Congressional Budget Justification - Retirement and Insurance Service 2

	U.S. Office of Personnel Management Congressional Budget Justification

U.S. Office of Personnel Management

Congressional Budget
Justification

OPM Strategic Plan Goal II:
protect and promote the merit-based civil service and the employee earned benefit programs through an effective oversight and evaluation program.

FY 1999 Resource Summary:

Obligations (000): $11,563

Full-Time Equivalents: 130

By the year 1999, resolve material weaknesses and improve financial systems and internal controls to maintain the integrity of the earned employee benefits trust funds totaling more than $60 billion in annual benefit payments and OPM’s appropriated and reimbursable funds.

RIS Goal 4:		Install a new core financial management system for the employee benefit programs and integrate it will appropriate sub-systems. The system will be year 2000 compliant and will integrate appropriate sub-systems.
	•	Install the new core financial management system, test the system to ensure system integrity, convert data from the existing system and test the system to ensure that it produces the desired results.
	•	Develop the necessary interfaces to ensure that sub-systems are integrated.
	•	Ensure that the overall system meets all Federal financial management systems requirements at the transaction level, including the Federal accounting standards and the Standard General Ledger.

	•	RIS management's FY 1999 annual performance reports show that new system produces more accurate and timely financial information and that this facilitates management decision making.
	•	Systems implementation occurs on schedule and within expected budget.
	•	Annual audits by OPM's Auditor and Inspector General validate that weaknesses identified in current systems have been resolved.
	•	Material weaknesses in financial systems are reported as resolved in FY 1999 FMFIA annual assurance letter.
	•	FMFIA reviews conducted by the OCFO during the year 2000 validate that the material weaknesses in financial systems have been resolved, or are being resolved.
	•	Audit reports for the FY 1999 financial statements for the Government’s benefits programs show that the information reported fairly represents the financial position of the benefits programs.

RIS Goal 5:		Replace existing receivables management system and ensure that it is integrated with core financial system.
	•	Install off-the-shelf technology that meets all Federal financial management systems requirements, including the Federal accounting standards, and the Standard General Ledger at the transaction level.
	•	Fully integrate the new receivables system with the new core financial systems installed during FY 1998 so that the overall system meets all Federal financial management systems requirements, including the Federal accounting standards, and the Standard General Ledger at the transaction level.

	•	Provide improved customer service to our constituents that results from an efficient real-time customer look-up system that will permit our employees to effectively communicate the current status of accounts.
	•	System implementation occurs on schedule and within expected budget.
	•	Annual audits by OPM's Auditor and Inspector General validate that weaknesses identified in current systems have been resolved.
	•	Material weaknesses in financial systems are reported as resolved in FY 1999 FMFIA annual assurance letter.
	•	FMFIA reviews conducted by the OCFO during the year 2000 validate that the material weaknesses in financial systems have been resolved, or are being resolved.
	•	Audit reports for the FY 1999 financial statements for the Government’s benefits programs show that the information reported fairly represents the financial position of the benefits programs.

RIS Goal 6:		Ensure that financial policies and procedures that establish internal controls and financial management/accounting systems, which provide useful and reliable financial information for OPM's benefit programs, are adequately documented.
	•	Use RIS Financial Policy staff, established in 1997, to develop sound financial policies for all retirement and insurance activities.
	•	Use contract signed with the Department of the Treasury in October 1997 to review and document accounting policies and procedures, and produce needed procedure manuals.
	•	Closely monitor contractor performance to ensure that deliverables meet OPM's financial management documentation needs.

	•	Material weaknesses in financial policies and procedures are reported as resolved in FY 1999 FMFIA annual assurance letter.
	•	FMFIA reviews conducted by the OCFO during the year 2000 validate that the material weaknesses in financial policies and procedures have been resolved, or are being resolved.
	•	Audit reports for the FY 1999 financial statements for the Government’s benefits programs show that the information reported fairly represents the financial position of the benefits programs.

RIS Goal 7:		Begin implementing Central Enrollment Clearinghouse for selected health benefit carriers and agency payroll offices.
	•	Use contractor to design and implement system.
	•	Work with agencies and carriers to obtain their agreement to participate.

	•	Contract in place.
	•	After implementation, testing, and evaluation, carriers and agencies using the clearinghouse report that it is an improvement over the existing system because more reconciliations are completed successfully and in a timely fashion.

• Ensure Federal Employees’ Health Benefits and Federal Employees’ Group Life Insurance contract compliance through financial and performance audits and quality assurance standards.

RIS Goal 8:		Improve insurance carrier financial reporting and performance.
	•	Implement accounting and auditing guidelines requiring that experienced-rated carriers report FEHB financial activity in accordance with generally accepted accounting principles.
	•	Require that the carriers engage an independent public accountant, to perform agreed upon procedures to ensure that carriers are complying with required guidelines.
	•	Validate compliance with FEHB and FEGLI contract provisions through regular financial and performance audits.
	•	Work with carriers to consolidate contracts with the same organization in multiple geographic areas.
	•	Reduce the administrative burden placed on prepaid carriers by standardizing their performance reporting requirements. Where appropriate, begin using externally recognized contractor performance standards, such as those issued by the National Committee for Quality Assurance (NCQA).
	•	Improve FEHB and FEGLI contract recordkeeping practices and procedures so that they parallel the requirements of the Federal Acquisition Regulations.
	•	Improve the process used to develop the service charge for experience-rated carriers through the development of more consistently applied, objective criteria.

	•	Program financial decision-making, including rate setting can occur with increased confidence in the information provided by the experienced-rated carriers.
	•	Audit reports for the FY 1999 financial statements for the Government’s benefits programs show that the information reported fairly represents the financial position of the benefits programs.

RIS
Goal 9:

Ensure that health benefit and life insurance program customers receive the services described in negotiated contracts, plan brochures, and customer service standards, and provide them with improved consumer information regarding these services.

•

Use relationships with other large purchasers, research by recognized organizations such as NCQA and the Foundation for Accountability (FAACT), and survey results to develop and test publication formats and content to facilitate informed consumer choice. Then use print media and the OPM Web site to deliver this information to customers.

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Continue to measure OPM and carrier performance against customer expectations through surveys and use results to identify needed policy and operational improvements.

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Continue implementing the Consumer Bill of Rights with the health benefits program.

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Re-evaluate customer service standards, and if necessary develop new standards.

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Continue working with NCQA, FAACT, and others to develop health care outcome measures for eventual incorporation into consumer informational materials.

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Continue to report NCQA accreditation status of HMO’s in our consumer information materials and develop strategies to encourage additional plans to seek accreditation.

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All of FEHB carriers report on compliance with quality assurance and performance standards for 1999, and meet the following:

HEALTH BENEFITS PROGRAM – PERFORMANCE INDICATORS
Outcome Indicators	FY 1995	FY 1996	FY 1997	FY 1998	FY 1999	Performance Standard
Overall Customer Satisfaction with Their HB Plan	HMOs - 86% FFSs - 87%	HMOs - 85% FFSs - 87%	HMOs -84% FFSs- 87%	HMOs -84% FFSs- 87%	HMOs - 85% FFSs - 88%	HMOs - 85% FFSs - 88%
Accuracy of Claims Coding (FFS Plans only)	67% met target	67% met target	70% will meet target	75% will meet target	80% met target	98% Accurate
Speed to answer customer calls (HMO Plans only)	82% Met target	84% met target	85% will meet target	85% will meet target	87% meet Standard	Calls answered w/in 1.5 minutes
HB Disputed Claims Processing Times (All Plans)	40% met target	92% met target	95% will meet target	95% will meet target	95% will meet target	95% processed w/in 45 days
Routine Correspondence Answered On Time	88%	90%	90%	90%	90%	90% w/in 30 days

LIFE INSURANCE PROGRAM – PERFORMANCE INDICATORS
Output Indicators	FY 1995	FY 1996	FY 1997	FY 1998	FY 1999	Performance Target
Accuracy of Claims Payments: as % of # Paid as % of $ Paid as % of # Cert/OPM	0.5% 0.4% 0.3%	0.4% 0.2% 0.3%	0.4% 0.2% 0.3%	0.5% 0.3% 0.3%	0.5% 0.3% 0.3%	Less Than 1% Errors
Timeliness of Claims Payments:	6.3 Days	6.8 Days	6.3 Days	6.0 Days	6.0 Days	Fully documented claims paid w/in 10 days

OPM Strategic Plan Goal III:
provide advice and assistance to help Federal agencies improve their human resources management programs to effectively operate within the economy, demographics and environment of the 21st century.

FY 1999 Resource Summary:	Obligations (000): $1,583	Full-Time Equivalents: 23

• By the year 2000, improve agency administration of the earned benefit programs so that (a) 80% of all retirement submissions are received within 30 days of employee retirement dates, (b) most retirement application packages are ready for processing upon receipt at OPM, and (c) employees receive from their agency complete and timely retirement counseling and services pertinent to the earned benefit programs.

RIS Goal 10:		Increase to 50 percent the number of retirement applications that Federal agencies submit to OPM using automated records.
	•	Provide agencies with the technical assistance they need to join the automated submissions program, focusing particularly on those in the Department of Defense.
	•	Work with agencies to improve and automate benefits application processes to: facilitate counseling, provide reliable estimates and projections of benefits, speed application submissions, reduce redundant data entry, and ensure data and application integrity by employing "smart forms" that require consistency in preparation.
	•	Continue efforts to improve the timeliness and accuracy of agency retirement submissions by issuing quarterly progress reports to retirement counselors and using the Interagency Advisory Group as a forum to deal with systemic problems.

	•	Aging of Separations reports show that on average, 80 percent of all retirement claims are received within 30 days of retiring employees' date of separation for retirement.
	•	Reports from OPM's automated annuity payment system show that 50 percent of all new annuitant payment records were generated via the automated submissions program.

RIS Goal 11:		Enhance quarterly timeliness reports to the agencies concerning their submission of retirement claims by telling them how many of the retirement claims they submitted were complete and ready for immediate processing.
	•	Complete the project that was started during FY 1998 to develop the tracking systems needed to measure the number of new retirement claims that are fully documented, and the number that require further documentation in order to compute the full annuity benefit due to retirees.
	•	Coordinate with agencies to determine what the acceptable levels of performance regarding the completeness of claims should be.
	•	Assist agencies in need of help because of downsizing, base closures and Early Optional Retirement authorities affecting a large number of employees in a short time period. Create win/win situations where in exchange for administrative and technical assistance, these agencies will allow OPM to ensure the quality of their retirement submissions on-site.

	•	Measures will be developed in early FY 1999 after tracking system is fully functional and discussions with the agencies regarding desirable performance levels have taken place.

Page Updated 13 June 1998