Sneak Preview: More Effort Needed To Address NIH Timely Grant, Contract Closeout
(The following was excerpted from a recent Thompson Grants Compliance Expert article.) The National Institutes of Health (NIH) plans to update its practices to more effectively oversee award recipients’ closeout processes, in response to findings and recommendations included in recent audit reports from the Department of Health and Human Services (HHS) Office of Inspector General (OIG). In separate reports, OIG audited NIH processes used to close out federal grants and contracts and found they fell short of the requirements, which OIG said resulted in the “increased risk of fraud, waste and abuse involving huge amounts of federal funding.”
With an annual budget of more than $45 billion, NIH is the largest single public funder of biomedical and behavioral research in the world, and invests more than 70% of its budget a year on research “to enhance life, and reduce illness and disability,” OIG said. Each year, NIH awards over 60,000 grants that directly support more than 300,000 researchers at more than 2,500 institutions, most of them institutions of higher education (IHEs).
In two reports, OIG faulted NIH for not closing out awards and contracts in accordance with federal regulations and HHS policies and procedures, finding particular issues with timely closeout. Most NIH funding for research to IHEs is awarded as grants, or occasionally as cooperative agreements. Research contract awards are also made by the agency in certain circumstances (see ¶751).
In accepting a federal funding award, institutions agree to comply with federal requirements, which includes requirements for closing out awards. Closeout of an award is the process by which NIH determines that all applicable administrative actions and all required work of an award have been completed by the recipient and NIH, and the recipient has submitted all final reports (see graphic).
Within NIH, grant closeout award services and oversight are provided by the Office of Policy for Extramural Research Administration (OPERA) Closeout Center. Awards are closed in NIH’s grants management system (eRA Commons) either: (1) when all final reports are received and approved; or (2) administratively by a closeout specialist within the closeout center when manual intervention is needed; or (3) unilaterally by an NIH institute or center (IC) grant manager when the required final reports are not received from the award institution.
“Grant closeout is the final phase in a grant’s life cycle, and is a key step in ensuring that all applicable administrative actions and all required work of an award have been completed by the recipient and NIH,” OIG said. “If recipients submit final reports late, it could indicate an issue with their ability to comply with grant requirements, including accounting for grant funds and tracking the progress and outcomes of the grant” (see ¶735).
In the audit report, OIG noted the consequences of noncompliance with NIH closeout requirements. Failure by recipients to correct recurring problems could cause NIH to take corrective actions, such as withholding further awards, or suspension or termination of an award. If a recipient does not provide timely reports, NIH will undertake a “unilateral closeout” — closing out an award without the cooperation of the recipient.
(The full version of this story has now been made available to all for a limited time here.)
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