HHS Inspector General Reveals FY2026 Tech Audits

Texas technology vendors working with the agencies within the Texas Health and Human Services (HHS) System should expect continued and expanding scrutiny in Fiscal Year 2026, as outlined in the latest audit and inspections plan released by the Office of Inspector General (OIG).

The OIG will focus multiple audit and inspection projects on information systems, cybersecurity practices, data integrity and digital services across the HHS system and Department of Family and Protective Services. These audits signal the state’s interest in tightening oversight of how vendors handle sensitive data and compliance obligations.

Part of the focus, according to the plan, is to look for "programs, services, providers and contractors with an elevated potential for fraud, waste and abuse."

Among the technology-focused audits scheduled:

• IT Security and Continuity: Audits will assess whether managed care organizations (MCOs) and local behavioral health authorities have effective safeguards in place to protect confidential HHS data and maintain continuity of operations.
• TIERS Data Integrity: The Texas Integrated Eligibility Redesign System, a core component of benefits processing, will undergo a continued review to evaluate the effectiveness of its automated and manual processing controls.
• Financial Systems Oversight: OIG will review how MCOs prepare and report expenses on their financial statistical reports, testing for compliance with laws and contract requirements and evaluating internal control design and effectiveness.
• Vital Records Security: The audit of the Department of State Health Services’ Vital Statistics Unit will examine system and document security around the processing of birth certificates.
• Cost Reporting Systems: Providers participating in programs such as Home and Community Based Services and Federally Qualified Health Centers will be reviewed for accuracy and completeness in their electronic cost reporting submissions.

In addition to planned audits, the OIG will carry over several projects from FY 2025, including reviews of how managed care vendors report provider fraud and recoveries through their special investigative units, and a system audit of how Medicaid data is processed and protected. This has direct implications for vendors supporting special investigative unit operations, especially those providing fraud detection software, claims analytics tools or reporting platforms, as their systems may be part of the compliance infrastructure under review.

The plan also notes that audits may be reprioritized based on emerging risks or resource shifts.

The full audit plan is available from the Texas Health and Human Services Office of Inspector General.