auditors, the lead auditor, or the audit manager for any necessary assistance.

After all component parts of the audit report are in draft form, the audit manager reviews and edits the entire report before submitting it for the RIG's review. The RIG may suggest changes and identify problems in the report, which are then addressed by the audit manager and the relevant members of the audit team. Draft reports of regional audits are issued by the RIG, while national draft reports are submitted to the Inspector General in Washington, who may initiate subsequent cycles of review and editing with the regional office before issuing the draft audit report to the audited entity, program, or individual (the "auditee") for comments and responses to the issues reported and the recommendations suggested.

The RIG engages in formal communications with the auditee and may revise findings or recommendations based on additional information or clarification provided by the auditee. Once this phase is complete, the RIG (or IG, as applicable) issues the final audit report to the auditee and publishes the report in the formal HHS-OIG records and on the HHS public website. The recommendations of all HHS-OIG reports carry the weight of federal law and are enforceable by the OIG Office of Investigations, the enforcement arm of each federal agency OIG.

Conclusion

By the time auditors reach the GS-13 level, they are not readily distinguishable from one another in terms of technical skill — if they were, they would not have risen above the GS-12 level. Therefore, it is precisely their performance in the unofficial role of "supervisory" auditor that is most often considered the deciding difference between auditors capable of perpetuating the healthy organizational culture of the agency as managers, and those who are appreciated for their hard work but are not identified as candidates for promotion to management. This dynamic illustrates how informal leadership behavior, rather than formal title or technical proficiency alone, ultimately shapes the trajectory of a career within the HHS-OIG Office of Audit Services.