Proposal to beef up OPM role in health care met with skepticism

A Senate proposal that would give the Office of Personnel Management responsibility for managing a national health insurance program elicited mixed reactions from observers on Monday.

Senators reportedly are considering a national health care reform plan modeled on the Federal Employees Health Benefits Program. The proposal would create a national insurance health exchange. The uninsured, small business employees and those who spend more than 12 percent of their income on health care likely would be eligible for insurance under the plan.

Some feared that expanding OPM's portfolio could adversely affect federal employees' coverage.

"OPM does a very good job administering the Federal Employees Health Benefits Program," said Matt Biggs, legislative director for the International Federation of Professional and Technical Engineers. "Why add additional responsibilities to OPM?"

The agency currently manages FEHBP by negotiating health premiums and benefits with private insurers, which often results in better rates for government employees than for private sector workers. FEHBP offers hundreds of plans across the country, although employees' options depend on their location.

Jacqueline Simon, public policy director for the American Federation of Government Employees, said FEHBP is a poor model for a national health care system, and criticized OPM's management of the program.

"OPM does not have the capacity to run FEHBP in a cost-effective way, and they certainly wouldn't be able to do that for an expanded program," Simon said.

Simon alleged that a lack of transparency and aggressiveness in OPM's negotiations over health care premiums have led to premium hikes. Earlier this year, OPM announced that FEHBP enrollees would see an average 8.8 percent hike in 2010. Walton Francis, author of the Consumers' Checkbook 2010 Guide to Health Plans for Federal Employees said in the long term, FEHBP's premium increases have been less than the general cost of health care; during the past decade, however, they've been roughly the same.

Others said FEHBP was a worthy model, but OPM should not have a role in managing an expanded program.

"If you talk about it as a concept, and as a model, that's OK, as long as there's a recognition that it's an employer plan, and it should not get caught up in anything else that someone decides OPM should do or administer," said Colleen Kelley, president of the National Treasury Employees Union.

Francis said OPM's past experience delivering health care to federal employees demonstrates its expertise to handle a larger pool of enrollees. "OPM is highly qualified to do that," Francis said.

OPM declined to comment on the Senate's proposal.