How does someone report fraud in their own government office?

my wife is an office manager for one of the offices of a tri-county community mental health office...there is so much fraud from the therapists all the way up to the head honcho...she has therapists at her office that show up late everyday and leave early as well and always get paid for a full day...if there is a client, well the client has to get rescheduled...geez, they even have a doctor that comes in once a week...she always is late as well...sometimes she will show up the last half hour of the day so that she can get a whole days pay even though she saw none of the scheduled patients...the therapist use the company credit card for their own personal use...a couple of the therapist double charges medicaid and medicare to look like they are doing more work...one even charges medicare for "golf outings, fishing trips, and many other things" saying that it is needed for his clients to learn how to be sociable...that is completely not his job...another thing that one of the therapist do is that he turns in a "travel reimbursement" every month that pockets him an extra $600 something a month...their office has drivers with company vans that do what he is saying he does with his personal vehicle...my wife figured that for what he is claiming, there is absolutely no time that he would be spending in the office doing his actual job!...the funny thing is the "boss" there lets every one get away with this crap and even signs the stuff okaying everything...now because of budget reasons, everyone there is getting a pay cut and a drop in benefits...it is a hard thing to accept when they see the top man of CMH going on "business trips" that has nothing to do with what they are doing...and get this...there was a contract that the top honcho signed off on...one contractor had a bid for 300 grand...another had a bid for 600 grand...the one with the higher bid won (the high bidder is a family members business)...a 300 grand difference could have maybe stopped people from pay and benefit cuts!!!...how can this fraud be so blatent and nothing happens?...it is really awful when it affects the clients that need help...how can my wife make a complaint to someone and not fear retribution?...how, where and who could she make this complaint to?...