Among more than 200 open recommendations cited by the OPM OIG, three include potential cost-saving fixes to the FEHBP. seng kui Lim / Getty Images
OPM’s unfulfilled recommendations include health insurance benefits changes, IG says
The agency is making progress on implementing IG recommendations, but three of its top yet-to-be-completed recommendations included changes that would prevent improper and inaccurate payments within the Federal Employee Health Benefits Program.
Among some of the Office of Personnel Management’s most-needed, and currently incomplete, recommendations include three efforts that could address transparency and correcting payment errors within the Federal Employees Health Benefits Program.
In a May 31 brief from the OPM office of the inspector general outlining its recommendations that have been open for more than six months as of March 31, the watchdog pointed to three priority recommendations for the employee health insurance program that could help curb inaccurate penalties and other errors.
The OIG credited OPM with making progress on implementing recommendations, noting a 20% drop in open directives since its last reporting period, but noted that there is more work to be done.
“We continue to observe, however, that OPM’s audit resolution process could be improved,” the report said. “As shown in the chart below, more than 80% of current open recommendations are still unresolved more than six months after being issued. This effectively means that not only are the recommendations still open, but there is also no plan to even begin correcting the underlying control weaknesses.”
Among the three still unresolved cost-reduction priorities for OPM include efforts to revise or remove its medical loss ratio requirements.
The MLR, which accounts for a portion of FEHBP premiums “spent on clinical services and quality health improvements,” was the subject of a partially redacted August 2022 OIG report, that found portions of the MLR submissions “contained errors due to system logic issues and claims payment errors” and that insurance carriers with integrated health care plans “are fundamentally unable to meet the reporting requirements.
“This represents a huge time and monetary burden that is placed on carriers, which, based on the OIG’s audits of the application of the MLR process by a number of FEHBP carriers over the last several years, results in an unreliable FEHBP MLR that should not be used by OPM to ascertain that the government and federal employees are receiving a fair market rate and a good value for their premium dollars,” the report added, recommending that OPM overhaul the MLR requirements to offer a better measure of premium spending within the FEHBP program.
As of Friday’s report, the MLR recommendation is the last remaining directive from the 2022 audit that is unimplemented.
Another set of recommendations dates back to April 2021 and centers on how OPM should direct insurance carriers to catch overpayments and define egregious errors.
That report explored contractual vulnerabilities within the FEHBP, finding “too much is open to interpretation by the carrier” when discussing contract language requiring insurance carriers to identify fraud, waste and abuse.
The OIG noted that 11 recommendations around strengthening contract language remain open, putting the program at continued risk of improper payments.
Finally, the OIG pointed to a four-year-old report that offered recommendations for lowering prescription drug costs within the FEHBP.
The March 2020 report called on OPM to conduct a comprehensive study into how it could reduce prescription drug costs and develop plans based on the report’s findings. As March 31, the OIG noted that the agency still hasn’t conducted the study, but it has recently secured funding for it and has been working a contractor to develop it.
As of March 31, the OIG said that there were 283 unimplemented recommendations more than six months old.