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News Release

FOR IMMEDIATE RELEASE
Wednesday, April 05, 2006
Contact: Michael Orenstein
Tel: 202-606-2402

OPM Issues Call Letter to FEHB Carriers; Encourages Expansion of Health Benefits Options, Transparency in Program that Covers Millions

Washington, D.C. -- U.S. Office of Personnel Management Director Linda M. Springer announced Tuesday policy goals and key initiatives for health insurers to consider during upcoming negotiations on next year's benefits and premiums for federal employees and federal retirees.

The agency's annual Call Letter (http://www.opm.gov/carrier/carrier_letters/2006/2006-09.asp) -- a blueprint of priorities for carriers participating in the Federal Employees Health Benefits (FEHB) Program -- urges carriers to expand their plan options and make benefits, coverage and costs more "transparent." Springer believes transparency in the program will simplify plan comparisons for health care shoppers.

"For nearly 45 years, affordable, cutting-edge health benefits have been made available to federal employees and retirees by leading insurance companies through the FEHB Program," said Springer. "Advances in medicine and the growth of the health care industry, in general, make it increasingly important for health care providers to continue giving our nation's federal public servants access to quality health care, as well as to clear, easily obtainable information that allows them to make informed choices for themselves and their families."

The FEHB Program, with 278 plan options in 2006, covers approximately eight million federal employees, federal retirees and their dependents. OPM officials kick-off the negotiation season with a Carrier Conference in Arlington, Virginia, April 6 - 7.

In all, the Call Letter contains eight initiatives on which carriers should focus for the 2007 contract year. Initiatives in the letter include:

  • encouraging carriers to offer High Deductible Health Plans and Health Savings Accounts, promoted by the Bush Administration as a way to encourage consumers to save for their future medical needs and make better use of health-care resources. HDHPs have been offered by the FEHB Program since 2005, when 14 high-deductible plans had 3,000 enrollees; in 2006, the HDHP offerings grew to 27, with 6,476 enrollments
  • asking carriers to expand and enhance their use of Health Information Technology, an effort to automate enrollee medical information, with the long- term goal of improving patient care and reducing medical errors
  • promoting health-care cost and transparency by asking carriers to put provider quality and prices on their web sites, which might include information allowing individuals to compare the cost of network versus non-network procedures
  • soliciting proposals on enhanced drug management, including costly specialty pharmaceuticals, such as infusion therapy and injectable medications

The Call Letter also addresses policies on drug formularies, vaccination schedules endorsed by the Centers for Disease Control and Prevention, and organ/tissue transplants.

In December 2006, federal employees and retirees will have access to enhanced dental/vision benefits. Legislation signed in 2004 authorized this benefit, which will be available as a supplement to FEHB coverage. Pending the number of plans offering the supplemental coverage and the number of people enrolling in the inaugural year, OPM is advising carriers to not make changes to their existing dental and vision benefits.

The Call Letter includes OPM's guiding principles to which FEHB carriers must commit. The principles are:

  • ensuring enrollees have access to good health care benefits
  • striving to keep FEHB premiums affordable
  • ensuring enrollees have access to quality provider networks
  • providing competitive health care choices for consumers
  • strengthening information for consumers so they can be more involved and responsible for their own health care decisions
  • being well-managed and financially secure
  • providing efficient and effective contract administration
  • ensuring the timely and accurate submission of actuarial data and financial accounting information
  • maintaining compliance with FEHB laws, regulations, contract requirements and administrative guidance at all times
  • guaranteeing that enrollee and government resources are protected
- end -

Our mission is to Recruit, Retain and Honor a World-Class Workforce to Serve the American People. OPM supports U.S. agencies with personnel services and policy leadership including staffing tools, guidance on labor-management relations and programs to improve work force performance.


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