Congressional Budget Justification - Retirement and Insurance Service 1

	U.S. Office of Personnel Management Congressional Budget Justification

U.S. Office of Personnel Management

Congressional Budget
Justification

Transfers From the Trust Funds
Comparative Summary Statement
(dollar amounts in thousands)

Obligations			FY 1997 Actual	FY 1998 Estimate	FY 1999 Request	FY 1999 Change
	Retirement and Insurance Service*		$103,996	$106,399	$110,377	$3,978
	Administrative Services		4,437	2,909	2,909	---
	Executive and Other Services		3,347	3,825	3,825	---
		Total	$111,780	$113,133	$117,111	$3,978

Offsetting Collections
	Annual		$90,457	$91,236	$91,236	---
	Carryover		250	250	---	(250)
	Permanent Indefinite Authority Title V, Section 8348		18‚535	19,555	19,555	---
	New No-Year		---	---	---	---
	Prior No-Year		2,538	2,092	6,320	4,228
		Total	$111,780	$113,133	$117,111	$3,978

Trust Funds Budget Authority
	Annual		$91,236	$91,236	$91,236	---
	No-Year		3,500	---	---	---
		Total	$94,736	$91,236	$91,236	---
	Carryover		$250	$250	---	($250)
		Grand Total	$94,986	$91,486	$91,236	($250)

Outlays			$111,780	$113,133	$117,111	$3,978

Full-Time Equivalents
	Retirement and Insurance Service		1,265	1,301	1,301	---
	Administrative Services		34	31	31	---
	Executive and Other Services		39	46	46	---
		Total	1,338	1,378	1,378	---

* Note:	Obligations for Retirement and Insurance include no-year funds and Title V, Section 8348, which provides permanent indefinite authority.

Transfers From the Trust Funds Obligations by Object Class (dollar amounts in thousands)
Object Class		FY 1998 Estimate	FY 1999 Request	Change
Personnel Compensation		$59,771	$61,082	$1,311
Personnel Benefits		13,759	14,355	596
Benefits for Former Personnel		25	25	0
Travel and Transportation of Persons		277	277	0
Transportation of Things		50	50	0
Rental Payments to GSA		8,750	8,750	0
Communications and Utilities		8,987	8,987	0
Printing and Reproduction		1,830	1,830	0
Advisory and Assistance Services		1,300	5,300	4,000
Other Services		9,715	8,704	(1,011)
Supplies and Materials		1,045	1,045	0
Equipment		7,624	6,706	(918)
	Total Obligations	$113,133	$117,111	$3,978

Transfers From the Trust Funds
Retirement and Insurance Service
(dollar amounts in thousands)

Resources	FY 1997 Actual	FY 1998 Estimate	FY 1999 Request	FY 1999 Change
Obligations
Annual Carryover Permanent Indefinite Authority Title V, Section 8348 No Year	$82,673 250 18,535 2,538	$84,502 250 19,555 2,092	$84,502 --- 19,555 6,320	--- (250) --- 4,228
Total Obligations	$103,996	$106,399	$110,377	$3,978
No-Year New Obligational Authority	$3,500	---	---	---

Full-Time Equivalents	1,265	1,301	1,301	---

Description of Activity

The Retirement and Insurance Service (RIS) is a large-scale financial enterprise that provides fast, friendly, accurate, and cost-efficient benefit services to Federal agencies, employees, annuitants, and their families. It is a vital part of the Government's effort to recruit and retain a Federal workforce equipped to meet the challenges of the 21st century.

Sub-activities include:

Retirement Programs

Act as the personnel and payroll office for 2.3 million retired Federal workers and their survivors covered under the Civil Service Retirement System (CSRS) and the Federal Employees' Retirement System (FERS).

Make benefit determinations in accordance with sound benefit policy and applicable laws and regulations.

Process over 4 million workload items per year, ranging from the initial decision on eligibility and the amount of an annuity to recording changes in beneficiaries' addresses.

Insurance Programs

Negotiate and administer contracts with approximately 350 health insurance carriers and the Metropolitan Life Insurance Company to provide benefits at a reasonable cost to eligible employees and annuitants enrolled in the Federal Employees Health Benefits (FEHB) and Federal Employees' Group Life Insurance (FEGLI) programs.

Conduct annual FEHB Open Seasons and FEGLI Open Seasons as required.

Monitor use and benefit trends within the health and life insurance industries and implement program changes directed by the Administration and Congress.

Decide disputed claims between FEHBP enrollees and carriers.

Retirement Policy / Insurance Policy / Agency Services / Actuarial Support

Lead agencies and carriers in improving the quality of benefits administration.

Develop policies, regulations and proposals to improve Federal employee earned benefit programs.

Design and maintain user-friendly informational publications, training programs, and software to help Government agencies comply with benefits laws.

Help agencies to resolve complex technical benefits issues.

Negotiate health insurance premiums and conduct periodic actuarial valuations of the retirement and life insurance programs in accordance with statutory guidelines.

Serve as a resource for a broad range of issues affecting the financing and delivery of health care by providing policy documents, contributing technical materials, and answering requests for information from Congressional staff, Federal agencies, the media, and the general public.

Financial Management

Maintain financial oversight and control over the OPM Retirement and Insurance Trust Funds and prepare accounting and program performance reports for the Department of the Treasury, the Office of Management and Budget, and Congress according to guidelines issued by the Chief Financial Officer.

Ensure that benefit program and administrative resources are used effectively, and continuously evaluate retirement and insurance products to determine if they meet established standards.

Provide administrative services in support of retirement and insurance operations.

Systems Modernization and Maintenance

Develop and implement an integrated RIS information technology strategy that promotes the efficient and effective delivery of service to customers and incorporates technological advances in the industry.

Operate the Washington Technology Center and provide OPM-wide mainframe systems development and hardware maintenance services.

FY 1997 Accomplishments and 1998 Initiatives

Initiated a benefits vision study to collect information regarding the structure, financing, and service delivery of contemporary and emerging earned employee benefits being used and developed by private and other public sector employers. During FY 1998, use the information we developed from this study to perfect a consensus among major stakeholders about a vision for the future of Federal earned employee benefits.

Took the first major steps to modernize the Federal retirement system by validating the business requirements of the current system and developing a concept of business operations for the future. During FY 1998, with the assistance of our major stakeholders, re-engineer work processes in components consistent with the newly developed business concept.

Signed a remediation contract to bring OPM’s employee benefit program systems into Year 2000 compliance. During 1998, ensure all enterprise hardware meets Year 2000 Compliance requirements, and complete the process of renovating and validating all mission-critical support systems and programs.

Purchased off-the-shelf, integrated core financial and receivables management systems. During FY 1998, install the core financial systems and integrate them with major sub-systems.

Limited the average rate of contract year 1998 premium increases in the Health Benefit Program to 8.5 percent, which is projected to continue to be below the rate experienced by other employers.

Improved Retirement Program customer satisfaction with teleservices, responses to written inquiries, and maintenance of annuity payment accounts. Customer satisfaction improved for the following reasons:

— Reduction in caller hold times by 35 percent and the number of lost calls by 22 percent.

— Expansion of Annuitant Express (our automated teleservice system) services to include withholdings for state income tax and purchase of savings bonds. The volume of transactions completed via Annuitant Express increased by 60 percent.

— Establishment of toll-free telephone access to all Retirement Program call centers.

— Reduction in the total processing time for interim annuity payments, and an increase in the percentage of these payments authorized on a same day basis to 30 percent.

— Establishment of a new Teleservice Center to respond more quickly to customer telephone calls.

—	Reduction in caller hold times by 35 percent and the number of lost calls by 22 percent.
—	Expansion of Annuitant Express (our automated teleservice system) services to include withholdings for state income tax and purchase of savings bonds. The volume of transactions completed via Annuitant Express increased by 60 percent.
—	Establishment of toll-free telephone access to all Retirement Program call centers.
—	Reduction in the total processing time for interim annuity payments, and an increase in the percentage of these payments authorized on a same day basis to 30 percent.
—	Establishment of a new Teleservice Center to respond more quickly to customer telephone calls.

The Administration is proposing legislation to cancel the FERS Open Season scheduled for July 1, 1998, through December 31, 1998. If the Congress does not act to approve the Administration’s proposal, however, OPM and other Federal agencies are prepared to carry out a successful FERS Open Season during the period specified under current law.

FY 1998 initiatives will maintain these gains in customer satisfaction while expanding the range of services available via teleservice technology and implementation of similar services through the OPM Web site.

Expanded use of the OPM Web site to support the earned benefit programs, particularly with regard to consumer information made available during the Health Benefits Open Season. Program goals for FY 1998 include building on these improvements by enhancing and expanding the information so that health benefit program customers can make better-informed choices when evaluating and selecting a health plan.

Made continuing investments in the RIS infrastructure to support the upgrade and full integration of the OPM’s LAN and mainframe computer systems. During FY 1998, will make training investments to ensure that all employees meet the OPM Core Competencies, begin implementing a significantly expanded and improved computer network, and continue developing new job competencies and performance management tools.

Annual Performance Goals for FY 1999
By Strategic Plan Goal and Objective

OPM Strategic Plan Goal I:
Provide policy direction and leadership to recruit and retain the federal workforce required for the 21st century.

FY 1999 Resource Summary:

Obligations (000): $14,700

Full-Time Equivalents: 244

Compensation, Classification, and Benefits

Become the acknowledged leader in the design and provision of cost-effective employee earned benefit programs.

RIS Goal 1:		Develop a proposal to implement the design, financing, and service delivery of Federal earned benefits recommended by the Benefits Vision Study.
	•	Sponsor a conference of major stakeholders to review the results of the Benefits Vision Study and develop a consensus regarding what future earned benefits should be and how they are administered.
	•	Work with stakeholders to produce a final report describing the consensus vision that will maintain the Federal government's competitiveness as an employer.

	•	Positive feedback from Congressional staff, employee organizations, OPM policy offices, interest groups and OMB as indicated by surveys to ensure OCR meets the needs of those served.

RIS Goal 2:		Correct retirement coverage errors for all people affected, in a way that is easy to understand, can be effectively administered, and provides effective income security in retirement.
	•	Work with congressional oversight committees to develop a consensus to correct retirement coverage errors.
	•	When the legislation is passed, implement an operational plan with agencies and affected persons to effect the legislation quickly.
	•	Continue working with the Interagency Network on Retirement and Insurance issues to keep agencies and their benefit counselors informed about legislative and policy issues.

	•	Agency feedback obtained through IAG meetings, the Annual Benefits Officers Conference, and OPM Customer Surveys indicates that coverage errors are corrected effectively.

RIS Goal 3:		Position OPM to be able to support other retirement systems with the delivery of their services.
	•	Support the Central Intelligence Agency retirement system by providing account maintenance services for existing customers and performing initial processing of new claims for benefits.
	•	Work with CIA officials to determine the payment processing times, payment accuracy, etc. that CIA annuitants and survivor annuitants are currently experiencing and ensure that these levels of service delivery are maintained by OPM.
	•	Ensure that both OPM and CIA continue to meet their financial management and fiduciary responsibilities in areas affected by the transfer of services to OPM.
	•	Develop performance measures to assess service delivery for CIA annuitants and survivor annuitants.

	•	Transfer of responsibility for CIA retirements to OPM occurs within timeframes agreed to by OPM and CIA and within projected costs.
	•	CIA annuitants and survivor annuitants receive benefit payments, account maintenance services, and benefit/program information at levels that maintain or enhance the service received from the CIA.

Page Updated 13 June 1998