Remarks of Acting OPM Director Beth Cobert

Carrier Conference

Renaissance Arlington Capital View, Arlington, VA

March 31, 2016

As prepared for delivery

Thank you, John. And thank you for your strong leadership of OPM’s Healthcare and Insurance mission. Thank you for the work you and your team do to make sure that our 8.2 million Federal employees, retirees, and their families get the high quality, affordable health care that FEHB plans provide.

The conference is a terrific example of the teamwork between OPM and our partners in the insurance industry. I want to thank Mark Hamelburg of AHIP and Chuck Zebrowski of OPM for all their efforts in putting this conference together.

As John said, before I joined the Administration I was a consultant and partner at McKinsey & Company. In that former life I had experience with both sides of the health insurance street. I worked with companies as they tried to structure their health insurance plans for their employees. I had provider networks and hospital systems as clients. I probably did at least one study a year around health insurance.  So I am excited to talk with you about the work we’ve done together and will do going forward.

As we meet here today we can look back at this Administration and see that it’s clear how much we’ve done. The Affordable Care Act obviously brought a huge change in health care. I should note that this month marks the sixth anniversary of President Obama’s signing of the Affordable Care Act into law. Since that landmark legislation was passed, an estimated 20 million Americans have gained health insurance. The most recent Open Enrollment period was particularly impressive when you consider that 42 percent of people who signed up for coverage through healthcare.gov were new to the Marketplace.

Together we embraced the ACA and we added nearly 300,000 people up to age 26 to their parents’ plans. We stood up the Multi-State Program Plan, and last year more than 400,000 individuals enrolled in more than 200 MSP options in 36 states and the District of Columbia.

I want to congratulate you and our OPM team for the work we’ve done this year to stand up an entire new eligibility category to FEHB – Self Plus One. We’ve developed a comprehensive Performance Plan Assessment strategy for measuring health care quality. And we have joined forces to tackle a problem that faces all of us – ensuring that we have the best practices in place when it comes to information technology security. I’ll come back to talk more about these accomplishments and challenges in a few minutes.

But as we go forward together in the coming year, our mission should be to keep building on the progress that we’ve made together. For more than 50 years – half a century – the FEHB has partnered with insurers to offer affordable, reliable, and high quality health care. As the largest employer-sponsored health insurance plan in the nation, this partnership with each of you in this room is critical to our mission – to attract, develop, and retain a world-class 21st Century workforce.

The changes that we have made will help us continue to deliver on that promise. Moving forward, we have the opportunity to build on our success.

Today I’d like to talk about what two of the policy goals included in this year’s Call Letter: the benefit enhancement for children on the autism spectrum and the three priority items we will be focusing on during this first year of implementing the Performance Plan Assessment. And, I want to share the latest information about how we’re working together to deal with IT security.

But first I want to thank you. As I said, this year we introduced a new eligibility category, Self-Plus One. This was an extremely successful rollout. And I know it entailed a lot of work for you and for OPM. As I’m sure you know, unless you are on the inside of such a complicated rollout, it’s easy to wonder what all the fuss was about. Our Self Plus One implementation team was often asked by people not involved in the project; “Why is this taking so long? You’re just adding an enrollment code, right?”

Not exactly. In order to make sure the system accepted those codes, the team had to coordinate updates to 21 internal systems, 8 financial systems, 112 online enrollment portals that serve Federal agencies across government, 142 payroll offices, and systems at 92 FEHB carriers. Oh, and they had to test each one of these before Open Season!

And that’s just one aspect of the rollout. The successful implementation of Self Plus One required the work of several teams from across OPM that had to update hundreds of documents, educate thousands of benefits officers, human resources personnel, and customer service representatives. And of course, they had to negotiate rates and benefits for our more than 200 FEHB plan options. I could go on. I’m sure within your shops you had similar experiences. The bottom line is:  Self Plus One rolled out successfully thanks to a lot of hard work. Congratulations!

Now, as we look ahead with this year’s Call Letter, we now expect all plans to offer Applied Behavior Analysis benefits for children on the autism spectrum. Until now, FEHB coverage has been uneven for this intense one-on-one therapy that is becoming a leading form of treatment for these children. As you know, we have been encouraging plans to cover this treatment since 2013 and we’re pleased that in the past several years more FEHB plans have begun covering it. But despite the expansion, we continued to receive letters from Federal families desperate to get this coverage for their children. We heard from Federal families who had to pay out-of-pocket for this expensive treatment just because of where they lived.

Ultimately, we decided the best way to ensure that our Federal families have the coverage they need was to expect every plan to cover it. This way, all employees with children on the autism spectrum will have this coverage under their plan. I know you’ll be discussing this more thoroughly during today’s panel.

When I opened this talk, I said that OPM is charged with providing our Federal family with high quality, affordable health coverage. Providing such coverage is necessary if we are going to continue to attract, retain, and engage the talent we need to serve the American people. The results from the 2015 Federal Benefit Survey suggest that health benefits have an impact on recruitment and retention in the Federal workforce. Sixty-seven percent of respondents to the survey said that the availability of health insurance through FEHB influenced their decision to take a Federal job. And seventy-eight percent said that the availability of FEHB influences their decision to stay with their job. Very simply, if don’t have the highest quality and inclusive FEHB benefits, than we risk our ability to attract and retain a high quality federal workforce.

The same is true when it comes to requiring the highest standards of care and making sure that we measure quality. The work we’ve been doing together on Performance Plan Assessment is an important step in this process.

Those of you who have heard me speak before know I refer to myself as a data geek. I love data. When I was at the Office of Management and Budget before joining OPM I was the Chief Performance Officer.  One of the initiatives I spearheaded there was benchmarking costs and best practices of a wide swath of agency functions. Knowing how to use these metrics makes a difference. I know OPM and our insurers here have been working on developing and refining performance measures. It’s has been a journey, but we have done it right and now we’re ready to implement it.

OPM is in this with you. Just as your margins will be affected by how well you perform on these measures, we are making the success of these measures part of the criteria by which we measure our success as an agency. We will be reporting OPM’s progress on this to OMB and to the public on performance.gov.

As you know, a proportion of your margins during this first Performance Plan Assessment implementation year will be tied to 19 performance measures. But this year we are particularly zeroing in on three important priority items – blood pressure control, the timeliness of pre-natal care, and reducing hospital readmissions.

I’ve had some first-hand experience recently with the third priority – reducing hospital readmissions.
My 92-year-old mother was recently in both a midsize suburban hospital and a large urban tertiary care center. It was clear to me that for both hospitals preventing readmissions was a clear priority.

Finally, I want to talk about a challenge we all share – protecting ourselves against the kind of data breaches that OPM and too many other organizations experienced in the past year. Whether it was the intrusions we suffered at OPM or the breaches at so many other insurers and health care providers, we must work together to keep the information entrusted to us secure.

And we are taking action. In September 2015 OPM convened an IT Security Workgroup of FEHB Carriers. This group’s goal is to ensure insurer practices are complete, sufficient, and uniform when it comes to reporting data breaches. And, that going forward carrier practices are aligned with best practices in IT. We expect to soon release a Carrier Letter that will update the guidance to all our FEHB Carriers regarding the reporting of information security incidents.

One of our responses to the breaches at OPM was to bring on board a Cybersecurity Advisor who reports to me as Acting Director of OPM. Clif Triplett came to OPM with 30 years of cross-industry and IT organizational transformation experience. And before Clif’s extensive private sector career, he had a distinguished military careers working on technology and control systems. Clif has been working directly with the IT Security workgroup and we are collaborating with our key partners in government, including HHS and DHS.

Clif and representatives from HHS and DHS will be part of a cybersecurity panel discussion tomorrow morning. The discussion will focus on the role of the Federal Government in assisting you in keeping information secure. This is just one more step in our important collaboration on this issue.

So again, I want to thank all of our Carriers for the partnerships that have enabled us to offer quality and affordable health care to our Federal family.

Working together to keep costs down, we have had five years of the lowest premium increases in the program’s history. I know that together we can continue such premium stability and growth in the quality of the coverage offered to Federal employees, retirees and their families for many years to come. Thank you.