OPM: FEHBP must cover lesbian fed’s wife, but no other same-sex spouses
May 3rd, 2012 | Pay & Benefits | Posted by Stephen Losey
Karen Golinski, a lesbian federal employee, won a major court victory in February when a federal judge ruled that the government had to extend health benefits to her same-sex wife. But other gay and lesbian feds won’t be able to benefit from Golinski’s victory at this time.
The Office of Personnel Management in March ordered Blue Cross Blue Shield to cover Golinski’s wife, Amy Cunninghis. But today, OPM sent a notice out on its listserv that said the Golinski ruling does not apply to anyone else.
“OPM has been directed by the Department of Justice to continue applying the Defense of Marriage Act (DOMA) to all other situations,” OPM said. “Therefore, if you receive a request to enroll a same-sex spouse, you are still precluded by DOMA from processing the enrollment request or sending it to the [Federal Employees Health Benefits] Plan.”
OPM has been in an awkward position for some time regarding health benefits for same-sex spouses. OPM Director John Berry is gay, and has repeatedly said he thinks gay and lesbian feds’ spouses should be covered. But Section 3 of DOMA prevents the government from legally recognizing same-sex marriages, which bars gay feds’ husbands and wives from FEHBP. The Justice Department last year said it believes DOMA is unconstitutional and it would no longer defend the law. And last July, Justice backed Golinski’s case in a brief that amounted to a mea culpa for the government’s “significant and regrettable” history of persecuting gay and lesbian employees. (Go back and read that blog, and this one for some background on how gay and lesbian feds were treated. It’s pretty startling.)
But even though the Obama administration may want to extend health care to gay and lesbian feds’ spouses, it now seems pretty clear that won’t happen until DOMA is repealed or struck down.
OPM pension processing hamstrung by outdated IT
February 1st, 2012 | Pay & Benefits | Posted by Stephen Losey
John Berry (file photo/Getty Images)
Office of Personnel Management Director John Berry’s plan to fix its longstanding pension processing problem got a relatively warm reception on Capitol Hill today. But there were some red flags raised, not least of which is the incredibly sprawling and antiquated set of IT systems and paper-based processes that the government relies upon to calculate new retirees’ pensions. OPM doesn’t have a real plan for straightening it out, the Government Accountability Office said, and needs to do more.
For example: OPM has 80 legacy systems that have to talk to roughly 400 other systems across the rest of the government, IG Patrick McFarland said. And those systems rely on roughly 3 million lines of custom code. If OPM decides to change or repair something in those systems, McFarland said, that is difficult to modify because the agency has to sift through all 3 million lines to find the one line in particular that needs tweaking.
Berry said some systems still even use COBOL, believe it or not, a dinosaur of a programming language that was first introduced 50 years ago.
As a result of all the IT problems, calculating pension payments is still largely a paper-and-pencil process — one that is made much more difficult when agencies don’t submit all the necessary documents. Which is what usually happens.
GAO’s Valerie Melvin also said that OPM’s plan “does not describe whether or how the agency intends to modify or decommission the over 80 legacy systems that support retirement processing.” She wants OPM to take a broader look at its overall IT system structure, and formulate a concrete plan for how it will straighten things out. ”There’s a lot more OPM can do,” Melvin said.
Senators on the Homeland Security and Governmental Affairs federal workforce subcommittee praised Berry for putting the plan forward, and IG McFarland said OPM is now on the right track.
But consultant George Nesterczuk, a former OPM official, blasted Berry for abandoning a full-scale, IT-based modernization of the retirement process and instead relying heavily on adding people. Although the previous administration’s Retirement Systems Modernization strategy that relied on commercial technologies crashed and burned in 2008, Nesterczuk said it “was a sound strategy and it should receive renewed consideration.”
In the meantime, pressure is mounting on OPM. Berry said OPM received 21,000 new retirement applications in January — traditionally the busiest month — which swelled the backlog to 62,000. But there was a bright spot last month — Berry said OPM processed 20 percent more cases this January than in January 2011, which he sees as proof the reforms are already taking hold.
He also pledged to report the size of the backlog to Congress on the fifth day of each month.
[Updated blog post to clarify that OPM's processing problems are a result of all of its IT difficulties.]
Tags: incomplete annuities, John Berry, Office of Personnel Management, pension, retirement, Senate
Taps for the National Security Personnel System
December 28th, 2011 | Defense OPM | Posted by Sean Reilly
As of this Sunday, the National Security Personnel System is officially defunct.
In a Federal Register notice published today, the Office of Personnel Management and the Defense Department report that they are repealing the regulations accompanying the controversial pay-for-performance system effective Jan. 1. The repeal is basically just housekeeping; the 2010 National Defense Authorization Act ended the legal authority for the NSPS and declared that any existing regs would be toast by the beginning of 2012.
Should anyone need a refresher on what the very long-running flap was about, incidentally, this Federal Times article offers a good recap.
Tags: Defense Department, National Security Personnel System, Office of Personnel Management
Health care premiums coming tomorrow
September 26th, 2011 | Pay & Benefits | Posted by Stephen Losey
Here’s a heads up for all of our readers: Tomorrow morning, the Office of Personnel Management is planning to unveil next year’s premiums for the Federal Employees Health Benefits Program. Check back in at FederalTimes.com sometime after 11 a.m. Tuesday for the news on how your health care costs will change in 2012.
White House: Streamline prescription drug contracting
September 19th, 2011 | Pay & Benefits | Posted by Stephen Losey
The White House has also tucked a proposal into its $3 trillion deficit reduction proposal to overhaul how the government buys prescription drugs for the Federal Employees Health Benefits Program. On page 43 of its report, the administration calls for allowing the Office of Personnel Management to contract directly with pharmacy benefit managers, or PBMs, for prescription drugs. PBMs are companies that negotiate prescription drug prices with pharmaceutical companies on behalf of FEHBP’s insurance providers. But PBMs are not considered subcontractors, and as a result, OPM has little oversight of them and cannot be sure they pass on rebates (of as much as 50 percent of the drugs’ retail cost) to FEHBP enrollees.
The White House says the current “fragmented strategy [using PBMs] does not take full advantage of the combined purchasing power of the nearly eight million enrollees in the FEHB program.” It projects the move would save $1.6 billion over a decade.
Tags: deficit reduction, FEHBP, Office of Personnel Management, prescription drugs
GAO: Most long term care enrollees swallowed premium hike
August 10th, 2011 | Pay & Benefits | Posted by Stephen Losey
The Government Accountability Office today released a report that found 46 percent of enrollees in the Federal Long Term Care Insurance Program who were facing steep premium hikes elected to make no changes and accept 24 percent premium increases. Those 67,511 enrollees are now paying an extra $28.54 per month on average.
The Office of Personnel Management was blasted in 2009 when it announced up to 155,000 enrollees — who were under the assumption they had signed up for an option that would protect them against those sudden hikes — would pay a lot more for their benefits. This came as a shock to many enrollees, some of whom said they might drop out of the program rather than pay the increase.
But very few people ended up doing that. Only 2,344 enrollees — less than 2 percent of those affected — let their coverage lapse.
The remaining 76,560 made some kind of change. Some scaled back to keep costs down, but others increased their coverage and ended up paying a lot more. GAO said that 29,340 kept their old coverage and opted for reduced inflation protection, which actually decreased their premiums by 12 cents on average. Another 37,648 upgraded to an expanded coverage plan and also scaled back their inflation protection. Their average monthly premiums went up 1 percent, or $2.14.
But participants who chose to keep their old inflation protection and take the expanded coverage saw the steepest hikes. Their average monthly premiums increased by 38 percent, or $40.56.
All in all, the average long term care premium increased 14 percent, or $16.30 per month.
More shutdown details from OPM
April 6th, 2011 | 2011 Budget | Posted by Stephen Losey
Here are some additional information from the shutdown guidance OPM posted last night:
- Health benefits and life insurance coverage will continue during a shutdown, as long as the shutdown doesn’t last more than a year.
- But furloughed employees may lose their long-term care, dental and vision coverage. The guidance says “deductions will cease for non-excepted employees” — that is, those who are furloughed. OPM said it will provide information on how furloughed employees can continue long-term care, dental and vision coverage by Friday. I’ve asked OPM for confirmation on this and will update the blog when they get back to me.
- Any paid leave — annual, sick or otherwise — will be canceled. Meaning you still won’t come in to work, but you won’t be paid for those days.
- As expected, it will be up to Congress to decide whether furloughed employees will be paid for the shutdown time. It happened last time, but given the prominence of deficit hawks in Congress these days — and the general hostility towards federal employees in some quarters — it may not happen this time.
- If an excepted employee refuses to report for work, he will be considered absent without leave and subject to any AWOL penalties.
- Federal employees’ pensions — including calculation of the high-3 — won’t be affected unless the shutdown lasts for more than six months.
More information can be found in this Q&A we posted in February.
USPS pension puzzle (revisited)
March 18th, 2011 | 2012 Budget OPM Postal Service Uncategorized | Posted by Sean Reilly
Attentive (and we mean really attentive) Fedline readers might remember a post from last month about the apparent disconnect of the Office of Personnel Management’s charging the U.S. Postal Service more for its current pension contributions at the same time the Obama administration is proposing a big refund to the Postal Service on past contributions. We’d asked OPM for comment and finally received an answer yesterday. So, in the interest of thoroughness, we’re rerunning the original Feb. 22 post, with the OPM response appended verbatim.
Here’s an intriguing nugget from the U.S. Postal Service’s latest quarterly report: Even as the Obama administration agrees that the Postal Service is owed a huge refund on past payments to its pension program, the Office of Personnel Management—headed by Obama appointee John Berry—is requiring it to shell out more for current payments.
For the first quarter of fiscal 2011, the Postal Service’s contributions to the Federal Employees Retirement System, or FERS, rose by $24 million—from $1,469 million to $1,493 million—versus the same period in fiscal 2010, even though the USPS workforce continued to shrink, the report says. The reason, according to the Postal Service, is that its employer contribution rate increased from 11.2 percent to 11.7 percent of eligible payroll. The agency is appealing that boost to a federal board of actuaries on the grounds that its FERS obligation is already overfunded to the tune of some $6.9 billion.
In its newly released 2012 budget request, the White House proposed refunding the Postal Service that money over 30 years, starting with a $550 million down payment this year.
At least to non-actuarial minds, it seems contradictory to be giving with one hand and taking away with the other. In an email, OPM spokeswoman Brittney Manchester offered the following explanation:
“Under current law, the Postal FERS ongoing contributions and the Postal FERS surplus are subject to different provisions of law that are independent of each other. Without specific legal authority, the Office of Personnel Management cannot make adjustments to Postal’s ongoing contributions despite the fact that there is a surplus in the retirement fund attributable to Postal employees.
“The October 1, 2010, increase in the FERS employer contribution rate applied not just to the Postal Service, but to all other agencies as well. Under FERS, all agencies pay the same contribution rate. Different provisions apply to the overall funding situation. Retirement funding is a long-term matter, and estimates have to be made covering economic and other factors that are many years distant. Over the past quarter century, Postal Service FERS funding has grown gradually to exceed projected future liabilities by approximately $6.9 billion.”
“The President’s 2012 Budget provides short-term financial relief through a sensible and fair restructuring of key retiree liabilities, while seeking to work with Congress and stakeholders to secure needed reforms to modernize its business model.”
Tags: John Berry, Office of Personnel Management, U.S. Postal Service
USPS pension puzzle
February 22nd, 2011 | 2012 Budget OPM Postal Service | Posted by Sean Reilly
Here’s an intriguing nugget from the U.S. Postal Service’s latest quarterly report: Even as the Obama administration agrees that the Postal Service is owed a huge refund on past payments to its pension program, the Office of Personnel Management—headed by Obama appointee John Berry—is requiring it to shell out more for current payments.
For the first quarter of fiscal 2011, the Postal Service’s contributions to the Federal Employees Retirement System, or FERS, rose by $24 million—from $1,469 million to $1.493 million—versus the same period in fiscal 2010, even though the USPS workforce continued to shrink, the report says. The reason, according to the Postal Service, is that its employer contribution rate increased from 11.2 percent to 11.7 percent of eligible payroll. The agency is appealing that boost to a federal board of actuaries on the grounds that its FERS obligation is already overfunded to the tune of some $6.9 billion.
In its newly released 2012 budget request, the White House proposed refunding the Postal Service that money over 30 years, starting with a $550 million down payment this year.
At least to non-actuarial minds, it seems contradictory to be giving with one hand and taking away with the other. We’ve asked OPM for an explanation; if we get one, we’ll post it here.
Tags: Federal Employees, John Berry, Office of Personnel Management
Bypass OPM, postal groups urge Obama
January 14th, 2011 | Postal Service Uncategorized | Posted by Sean Reilly
With the U.S. Postal Service on a steady slide toward insolvency, labor and management are double-teaming the White House in a bid for help.
In a joint letter to President Obama this week, the Postal Service’s four unions, as well as organizations representing postmasters and postal supervisors, asked the administration to override the Office of Personnel Management’s position on allocation of pension costs.
If that subject sounds like a snoozer, some see it as a magic bullet for the Postal Service’s many ills.
Over the years, the Postal Service has overpaid between $50 billion to $75 billion into the Civil Service Retirement System and another $6 billion or so into the Federal Employees Retirement System, according to outside studies. Although the Postal Service would love to have that money back, OPM has stuck to its stance that Congress must authorize any change in actuarial methods, even though some lawmakers say the personnel office could do the job on its own.
“Since OPM refuses to exercise this authority, we urge you to use your authority as President to do so,” the letter states.
A White House spokesman did not respond to requests for comment Friday.
The Postal Service, which suffered record losses last year, expects to run out of money in September if it has to make a legally required $5.5 billion payment for retiree health care.
Tags: Office of Personnel Management, President Obama, U.S. Postal Service