Retirement & Financial Planning Report

OPM has raised the prospects of creating a centralized enrollment system for the FEHB program out of concern that ineligible persons are getting coverage under family enrollments.

“The extent of ineligible family members covered under FEHB Self and Family enrollments is currently unknown. In addition, there is no centralized FEHB enrollment database of eligible enrollees and family members, in part, because current enrollment systems do not require the input of family member dependent information. Thus, there is no mechanism to determine who is receiving benefits under any one Self and Family enrollment,” OPM in a recent report to Congress.


OPM last year announced a sampling audit of the program, citing overall health industry estimates that as many as 10 percent of private health claim benefits are incurred by persons not eligible for family coverage. Since the FEHB pays out about $23 billion in benefits each year, OPM said, each percentage point is worth $230 million—about 70 percent of which is paid by the government, under the premium sharing formula.

“Under current FEHB procedures, agencies and the FEHB carriers both have responsibility for family member eligibility determinations,” OPM said. “However, there is no evidence that family member eligibility is systematically verified at the time of the initial enrollment, when enrollment is changed during Open Season or upon experiencing a Qualifying Life Event (QLE) (although some agencies do require documentation for QLE changes) or at any other time during the employee’s period of coverage. With the advent of electronic enrollment systems, enrollees can make certain FEHB enrollment changes without submitting any proof to their agency benefit officers.”

Results of the audit will assist in determining if a centralized enrollment system is necessary to maintain an enrollment database of enrollees and only family members whose eligibility is verified; and will help program managers to determine if the scope of the problem warrants changes in the current policies and procedures utilized by agency benefit officers when verifying family member eligibility, OPM said.

Should the sample audit indicate the need for a broader investigation, OPM would determine if a full audit of the program is needed. It laid out a series of steps to make such decisions but imposed no time frame.