Problems in Administration of Two Health Grant Projects in Region VIII

The actions of the Department of Health, Education, and Welfare (HEW) in region VIII were reviewed concerning: (1) use of federal funds for construction of a medical facility by the Neighborhood Health Center in Salt Lake City, Utah; and (2) accountability for federal grant funds awarded to Sweetwater Health Services, Inc., in Rock Springs, Wyoming. The Neighborhood Health Center is currently being used by a federally qualified health maintenance organization (HMO), and Sweetwater Health Services was an HMO project that has been terminated. The review was prompted by allegations of mismanagement of the HMO program in region VIII, conflicts of interest involving federal employees, and possible misappropriation of federal funds.