LEGEND
= Met
= Not Met
= No Data Available
= FY 2000
D = Deferred
P = Progress

FY 1999 Performance Report
Appendices

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U.S. Office of Personnel Management

Appendix H
Retirement and Insurance Service (RIS)

FY 1999 Performance Report
Goal & Performance Indicators Checklist

OPM Strategic Goal I
Provide policy direction and leadership to recruit and retain the Federal workforce required for the 21st Century.

RIS Goal 1

A Long-Term Care program is implemented for Federal employees and annuitants, providing that authorizing legislation is passed.

Long-term Care program is implemented within timeframes described in authorizing legislation.

Long-Term Care legislation was not passed in FY 1999.

Agency HR Directors and Specialists are satisfied with OPM's efforts in implementing a long-term care program, as indicated in the CSS.

We worked closely with staff from the Department of Health and Human Services to develop a legislative proposal to enable OPM to contract for long term care products. This proposal was introduced in the Congress in January 1999. However, an alternative proposal also has been introduced and RIS is now working with the Congress to resolve the differences between the two bills.

FY 1999 OPM Customer Satisfaction Survey results established a baseline and show that 72% of HR Specialists respondents working in the Retirement and Insurance benefits area agree that OPM has kept them well informed of the status of the Long-Term Care proposal. (The responses to the HR Director's Survey were not sufficient enough to make it a credible or reliable survey. We will look to future year's data to determine trends.)

RIS Goal 2

New life insurance products are offered to Federal employees and annuitants.

New life insurance products are implemented within timeframes described in authorizing legislation.

In May 1999, we forwarded a Report to the Congress in response to PL 105-311, the Federal Employees Life Insurance Improvement Act. This report described new kinds of life insurance products that might be made available to Federal employees, including group universal life, group variable life, and voluntary accidental death and dismemberment insurance. The report also included the results of an OPM survey in which Federal employees showed considerable interest in these kinds of products. To date, no authorizing legislation for these products has been passed by the Congress.

Agency HR Directors and Specialists are satisfied with OPM's policy, technical assistance, and guidance materials for implementing new life insurance products.

Since no legislation was passed to authorize new life insurance products, data for this specific measure was not collected during FY 1999. However, the FY 1999 results established a baseline and show that 72% of responding HR Specialists agree that OPM has kept them well informed of the status of potential new life insurance products. The response rate to the HR Directors Survey was insufficient to make it a credible and reliable survey. We will look to future year's data to determine trends.

RIS Goal 3

Flexible, responsive, and cost-effective employee benefit policies and packages are developed by a Center for Benefits Design and Delivery.

Respond to emerging benefits design and policy needs.

During FY 1999, we established the Center for Benefits Design and Delivery as a virtual organization within the Service. The Center serves as a coordinating mechanism through which a multi-disciplinary group of specialists are assembled to focus on a broad range of current, emerging, and future initiatives in the employee benefit arena. Two of our most notable accomplishments that demonstrate our responsiveness to emerging benefit policy pertained to the Federal Employees' Health Benefits Program where we fully implemented the Patient's Bill of Rights, and developed a strategy to implement in FY 2001 parity for mental health and substance abuse illnesses. Both of these important initiatives became as part of our FY 1999 agenda after we had published our performance plan and we responded to them appropriately during the year.

Organizations outside of OPM recognize RIS' leadership in the benefits industry.

OPM's leadership in the health insurance marketplace has been recognized in a number of forums, including the White House. The Agency is especially proud of the special award received from the Small Business Administration for efforts to promote the interests of small and disadvantaged businesses in the FEHB Program. In another example, we were asked to co-chair the Patient and Consumer Information Workgroup of the Quality Inter-Agency Coordination Task Force and participate in the planning committee for the creation of The Forum for Health Care Quality Measurement and Reporting. These important organizations were created by the President to advance consumer understanding and the quality of health care in the United States.

External studies indicate that Federal employee benefits are competitive with those offered in the private sector.

This is an FY 2000 indicator.

Results of the CSS indicate that OPM is meeting the agencies' policy needs in the area of earned employee benefits.

The responses to the HR Directors Survey were not sufficient enough to make it a credible and reliable survey. We will look to future year's data to determine trends.

RIS Goal 4

Retirement coverage errors are corrected for all people affected, in a way that is easy to understand and can be effectively administered.

Increased level of satisfaction among agency HR Directors and Specialists as demonstrated in the CSS regarding policy leadership in the correction of retirement coverage errors.

As provided for in our FY 1999 Performance Plan, we will implement an operational plan for these corrections when legislation is passed. During the year, we took the lead on behalf of the Administration, worked in concert with our agency partners, and crafted a legislative proposal, which was introduced in the Senate, for the correction of retirement coverage errors. The House proposed alternative legislation and we are now working with both houses of the Congress to resolve the issues separating the two proposals. As a result of these efforts, 72% of the Human Resource Specialists responding to the FY 1999 OPM Customer Satisfaction Survey agree that OPM has kept them well informed of the status of this legislative proposal. The response rate to the HR Directors Survey were not sufficient enough to make it a credible and reliable survey. We will look to future year's data to determine trends.

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

RIS Goal 5

The financial oversight of the employee benefit trust funds is strengthened in that (a) the FY 1998 Trust Fund annual financial statements receive unqualified opinions from an independent auditor, (b) the earned benefit financial subsystems are integrated with the new general ledger installed in early FY 1999, and c) financial policies and procedures supporting the earned benefit financial systems are properly documented and comply with applicable requirements and standards.

The 1998 annual financial statements received "unqualified opinions" from the independent auditing firm.

On March 1, 1999, the OPM Inspector General announced his concurrence with the report of KPMG Peat Marwick LLP, which gave unqualified accounting opinions on the financial statements for the retirement program, the health insurance program and the life insurance program.

The full implementation of RIS' new core financial management system in 1999, and the other achievements described above, represent a major upgrade that has enhanced accounting, but the management and administrative controls as well. As a result, RIS will no longer report in the FMFIA annual assurance letter two of the three previously identified material non-conformances with government-wide financial management systems standards. The improvements also allowed RIS to report as resolved four long-standing material weaknesses in management controls - Oversight of Agency Activities, Financial Management Policies and Procedures, Controls Over Annuity Payments and Controls over Health Benefit Program Claims Payments. Finally, we will no longer report to the President and Congress the weaknesses identified in our Retirement Program Public Receivables system.

Financial policies and procedures are documented as planned.

We continued to make progress on this long term documentation effort during FY 1999. During Fiscal Year 1999 the Center for Applied Financial Management delivered detailed desk procedure documentation for four critical areas.

The Center also developed documentation on general Funds Management business processes since contract inception in 1997. The next segment of the accounting manual to be issued is the Financial Policy Statements.

OPM Strategic 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.

RIS Goal 6

Benefits information is more easily available to both agency benefits officers and employees, and is written in Plain Language.

Responsiveness to sudden changes in policy direction is demonstrated.

We demonstrated our ability to respond to sudden changes in policy direction by conducting a life insurance open enrollment period in response to PL 105-311. The open enrollment period was held between April 24 and June 30, 1999. During this time, eligible participants in the Life Insurance Program could elect to increase the amount of additional optional insurance they carried.

Technical assistance needs of agency benefit counselors and employees are met.

Provided agency benefits officers and other agency HR staff with several Benefits Administration Letters to prepare them for the life insurance open enrollment period. Preparations also included a briefing at the IAG Network of Benefits Officers on the changes to the Life Insurance Program brought about by PL 105-311 and the specifics of the open enrollment period. In addition, we produced a satellite broadcast for agency HR staff during the open enrollment period, and developed materials for the OPM web site.

Increase agency HR specialists' satisfaction in the CSS with information sharing, technical assistance, and guidance materials regarding the employee benefits programs.

While satisfaction with information sharing and technical assistance regarding the health benefits and life insurance open seasons declined by 5 points from the very high levels seen in FY 1998, results remained at FY 1998 levels for specific guidance materials and the health benefits web page.

RIS Goal 7

Agency and Health Benefit plan personnel are more knowledgeable about the administration of earned benefit programs and are better able to provide benefits counseling and related assistance to Federal employees and retirees.

Increase agency HR specialists' satisfaction with the availability of benefits information via the OPM Website.

Although agency HR Specialists satisfaction among with information sharing and technical assistance missed the expected target levels for FY 1999, this was off-set by the continued high levels of satisfaction with the user-friendliness and usefulness of the benefits information available on the OPM website. The website is becoming one of OPM's primary vehicles for providing support to the agencies.

The percentage dropped in FY 1999. However, other data collected by the survey for the first time, indicates that 28% of retiring employees who responded obtained retirement information on their own instead of relying on their agencies. Thus not meeting the expected target level for FY 1999 is not indicative of a performance lapse by OPM, but of the existence of a broader range of choices available to retiring employees.

Increase the number of retiring Federal employees who are satisfied with the retirement planning and counseling they received.

88% of new retirees surveys for FY 1999 indicate they were satisfied with the accuracy of the information from their agency when planning their retirement, exceeding the 80% target level.

Additional measure - External reports indicate agencies are providing benefits counseling as recommended by experts.

In March 1999, the General Accounting Office (GAO) issued a report on agency efforts to educate employees on their benefits package. To do this study, GAO convened a group of experts in benefits administration to identify the key actions that an employer needs to take to educate employees on their benefits package. GAO then surveyed a number of agencies to determine what they do to make employees aware of their benefits package and about the products they use. The study found that agencies are doing the critical things recommended by the experts, and that they prefer to use OPM products.

GAO made no recommendations for improvement. However, since the GAO report did not gather information on what agencies actually are doing or obtain employee views, OPM is considering doing a study of benefits counseling in FY 2000.

RIS Goal 8

D A baseline is established regarding the quality of agency submissions to the retirement system based on OPM reports to agencies that include information about how many of the retirement claims submitted were complete and ready for immediate processing.

D Develop an agency performance tracking system.

Progress was slowed on this project by the need to focus IT resources on OPM's Y2K compliance program. However, the basic programming that extracts the data needed for this system from OPM's annuity payments systems has been completed. We expect to complete the project during FY 2000.

RIS Goal 15

Agency staff are more knowledgeable about the administration of the earned benefits programs by attending the Annual Benefits Officers Conference, attending pre-conference training, and/or the annual Fall Festival of Training.

Post-conference feedback and the CSS indicate agency personnel find these programs improve their knowledge of the benefit programs.

We continued a wide range of outreach activities with the agencies to strengthen the administration of the employee benefit programs to Federal employees. A primary vehicle for this outreach is the annual Benefits Officers' Conference. In FY 1999, we renamed it the Federal Benefits Conference to reflect the broader focus of human resource specialists and their desire to include payroll staff as full participants in the conference. Sessions covered the interactions between payroll and personnel, new approaches to communicating benefits information, long term care proposals, the Federal Employees Group Life Insurance changes, Workers' Compensation rule changes, Social Security partnership with OPM, Thrift Savings Plan updates, and military retired pay interface with retirement.

RIS Goal 16

Agency retirement records are stored with OPM when they are changing their payroll systems.

Agencies continue to request these services from OPM.

This is a service RIS provides agencies when agencies make an ad hoc request for this assistance. During FY 1999, no such requests were received. However, RIS was prepared to perform this service during FY 1999.

OPM Strategic Goal IV
Deliver high-quality, cost-effective human resources services to Federal agencies, employees, annuitants and the public.

RIS Goal 9

The delivery of services in the FEHB Program is improved by developing and using health care quality measures and communicating quality information to program customers and prospective customers.

During FY 1999, we overhauled the quantitative indicators for the Health Benefits Program described in the .FY 1999/2000 Performance Plan since many of them were based on carrier reported data that was unaudited and could not be verified. We replaced those indicators with quantitative measures that we are reporting below. These new indicators are more reliable and better reflect our near-and long-term goals for the Federal Employees Health Benefits Program.

Partnerships are used to promote the use of Health Care Quality Measures.

We continued to use our relationships with others in the health insurance industry to improve the delivery of health care to those covered by the FEHBP. One of the most significant accomplishments that emanated from these relationships during FY 1999 was the implementation of the Patient's Bill of Rights. To implement the Patient's Bill of Rights, we adapted to the different health carrier environments and delivery systems that characterize the FEHBP, and focused on outcomes rather than processes. Thus, we improved an already progressive health benefits program at an incremental cost of less than $1 per month, per contract holder.

P Customer satisfaction with the HB plan reaches 87% for HMOs and 90% for FFSs.

As a part of the overhaul of performance indicators, we established a new baseline and future target levels as shown below for measuring customer satisfaction with Program service delivery by participating in the annual Consumer Assessment of Health Plans Survey (CAHPS). The CAHPS instrument is the health care industry's most thoroughly tested and widely accepted tool for obtaining customer feedback regarding health plan performance. Since the CAHPS is different from the surveys conducted prior to FY 1999, the CAHPS results cannot be compared to those from these other surveys; a new baseline has been established.

Percent of participating plans that are highly rated or accredited

As discussed above, RIS overhauled the business process indicators for the health insurance program. The new indicators are more closely aligned with the strategic direction of the Health Benefits Program which is to complete the program's evolution to a quality-driven system based on health care outcomes, and support program enrollees with the kind of consumer information they need to choose a health benefits plan that best meets their needs.

For instance, an indicator of the extent to which to Program is quality-driven is reflected in the percent of participating plans that are accredited or rated by their customers as above average in overall customer satisfaction. Thus, the percent of the participating plans so rated has been established as a business process indicator.

Because these are new indicators, historic performance data for them is available back to FY 1997 instead of the usual five years, and there is no target level for FY 1999. The increase in the percent of accredited plans is due to a number of small HMO plans leaving the program at the beginning of the year.

Percent of customers enrolled in a highly rated or accredited plan

A complementary measure to the percent of plan that are highly rated or accredited is the percent of Program enrollees who are enrolled in such a plan. OPM believes that increasing these factors ensures that Program customers experience the best health care the Program has to offer. The fluctuation in this measure since FY 1997 is due to the program's largest plan being highly rated in 1998, but not in 1999. This resulted in the loss of 80% enrollees for highly rated plan in FY 1998.

RIS Goal 10

Claims for life insurance benefits are at least 99% accurate and paid within 10 days of being fully documented to the OFELI.

More than 99% of claims payments are accurate as a % of #paid

Timeliness of claims payments -- 10.0 days

Processing times for life insurance claims increased above the established 10-day standard (see table below). This was due to the implementation of a new Y2K compliant payment system by the program carrier which drove up processing times during the fourth quarter. Processing times, excluding the fourth quarter data, averaged 9 days, which remains within the 10-day standard.

RIS Goal 11

The FY 1998 level of customer satisfaction, processing times, and accuracy rates for processing new claims for annuity and survivor benefits is increased or maintained.

Customers who received first payment when they expected -- stretch target 80%

Stretch target level met as shown below:

Annuitants who indicate overall satisfaction with the handling of retirement claims -- stretch target 90%

Stretch target level met as shown below:

Interim payment processing time in calendar days -- 3 day standards

Expected target level met, as shown below:

CSRS annuity processing time in calendar days -- stretch target 25 days

Stretch target level not met; historic trend indicates progress over the long term:

CSRS annuity claims accuracy -- 96%

Expected target level not met:

FERS annuity processing time in calendar days -- stretch target 60 days

Expected target level not met:

FERS annuity claims accuracy -- stretch target 95%

Expected target level not met.

Survivor annuities authorized via Survivor Express Pay -- stretch target 65%

Stretch target level met:

CSRS death claims accuracy -- 97%

Expected target level met:

Overall payment accuracy ($) -- 99.9%

The statistician's report on the results of the FY 1999 year-end case audit described the net overpayment/underpay errors for the fiscal year as 0.082%, equating to an accuracy rate of 99.9%.

P Overall survivor pay processing time in calendar days -- stretch target was 10 days.

Expected target level not met; but improvement from FY98 demonstrated:

Expected target level not met; but improvement from FY98 demonstrated:

RIS Goal 12

P The FY 1998 level of customer satisfaction with RIS teleservices and timeliness of written responses to inquiries is increased or maintained.

Overall satisfaction with call handling -- 90%

Expected target level met:

Overall satisfaction with content and timeliness of written responses -- 87%

Expected target level not met:

RIS Goal 13

The FY 1998 level of customer satisfaction with the accuracy and timeliness of account maintenance services is improved, and workload balances are reduced, as more of these customer service requests are handled through the telecommunications media.

85% of customers satisfied with overall services

Target level met:

Average processing time of 4.0 days for change of address

Target level met as FY 1999 processing showed significant improvement. Since this indicator is not reflective of overall account maintenance processing, it is being eliminated from future tracking and reporting.

Target level virtually met. Since this indicator is not reflective of overall account maintenance processing, it is being eliminated from future tracking and reporting.

Target level virtually met; historic trend shows significant improvement in last three years, as shown below.

Increase by 5% number of account maintenance transactions handled by Interactive Voice Response (IVR) telephone system

This indicator was changed during FY 1999 from the number of transactions processed by IVR systems to the percent of such transactions. This change was made to account for declines in workload volumes brought about by the use of IVR technology.

RIS Goal 14

Accelerated information technology solutions for a modernized retirement system are designed, developed, and implemented.

A new business model for the retirement program is selected and a business process reengineering effort is initiated to form the basis for new technology solutions.

Our Business Process Reengineering (BPR) Study is on going and will continue throughout FY 2000. However, it has already produced deliverables that were critical to the Project in FY 1999. First, it enabled us to identify three early win projects which are now virtually completed. Second, generated "To Be" model of the modern retirement system, encompassing six core business processes: Member Administration, Retirement Counseling, Claim to Payment, Annuity Roll Maintenance, Trust Fund Management, and Employee Withholdings. Finally, developed a Capital Asset Plan for the Project which provides a long range view of the technology investments that will be necessary to implement the system.

OTHER INITIATIVES

We continued to be a leader in employee benefits policy during FY 1999. Our leadership was manifested in ways that went beyond the goals we established for this past fiscal year. One of our most notable accomplishments pertained to the Federal Employees Health Benefits Program (FEHBP) where we set a standard for the Nation by laying the ground work to achieve parity for the treatment of mental health and substance illness in the year 2001. Despite a growing recognition that these illnesses, like other medical conditions, are susceptible to effective treatment regimes that could reduce related medical and societal costs, many health plans have not provided equivalent benefits. We responded to the White House call during the Mental Health Conference in July 1999, worked with the carriers participating in the health program and have ensured that parity of treatment will be delivered to all FEHB enrollees in 2001.

During this past year, we continued to use surveys to measure ourselves and our performance against our customers' expectations. The results for 1999 indicated that we were right on track with this during FY 1999. For instance, overall customer satisfaction with the delivery of Retirement Program services has remained at or above 90% for the past four years. This was not an accident. We worked for it by combining telecommunications technology with a continuing emphasis on customer service.

These excellent customer satisfaction results were confirmed through our participation in the American Customer Satisfaction Index. This first time governmentwide effort, sponsored by the President's Management Council and overseen by the Federal Consulting Group in partnership with the Arthur Andersen, Inc., measured public satisfaction with a broad range of Federal government agencies and programs and compared them to their appropriate private sector counter parts. The results for our customer segment -- our Retirement Program annuitants - compare well with customer satisfaction levels in the insurance and financial services sector of the American economy, particularly in our claims processing operations.